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M 


TABLE   OF   CONTENTS. 


I.  Contract  and  Quasi  Contract 
Distinguished. 

Page 
Lawson's  Ex'r  v.  Lawson,  16  Grat.  (Va.) 

230  3 

Hertzog  V.  tiertzog,  29  Pa.  St.  465 5 

Sceva  V.  True.  53  N.   II.   627 8 

O'Brien  t.  Young.  95  N.  Y.  428 11 


n.  Oflfer  and  Acceptance. 

(a)    Necessity  for  0£Fer  and  Acceptanee. 

Thruston  v.  Thornton,  1  Gush.  (Mass.)  89.  .     14 

Cb)    Necessity  for  Commiinicatioii. 

White  V.  Codies,  46  N.  Y.  4G7 16 

Parker  v.  South  Eastern  Ry.  Co.,  2  G.  P. 
Div.  416   18 

(c)  Manner   of   Communication. 

Bliason  v.  Henshaw.  4  Wheat.  225 24 

(d)  Communication  by  Conduct. 

Foee  ▼.  Portsmouth  Atheneum,  44  N.   H. 

m  26 

Day  T.  Caton,  119  Mass.  513 28 

Royal  Ins.   Co,  t.  Beatty,   119  Pa.   St   6, 
12  Atl.  607 29 

(e)    l/ommunlcatlon  by  Correspondenoe. 

Dunlop  V.  Higgins,  1  H.  L.  Cas.  381 31 

Mactier's   Adm'rs   v.    Frith,   6  Wend.    (N. 

Y.)   103    38 

Household  Fire  &  Carriage  Ace.  Ins.  Co.  v. 

Grant,  4  Exch.  Div.  216 58 

Lewis  V,  Browning,  130  Mass.  178 62 

(f)    Character   of  Acceptance. 

Harris  t.  Scott  (N.  H.)  32  Atl.  770 63 

Thomas  v.  Greenwood,  69   Mich.   215,   37 
N.  W.   195 65 


(S)    General  Offers. 

Carlill  V.  Carbolic  Smoke  Ball  Co.   [1893] 

1  Q.  B.  256 67 

(h)    Revocation  of  Offer  or  Acceptance. 

Paine  v.  Cave,  3  Term  R.  148 74 

Bos-ton  &  M.   R.  R.   v.  Bartlett,   3   Gush. 

(Mass.)  224 75 

Dickinson  v.  Dodds,  2  Gh.  Div.  463 77 

Ide  V.  Leiser,  10  Mont  5,  24  Pac.  695.  ..  82 


Pace 

Hyde  t.  Wrench,  3  Beav.  334 89 

Wallace  v.  Townsend,  43  Ohio  St  537,  3 
N.  E.  601 90 

(j)    Contractual  Intention. 

Stamper    v.    Temple,    6    Humph.    (Tenn.) 

113   93 

Ileffron  v.  Brown.  155  HI.  322.  40  N.   E. 

r>8S 95 

Moulton  V.  Kershaw,  59  Wis.  316,   18  N. 

W.    172 99 

Mis.sissippi  &  D.  S.  S,  Go.  v.  Swift,  86  Me. 

248,  29  Atl.  1063 101 


III.  Contracts  under  Seal. 

(a)    Delivery. 

Martin  v.  Flaharty,  13  Mont  96,  32  Pac 


287 


100 


Cb)    Consideration. 

AUer  T.  Aller,  40  N.  J.  Law,  446 110 

(c)    Revocation  of  Offer  under  Seal. 

McMillan   t.  Ames,  33   ilinn.   257,  22   N. 
W.   612 113 

IV.  Statute  of  Frauds. 

(a)    Instruments   under   Statutes. 
Thompson  v.  Blanchard,  3  N.  Y.  335 115 


Cb)   Executed  Contracts. 

Stone  V.  Dennison.  13  Pick.  (Mass.)  1. 


116 


Ci)    I<apse   of   Offer. 

Longworth  v.  Mitchell,  26  Ohio  St  334.  .     85 
Minnesota     Linseed     Oil     Co.     v.     C-oUier 
White-Lead  Co.,  Fed.  Cas.  No.  9,635.  . .     87 

H0PK.SEL.CAS.COXT.  (iii 


(c)    Promise  by  Executor  or  Adminis- 
trator. 

Bellows  V.  Sowles,  57  Vt  164 IIS 

(d)  Promise  to  Ansxrer  for  Debt  of 

Another. 

Larson   v.   Jensen,    53    Mich.   427,    19    N. 

W.   130    120 

Crane   v.   Wheeler.   48   Minn.   207,    50   N. 

W.  1033   122 

Wait  v.  Wait's  Ex'r,  28  Vt  350 123 

Mallory  v.  Gillett  21  N.  Y.  412 124 

(e)  Ag:Teements  in  Consideration  of 

Marriage. 

Mallory's   Adm'r   v.    Mallory's    Adm'r,    92 
Ky.  316,  17  S.  W.  737 138 


(f)    Agreements  Relating  to  Land. 

Haviland  t.  Sammia.  62  Conn.  44,  25  AtL 
394 139 


734Q34  _. 


IV 


TABLE  OF  CONTENTS. 


Page 

Mnmford  t.  Whitney.   15  Wend.   (N.   Y.) 

3S() 14U 

Green  T.' Armstrong.  1  Denio  (N.  Y.)  550.    145 
Hirth   T.   Graham,   50  Ohio  St.  5«,  33  N. 
E.  90 1^' 

(g)    AgTeeBients     not     to     be     Performed 
within   a   Year. 

Blake  v.  Cole,  22  Pick.  (Mtxss.)  97 149 

Doyle  T.  Dixon,  97  Mass.  208 150 

(h)    Sale  of  Goods. 

Baldwin  v.  Williams,  3  Mete.  (Mass.)  ol>5.  151 

Goddard  v.  Biuney,  115  Mass.  450 153 

Cooke  V.  Millard,  65  N.  Y.  352 155 

Pratt  V.  Miller.  109  Mo.  78.  18  S.  W.  965.  163 

Caalkins  v.  Hellman,  47  N.  Y.  449 H>6 

Garfield  v.  Paris,  96  U.  S.  557 168 

Edgerton  v.  Hodge,  41  Vt.  676 172 

Hunter  v.  Wetsell,  84  N.  Y.  549 174 

(i)    TTie  Memorandnm  in  Writing. 

Peabody  v.  Speyers,  56  N.  Y.  230 176 

Louisville  Asphalt  Varnish  Co.  v.  Lorick, 

29  S.  C.  533,  8  S.  B.  8 178 

McGovern  v.  Hern,  153  Mass.  308,  26  N. 

E.  861 183 

Drake  v.  Seaman.  97  N.  Y.  230 184 

Justice  V.  Lang,  42  N.  Y.  493 187 

Wilkinson  v.  Heavenrich,  58  Mich.  574,  26 

N.   W.  139. 199 

Clason  T.  Bailey,  14  Johns.  484 ,...   201 

(j)    EfPect    of    Noncompliance    with. 
Statute. 

Townsend  v.  Hargraves,  118  Mass.  325.  .  205 

Wheeler  r.  Reynolds,  66  N.  Y.  227 208 

Nally  V.  Reading,  107  Mo.  350,  17  S.  W. 

978  212 

Britain  v.  Rossiter,  11  Q.  B.  Div.  123.  .  .  213 
Baker  v.   Lauterback.   68  Md.  64,  11  AtL 

703  218 


V.  Consideration. 

(a)    Defined. 

flamer  v.   Sidway,   124  N.   Y.  538,   27   N. 


Pag9 

McKjnley  t.  Watkins,  13  IB.  140 243 

Rue  y.  Meirs,  43  N.  J.  Eq.  377.  12  A.tL  369  249 


(f)    Natnral  Affection. 

Fink  V.  Cox,  18  Johns.  (N.  Y.)  145. 


253 


(g)    Moral  Obligation. 

Mills  v.  Wyman,  3  Pick.  (Mass.)  207 254 

(b)    Impossible  Promises. 

Stevens  v.  Coon,  1  Pin.  (Wis.)  356 256 

(i)    Doing  Wliat  One  is  Bound  to  Do. 

Stilk  V.  Myrick,  2  Comp.  317 257 

Munroe  v.  Perkins,  9  Pick.  (Mass.)  298. . .   258 

Vanderbilt  v.  Schreyer,  91  N.  Y.  392 260 

Wheeler  v.  Wheeler,  11  Vt.  60 264 

Jaffray  v,  Davis,  124  N.  Y.  164,  26  N.  B. 
351 266 

(j)    Past  Consideration. 

Ehle  V.  Judson,  24  Wend.  (N.  Y.)  97 269 

Pool  V.  Homer,  64  Md.  131,  20  Atl.  1036. .  271 

Boothe  V.   Pitzpatrick,   36  Vt.  681 272 

Earle  t.  OUver,  2  Exch.  71 274 


VI.  Capacity  of  Parties. 

(a)    Tbie   Government. 
U.  S.  T.  TiQgey,  5  Pet  115 


276 


E.  256 


220 


(b)   Necessity. 


liann  v.  Hughes,  7  Term  R.  350 224 

(,c)    Adequacy. 

Haigh  v.  Brooks,  10  Adol.  &  E.  .''.09 226 

Judy  V.  Louderman,  48  Ohio  St,  562,  29  N. 

E.  181   227 

SchneU  v.  NeU,  17  Ind.  29 2;30 


(d)    Mutual  Promises. 

Coleman  v.  Eyre.  45  N.  Y.  38 232 

Seward  v.  Mitchell,  1  Cold.  (Tenn.)  87 233 

Presbyterian  Church  v.  Cooper,  112  N.  Y. 

517,  20  N.  E.  352 234 

Keep  v.  Goodrich,  12  Johns.  (N.  Y.)  397.  .   236 
L'Amoreux  v.  Gould,  7  N.  Y.  349.......   238 

Davie  v.  Lumberman's  Min.  Co.,  93  Mich. 

491,  53  N.  W.  625 240 

(e)    Forbearance. 

Cook  V.  Wright,  1  Best  &  S.  5.59 242 

Rector,  etc,   St.   Mark's   Church  v.  Teed, 
120  N.  Y.  5.83,24  N.  B.  1014 246 


(b)    Infants. 

Whitney  v.  Dutch,  14  Mass.  457 278 

Bordentown  Tp.  v.  Wallace,  50  N.  J.  Law, 

13,  11  Atl.  267 281 

Rvder  v.  WombweU.  L.  R.  4  Exch.  32 282 

M'cKanna  v.  Merry,  61  111.  177 286 

Johnson  v.  Lines,  6  Watts  &  S.  (Pa.)  80. .   287 

Stafford  v.  Roof.  9  Cow.   (N.  Y.)  626 290 

Goodnow  V.  Empire  Lumber  Co.,  31  Minn. 

468,  18  N.  W.  283 292 

Mansfield  v.  Gordon.  144  Mass.  168,  10  N. 

E.  773   294 

Tucker  v.  Moreland,  10  Pet.  58 295 

Henry  v.  Root,  33  N.  Y.  526 301 

Lemmon  v.  Beeman,  45  Ohio   St.  505,   15 

N.  E.  476 313 

Rite  V.  Boyer,  108  Ind.  472,  9  N.  E.  420.  .   315 

(c)    Insane  Persons  and  Idiots. 

Allis  V.  Billings,  6  Mete.  (Mass.)  415 319 

Hovey  v.  Hobson,  53  Me.  451 322 

Mutual  Life  Tns.   Co.   v.   Hunt,   79  N.   Y. 

541 325 

Seaver  v.  Phelps,  11  Pick.  (Mass.)  304...  320 

Sawyer  v.  Lufkin,  56  Me.  308 328 

(d)    Drunken  Persons. 

Barrett  v.  Buxton,  2  Aiken  (Vt)  167 329 

(e)    Married  Women. 

Martin  v.  DweUy,  6  Wend.  (N.  Y.)  9 331 

Gregory  v.  Pierce.  4   Mete.  (Mass.)  478.  .  335 

Willard  v.  Eastham,  15  Gray  (Mass.)  328.  336 

Owen  V.  Cawley,  36  N.  Y.  600 339 

(f)    Corporations, 

Downing  v.  Mt  Washington  Road  Co.,  40 
N.  H.  230 342 


TABLE  OF  CONTENTS. 


Thomas  v.  Railroad  Co.,  101  U.  S.  71 34." 

Bradley  v.  Ballard.  HO  III.  413 350 

Union  Bank  v.  Jacobs,  G  Humph.  (Tenn.) 
515 352 


VII.  Reality  of  Consent. 

(a)    Mistake. 

Foster  v.  Mackirinon.  L.  U.  4  C.  P.  704.  .  358 

Cuudj'  V.    Liiidsav,   3   App.    Gas.   459 3G0 

Couturier  v.  ilastio,  5  H.  L.  Ca.s.  073...  363 
Irwin  V.   Wilson,  45  Ohio   St.   426,   15  N. 

E.  209  366 

Sherwood  v.  Walker,  60  Mich.  508,  33  N. 

W.  919 370 

Osbnrn  v.  Throckmorton,  90  Va.  311,  18  S. 

E.  28o   374 

(b)    Fraud. 

People's   Bank   of   City    of   New    York    t. 

Bogart,  81  N.  1.  101 376 

Lomerson  v.  Johnston;  47  N.  J.  Eq.  312,  20 

Atl.  075   379 

Gordon  v.  Parmelee,  2  Allon  (Mass.)  212.  380 
Sheldon   v.   Davidson,  85  Wis.   138,  55  N. 

W.   101    382 

Stimson  v.  Helps,  9  Colo.  33.  10  Pac.  290.  oS4 

Cobb  T.  Hatfield,  40  N.  Y.  533 380 

Rowley  v.  Bipelow,  12  Pick.  (Mass.)  307.  .  388 

Mallory  v.  Leach,  35  Vt.  150 390 

(e)    Duress. 

Brown   .-.  Pierce,  7  Wall.  205 394 

Spaids  V.  Barrett,   57  111.  289 396 

Robinson  v.  Gould,  11  Cush.  (Mass.)  55.  .  398 
Fairbanks  v.  Snow,  145  Mass.  153,  13  N. 

E.  59c>   400 

(d)    Undue    Influence. 

Cowee  V.  Cornell,  75  N.  Y.  91 402 

McParland   v.    Larkin.   155   111.  84,  39   N. 

E.    609 406 

Wooley  V.  Drew,  49  Mich.  290,  13  N.  W. 

5M    410 


Vm.  Illegality  of  Object. 

(a)    Commission  of  Crime  or  Civil  Wrong. 

Atkins  V.  Johnson,  43  Vt.  78 412 

Jewett  Pnb.  Co.  v.  Butler,  159  Mass.  517, 
34  N.  E.  1087 414 

Cb)    Violation  of  Statutes. 

Griffith  V.  W^lls.  3  Denio  (N.  Y.)  226 416 

(c)    Same — Sunday    Laws. 

Lyon  T.   Strong,  6  Vt.  219 417 

(d)    Same — Usury. 

Lloyd  V.  Scott.  4  Pet.  205 421 

(e)    Public  Policy — Injury  to  Public 
Service. 

Bliss  V.  Ijawrence,  58  N.  Y.  442 425 

Providence  Tool  Co.  v.  Norris,  2  Wall.  45.   428 
Trist  V.  Child.  21  Wall.  441 430 

(f)    Same — Obstruction  of  Justice. 

Goodrich  v.  Tenney.  144  111.  422,  33  N.  B. 

44   434 

Jones  V.  Rice,  18  Pick.   (Mass.)  440 439 


(g)    Same — Champerty   and    Maintenance. 

Pa-.- 

Thompson  v.  Reynolds,  73  111.  11 440 

Fowler  v.  Callan.  102  N.  Y.  3!t."j,  7  N.  E. 

1(;9   442 

Courtright  v.  Burnes,  13  Fed.  317 443 

Oi)    Same— Immoral    Aereements. 

Saxon  V.  Wood,  4  Ind.  App.  242,  30  N.  E. 
797  444 

(i)    Same — Gaming  and  Wagers. 

Collamer  v.   Day,  2  Vt.  144 447 

(j)    Same — Futures. 

Beadles  v.  McElrath.  85  Ky.  230.  3  S.  W. 
152   448 

(k)    Same — Fraud    and    Breach    of    Trust. 

Spinks  V.  Davis,  32  Miss.   152 452 

(1)    Same — Derogation    of    Marriage     Re- 
lation. 

Lowe  V.   Peers,  4  Barrows,  2225 454 

(m)    Same — Restraint  of  Trade. 

Herreshoff  v.  Boutineau,  17  R.  I.  3,  19 
Atl.  712 458 

Diamond  Match  Co.  v.  Roeber,  106  N.  Y. 
473,  13  N.   E.  419 401 

Cartl  V.  Snyder  (N.  J.  Ch.)  26  Atl.  977.  ..   40.^. 

Tode  V.  Gross,  127  N.  Y.  480,  28  N.  E.  469  407 

(n)    Same— Unlavrfnl    Combinations — 
Monopolies,    etc. 

Morris  Run  Coal  Co.  v.  Barclay  Coal  Co., 

68  Pa.  St  173 469 

Central  Shade-Roller  Co.  v.  Cushman,  143 

Mass.  353,  9  N.  E.  629 473 

Good  V.  Daland.  121  N.  Y.  1.  24  N.  E.  15.  .  474 

More  V.  Bennett,  140  111.  09,  29  N.  E.  888  470 

(o)    Same — Idmiting    Liability     for     Neg- 
ligence. 

Railroad  Co.  v.  Lockwood,  17  Wall.  357.  .   480 

(p)   Effect  orf  niegality. 

Sullivan  t.  Hergan,  17  R.  I.  109,   20  Atl. 

232   490 

Shaw  V.  Carpenter.  54  Vt  155 491 

Roys  v.  Johnson.   7  Gray   (Mass.)  162....  490 

Tracy  t.  Talmage,  14  N.  Y.  162 497 

Tvler  V.  Carlisle,  79  Me.  210.  9  Atl.  356.  .  508 

Frost  V.  Gage,  3  Allen  (Mass.)  500 509 

Woodworth  v.  Bennett  43  N.  Y.  273 511 

Sprins  Co.  v.  Knowlton.  103  N.  Y.  49 513 

Ford  \.   Harrington,  10  N.  Y.   2S5 517 

White  V.  Franklin  Bank,  22  Pick.  (Mass.) 

181 520 


IX.  Operation  of  Contract. 

(a)    Limits  of  Contractual  Relation. 

Boston  Ice  Co.  v.  Potter,  123  Mass.  28.  ..   524 
Exchange  Bank  of  St.  Louis  v.  Rice,  107 

Mass.  37   526 

Lawrence  v.  Fox.  20  N.  Y.  208 529 

(b)    Assigrnment. 

Rapplye   ▼.   Racine   Seeder   Co.,   79   Iowa, 
220.   44   N.   W.   303 534 


VI 


TABLE  OF  CONTENT.^. 


Page 

Coolidcre  v.  Rugrcles.  15  Mass.  3S7 538 

Walker  v.  Brooks.  125  Mass.  241 539 

Arkansas    Vallev   Smeltins   Co.    v.   Belden 

Min.  Co.,  127  U.  S.  379,  S  Sup.  Ct.  130S.  542 
Vanbuskirk  t.  Hartford  Fire  Ins.  Co.,  14 

Conn.  141   545 

Mott  V.  Clark,  9  Pa.  St.  399 546 

(c)    Joint  and   Several  Contracts. 

Eller  V.  Lacv.  137  Ind.  436.  36  N.  E.  lOSS  549 
Ansrus  v.  Robinson.  59  Vt  5S5,  8  Atl.  497.   551 


X.  Interpretation  of  Contract. 

(a)    Rales   Relating   to   Evidence. 

Smith  V.  Williams,  1  Murph.  (N.  C.)  426.   552 

Cb)    Same — Proof    of   Custom    and    Usage. 

Cooper  V.  Kane,  19  Wend.  (N.  Y.)  3S6 555 

(c)    Roles  of  Constmction. 

Grav  V.  Clark,  11  Vt.  583 556 

(d)    Same — Rules  as  to  Time. 

Beck  &  Pauli  Lithographing  Co.  v.  Colo- 
rado MUIing  &  Elevator  Co..  3  C.  C.  A. 
248,  52  Fed.  700 558 

(e)    Same — Penalties     and     Liquidated 
Damages. 

561 


laqnith  v.  Hudson,  5  Mich.  123. 


XI.  Discharge  of  Contract. 

(a)    Waiver. 

Uobbs   v.   ColTimbia  Falls  Brick  Co.,    157 
Mass.  109,  31  N.  E.  756 566 

Cb)    Substituted  Agreement. 

Cutter  V.  Cochrane,   116  Mass.  408 567 

Buttertield  y.  Hartshorn,  7  N.  H.  345 568 


(c)    Performance — Payment. 

PaK» 
Markle  v.  Hatfield,  2  Johns.  (N.  Y.)  455.  .   571 
Cheltenham  Stone  &  Gravel  Co.  v.  Gates 
Iron  Works,  124  111.  623,  16  N.  E.  923.  .   573 

(d)    Same — Tender. 

Lamb  v.  Lathrop,  13  Wend.  (N.  Y.)  95.  ..   57.^ 

(e)    Conditions    Subsequent. 

Ray  V.  Thompson,  12  Gush.  (Mass.)  281. . .   577 

(f)    Breacb — Renunciation. 

Lake  Shore  &  M.  S.  Ry.  Co.  v.  Richards, 
152  111.  59,  38  N.  E.  773 578 

(g)   Same — Impossibility  Caused  by  Party. 

Newcomb  v   Brackett,  16  Mass.  161 592 

(b)    Same — Concurrent  Conditions. 

Morton  v.  Lamb,  7  Term  R.  125 594 

(i)    Same — Conditions    Precedent. 

Dey  V.  Dox,  9  Wend.  (N.  Y.)  129 598 

Grant  v.  .Tohnson,  5  N.  Y.  247 601 

Norrington   v.    Wright,    115    U.   S.    188.   6 

Sup.    Ct.   12 604 

Wooten  V.  Walters,  110  N.  C.  251,  14  S.  E. 

734  610 

Bast  V.  Byrne,  51  Wis.  531,  8  N.  W.  494.  .   613 

(j)    By  Operation  of   'La.w — Impossibility. 

Superintendent  &  Trustees  of  Public 
Schools  of  City  of  Trenton  v.  Bennett,  27 
N.  J.  Law,  513 615 

Yerrington  v.  Greene,  7  R.  I.  589 618 

(k)    Same — Merger. 

Van  Vleit  v.  Jones,  20  N.  J.  Law,  340 620 

(X)    Same — Alteration  of  .Written  Instru- 
ment. 

Wood  T.  Steele,  6  Wall.  80 622: 


CASES  REPORTED. 


PaRe 

Allpr  V.  Allor  (40  N.  J.  Law.  44G) 110 

AUis  V.  Billirijrs  (C,  Mi-to.  4ir.i 319 

Angus  T.  Robinson  (8  Atl.  497,  59  Vt.  585)  551 
Arkansas    V:illey    Smt'ltinj;    Co.    v.    Beldeu 

Mill.  Co.  (8  Sup.  Ct.  laOS,  127  U.  S.  379)  542 

Atkins  V.  Johnson  (43  Vt.  78) 412 

Baker  t.  Lauterback  (11  Atl.  703,  68  Md. 

&4)    218 

Baldwin  v.  Williams  (3  Mctc.  365) 151 

B.irrett   v.   Buxton   (2   Aik.  167) 329 

Bast  V.  Byrne  (8  N.  W.  494,  51  Wis.  531) .  613 
Beadles  v.  Leet  (3  S.  W.  152.  85  Ky.  230)  448 
Beadles  v.  McElrath  (3  S.  W.  152,  85  Ky. 

230)    448 

Beck  &  Pauli   Lithographing  Co.  v.   Colo- 
rado Milling  &  Elevator  Co.  (3  C.  C.  A. 

248,   52  Fed.  700) 558 

Bellows  V.  Sowles  (57  Vt.  104) 118 

Blake  v.  Cole  (22  Pick.  97) 149 

Bliss  V.  Gardner  ^58  N.  Y.  442) 425 

Bliss  V.  Lawrtmc6  (58  N.  Y.  442) 425 

Boothe  v.  Fitzpatrick  (36  Vt.  681) 272 

Bordentown   Tp.  v.   Wallace   (13  Atl.  267, 

50  N.  J.  Law,  13) 281 

Boston  Ice  Co.  v.  Potter  (123  Mass.  28) .  .  524 
Boston  &  M.   R.   R.   v.   Bartlett   (3  Cush. 

224)    75 

Bradley  v    Ballard  (55  111.  413) 350 

Britain  v.  Kossiter  (11  Q.  B.  Div.  123) 213- 

Brown  v.  Pierce  (7  Wall.  205) 39-4 

Butterfield  v.  Hartshorn  (7  N.  H.  345) 568 

Carlill  V.  Carbolic  Smoke  Ball  Co.   ([1893] 

1  Q.  B.  256) 67 

Carll  V.  Snyder  (26  Atl.  977) 465 

Caulkins  v.  Hellman  (47  N.  Y.  449) 166 

Central    Shade-Roller    Co.    v.    Cushman    (9 

N.  E.  629,  143  Mass.  .353) 473 

Cheltenham  Stone  &  Gravel  Co.  v.  Gates 

Iron  Works  a6  N.  E.  923,  124  111.  623).  .   573 

Clason  v.  Bailey  (14  Johns.  484) 201 

Clason  V.  Denton  (14  Johns.  484) 201 

Clason  T.  Merrit  (14  Johns.  4$4) 201 

Cobb  V.  Hatfield  (46  N.  Y.  .5.33) 386 

Coleman  v.  Eyre  (45  N.  Y.  38) 2;^2 

Collamer  v.  Day  (2  Vt.  144) 447 

Cook  V.  Wrifrht  (1  Be.st.  «fc  S.  5."9) 242 

Cookp  V.   Millard   (65  N.  Y.  352) 155 

Coolidge  V.  Ruggles  (15  Mass.  387) 538 

Cooper  V.  Kane  (19  Wend.  386) 5.55 

Courtrip:ht   v.  Burnes   (13  Fed.  317) 443 

Couturier  v.  Hastie  (5  H.  L.  Gas.  673) 363 

Cowee  v.  Cornell  (75  N.  Y.  91) 402 

Crane    v.    Wheeler    (50    N.    W.    1033,    48 

Minn.    207)     122 

Cundv  V.  Lindsay  (3  App.  Cas.  4.59) 360 

Cutter  V.   Cochrane  (116  Mass.  408) 567 

Davie  t.  Lumberman's  Min.  Co.  (53  N.  W. 

625.   93   Mich.   491) 240 

Day  V.   Caton  (119  Mass.  513) 28 

I  )ey  V.  Dox   (9  Wend.  129) 598 

Diamond   Match  Co.   v.  Roeber  (13   N.   E. 

419.   106   N.   Y.  473) 461 

Dickinson  v.  Dodds  (2  Ch.  Div.  463) ...  77 
Downing  v.  Mt.  Washington  Road  Co.  (40 

X.    H.    230)     342 

Dovle  V.  Dixon  (97  Mass.  208) 1.50 

Drake  v.  Seaman  (97  N.  Y.  230) 184 

Dunlop  V.  Higgins  (1  H.  L.  Cas.  381) 31 

Earle  v.  Oliver   (2  Exch.  71) 274 

Edgerton  v.  Hodge  (41  Vt.  676) 172 


Page 

Ehle  T.  Jud.son  (24  Wend.  97) 269 

Eliason  v.  Henshaw  (4  Wheat.  225) 24 

EUer  V.  Lacy  (36  N.  E.  luss,  137  Ind.  436)  549 
Exchange  Bank  of  St.  Louis  v.  Rice  (107 
Mass.  37)    526 

Fairbanks    v.    Snow    (13    N.    E.    596,    145 

Mass.   153)    400 

Fink  v.  Cox  (18  Johns.  145) 253 

Fogg  V.  Portsmouth  Athencum  (44  N.  H. 

115)    26 

F..rd  V.  Harrington  (16  N.  Y.  2S5)    517 

Foster  v.  Mackinnon  (L.  R,  4  C.  P.  704).  .  358 
Fnuier  v.  Cullan  (7  N.   E.  169,  102  N.   Y. 

395)    442 

Frost  v.  Gage  (3  AJlen,  560) 509 

Gabell  v.  South  Eastern  Ry.  Co.  (2  C.  P. 

Div.   416)    18 

Garfield  v.  Paris  (96  U.  S.  557) 168 

Goddard  v.  Binney  (115  Mass.  450) 153 

Good  V.  Daland  (24  N.  E.  15,  121  N.  Y.  1)  474 
Goodnow  V.  Empire  Lumber  Co.  (18  N.  W. 

283,  31  Minn.  468) 292 

Goodrich  v.  Tenney  (32  N.  E.  44,  144  111. 

422)    434 

Gordon   v.   Parmelee,  two  cases   (2  Allen, 

212)    380 

Grant  v.  Johnson  (5  N.  Y.  247) 601 

Gray    v.    Clark    (11   Vt   583) 556 

Green  v.  Armstrong  (1  Denio,  5.50) 145 

Gregory  v.  Pierce  (4  Mete  478) 335 

Griffith  v.   Wells   (3  Denio,  226) 416 

Haigh  T.  Brooks  (10  Adol.  &  E.  309) 226 

Hauler  v.  Sidway  (27  N.  E.  256,  124  N.  Y, 

538)    220 

Harris  v.    Scott    (32   Atl.    770) 63 

Haviland     v.    Sammis    (25    AtL    394,    62 

Conn.  44)    139 

Heffron  v.  Brown  (40  N.  E.  583,   155  111. 

322)    95 

Henry  v.  Root  (33  N.  Y.  526) 301 

Horreshofif  v.   Boutineau  (19   Atl.   712,   17 

R.  I.  3)   458 

Hertzog  v.  Hertzog  (29  Pa.  SL  465) ri 

Hirth  V.  Graham  (33  N.  B.  90,  50  Ohio  St. 

57)    147 

Hobbs    V.    Columbia    Falls    Brick    Co.    (31 

N.  E.  756.  157  Mass.  109) 560 

Household  Fire  &  Carriage  Ace.   Ins.  Co. 

V.  Grant  (4  Exch.  Div.  216) 58 

Hovey   v.    Hobson   (53   Me.   451) 322 

Hunter  v.  Wetsell  (84  N.  Y.  549) 174 

Hyde  v.  Wrench   (3  Beav.  334) 89 

Ide  V.  Leiser  (24  Pac.  695.  10  Mont.  5) 82 

Irwin   V.    Wilson   (15   N,   E.   209,   45  Ohio 
St.    426)    366 

Jaffray  v.  Davis  (26  N.  E.  351.  124  N.  Y. 

164)    266 

Jaquith  v.    Hudson  (5  Mich.  123) 561 

Jewett  Pub.  Co.  v.  Butler  (34  N.  E.  1087, 

159    Mass.    517)    414 

Johnson  v.  Lines  (6  Watts  &  S.  80) 2S7 

Jones  V.   Rice  (IS  Pick.   440) 439 

Judy  V.  Louderman  (29  N.  E.  181,  48  Ohio 

St.    562)    227 

Justice  V.  Lang  (42  N.  Y.  493) 187 


Keep  V.  Goodrich   (12  Johns.  397). 


236 


nOPK.SEI..CAS.CONT. 


(vii) 


viii 


CASES  REPORTED. 


Lake  Shore  &  M.  S.  Ry.  Co.  v.  Richards 

(3S  N.  E.   773,  152  111.   59) 

Lamb  v.  Lathrop  (13  Wend.  95) 

L'Amoreiix  v.   Gould  (1  N.  Y.  349) 

Larson  v.  Jensen  (19  N.  W.  130,  53  Mich. 

Lawrence*  V!  'Fox  (20*  isV  Y.'  268) '.'.'.'.'.'.'.'. 
Lawson's  Ex'r  v.  Lawson  (16  Grat.  230).  . 
Lemraon    v.    Beeman    (15    N.    E.   47G,   45 

Ohio    St    505) 

Lewis  V.   Brownins   (130   Mass.   173) 

Lloyd  T.  Scott  (4  Pet.  205) 

Lomerson  v.  Johnston  (20  Atl.  675,  47  N. 

J.   Eq.   312)    

Longworth  v.  Mitchell  (26  Ohio  St.  334) .  . 
Louisyille   Asphalt   Varnish  Co.   v.   Lorick 

(8   S.   E.  8,  29  S.  C.   533) 

Lowe  V.  Peers  (4  Burrows.  2225) 

Lyon   v.    Strong    (6  Vt.   219) 

McGovern  v.  Hern  (26  N.  E.  861,  153 
Mass.  308)   

MoKanna    v.    Merry   (61    111.    177) 

McKinley   v.   Watkins   (13   111.   140) 

McMillan  v.  Ames  (22  N.  W.  612,  33 
Minn.  257)   

McParland  v.  Larkin  (39  N.  E.  609,  15o 
lU.    84)    

Mactier's  Adra'rs  v.   Frith  (6  Wend.   103) 


Page 

578 
575 

238 

120 
529 


313 

62 
421 

379 
85 

178 
454 
417 


MaUory  v.  Gillett  (21  N.  Y.  412) . 
Mallory  t.  Leach  (35  Vt.  156).., 


183 

286 
248 

113 

406 

38 

124 

390 

Maiiory's   Adm'r   v.   Mallory's    Adm'r   (17 

S.  W.  737.  92  Ky.  316) 138 

Mansfield    v.    Gordon   (10  N.   E.   773,   144 

Mass.   168)    294 

Markle  v.  Hatfield  (2  Johns.  455) 571 

Martin  v.  Dwclly  (6  Wend.  9i 331 

Martin  v.  Flaharty  (32  Pac.  287,  13  Mont. 

96)    106 

MiUs  V.  Wyman  (3  Pick.  207) 254 

Minnesota  Linseed  Oil  Co.  v.  Collier  White 

Lead  Co.  (Fed.  Cas.  No.  9,635) 87 

Mississippi  &  Dominion   Steamship   Co.  v. 

Swift   (29  Atl.   1063,  86  Me.  248) 101 

More  V.  Bennett  (29  N.  E.  888,  140  111.  69)  476 
Morris  Run  Coal  Co.  v.  Barclay  Coal  Co. 

(68  Pa.  St.  173) 469 

Morton  v.   Lamb   (7  Term    R.  125) 594 

Mott  V.  Clark  (9  Pa.  St.  399) 546 

Moulton   V.    Kershaw    (18   N.   W.   172,   59 

Wis.  316)   99 

Mumford  v.  Whitney  (15  Wend.  .3,80) 140 

Munroe  v.   Perkins   (9  Pick.   208) 258 

Mutual  Life   Ins.   Co.   v.   Hunt  (79  N.   Y. 

541)    325 

Nally  V.  Reading  (17  S.  W.  978,  107  Mo. 

350)    212 

Newcomb  v.  Brackett  (16  Ma.ss.  161).-...  592 
Norrington  v.  Wright  (6  Sup.  Ct.  12,  115 

U.   S.   188)    604 

O'Brien  v.  Young  (95  N.  Y.  428) 11 

Osbum   V.    Throckmorton    (18    S.    E.   285, 

90  Va.  311) 374 

Owen  V.  Cawley  (36  N.  Y.  600) 339 

Paine  t.  Cave  (3  Term    R.  148) 74 

Parker  v.  South  Eastern  Ry.  Co.  (2  C.  P. 

Div.    416)     18 

Peabody  v.  Speyers  (56  N.  Y.  230) 176 

People's  Bank  of  City  of  New  York  v.  Bo- 

gart  (81  N.  Y.  101) 376 

Pool  T.  Homer  (20  Atl.  1036,  64  Md.  131)  271 
Pratt  V.  Miller  (18  S.  W.  945,  109  Mo.  78)  163 
Presbyterian  Church  v.   Cooper  (20  N.  E. 

3.52,    112    N.    Y.    517) 234 

Providence  Tool  Co.  v.  Norris  (2  Wall.  45)  428 

Railroad  Co.  v.  Lockwood  (17  Wall.  357)  480 
Rann  v.  Hughes  (7  Term  R.  3-50,  note) ...  224 
Rapplye  v.   Racine  Seeder  Co.   (44  N.  W. 

363,   79   Iowa.   220 1 534 

Ray   T.  Thompson   (12  Cash.   281) 577 


Paga 
Rector,  etc.,  of  St.  Mark's  Church  t.  Teed 

(24  N.  E.  1014,  120  N.  Y.  583) 246 

Rice  V.  Boyer  (9  N.  E.  420,  108  Ind.  472)  315 

Robinson  v.  Gould  (11  Cush.  55) 393 

Rowlev  V.  Bigelow  (12  Pick.  307) 388 

Roval  Ins.  Co.  v.  Beatty  (12  AtL  607,  119 

Pa.  St.  6) 20 

Roys  T.  Johnson  (7  Gray,  162) 496 

Rue  V.   Meirs  (12  Atl.  369,  43  N.  J.   E.j. 

377)    249 

Ryder  v.  WombweU  (L.  R.  4  Exch.  32).  ..   282 

St.  >Lark's  Church  v.  Teed  (24  N.  E.  1014, 

120  N.  Y.  58:3) 246 

Sawyer  v.  Lufkin  (56  Me.  308) 328 

Saxon  V.  Wood  (30  N.  E.  797,  4  Ind.  App. 

242)    444 

Sceva  V.  True  (53  N.  H.  627) 8 

Schnoll  V.  Nell  (17  In  1.  29) 230 

Seaver  v.  Phelps  (11  I'ick.  304) 326 

Seward  v.  Mitchell  (1  L'old.  87) 233 

Shaw  V.  Carpenter  (54  Vt.  155) 491 

Sheldon   v.    Davidson    (r)5   N.    W.    161.   85 

Wis.   138)    382 

Sherwood   v.    Walker   (33   N.   W.    919.    66 

Mich.   568)    370 

Smith  V,  Williams  (1  Murph.  426) 552 

Spaids  V.  Barrett  (57  111.  L'SO) 396 

Spiuks  V.  Davis  (32  Miss.  152) 4-52 

Spring  Co.  v.  Knowlton  (103  U.  S.  49) 513 

Stafford  v.  Roof  (9  Cow.  626) 290 

Stamper  v.  Temple  (6  Humph.  113) 93 

State  of  Indiana  v.  Leavitt  (14  N.  Y.  162)  497 

Stevens  v.  Coon  (1  Pin.  356) _256 

Stilk  V.  Myrick  (2  Comp.  317) 257 

Stimson  v.  Helps  (10  Pac.  290,  9  Colo.  33)  384 

Stone  V.  Dennison  (13  Pick.   1) 116 

Sullivan  v.  Hergan  (20  Atl.  232.  17  R.   I. 

109)    490 

Superintendent     &     Trustees     of     Public 

Schools   of   City  of  Trenton   v.    Bennett 

(27  N.  J.  Law.  513) 615 

Thomas  v.  Greenwood  (37  N.  W.  195.  69 

Mich.   215)    65 

Thomas  v.  Railroad  Co.  (101  U.  S.  71).  .*.   345 

Thompson  v.  Blanchard  (3  N.  Y.  335) 115 

Thompson  v.  Reynolds  (73  111.  11) 440 

Thruston  v.  Thornton  (1  Cush.  89) 14 

Tode  V.  Gross  (28  N.  E.  469.  127  N.  Y.  480)  467 
Towusend  v.  Hargraves  (118  Mass.  325) . . .   205 

Tracy  v.  Talmage  (14  N.  Y.  162) 497 

'Prist  V.  Child  (21  AVall.  441) 430 

Tucker  v.  Moreland  (10  Pet.  58) 295 

Tyler  t.  Carlisle  (9  Atl.  356,  79  Me.  210) . .  508 

Union  Bank  v.  Jacobs  (6  Humph.  515) 352 

United  States  v.  Tingey  (5  Pet  115) 276 

Vanbuskirk  v.  Hartford  Fire  Ins.  Co.  (14 

Conn.  141)    545 

Vanderbilt  v.  Schreyer  (91  N.  Y.  392) 260 

Van  Vleit  v.  Jones  (20  N.  J.  Law.  340).  ..  620 

Wait  V.  Wait's  Ex'r  (28  Vt.  350) 123 

Walker  v.  Brooks  (125  Mass.  241) 539 

Wallace  v.  Townsend  (3  N.  E.  601,  43  Ohio 

St.    537)    90 

Wheeler  v.  Reynolds  (66  N.  Y.  227) 208 

Wheeler  v.  Wheeler  (11  Vt  60) 264 

White  V.  Corlies  (46  N.  Y.  467) 16 

White  V.  Franklin  Bank  (22  Pick.  181)...   52T) 

Whitney  v.  Dutch  (14  Mass.  457) 278 

Wilkinson  v.  Heavenrich  (26  N.  W.  139,  58 

Mich.    574)    199 

Willard  v.  Easthara  (15  Gray,  328) 336 

Wood  v.  Steele  (0  Wall.  80) 622 

Wood  worth  v.  Bennett  (43  N.  Y.  273).,.  511 
Wooley  V,  Drew  (13  N.  W,  594,  49  Mich. 

2fX))    410 

Wooten  V.  Walters  (14  S.  E.  734.  110  N. 

C.   251)    610 

Yerrington  v.  Greene  (7  R.  L  589) 618 


ILLUSTRATIVE  CASES 


ON  THE 


LAW  OF  CONTRACTS 


HOPK.SEL.CAS.COST.  (1)* 


>3/ 


CONTRACT  AND  QUASI-CONTRACT   DISTINGUISHED 


3 


LAWSON'S  EX'Il  V.  LAWSON. 
(16  Grat.  230) 
Supreme  Court  of   Api)f'als  of   Virginia.'   April 
10,  1801. 
This   was  an   action  of  assumpsit   in   the 
circuit  court  of  tlio  county  of  Alexandria  by 
Thomas  A.  Brew  is.  executor    of  John  Law- 
son,     deceased,     ajjaiust     Isabella     Lawsou. 
The  declaration  contained  only  the  common 
couut.s,  and  whilst  it  commenced  in  the  name 
of  Thomas  A.  Brewis,  executor  of  .Tohn  Law- 
son,  it  charged  that  the  defendant   was  in- 
debted to  the  plaintiff,  and  promised  to  pay 
the  plaintiff. 

The  defendant  pleadetl  "non  assumpsit;" 
and  on  the  trial  demurred  to  the  evidence. 
That  evidence  was  that  on  the  3d  day  of 
June,  1851,  T.  A.  Brewis,  the  plaintiff,  came 
to  the  room  where  John  Lawson,  the  plain- 
tiff's testator,  was  sick  in  bed,  and  counted 
out  to  him  a  sum  of  mo  ley,  upwards  of  six 
hundred  dollai-s,  in  notes,  and  asked  Lawson 
if  he  (Brewis)  should  carry  the  money  back 
to  the  store.  That  Lawson  said,  "No;  he 
would  be  better  afttr  a  while,  and  would 
then  arrange  it  for  the  bank."  Lawson  then 
handed  the  money  to  his  wife,  the  defend- 
ant, and  told  her  to  put  it  aside  until  he 
felt  better,  and  that  he  would  arrange  it  for 
the  bank.  That  John  Lawson  died  on  the 
18th  of  Juno,  1851,  and  that  between  that 
date  and  the  time  when  Brewis  qualified  as 
executor  of  the  estate  of  Lawson,  Brewis 
asked  Mrs.  Lawson  for  the  money  which  he 
handed  to  John  Lawson.  and  Mrs.  Lawson 
refused  to  give  it  to  him  saying  she  mteud- 
ed  to  keep  it. 

There  was  a  verdict  for  $569.85,  with  in- 
terest from  the  19th  of  June,  1851,  until 
paid,  subject  to  the  demurrer  to  evidence; 
and  upon  the  demurrer  the  court  below  gave 
a  judgment  for  the  defendant,  whereupon 
Brewis  applied  to  this  court  for  a  superse- 
deas, which  was  allowed. 

Brent  &  Kinzer,  for  appellant  F.  J.  Smith, 
Lor  appellee. 

LEE,  J.  The  money  sought  to  be  recov- 
ered in  this  case  was  the  property  of  the 
plaintiff's  testator  in  the  form  of  bank  notes, 
and  was  handed  to  defendant  (his  wife)  a 
short  time  before  his  death,  for  safe-keeping 
until  he  should  be  better,  when  as  he  said, 
he  would  arrange  it  for  the  bank.  It  re- 
mained in  her  possession  during  his  life,  and 
at  his  death,  which  took  place  a  few  days 
after,  it  was  still  his  propertj'.  She  made 
no  claim  to  it  as  hers,  during  his  life;  nor, 
so  far  as  appears,  did  she  dispose  of  any 
part  of  it  to  her  own  use  or  that  of  her  hus- 
band. After  his  death  the  plaintiff,  though 
before  he  had  qualified  as  executor  under 
the  will  of  his  testator,  called  on  the  defeud- 
imt  for  the  money,  but  she  refused  to  sur- 
render it,  saying  that  she  intended  to  keep  it 

1  Irrelevant  parts  of  opiuion  omittod. 


Now  as  this  money  was  part  of  the  assets 
of  the  estate  of  the  testator,  it  Is  clear  that 
the  plaintiff  is  entitled  to  recover  it  in  some 
form  of  action,  and  in  some  character  either 
individual  or  representative. 

But  it  is  said  that  if  the  plaintiff  be  en- 
tith'd  to  recover,  he  cannot  do  so  in  this 
action,  but  should  have  declared  on  the 
special  case,  or  in  trover  anil  conversion. 

I  do  not  think  the  plaintiff  was  bound  to 
declare  spe<Mally.  The  action  of  Indebita- 
tus assumpsit  for  money  had  and  received 
will  lie  whenever  one  has  the  money  of  an- 
other which  he  has  no  right  to  retain,  but 
which  ex  aequo  et  bono,  he  should  i>ay  over 
to  that  other.  This  action  has  of  late  years 
been  greatly  extended,  becau.se  founded  on 
principles  of  justice;  and  it  now  embraces 
all  cases  in  which  the  plaintiff  has  equity 
and  conscience  on  his  side,  and  the  defend- 
ant is  bound  by  ties  of  natural  justice  and 
equity  to  refund  the  money.  In  such  a 
case,  no  express  promise  need  be  proved, 
because  from  such  relation  between  the  par- 
ties the  law  will  imply  a  debt  and  give  this 
action  founded  on  the  equity  of  the  plain- 
tiff's case,  as  it  were  upon  a  contract  quasi 
ex  contractu  as  the  Roman  law  expresses  it. 
and  upon  this  debt  founds  the  requisite  un- 
dertaking to  pay.  Moses  v.  Macfarlan,  2 
Burrows,  1005,  1008,  1012;  per  Buller,  J.. 
Stratou  v.  RastaU,  2  Term  R.  3G6,  370. 

Here  this  money  was  part  of  the  assets 
of  the  plaintiffs  testator,  and  it  was  the 
duty  of  the  defendant  ex  aequo  et  bono,  to 
pay  it  over  to  the  plaintiff. 

Nor  do  I  think  the  plaintiff  was  bound  to 
declare  in  trover  and  conversion.  The  mon- 
ey handed  to  the  defendant  by  the  taetator 
was  in  bank  notes,  and  if  it  be  conceded 
that  upon  the  refusal  of  the  defendant  to 
deliver  the  same  to  the  plaintiff,  trover 
might  be  maintained  as  for  a  tort  it  by  no 
means  follows  thai  as.sumpsit  could  not  be 
brought.  There  are  many  cases  in  which  a 
party  aggrieved,  who  has  a  clear  remedy  by 
action  as  for  a  tort,  may  waive  the  tort  and 
sue  in  assumpsit  Thus  an  action  against 
a  common  carrier  is  for  a  tort  and  sup- 
posetl  crime,  but  assumpsit  will  lie  for  the 
same  cause.  Per  Lord  Mansfield,  Hambly 
V.  Trott,  Cowp.  371,  375.  So  if  a  man  takes 
a  horse  from  another,  and  brings  him  back 
again,  an  action  of  trespass  may  be  brought, 
but  the  owner  may  bring  assiuupsit  for  the 
use  and  hire  of  the  horse.  Id.  If  a  bank- 
rupt, on  the  eve  of  his  bankruptcy,  fravid- 
ulently  deliver  goods  to  one  of  his  creditoi-s. 
the  assignees  may  recover  the  goods  in  tro- 
ver, or  waive  the  tort  and  bring  assumpsit 
Smith  V.  Hodson,  4  Term  R.  211.  If  a  stran- 
ger takes  my  goods  and  delivers  them  to  an- 
other, a  contract  may  be  implied,  and  I 
may  bring  an  action  of  trover  for  them,  or 
of  assumpsit  to  recover  their  value.  Per 
Lord  Abinger.  Bassell  v.  BeU,  10  Mees.  & 
■V\'.  350.  In  this  case  it  was  decided  that 
the    assignees    of   bankrupt,    who    after    the 


CONTRACT  AND  QUASI-CONTRACT  DISTINGUISHED. 


bankruptcy  had  delivered  goods  to  the  de- 
fendant to  meet  an  accommodation  bill 
which  they  were  about  to  give  the  bank- 
rupt, might  waive  the  tort  and  sue  in  as- 
sumpsit. So  a  master  whose  apprentice  has 
left  him  and  entered  into  the  service  of  an- 
other, who  persuades  him  to  remain  with 
him  after  he  had  found  out  who  he  was 
and  from  what  shop  he  had  deserted,  may 
waive  the  tort  and  bring  assimipsit  against 
the  defendant  for  the  work  and  labor  of  the 
apprentice.  Foster  v.  Stewart.  3  Maule  & 
S.  191.  See,  also,  Curtis  v.  Bridges,  Comb. 
450:  Eades  v.  Vandeput  5  East,  39;  Lightly 
T.  Clowston,  1  Taunt  112.  So  if  a  man  take 
the  goods  of  another  and  sell  them,  the  own- 


er may  waive  the  trespass  and  sue  him  for 
money  had  and  received.  Gilmore  v.  Wil- 
bur, 12  Pick.  120;  Foster  v.  Stewart,  3 
Maule  &  S.  191.  See,  also,  Jones  v.  Hoar, 
5  Pick.  285.  Other  illustrations  may  be  de- 
rived from  the  cases,  but  I  will  not  stop  to 
give  them.  I  think  that  in  no  case  could 
the  exercise  of  the  right  to  elect  between  an 
action  in  tort  and  assumpsit  be  more  ap- 
propriate than  in  this.  The  bank  notes  wert 
received  and  treated  by  the  testator  as  mon 
ey,  and  as  such  were  received  and  retained 
by  the  defendant,  and  though  trover  might 
lie  to  recover  the  notes,  the  law  will  imply 
a  promise  to  pay  the  amotmt  to  the  plaintiff. 


-6  3/ 


CONTRACT  AND  QUASI-CONTRACT  DISTINGUISHED. 


HEIITZOG  T.  HERTZOQ. 

(29  Pa.  St.  465.) 

Supreme  Court  of  Pennsylvania.    1857. 

Error  to  court  of  cominon  pleas,  Fayette 
county 

This  suit  was  brought  by  John  Hertzes  to 
recover  from  the  estate  of  his  fatlior  compen- 
sation for  services  rendered  the  latter  in  his 
lifetime,  and  for  money  lent.  The  pUiintilT 
was  twenty-one  years  of  age  about  the  year 
1825,  but  continued  to  reside  with  his  father, 
who  was  a  farmer,  and  to  labour  for  him  on 
the  farm  except  one  year  that  he  was  ab- 
sent in  Virginia,  until  1S42,  when  the  plaintiff 
married  and  took  his  wife  to  his  father's, 
where  they  continued  for  some  time  as  he  had 
done  before.  His  father  then  put  him  on  an- 
other farm  which  he  owned,  and  some  time 
afterwards  the  father  and  his  wife  moved  in- 
to the  same  house  with  .John,  and  continued 
to  reside  there  until  his  death  in  1849. 

The  testimony  of  Adam  Stamm  and  Daniel 
Roderick  was  relied  on  to  prove  a  contract 
or  agreement  on  the  part  of  George  Hertzog 
to  pay  for  the  services  of  plaintiff. 

Adam  Stamm  affirmed:  "John  laboured  for 
his  father.  All  worked  together.  The  old 
man  got  the  proceeds.  I  know  the  money 
from  the  grain  went  to  pay  for  the  farm. 
The  old  man  said  so.  John's  sei-vices  worth 
.$12  per  month;  the  wife's  worth  $1  per  week, 
beside  attending  to  her  own  family.  I  heard 
the  old  man  say  he  would  pay  John  for  the 
labour  he  bad  done." 

Daniel  Roderick  sworn:  "John  Hertzog  re- 
quested him  to  see  his  father  about  paying 
liim  for  his  work,  which  he  had  done  and  was 
doing,  and  stated  that  he  had  frequently 
spoken  to  the  old  man,  his  father,  about  it, 
and  he  had  still  put  him  off.  He  agreed  to 
see  him,  and  thinks  it  was  in  Jime,  1849. 
Coming  from  Duncan's  Furnace,  he  spoke  to 
the  old  man  about  paying  John  for  his  work. 
He  said  he  intended  to  make  John  safe.  John 
spoke  to  me  in  the  spring  of  1848.  The  old 
awn  died  in  August,  1849,  I  think." 

The  plaintiff  also  proved  the  services  ren- 
dered by  himself  and  by  his  wife,  and  by  the 
declarations  of  the  intestate  that  he  had  re- 
ceived from  the  plaintiff  ?5lX),  money  that  be- 
longed to  the  latter's  wife,  at  the  time  of 
purchasing  a  fann  in  1847.  The  court,  after 
the  defendant's  points  were  presented,  per- 
mitted the  plaintiff  to  add  to  his  declaration 
a  count  on  a  quantum  meruit. 

The  defendant  pleaded  the  statute  of  lim- 
itation?, and  presented  the  following  points: 

1.  The  court  are  respectfully  requested  to 
charge  the  jury  that  where  a  son,  after  he 
arrives  at  the  age  of  twenty-one  years,  and 
continues  to  live  with  and  work  for  his  father, 
without  any  special  contract,  he  cannot  "re- 
cover for  wages  or  sei'vice  rendered,  from  the 
estate  of  his  deceased  parent,  unless  upon 
clear  and  imequiVocal  proof,  leaving  no  doubt 
that  the  relation  between  the  parties  was  not 


the   ordinary   one  of   parent   and   child,   but 
master  and  servant." 

2.  That  according  to  the  plaintiff's  own 
showing,  the  .$.">00  claimed  by  him  belonged 
to  the  wife  of  the  plaintiff,  and,  since  the  act 
of  1848,  is  her  separate  property,  and  cannot 
be  recovered  in  this  suit,  the  same  having 
been  instituted  in  \he  name  of  the  husljund 
alone. 

3.  The  plaintiff  cannot  recover  in  this  ac- 
tion on  a  quantum  meruit,  there  being  no 
such  count  in  plaintiff's  narr. 

The  court  below  (Gilmore,  P.  J.)  answered 
these  points  as  follows: 

"1.  We  answer  this  in  the  affirmative.  It 
was  so  ruled  in  Candor's  Appeal,  5  Watts  & 
S.  515.  If  the  plaintiff  was  working  for  his 
father,  without  a  mutual  understanding  be- 
tween them  that  he  was  to  be  paid  for  his 
labour,  he  cannot  recover  wages. 

"The  jury  must  be  satisfied  from  the  evi- 
dence that  it  was  understood  between  him 
and  his  father  that  he  was  to  be  compensat- 
ed, not  by  the  way  of  gift  or  legacy,  but  by 
the  payment  of  wages."  Here  the  court  re- 
ferred to  the  evidence  of  Adam  Stamm  and 
Daniel  Roderick,  and  said,  "From  this  evi- 
dence, if  you  believe  it,  you  may  infer  such 
an  agreement. 

"2.  If  the  jury  are  satisfied  from  the  evi- 
dence that  the  S-'OO  was  in  the  possession  of 
plaintiff's  wife  in  1847,  and  that  the  defend- 
ant [decedent]  then  received  it  from  her,  this 
would  be  considered  the  possession  of  tlie 
same  by  the  husband,  and  plaintiff  could  sue 
without  joining  his  wife. 

"3.  The  court  permit  the  declaration  to  be 
amended  so  as  to  embrace  this  point." 

The  jury  foimd  a  verdict  for  the  plaintiff  of 
?2,203.97,  and  the  court  entered  judgment 
thereon. 

The  defendant  sued  out  a  writ  of  error,  and 
assigned  the  answers  of  the  court  below  for 
error. 

Fuller  &  Oliphant,  for  plaintiff  in  error. 

Miller  &  Patterson,  for  defendant  in  error. 

LOWRIE,  J.  "Express  contracts  are,  where 
the  terms  of  the  agreement  are  openly  uttered 
and  avowed  at  the  time  of  tlie  making;  as.  to 
deliver  an  ox  or  ten  loads  of  timber,  or  to  pay 
a  state<i  price  for  certain  goods.  Implied  are 
sxich  as  reason  and  justice  dictate;  and  which, 
therefore,  the  law  presumes  that  every  man 
undertakes  to  perform.  As,  if  I  employ  a  per- 
son to  do  any  business  for  me.  or  perform  any 
work,  the  law  implies  that  I  undertook  and 
contracted  to  pay  him  as  much  as  his  labour 
deserves.  If  I  take  up  wares  of  a  tradi's- 
man  without  any  agreement  of  price,  the  law 
concludes  that  I  contracted  to  pay  their  real 
value." 

This  is  the  language  of  Blackstone  (2  Comm. 
443).  and  it  is  open  to  some  criticism.  There 
is  some  looseness  of  thought  in  supposing  that 
reason  and  justice  ever  dictate  any  contracts 
between  parties,  or  impose  such  upon  them. 
All  true  contracts  gi'ow  out  of  the  intentions 


CONTRACT  AND  QUASI-CONTRACT  DISTINGUISHED. 


of  the  parties  to  transactions,  and  are  dic- 
tated only  by  their  mutual  and  accordant 
wills.  When  this  intention  is  expressed,  we 
call  the  contract  an  express  one.  When  it  is 
not  expressed,  it  may  be  inferred,  implied,  or 
presumed,  from  circumstances  as  really  ex- 
isting, and  then  the  contract,  thus  ascertain- 
ed, is  called  an  implied  one.  The  instances 
given  by  Blackstone  are  an  illustration  of 
this. 

I^ut  it  appears  in  another  place  (3  Bl. 
Comm.  159-166)  that  Blackstone  introduces 
this  thought  about  reason  and  justice  dictat- 
ing contracts,  in  order  to  embrace,  under  his 
definition  of  an  implied  contract,  another 
large  class  of  relations,  which  involve  no  in- 
tention to  contract  at  all,  though  they  may 
be  treated  as  if  they  did.  Thus,  whenever, 
not  our  variant  notions  of  reason  and  jus- 
tice, but  the  common  sense  and  common  jus- 
tice of  the  country,  and  therefore  the  com- 
mon law  or  statute  law,  impose  upon  any  one 
a  duty,  irrespective  of  contract,  and  allow  it 
to  be  enforced  by  a  contract  remedy,  he 
calls  this  a  case  of  implied  contract.  Thus 
out  of  torts  grows  the  duty  of  compensation, 
and  in  many  cases  the  tort  may  be  waived, 
and  the  action  brought  in  assumpsit. 

It  is  quite  apparent,  therefore,  that  rad- 
ically different  relations  are  classified  under 
the  Siime  term,  and  this  must  often  give  rise 
to  indistinctness  of  thought.  And  this  was 
not  at  all  necessary;  for  we  have  another 
well-authorized  technical  term  exactly  adapt- 
ed to  the  office  of  making  the  true  distinc- 
tion. The  latter  class  are  merely  construct- 
ive contracts,  while  the  former  are  truly  im- 
plied ones.  In  one  case  the  contract  is  mere 
fiction,  a  form  imposed  in  order  to  adapt  the 
case  to  a  given  remedy;  in  the  other  it  is  a 
fact  legitimately  inferred.  In  one,  the  in- 
tention is  disregarded;  in  the  other,  it  is  as- 
certained and  enforced.  In  one,  the  duty 
defines  the  contract;  in  the  other,  the  con- 
tract defines  the  duty. 

We  have,  therefore,  in  law  three  classes  of 
relations  called  contracts: 

1.  Constructive  contracts,  which  are  fic- 
tions of  law  adapted  to  enforce  legal  duties 
by  actions  of  contract,  where  no  proper  con- 
tract exists,  express  or  implied. 

2.  Implied  contracts,  which  arise  under 
circumstances  which,  according  to  the  ordi- 
nary course  of  dealing  and  the  common  un- 
derstanding of  men,  show  a  mutual  inten- 
tion to  contract. 

3.  Express  contracts,  already  sufficiently 
distinguished. 

In  the  present  case  there  is  no  pretence  of 
a  constructive  contract,  but  only  of  a  proper 
one,  either  express  or  implied.  And  it  is 
scarcely  insisted  that  the  law  would  imply 
one  in  such  a  case  as  this;  yet  we  may  pre- 
sent the  principle  of  the  case  the  more  clear- 
ly, by  showing  why  it  is  not  one  of  implied 
contract. 

The  law  ordinarily  presumes  or  implies  a 
contract  whenever  this  is  necessary  to  ac- 


count for  other  relations  found  to  have  ex- 
isted between  the  parties. 

Thus  if  a  man  is  found  to  have  done  work 
for  another,  and  there  appears  no  known  re- 
lation between  them  that  accounts  for  such 
sen'ice,  the  law  presumes  a  contract  of  hir- 
ing. But  if  a  man's  house  takes  fire,  the 
law  does  not  presume  or  imply  a  contract  to 
pny  his  rieighbotirs  for  their  services  in  sav- 
ing his  property.  The  common  principles  of 
human  conduct  mark  self-interest  as  the  mo- 
tive of  action  in  the  one  case,  and  kindness 
in  the  other;  and  therefore,  by  common  cus- 
tom, compensation  is  mutually  counted  on  in 
one  case,  and  in  the  other  not. 

On  the  same  principle  the  law  presumes 
that  the  exclusive  possession  of  laud  by  a 
stranger  to  the  title  is  adverse,  tmless  there 
be  some  family  or  other  relation  that  may 
account  for  it.  And  such  a  possession  by 
one  tenant  in  common  is  not  presumed  ad- 
verse to  his  co-tenants,  because  it  is,  prima 
facie,  accounted  for  by  the  relation.  And  so 
of  possession  of  land  by  a  son  of  the  owner. 
And  in  Magaw's  Case,  Latch,  168,  where  an 
heir  was  in  a  foreign  land  at  the  time  of  a 
descent  cast  upon  him,  and  his  younger 
brother  entered,  he  was  presumed  to  have 
entered  for  the  benefit  of  the  heir.  And  one 
who  enters  as  a  tenant  of  the  owner  is  not 
presumed  to  hold  adversely  even  after  his 
term  has  expired.  In  all  such  cases,  if  there 
is  a  relation  adequate  to  account  for  the 
possession,  the  law  accounts  for  it  by  that 
relation,  unless  the  contrary  be  proved.  A 
party  who  relies  upon  a  contract  must  prove 
its  existence;  and  this  he  does  not  do  by 
merely  proving  a  set  of  circumstances  that 
can  be  accounted  for  by  another  relation  ap- 
pearing to  exist  between  the  parties. 

Mr.  Justice  Rogers  is  entitled  to  the'  grati- 
tude of  the  public  for  having,  in  several 
cases,  demonstrated  the  force  of  this  princi- 
ple in  interpreting  transactions  between  par- 
ents and  children  (3  Penn.  R.  36.5;  3  Rav»ie, 
249;  5  Watts  &  S.  357,  51.3);  and  he  has  been 
faithfully  followed  in  manj-  other  cases  (8 
Watts,  366;  8  Pa.  St.  2^3;  9  Pa.  St.  262;  12 
Pa.  St.  175;  14  Pa.  St.  201;  19  Pa.  St.  2.51, 
366;    25  Pa.  St.  308;   26  Pa.  St.  372,  383). 

Every  induction,  inference,  implication,  or 
presumption  in  reasoning  of  any  kind  is  a 
logical  conclusion  derived  from,  and  demand- 
ed by,  certain  data  or  ascertained  circum- 
stances. If  such  circumstances  demand  the 
conclusion  of  a  contract  to  account  for  them, 
a  contract  is  proved;  if  not,  not.  If  we  find, 
as  ascertained  circumstances,  that  a  stran- 
ger has  been  in  the  employment  of  another, 
we  immediately  infer  a  contract  of  hiring, 
because  the  principles  of  individuality  and 
self-interest,  common  to  human  nature,  and 
therefore  the  customs  of  society,  require  this 
inference. 

But  if  we  find  a  son  in  the  employment  of 
his  father,  we  do  not  infer  a  contract  of  hir- 
ing, because  the  principle  of  family  affec- 
tion  is   sufficient  to  account  for  the  family 


CONTRACT  AND  QUASI-CONTRACT  DISTIXGUISHED. 


association,  and  does  not  demand  the  infer- 
ence of  a  contract.  And  besides  this,  the 
position  of  a  son  in  a  family  is  always  es- 
teemed better  than  tliat  of  a  hired  servant, 
and  it  is  very  rare  for  sons  remaining  in 
their  father's  family,  even  after  they  aiTive 
at  age,  to  become  mere  hired  servants.  If 
they  do  not  go  to  work  or  business  on  their 
own  account,  it  is  generally  because  they 
perceive  no  suflicient  inducement  to  sever 
the  family  bond,  and  very  often  because 
they  lack  the  enei-gy  and  independence  nec- 
essary for  such  a  course;  and  very  seldom 
because  their  father  desires  to  use  them  as 
hired  servants.  Customarily  no  charges  are 
made  for  boarding  and  clothing  and  pocket 
money  on  one  side,  or  for  work  on  the  other; 
but  all  is  placed  to  the  account  of  filial  and 
parental  duty  and  relationship. 

Judging  from  the  somewhat  discordant  tes- 
timony in  the  present  case,  this  son  remain- 
ed in  the  employment  of  his  father  until  he 
was  about  forty  years  old;  for  we  take  no 
account  of  his  temporary  absence.  While 
living  with  his  father,  in  1S42,  he  got  mar- 
ried, and  brought  his  wife  to  live  with  him 
in  the  house  of  his  pai'ents.  Afterwards  his 
father  placed  him  on  another  farm  of  the 
father,  and  very  soon  followed  him  there, 
and  they  all  lived  together  until  the  father's 
death  in  1849.  The  farm  was  the  father's, 
and  it  was  managed  by  him  and  in  his  name, 
and  the  son  worked  on  it  vmder  him.  No  ac- 
counts were  kept  between  them,  and  the 
presumption  is  that  the  son  and  his  family 
obtained  their  entire  living  from  the  father 
while  they  were  residing  with  him. 

Does  the  law,  under  the  circumstances, 
presume  that  the  parties  mutually  intended 
to  be  ^ouud,  as  by  contract,  for  the  serv- 
ice and  compensation  of  the  son  and  his 
wife?  It  is  not  pretended  that  it  does.  But 
it  is  insisted  that  there  are  other  circum- 
stances besides  these,  which,  taken  together, 
are  evidence  of  an  express  contract  for  com- 
pensation in  some  form,  and  we  are  to  exam- 
ine this. 

In  this  court  it  is  insisted  that  the  contract 
was  that  the  farm  should  be  worked  for  the 
joint  benefit  of  the  father  and  son,  and  that 
the  profits  were  to  be  divided;  but  there  is 
not  a  shadow  of  evidence  of  this.  And  more- 
over it  is  quite  apparent  that  it  was  wages 
only  that  was  claimed  before  the  jury  for  the 
services  of  the  son  and  his  wife,  and  all  the 
evidence  and  the  charge  point  only  in  that 
direction.  There  was  no  kind  of  evidence 
of  the  annual  products. 

Have  we,  then,  any  evidence  of  an  express 
contract  of  the  father  to  pay  his  son  for  his 
work  or  that  of  his  wife?     We  concede  that, 


in  a  case  of  this  kind,  an  express  contract 
may  be  jjroved  by  indirect  or  circumstantial 
evidence.  If  the  parties  kept  accounts  be- 
tween them,  these  might  show  it.  Or  it 
might  be  suflicient  to  show  that  money  was 
periodically  paid  to  the  son  as  wages;  or,  if 
there  be  no  creditors  to  object,  that  a  set- 
tlement for  wages  was  had,  and  a  balance 
agreed  upon.  But  there  is  nothing  of  the 
sort  here. 

The  court  told  the  jury  that  a  contract  of 
hiring  might  be  inferred  from  the  evidence  of 
Stamm  and  Roderick.  Yet  these  witnesses 
add  nothing  to  the  facts  already  recited,  ex- 
cept that  the  father  told  them,  shortly  before 
his  death,  that  he  intended  to  pay  his  son  for 
his  work.  This  is  no  making  of  a  contract 
or  admission  of  one;  but  rather  the  contrary. 
It  admits  that  the  son  deserved  some  reward 
from  his  father,  but  not  that  he  had  a  con- 
tract for  any. 

And  when  the  son  asked  Roderick  to  see 
the  father  about  paying  him  for  his  work, 
he  did  not  pretend  that  there  was  any  con- 
tract, but  only  that  he  had  often  spoken  to 
his  father  about  getting  pay,  and  had  always 
been  put  ofL  All  this  makes  it  very  appar- 
ent that  it  was  a  contract  that  was  wanted, 
and  not  at  all  that  one  already  existed;  and 
the  court  was  in  error  in  saying  it  might  be 
inferred,  from  such  talk,  that  there  was  a 
contract  of  any  kind  between  the  parties. 

The  difficulty  in  trying  causes  of  this  kind 
often  arises  from  juries  supposing  that,  be- 
cause they  have  the  decision  of  the  cause, 
therefore  they  may  decide  according  to  gen- 
eral principles  of  honesty  and  fairness,  with- 
out reference  to  the  law  of  the  case.  But 
this  is  a  despotic  power,  and  is  lodged  with 
no  poilion  of  this  government. 

Their  verdict  may,  in  fact,  declare  what  is 
honest  between  the  parties,  and  yet  it  may 
be  a  mere  usurpation  of  power,  and  thus  be 
an  effort  to  correct  one  evil  by  a  greater  one. 
Citizens  have  a  right  to  form  connexions  on 
their  own  terms  and  to  be  judged  according- 
ly. When  parties  claim  by  contract,  the 
contract  proved  must  be  the  rule  by  which 
their  rights  are  to  be  decided.  To  judge 
them  by  any  other  rule  is  to  interfere  with 
the  liberty  of  the  citizen. 

It  is  claimed  that  the  son  lent  $500  of  his 
wife's  money  to  his  father.  The  evidence 
of  the  fact  and  of  its  date  is  somewhat  in- 
distinct. Perhaps  it  was  when  the  farm  was 
bought.  If  the  money  was  lent  by  her  or 
her  husband,  or  both,  before  the  law  of  1S4S 
relating  to  married  women,  we  think  he 
might  sue  for  it  without  joining  his  wife. 

.Tudgment  reversed,  and  a  new  trial  award- 
ed. 


CONTRACT  AND  QUASI-CON'TRACT  DISTINGUISHED. 


^t'M 


r9 


SCETA  T.  TRUE.  (^^  L-  3^ 

(53  N.  H.  627.)  ]f  ^^ 

Supreme    Judicial    Court    of    New    Hampshire. 
Dec  1S73. 

For  the  purpose  of  raising  questions  of  law, 
and  no  other,  the  parties  agreed  that  the 
facts  are  as  stated  in  the  following  motions 
to  dismiss,  and  the  questions  were  reserved 
for  the  consideration  of  the  whole  court: 

The  defendant,  by  her  guardian  ad  litem, 
moves  to  quash  the  writ  in  this  suit,  and 
to  dismiss  said  suit:  (1)  Because,  at  the 
time  of  the  attachment  of  the  defendant's 
real  estate  in  the  town  of  Andover  in  said 
suit — as  appeal's  by  the  officer's  return  up- 
on said  writ— and  at  the  time  of  the  service 
of  said  writ,  and  for  more  than  forty  years 
prior  thereto,  she  was,  and  had  been,  insane, 
and  without  any  guardian,  and  was,  and  for 
more  than  a  quarter  of  a  centui-y  had  been, 
so  hopelessly  insane  as  to  have  no  reason  or 
understanding;  that  at  the  time  of  such  at- 
tachment and  service — and  since  about  No- 
vember 1,  ISTl— she  was,  and  has  been,  kept 
at  a  private  madhouse  in  said  town,  by  its 
overseers  of  the  poor,  as  one  of  its  insane 
poor;  that  the  service  of  said  writ  was  made 
and  completed  by  leaving  a  writ  of  summons 
therein,  at  said  madhouse;  that,  for  nearly 
the  entire  forty  yeai-s  prior  to  said  Novem- 
ber 1,  1871,  she  had  lived  under  the  same 
roof  with  plaintiff's  intestate,  who  was  her 
brother-in-law,  and  under  his  charge,  and 
that  all  the  facts  which  transpired  prior  to 
the  death  of  said  intestate  (about  June  1, 
1S72)  were  weU  known  to  him,  and  that  the 
plaintiff  had  notice  or  knowledge  of  aU  the 
facts  in  the  premises.  (2)  That  this  suit  is 
assumpsit  for  the  support  of  said  Fanny,  un- 
der the  circumstances  before  set  forth,  and 
those  which  follow.  Prior  to  his  death,  Au- 
gu-st  11,  1822,  William  Trae,  father  of  said 
Fanny  and  her  sister  Martha,  wife  of  said 
intestate,  owned  a  farm  In  Andover  and  HUl, 
with  a  house,  barn,  and  outbuildings  thereon, 
situate  in  said  Andover.  On  May  2.5,  1822, 
in  expectation  of  his  death,  said  WQliam 
True  made  the  following  disposition  of  his 
property:  He  gave,  by  an  instrument  in 
writing  under  seal,  all  his  personal  prop- 
erty, upon  certain  conditions  and  subject  to 
ceilain  charges,  to  his  widow,  Betsey  Ti'ue, 
who  died  upon  said  premises  in  May,  1844, 
without  remarrying.  He  also  gave  her  on 
the  same  day,  in  the  same  way,  "the  use  and 
occupation  of  said  real  estate,  both  of  lands, 
buildings,  and  tenements,  so  long  as  she,  the 
said  Betsey,  remains  my  widow."  He  also, 
by  deed,  conveyed  on  the  same  day  one  undi- 
vided half  of  all  said  real  estate  to  each  of 
said  daughters.  Said  intestate  carried  on 
said  premi-ses  in  1822,  and  married  said  Mar- 
tha in  December,  1823,  and  lived  on  said 
premises  till  about  one  month  before  his 
death.  All  the  parties,  save  Fanny,  treated 
said  deeds  and  instruments  as  valid,  and 
supposed  they  were  valid;    and,  aside  from 


the  time  that  the  said  defendant  sVas  away 
in  insane  asylums  and  intirmaries  lov  treat- 
ment, all  lived  together  on  said  premises  in 
one  family  till  they  died,  or  until  siiiU  Enoch 
F.  Sceva  refused  to  support  said  Fanny  long- 
er; and  she  was  taken  away  about  said  No- 
vember 1st,  and  when  said  Enoch  F.  Sceva 
left,  the  month  prior  to  his  death.  Said  Sce- 
va took  the  entire  charge  of  the  premises, 
used  the  crops  and  the  proceeds  of  the  Imn- 
ber,  wood,  and  bark,  sold  off  of  the  whole 
farm  for  the  common  benefit  of  the  famUy, 
and  paid  the  taxes  and  other  biUs  for  the 
support  and  maintenance  of  the  family.  No 
administration  was  ever  had  upon  any  part 
of  the  estate  of  said  William  True,  nor  was 
there  any  use  or  trust  for  the  benefit  of  said 
Fanny.  No  attempt  was  ever  made  to  make 
any  contract  with  said  Fanny  about  her  sup- 
port, or  anything  else.  No  application  was 
made  for  the  appointment  of  a  guardian  in 
the  interest  of  said  Enoch  F.  Sceva,  because 
of  the  opposition  of  his  wife  to  any  step  look- 
ing to  that  end.  She  has  been  supported 
during  said  forty  years  by  said  Sceva,  his 
wife,  and  her  mother,  out  of  the  avails  of 
said  real  estate  taken  as  aforesaid,  and  out 
of  their  own  funds.  Since  1844  her  chief 
support  has  been  from  said  Sceva.  Said  in- 
testate was  worth  nothing  when  he  com- 
menced on  said  farm,  and  died  worth  about 
$1,600. 

Mr.  Barnard,  for  the  plaintiff.  Mr.  Shirley, 
for  the  defendant 

LADD,  J.  It  is  obvious,  we  think,  that 
one  question  which  has  been  argued  by  coun- 
sel at  considerable  length,  namely,  whether 
legal  service  of  a  writ  can  be  made  upon  an 
insane  person  or  idiot,  is  not  before  the  court, 
on  this  motion  to  dismiss,  in  such  way  that 
any  practical  results  would  be  gained  by  de- 
ciding it  The  agreement  of  the  parties  is 
not  that  the  suit  shaU  be  dismissed  in  case 
the  court  are  of  opinion  that  the  service  was 
insufficient,  but  only  that  the  facts  may  be 
taken  to  be  as  stated  for  no  other  purpose 
but  to  present  the  question  to  the  court;  and, 
if  the  decision  should  be  adverse  to  the  plain- 
tiff, we  see  no  reason  why  he  is  not  stiU  in 
a  position  to  take  the  objection  that  the  mat- 
ter ought  to  have  been  pleaded  in  abatement 
in  order  that  an  issue  may  be  raised  for  trial 
by  jury  upon  the  facts  which  he  reserves  the 
right  to  contest.  For  this  reason  we  have 
not  considered  that  question. 

The  other  facts  stated  in  the  motion  (which 
is  to  be  regarded  rather  as  an  agreed  case 
than  a  motion  to  dismiss)  stand  upon  a  dif- 
ferent footing,  inasmuch  as  they  go  to  the 
merits  of  the  case,  and  may  be  pleaded  in 
bar  or  given  in  evidence  under  the  general 
issue,  and,  when  so  pleaded  or  proved,  their 
legal  effect  will  be  a  matter  upon  which  the 
court,  at  the  trial,  must  pass.  Some  sugges- 
tions upon  this  part  of  the  case  may  there- 
fore be  of  use. 


CONTllACT  AND  QUASI-COXTUACT  DISTINGUISHED. 


We  regard  it  as  well  settled  by  the  cases 
referred  to  in  the  briefs  of  counsel,  many  of 
which  have  been  c-ommenled  on  at  l('n;;th  by 
Mr.  Shirley  for  the  defendant,  that  an  in- 
sane person,  an  idiot,  or  a  person  utterly  be- 
reft of  all  sense  and  reason  by  the  sudden 
stroke  of  accident  or  disease,  may  be  held 
liable,  in  assumpsit,  for  necessaries  fui-nished 
to  him  in  good  faith  while  in  tliat  unfortu- 
nate and  helpless  condition.  And  the  rea- 
sons upon  which  this  rests  are  too  broad,  as 
well  as  too  sensible  and  humane,  to  be  over- 
borne by  any  deductions  which  a  retlued  log- 
ic may  make  from  the  circumstiince  tliat  in 
such  cases  there  can  be  no  contract  or  i)rom- 
ise  in  fact,— no  meeting  of  the  minds  of  the 
parties.  The  cases  put  it  on  the  ground  of 
an  implied  contract;  and  by  this  is  not 
meant,  as  the  defendant's  counsel  seems  to 
suppose,  an  actual  contract,— that  is,  an  ac- 
tual meeting  of  the  minds  of  the  parties,  an 
actiial,  mutual  understanding,  to  be  inferred 
from  langiuige,  acts,  and  circumstances,  by 
the  juiy,— but  a  contract  and  promise,  said 
to  be  implied  by  the  law,  where,  in  point  of 
fact,  there  was  no  conti-act,  no  mutual  im- 
derstanding,  and  so  no  promise.  The  defend- 
ant's counsel  says  it  is  usurpation  for  the 
court  to  hold,  as  matter  of  law,  that  there 
is  a  contract  and  a  promise,  when  all  the  evi- 
dence in  the  case  shows  that  there  was  not 
a  contract,  nor  the  semblance  of  one.  It  is 
doubtless  a  legal  liction,  invented  and  used 
for  the  sake  of  the  remedy.  If  it  was  origi- 
nally usurpation,  certainly  it  has  now  be- 
come very  invetei-ate,  and  firmly  fixed  in  the 
body  of  the  law. 

Suppose  a  man  steals  my  horse  and  after- 
wards sells  it  for  cash.  The  law  says  I  may 
■waive  the  tort,  and  recover  the  money  re- 
ceived for  the  animal  of  him  in  an  action  of 
assumpsit.  Why?  Because  the  law,  in  order 
to  protect  my  legal  right  to  have  the  money, 
and  enforce  against  the  thief  his  legal  duty 
to  hand  it  over  to  me,  implies  a  promise — 
that  is,  feigns  a  promise  when  there  is  none — 
to  support  the  assumpsit.  In  order  to  recover, 
I  have  only  to  show  that  the  defendant,  with- 
out right,  sold  my  horse  for  cash,  which  he 
still  retains.  Where  are  the  circumstances, 
the  language  or  conduct  of  the  parties  from 
which  a  meeting  of  their  minds  is  to  be  in- 
ferred, or  implied,  or  imagined,  or  in  any 
way  found  by  the  jury?  The  defendant  nev- 
er had  any  other  pui'pose  but  to  get  the  money 
for  the  horse  and  make  off  with  it.  The 
owner  of  the  horse  had  no  intention  to  sell  it, 
never  assented  to  the  sale,  and  only  seeks 
to  recover  the  money  obtained  for  it  to  save 
himself  from  total  loss.-  The  defendant,  in 
such  a  case,  may  have  the  physical  capacity 
to  promise  to  pay  over  to  the  owner  the 
money  which  he  means  to  steal;  but  the  men- 
tal and  moral  capacity  is  wanting,  and  to  all 
practical  intents  the  capacity  to  promise  ac- 
cording to  his  duty  may  be  said  to  be  entire- 
ly wanting,  as  in  the  case  of  an  idiot  or 
lunatic.     At   all   events,    he   does   not   do    it 


He  struggles  to  get  away  with  the  money, 
and  resists  with  a  determination  never  to  pay 
if  lie  can  help  it.  Yet  the  law  implies,  and 
against  his  utmost  resistance  forces  into  his 
mouth  a  promise  to  pay.  So,  where  a  brutal 
husband,  without  cause  or  provocation,  but 
from  wanton  cruelty  or  caprice,  drives  his 
wife  from  his  house  with  no  means  of  sub- 
sistence, and  warns  the  tradesmen  not  to  trust 
her  on  his  account,  thus  expressly  revoking 
all  authority  she  may  be  supposed  to  have, 
as  his  agent,  by  virtue  of  the  mariUil  rela- 
tion, courts  of  high  authority  have  held  that 
a  promi.se  to  pay  for  necessaries  furnished  her 
while  in  this  situation,  in  good  faith,  is  im- 
plied by  law  against  the  husband,  resting  up- 
on and  arising  out  of  his  legal  obligation  to 
furnish  her  support.  See  remark  of  Sargent.  J., 
in  Ray  v.  Alden,  oO  N.  H.  t>3,  and  authorities 
cited.  So,  it  was  held  that  the  law  will  im- 
ply a  promise  to  pay  toll  for  passing  upon  a 
turnpike  road,  notwithstanding  the  defendant, 
at  the  time  of  passing,  denied  his  liability 
and  refused  payment.  Proprietors  v.  Taylor, 
G  N.  II.  4'J'J.  In  the  recent  English  case  of 
Railway  Co.  v.  Swaffield,  L.  R.  tJ  Exch.  132, 
the  defendant  sent  a  horse  by  the  plaintiffs' 
railway  directed  to  himself  at  S.  station.  On 
the  arrival  of  the  horse  at  S.  station,  at  night, 
there  was  no  one  to  meet  it,  and  the  plain- 
tiffs, having  no  accommodation  at  the  station, 
sent  the  horse  to  a  livery  stable.  The  de- 
fendant's servant  soon  after  arrived  and  de- 
manded the  horse.  He  was  referred  to  the 
livery  stable  keeper,  who  refused  to  deliver 
the  horse  except  on  payment  of  charges  which 
were  admitted  to  be  reasonable.  On  the  next 
day  the  defendant  came  and  demanded  the 
horse,  and  the  station  master  offered  to  pay 
the  charges  and  let  the  defendant  take  away 
the  horse;  but  the  defendant  declined,  and 
went  away  without  the  horse,  which  remain- 
ed at  the  livery  stable.  The  plaintiffs  after- 
wards offered  to  deliver  the  horse  to  the  de- 
fendant at  S.  without  payment  of  any  charges, 
but  the  defendant  refused  to  receive  it  unless 
delivered  at  his  farm,  and  with  payment  of  a 
sum  of  money  for  his  expenses  and  loss  of 
time.  Some  months  after,  the  plaintiff's  paid 
the  livery  stable  keeper  his  charges,  and  sent 
the  horse  to  the  defendant,  who  received  it; 
and  it  was  held  that  the  defendant  was  liable, 
upon  the  ground  of  a  contract  implied  by  law. 
to  the  plaintiffs  for  the  livery  charges  thus 
paid  by  them. 

Illustrations  might  be  multiplied,  but  enongh 
has  been  said  to  show  that  when  a  contract  I'r 
promise  implied  by  law  is  spoken  of,  a  very 
different  thing  is  meant  from  a  contract  in 
fact,  whether  express  or  tacit.  The  evidence 
of  an  actual  contract  is  generally  to  be  found 
either  in  some  writing  made  by  the  parties, 
or  in  verbal  comruunications  which  passed  be- 
tween them,  or  in  their  acts  and  conduct  con- 
sidered in  the  light  of  the  circumstances  of 
each  particular  case.  A  contract  implied  by 
law,  on  the  contrary,  rests  upon  no  evidence. 
It   has   no  actual   existence;    it   is   simply   a 


10 


COXTEACT  AND  QUASI-CONTRACT  DISTINGUISHED. 


mjiihical  creation  of  the  law.  The  law  says 
it  shall  be  taken  that  there  was  a  promise, 
when,  in  point  ot  fact,  there  was  none.  Of 
course  this  is  not  good  logic,  for  the  obvious 
and  sutficient  reason  that  it  is  not  true.  It  is 
a  legal  fiction,  resting  wholly  for  its  support  on 
a  plain  legal  obligation,  and  a  plain  legal  right. 
If  it  were  true,  it  would  not  be  a  fiction. 
There  is  a  class  of  legal  rights,  with  their 
correlative  legal  duties,  analogous  to  the  ob- 
ligationes  quasi  ex  contractu  of  the  civil  law, 
which  seems  to  lie  in  the  region  between 
contracts  on  the  one  hand  and  torts  on  the 
other,  and  to  call  for  the  application  of  a 
remedy  not  strictly  furnished  either  by  ac- 
tions ex  contractu,  or  actions  ex  delicto.  The 
common  law  supplies  no  action  of  duty,  as  it 
does  of  assumpsit  and  trespass;  and  hence 
the  somewhat  awkward  contrivance  of  this 
fiction  to  apply  the  remedy  of  assumpsit 
where  there  is  no  true  contract,  and  no  prom- 
ise to  support  it. 

All  confusion  in  this  matter  might  be  avoid- 
ed, as  it  seems  to  me,  by  a  suitable  discrim- 
ination in  the  use  of  the  term  "implied  con- 
tract." In  the  discussion  of  any  subject 
there  is  always  danger  of  spending  breath  and 
strength  about  mere  words,  as  well  as  of 
falling  into  error  when  the  same  term  is 
used  to  designate  two  different  things.  If  the 
term  "implied  contract"  be  used  indifferently 
to  denote  (1)  the  fictitious  creation  of  the 
law  spoken  of  above;  (2)  a  true  or  actual  but 
tacit  contract, — that  is,  one  where  a  meeting 
of  the  minds  or  mutual  understanding  is  in- 
ferred as  matter  of  fact  from  circumstances, 
no  words,  written  or  verbal,  having  been  used; 
and  (3)  that  state  of  things  where  one  is  es- 
topped by  his  conduct  to  deny  a  contract,  al- 
though, in  fact,  he  has  not  made  or  intend- 
ed to  make  one,— it  is  not  strange  that  confu- 
sion should  result,  and  disputes  arise,  where 
there  is  no  difference  of  opinion  as  to  the 
substance  of  the  matter  in  controversy; 
whereas,  were  a  different  term  applied  to 
each,— as,  for  example,  that  of  legal  duty  to 
designate  the  first;  contract,  simply,  to  des- 
ignate the  second;  and  contract  by  estoppel, 
the  third, — this  difficulty  would  be  avoided. 
It  would  of  course  come  to  the  same  thing, 
in  substance,  if  the  first  were  always  called 
an  implied  contract,  while  the  other  two  were 
otherwise  designated  in  such  way  as  to  show 
distinctly  what  is  meant.  This  is  not  always 
done,  and  an  examination  of  our  own  cases 
would  perhaps  show  that  more  or  less  confu- 
sion has  arisen  from  such  indiscriminate  use 
of  the  term.  A  better  nomenclature  is  de- 
sirable. But  whatever  terms  are  employed,  it 
is  indispensable  that  the  distinction,  which  is 
one  of  substance,  should  be  kept  clearly  in 
mind,  in  order  that  the  principles  governing 
in  one  class  of  cases  may  not  be  erroneously 
applied  to  another.  See  remarks  of  Smith, 
J.,  in  Bixby  v.  Moore,  51  N.  H.  402,  and  au- 
thorities cited  at  page  404. 


Much  may  doubtless  be  said  against  sup- 
plying a  remedy  for  the  enforcement  of  a 
plain  legal  right  'by  so  rude  a  device  as  a 
legal  fiction."  Mame's  Ancient  Law,  2G.  But 
at  this  time  of  day  that  Is  a  matter  for  the 
consideration  of  the  legislature  rather  than 
the  courts.  The  remedy  of  indebitatus  as- 
sumpsit can  hardly  be  abolished  in  that  large 
class  of  cases  where  it  can  only  be  sustained 
by  resorting  to  a  fiction  until  some  other  is 
furnished  to  take  its  place. 

It  by  no  means  follows  that  this  plaintifl:  is 
entitled  to  recover.  In  the  first  place,  it 
must  appear  that  the  necessaries  furnished  to 
the  defendant  were  furnished  in  good  faith, 
and  with  no  purpose  to  take  advantage  of  her 
unfortunate  situation.  And  tipon  this  ques- 
tion the  great  length  of  time  which  was  al- 
lowed to  pass  without  procuring  the  appoint- 
ment of  a  guardian  for  her  is  a  fact  to  which 
the  jury  would  undoubtedly  attach  much 
weight.  Its  significance  and  importance  must, 
of  course,  depend  very  much  on  the  circum- 
stances under  which  the  delay  and  omission 
occurred,  all  of  which  will  be  for  the  jury  tu 
consider  upon  the  question  whether  every- 
thing was  done  in  good  faith  towards  the  de- 
fendant, and  with  an  expectation  on  the  part 
of  the  plaintiff's  intestate  that  he  was  to  be 
paid.  Again,  the  jury  are  to  consider  whether 
the  support  for  which  the  plaintiff  now  seeks 
to  recover  was  not  furnished  as  a  gratuity, 
with  no  expectation  or  intention  that  it  should 
be  paid  for,  except  so  far  as  compensation 
might  be  derived  from  the  use  of  the  defend- 
ant's share  of  the  farm.  And  upon  this  point 
the  relationship  existing  between  the  parties, 
the  length  of  time  the  defendant  was  there  in 
the  family  without  any  move  on  the  part  of 
Enoch  F.  Sceva  to  charge  her  or  her  estate, 
the  absence  (if  such  is  the  fact)  of  an  ac- 
count kept  by  him  wherein  she  was  charged 
with  her  support  and  credited  for  the  use  and 
occupation  of  the  land,— in  short,  all  the  facts 
and  circumstances  of  her  residence  with  the 
family  that  tend  to  show  the  intention  or  ex- 
pectation of  Enoch  P.  Sceva  with  respect  to 
being  paid  for  her  support,— are  for  the  jury. 
Munger  v.  Munger,  33  N.  H.  581;  Seavey  v. 
Seavey,  37  N.  H  125;  Bundy  v.  Hyde,  50  N. 
H.  116.  If  these  services  were  rendered,  and 
this  support  furnished,  with  no  expectation 
on  the  part  of  Enoch  P.  Sceva  that  he  was  to 
charge  or  be  paid  therefor,  this  suit  cannot 
be  maintained;  for  then  it  must  be  regarded 
substantially  in  the  light  of  a  gift  actually 
accepted  and  appropriated  by  the  defendant, 
without  reference  to  her  capacity  to  make  a 
contract,  or  even  to  signify  her  acceptance  by 
any  mental  assent. 

In  this  view,  the  facts  stated  in  the  case 
will  be  evidence  for  the  jury  to  consider  upon 
the  trial;  but  they  do  not  present  any  ques- 
tion of  law  upon  which  the  rights  of  the  par- 
ties can  be  determined  by  the  court. 

Case  discharged. 


CO]SrTRACT  AND  QUASI-CONTRACT  DISTINGUISHED. 


11 


O'BRIEN  T.  YOUNG.i 

(95  N.  y.  428.) 
(^ourt  of  Appeals  of  New  York.    April  15,  1884. 

Appeal  from  order  of  the  peneral  term  of 
the  supreme  court,  in  the  First  judicial  de- 
partment, made  January  8,  1884,  which  af- 
firmed an  order  of  special  term  restraining 
the  sheriff  of  the  county  of  New  York  from 
collecting,  upon  a  judgment  issued  to  him 
herein,  interest  at  a  greater  rate  than  six 
per  cent,  after  January  1,  1880. 

Judsmont  was  perfected  in  this  action  in 
favor  of  plaintiff  and  against  defendants 
February  10,  1877.  Execution  thereon  was 
issued  to  the  sheriff  November  19,  1883,  in- 
structing the  sheriff  to  collect  the  amount 
thereof,  with  interest  at  the  rate  of  seven 
per  cent,  from  the  date  of  tlie  enti-j-  of  judg- 
ment. 

Lawrence  &  Waehner,  for  appellants.  Lu- 
cien  Birdseye,  for  respondent. 


EARL,  J.  By  the  decided  weight  of  au- 
thority in  this  state,  where  one  contracts  to 
pay  a  principal  sum  at  a  certain  future  time 
with  interest,  the  interest  prior  to  the  ma- 
turity of  the  contract  is  payable  by  virtue 
of  the  contract,  and  thereafter  as  damages 
for  the  breach  of  the  contract.  Macomber  v. 
Dunham,  8  Wend.  550;  United  States  Bank 
V.  Chapln,  9  N.  Y.  471;  Hamilton  v.  Van 
Rensselaer,  43  N.  Y.  244;  Ritter  v.  Phillips, 
.^3  N.  Y.  586;  Railroad  Co.  v.  Moravia,  61 
Barb.  180.  And  such  is  the  rule  as  laid  down 
by  the  federal  supreme  court.  Brewster  v. 
Wakefield,  22  IIow.  118;  Burnhisel  v.  Fir- 
man, 22  Wall.  170;  Holden  v.  Trust  Co.,  100 
U.  S.  72.  The  same  authorities  show  that 
after  the  maturity  of  such  a  contract,  the  in- 
terest is  to  be  computed  as  damages  accord- 
ing to  the  rate  prescribed  by  the  law,  and 
not  according  to  that  prescribed  in  the  con- 
tract If  that  be  more  or  less. 

But  when  the  contract  provides  that  the 
interest  shall  be  at  a  specified  rate  until  the 
principal  shall  be  paid,  then  the  contract 
rate  governs  until  payment  of  the  principal, 
or  until  the  contract  is  merged  in  a  judg- 
ment. And  where  one  contracts  to  pay  mou- 
ed  on  demand  "with  interest,"  or  to  pay 
money  generally  "with  interest,"  without 
specifying  time  of  payment,  the  statutoi-y 
rate  then  existing  becomes  the  contract  rate 
and  must  govern  until  payment,  or  at  least 
until  demand  and  actual  default,  as  the  par- 
ties must  have  so  intended.  Paine  v.  Cas- 
well, GS  Me.  80;  Eaton  v.  Boissonnault,  67 
Me.  540. 

If,  therefore,  this  judgment,  the  amount 
of  which  is  by  its  terms  payable  with  in- 
terest, is  to  be  treated  as  a  contract— as  a 
bond  executed  by  the  defendants  at  its  date, 
then  the  statutoi*y  rate  of  Interest  existing 
at  the  date  of  the  rendition  of  the  judgment 
is  to  be  treated  as  part  of  the  contract  and 

1  Opinion  of  Andrews,  J.,  omitted. 


must  be  paid  by  the  defendants  according  to 
the  terms  of  the  contract,  and  thus  the  plain- 
tiff's contention  is  well  founded. 

But  is  a  judgment,  properly  speaking,  for 
the  purposes  now  in  hand,  a  contract?  I 
think  not.  The  most  important  elements  of 
a  contract  are  wanting.  There  is  no  aggre- 
gatio  mentium.  The  defendant  has  not  vol- 
untarily assented.  All  the  authorities  assort 
that  the  existence  of  parties  legally  capable 
of  contracting  is  essential  to  every  contract, 
and  yet  they  ncnrly  all  agree  that  judgments 
ontero<l  against  lunatics  and  others  inca- 
pable in  law  of  contracting  are  conclusively 
binding  until  vacated  or  reversed.  In  Wy- 
man  v.  Mitchell,  1  Cow.  316,  Sutherland, 
J.,  said  that  "a  judgment  is  in  no  son.se  a 
contract  or  agreement  between  the  parties." 
In  McCoun  v.  Railroad  Co.,  50  N.  Y.  176, 
Allen,  J.,  said  that  "a  statute  liability  wants 
all  the  elements  of  a  contract,  consideration 
and  mutuality  as  well  as  the  assent  of  the 
party.  Even  a  judgment  founded  upon  con- 
tract is  no  contract."  In  Bidleson  v.  Whytel, 
3  Burrows,  1545-1."'.4S,  it  was  held  after  great 
deliberation  and  after  consultation  with  all 
tlio  judges.  Lord  Mansfield  speaking  for  the 
court,  "that  a  judgment  is  no  contract,  nor 
can  be  considered  in  the  light  of  a  contract, 
for  judicium  redditur  in  iuvitum."  To  the 
same  effect  are  the  following  authorities: 
Rae  V.  I-Iulbert,  17  111.  572;  Todd  v.  Crumb. 
5  McLean,  172.  Fed.  Cas.  No.  14,073;  Smith 
V.  Han-ison,  ?,3  Ala.  706;  Masterson  v.  Gib- 
son, 56  Ala.  50;  Keith  v.  Estill,  9  Port  669; 
Larrabee  v.  Baldwin.  35  Cal.  156;  In  re  Ken- 
nedy, 2  S.  C.  226;  State  v.  Mayor,  etc.,  of 
New  Orleans,  109  U.  S.  28.5,  3  Sup.  Ct  211. 

But  in  some  decided  cases,  and  in  text- 
books, judges  and  jurists  have  frequently, 
and.  as  I  think,  without  strict  accuracy, 
spoken  of  judgments  as  contracts.  They 
have  been  classified  as  contracts  with  refer- 
ence to  the  remedies  upon  them.  In  the  di- 
vision of  actions  into  actions  ex  contractu 
and  ex  delicto,  actions  upon  judgments  have 
been  assigned  to  the  former  class.  It  has 
been  said  that  the  law  of  contracts,  in  its 
widest  extent,  may  be  regarded  as  including 
nearly  all  the  law  which  regulates  the  rela- 
tions of  human  life;  that  contract  is  co-or- 
dinate and  commensurate  with  duty;  that 
whatever  it  is  the  duty  of  one  to  do  he  may 
be  deemed  in  law  to  have  contracted  to  do, 
and  that  the  law  presumes  that  every  man 
undertakes  to  perform  what  reason  and  jus- 
tice dictate  he  should  perform.  1  Pars.  Cont 
(0th  Ed.)  3;  2  Bl.  Comm.  543;  3  Bl.  Comm. 
160;  McCoun  v.  Railroad  Co.,  supra.  Con- 
tracts in  this  wide  sense  are  said  to  spring 
from  the  relations  of  men  to  each  other  and 
to  the  society  of  which  they  are  members. 
Blackstone  says:  "It  is  a  part  of  the  origi- 
nal contract  entered  into  by  all  mankind  who 
partake  the  benefits  of  society,  to  submit  in 
all  points  to  the  municipal  constitutions  and 
local  ordinances  of  that  state  of  which  each 
individual  is  a  member."    In  the  wide  sense 


12 


CONTRACT  AND  QUASI-CONTRACT  DISTINGUISHED. 


thus  spoken  of  the  contracts  are  mere  fic- 
tions invented  mainly  for  the  purpose  of 
giving  and  regulating  remedies.  A  man 
ought  to  pay  for  services  which  he  accepts, 
and  hence  the  law  implies  a  promise  that  he 
will  pay  for  them.  A  man  ought  to  support 
his  helpless  children,  and  hence  the  law  im- 
plies a  promise  that  he  will  do  so.  So  one 
ought  to  pay  a  judgment  rendered  against 
him,  or  a  penalty  which  he  has  by  his  mis- 
conduct incurred,  and  hence  the  law  implies 
a  promise  that  he  will  pay.  There  is  no  more 
contract  to  pay  the  judgment  than  there  is  to 
pay  the  penalty.  He  has  neither  promised 
to  pay  the  one  nor  the  other.  The  promise 
is  a  mere  fiction,  and  is  implied  merely  for 
tie  purpose  of  the  remedy.  Judgments  and 
penalties  are,  in  the  books,  in  some  respects, 
placed  upon  the  same  footing.  At  common 
law  both  could  be  sued  for  in  an  action  ex 
contractu  for  debt,  the  action  being  based 
upon  the  implied  promise  to  pay.  But  no 
one  will  contend  that  a  penalty  is  a  contract, 
or  that  one  is  really  under  a  contract  lia- 
bility to  pay  it  McCoun  v.  Railroad  Co., 
supiti. 

Suppose  a  statute  gives  a  penalty  to  an 
aggrieved  party,  with  interest,  what  interest 
could  be  recovered?  The  interest  allowed  bj 
law  when  the  penalty  accrued,  if  the  statu- 
tory rate  has  since  been  altered?  Clearly 
not.  He  would  be  entitled  to  the  interest 
prescribed  by  law  during  the  time  of  the  de- 
fendant's default  in  payment.  There  would, 
in  such  a  case,  be  no  contract  to  pay  inter- 
est, and  the  statutory  rate  of  interest  at  the 
time  the  penalty  accrued  would  become  part 
of  no  contract.  If,  therefore,  a  subsequent 
law  should  change  the  rate  of  interest,  no 
vested  right  would  be  interfered  with,  and 
no  contract  obligation  would  be  impaired. 

The  same  principles  apply  to  all  implied 
contracts.  When  one  makes  a  valid  agree- 
ment to  pay  interest  at  any  stipulated  rate 
for  any  time,  he  is  bound  to  pay  it,  and  no 
legislative  enactment  can  release  him  from 
his  obligation.  But  in  all  cases  where  the 
obligation  to  pay  interest  is  one  merely  im- 
plied by  the  law  or  is  imposed  by  law,  and 
there  is  no  contract  to  pay  except  the  fic- 
titious one  which  the  law  implies,  then  the 
rate  of  interest  must  at  an  times  be  the  stat- 
utory rate.  The  rate  existing  at  the  time 
the  obligation  accrued  did  not  become  part 
of  any  contract,  and  hence  the  law  which 
created  the  obligation  could  change  or  alter 
it  for  the  future  without  taking  away  a  vest- 
ed right  or  impairing  a  contract. 

In  the  case  of  all  matured  contracts  which 
contain  no  provision  for  interest  after  they 
are  past  due,  as  I  have  before  said,  interest 
is  allowed,  not  by  virtue  of  the  contract,  but 
as  damages  for  the  breach  thereof.  In  such 
cases  what  would  be  the  effect  of  a  statute 
declaring  that  no  interest  should  be  recover- 
e<l?  As  to  the  interest  which  had  accrued 
as  damages  before  the  date  of  the  law,  the 
law  could  have  no  effect  because  that  had  | 


become  a  vested  right  of  property  which 
could  not  be  taken  away.  But  the  law  could 
have  effect  as  to  the  subsequent  interest, 
and  in  stopping  that  from  running  would 
impair  no  contract.  A  law  could  be  passed 
providing  that  in  all  cases  of  unliquidated 
claims  which  now  di-aw  no  interest,  interest 
should  thereafter  be  allowed  as  damages; 
and  thus  there  is  ample  legislative  power  in 
such  cases  to  regulate  the  future  rate  of  in- 
terest without  invading  any  constitutional 
right.  When  a  man's  obligation  to  pay  in- 
terest is  simply  that  which  the  law  implies, 
he  discharges  that  obligation  by  paying  what 
the  law  exacts. 

This  judgment,  so  far  as  pertains  to  the 
question  we  are  now  considering,  can  have 
no  other  or  greater  force  than  if  a  valid 
statute  had  been  enacted  requiring  the  de- 
fendant to  pay  the  same  with  interest.  Un- 
der such  a  statute,  interest  would  be  com- 
puted, not  at  the  rate  in  force  when  the 
statute  was  enacted,  but  according  to  the 
rate  in  force  during  the  time  of  default  in 
payment.  A  different  rule  would  apply  if  a 
judgment  or  statute  should  require  the  pay- 
ment of  a  given  sum  with  interest  at  a  speci- 
fied rate.  Then  interest  at  the  I'ate  specified 
would  form  part  of  the  obligation  to  be  dis- 
charged. 

Here,  then,  the  defendant  did  not  in  fact 
contract  or  promise  to  pay  this  judgment 
or  the  interest  thereon.  The  law  made  it 
his  duty  to  pay  the  interest,  and  implied  a 
promise  that  he  would  pay  it.  That  duty 
is  discharged  by  paying  such  interest  as  the 
law,  during  the  time  of  default  in  paying 
the  principal  svuu,  prescribed  as  the  legal 
rate. 

If  this  judgment  had  been  rendered  at  the 
date  the  execution  was  issued,  interest  would 
have  been  computed  upon  the  original  de- 
mand at  seven  per  cent  to  January  1,  1880, 
and  then  at  the  rate  of  six  per  cent.  Shall 
the  plaintiff  have  a  better  position  because 
the  judgment  was  rendered  prior  to  1880? 

As  no  intention  can  be  imputed  to  the  par- 
ties in  reference  to  the  clause  in  the  judg- 
ment requiring  payment  "with  interest"  we 
may  in(iuire  what  intention  the  court  had. 
It  is  plain  that  it  could  have  had  no  other  in- 
tention than  that  the  judgment  should  draw 
the  statutory  interest  until  payment  It  can- 
not be  presumed  that  the  court  intended 
that  the  interest  should  be  at  the  rate  of 
seven  per  cent,  if  the  statutory  rate  should 
become  less. 

That  there  is  no  contract  obligation  to  pay 
the  interest  upon  judgments  which  is  beyond 
legislative  interference  is  shown  by  legis- 
lation in  this  country  and  in  England.  Laws 
have  been  passed  providing  that  all  judg- 
ments should  draw  interest,  and  changing 
the  rate  of  interest  upon  judgments,  and 
such  laws  have  been  applied  to  judgments 
existing  at  their  date,  and  yet  it  was  never 
supposed  that  such  laws  impaired  the  obli- 
gation  of  contracts. 


CONTRACT  AND  QUASI-CONTRACT  DISTINGUISHED. 


15 


It  is  claimed  tliat  the  provision  In  section 
I  of  the  act  of  1879,  which  reduced  the  rate 
of  interest  (chapter  538),  saves  this  judf,'- 
ment  from  the  operation  of  that  act.  Tlie 
provision  is  that  "nothing  herein  contained 
shall  be  so  coostniod  as  to  in  any  way  af- 
fect any  contract  or  obligation  made  before 
the  passage  of  this  act."  The  answer  to  this 
claim  is  that  here  there  was  no  contract  to 
pay  interest  at  any  given  rate.  The  implied 
contract,  as  I  have  shown,  was  to  pay  such 
interest  as  the  law  prescribed,  and  that  con- 
tract is  not  afl'oclcd  or  interfered  with. 
.  The  foregoing  was  written  as  my  opinion 
m  the  case  of  Prouty  v.  Railway  Co.    The 


only  difference  between  that  case  and  this 
Is  that  there  the  judgment  was  by  its  terms 
payal>le  "with  interest."  Here  the  judgment 
contains  no  direction  as  to  Interest.  The 
reasoning  of  the  oi)inion  is  applicable  to  this 
ca.se  and  is,  therefore,  read  to  justify  my 
vote  in  this.  Since  writing  the  opinion,  we 
have  decided  in  the  case  of  Sanders  v.  Rail- 
way Co.,  94  N.  Y.  G41.  the  law  to  be  as  laid 
down  in  the  first  paragraph  of  the  opinion. 
The  orders  of  the  general  and  special 
terms  should  be  reversed  and  the  motion 
granted,  without  costs  in  either  court,  the 
parties  having  so  stipulated. 


14 


M 


THRUSTON  V.  THORNTON 
(1  Gush.  89.) 

Supreme   Judicial   Court   of   Massachuse' 
Suffolk  and   Nantucket.    March 
Term,  18-iS. 


OFFER  AND  ACCEFTAXCE. 


This  was  an  action  of  assumpsit  to  recover 
compensation  for  services,  rendered  by  the 
plaiutiflf  as  a  broker,  in  selling  or  aiding  to 
sell  certain  real  estate  belonging  to  the  de- 
fendant. The  declaration  contained  the  com- 
mon money  counts,  a  bill  of  particulars,  and 
a  special  count.  The  cause  was  tried  in  the 
court  of  common  pleas,  before  Wells,  C.  J. 

The  bill  of  particulars  set  forth  a  claim  by 
the  plaintiff  against  the  defendant  of  the 
sum  of  one  thousand  dollars  and  interest,  as 
a  commission  of  five  per  cent.,  "as  per  con- 
tract, for  selling  his  farm  called  'Wood  Park,' 
in  Vii-ginia.  which  was  sold  to  Marcus  Bull, 
Esq.,"  through  the  plaintiff's  agency,  for 
twenty  thousand  dollars. 

In  the  special  count,  the  plaintiff  alleged, 
in  substance,  that,  in  consideration  that  at 
the  request  of  the  defendant,  he  would  find 
a  purchaser  for  and  sell  and  dispose  of  the 
defendant's  farm  above  mentioned,  the  de- 
fendant promised  to  pay  him  five  per  cent, 
of  the  amount  for  which  he  should  sell 
the  same,  as  a  commission  for  his  serv- 
ices; and  that  he,  confiding  in  the  defend- 
ant's promise,  did  find  a  purchaser  for  the 
estate,  for  the  sum  of  twenty  thousand  dol- 
lars, to  whom  the  defendant  sold  and  con- 
veyed the  same,  and  received  therefor  the 
said  sum. 

The  plaintiff  claimed  to  recover— First,  as 
upon  a  special  contract,  on  the  part  of  the 
defendant,  to  pay  him  a  commission  of  five 
per  cent,  on  the  sum  for  which  the  estate 
should  be  sold;  or,  secondly,  if  that  ground 
should  not  be  sustained  by  the  evidence,  then, 
a  reasonable  compensation  for  his  services  in 
effec-ting  the  sale. 

In  order  to  prove  the  special  agreement 
relied  on  by  the  plaintiff,  he  introduced  the 
deposition  of  Gary  Selden,  who  testified: 
"That  some  time  in  the  fall  of  1840,  or  early 
in  the  following  winter,  the  defendant  was 
In  the  city  of  Washington,  and  placed  in  the 
hands  of  the  deponent  a  written  schedule  of 
certain  real  and  other  property,  valued  at 
twenty-two  thousand  one  hundred  and  thirty 
dollars,  with  a  view  of  having  the  same  sold; 
that  some  short  time  thereafter  the  defend- 
ant came  into  the  oflUce  occupied  jointly  by 
the  deponent  and  the  plaintiff',  on  which  oc- 
casion the  deponent,  at  the  request  of  the 
plaintiff,  introduced  the  latter  to  the  defend- 
ant, when  the  sale  of  the  estate  alluded  to 
became  the  subject  of  conversation;  that  in 
the  course  of  the  conversation  the  plaintiff  in- 
quired of  the  defendant  if  he  would  pay  a 
commission  for  effecting  a  sale  of  the  prop- 
erty, to  which  the  defendant  replied  that  he 
would  pay  a  commission  to  any  person  who 
could  effect  a  sale  of  the   property  at   the 


price  mentioned  in  the  schedule;  and  that 
this  deponent  caused  a  copy  of  the  schedule 
to  be  taken  for  the  use  of  the  plaintiff." 

It  was  also  testified,  on  behalf  of  the  plain- 
tiff", that  he  did  recommend  the  estate  to  Mar- 
cus Bull,  who  called  upon  the  defendant,  and 
purchased  the  estate  for  the  sum  of  twenty 
thousand  five  hundred  dollars. 

It  appeared  in  evidence  that  the  plaintiff 
was  an  attorney  at  law,  and,  in  connection 
with  his  business  as  an  attorney,  acted  as  a 
real-estate  broker.  But  it  did  not  appear 
that  at  the  time  of  the  interview,  or  at  any 
time  prior  to  the  sale  of  the  estate,  the  de- 
fendant knew  that  the  plaintiff  ever  acted  as 
a  broker,  or  that  he  was  informed  that  the 
purchaser  was  sent  to  him  by  the  plaintiff. 

The  defendant  contended,  and  introduced 
evidence  tending  to  show,  that  no  such  con- 
versation as  was  testified  to  by  Selden  ever 
took  place,  and  that  he  never  gave  the  plain- 
tiff" any  written  description  of  the  estate. 

In  relation  to  the  special  count  the  judge 
instructed  the  jury  that  if  they  should  be  sat- 
isfied that  the  conversation  testified  to  by 
Selden  took  place  between  these  parties,  then, 
in  order  to  determine  whether  the  defendant 
was  liable  in  the  present  action,  it  would 
be  necessary  for  the  jury  to  understand  what 
constituted  a  legal  and  binding  contract;  and 
that,  so  far  as  the  matters  in  difference  in 
this  case  were  concerned,  it  was  only  neces- 
sarj'  for  them  to  fix  distinctly  in  their  minds 
the  foUowuig  part  of  the  definition  of  a  legal 
contract: 

"A  contract  implies  the  assent  of  two  minds. 
This  idea  is  often  expressed  by  the  phrase, 
Tt  takes  two  to  make  a  bargain.'  Or,  to 
state  it  in  other  words,  it  must  be  understood 
between  the  parties  that  the  one  party  has 
made  an  offer,  and  that  the  other  has  ac- 
cepted it.  If  one  party  should  make  an  of- 
fer, and  the  other  party  should  not  accept 
it,  there  would  be  no  contract.  There  is 
sometimes  an  apparent  exception  to  this  rule, 
but  it  is  only  apparent.  Thus,  if  a  person 
should  put  forth  an  advertisement,  offering  a 
reward  to  any  one  who  would  recover  lost 
property,  this  oft"er  is  to  no  one  in  particular 
and  no  one  accepts  it  at  the  time  it  is  made. 
But  the  meaning  of  the  offer  is  that  it  is 
made  to  whomsoever  will  act  upon  it;  and  it 
is  an  implied  part  of  the  offer  that  time  shall 
be  afforded  to  any  one  who  chooses  to  accept 
it;  and  if  a  person,  before  the  offer  is  with- 
drawn, does  that  which  by  the  terms  of  the 
offer  will  entitle  him  to  the  reward,  his  so 
acting  upon  the  offer  constitutes  an  accept- 
ance of  it,  and  the  party  making  the  offer  is 
bound  to  fulfill  his  promise.  But  when  the 
parties  are  face  to  face^^_to_ccjiiatitute_acon- 

cepfrtrfiTe5?'w^B?Fe"lt  is  a  part  of  the  agree- 
ment that  time  shall  be  given  to  the  person 
to  whom  the  offer  is  made,  to  determine 
whether  he  will  accept  or  not,  in  which  case, 
the  time  given  makes  a  part  of  the  offer." 


NECESSITY  FOH  OFFER  AND  ACCEPTANCE. 


15 


In  view  of  those  instructions,  the  Jury  wore 
directed  to  inquire  whether  it  was  proved  that 
at  the  interview  referred  to  the  minds  of  the 
parties  met,  and  they  made  a  lej,'al  and 
binding  contract;  or  whether  the  transaction 
was,  as  contended  by  the  defendant,  a  loose 
conversation,  not  midorstood  or  intended  by 
them  as  an  agreement;  and,  as  a  test,  tlie 
jury  were  directed  to  inquire  and  doterraine 
whether,  when  the  parties  separated,  it  was 
understood  between  them  that  the  plaintiff 
y  should  do  or  attempt  anytliing  for  the  de- 
fendant, in  relation  to  the  sale  of  his  estate, 
In  consequence  of  the  conversation  which  had 
taken  place. 

The  jury,  under  those  instructions,  rendered 
a  verdict  for  the  defendant,  and  the  plaintiff 
thereupon  filed  exceptions. 

H.  H.  Fuller  &  R.  F.  Fuller,  for  plain- 
tiff, argued  that  the  instructions  were  wrong 
as  to  the  necessity  of  a  formal  acceptance 
of  an  offer  made  when  the  parties  were  face 
to  face;  and  that  the  jury  should  have  been 
instructed  that,  if  the  plaintiff  acted  in  conse- 
quence of  the  defendant's  offer,  the  former 
was  entitled  to  recover.  Williams  v.  Car- 
wardine,  5  Car.  &  P.  56G,  574,  4  Barn.  & 
Adol.  621 ;  Lancaster  v.  Walsh,  4  Mees.  &  W. 
16,  22;  Murray  v.  Currie,  7  Car.  &  P.  584; 
Horford  v.  Wilson,  1  Taunt.  12;  20  Am.  Jur. 
19.  The  defendant  took  less  than  the  price 
stipulated,  but  that  was  no  reason  why  the 


plaintiff  should  be  deprived  of  his  commis- 
sion, 

J.* Dana,  for  defendant,  cited  RoUe,  Aur. 
"Actioh  of  the  Case"  pi.  1;  Com.  Dig.  "Ac- 
tion of  the  Case  upon  Ass.,"  T,  2. 

WILDE,  J.  On  a  careful  examination  of 
the  instructions  to  the  jury,  the  court  have 
been  unable  to  find  any  misdirection,  or  any 
remarks  tending  to  mislead  the  jury  in  their 
consideration  of  the  evidence.  Certainly  the 
remarks  of  the  judge  as  to  the  definition  of 
a  legal  contract,  and  as  to  the  necessary 
requisites  to  constitute  such  a  contract,  were, 
we  think,  clearly  correct.  The  jury  were 
then  directed  to  consider  the  evidence,  and  to 
decide  whether,  "at  the  interview  between 
the  parties,  their  minds  met,  and  they  made 
a  legal  and  binding  contract;  or  whether  the 
transaction,  as  was  insisted  by  the  defend- 
ant, was  a  loose  conversation,  not  under- 
stood or  intended  by  them  as  an  agreement." 
We  are  of  opinion  that  this  direction  was  en- 
tirelj'  correct.  It  was  for  the  jury  to  decide 
what  was  the  meaning  and  intention  of  the 
parties.  The  conversation  was  loose  and  in- 
definite, and  the  jury,  we  think,  might  well 
find,  as  they  did,  that  no  contract  was  in 
fact  made.  But,  however  this  may  be,  it  was 
a  question  of  fact  for  the  jury,  and  we  think 
they  were  in  no  respect  misdirected. 

Exceptions  overruled. 


It) 


^ 


OFFER  AND 

WHITE  V.  CORLIES.j^W^^ 
(46  N.  Y.  467.)  /   ^ 


Conrt  of  Appeals  of  New  York.    Nov.  20,  1S71. 

Appeal  from  First  judicial  district. 

The  action  was  for  an  alleged  breach  of 
contract. 

The  plaintiff  was  a  builder  with  his  place 
of  business  in  Fortieth  street,  New  York  City. 

The  defendants  were  merchants  at  32  Dey 
street. 

In  September,  1S65,  the  defendants  fur- 
nished the  plaintiff  with  specifications,  for 
fitting  up  a  suit  of  offices  at  57  Broadway, 
and  requested  him  to  make  an,estiiuate  of  the 
cost  of  doing  the  work. 

Un  September  2Sth  the  plaintiff  left  his  es- 
timate with  the  defendants,  and  they  were 
to  consider  upon  it,  and  inform  the  plaintiff 
of  their  conclusions. 

On  the  same  day  the  defendants  made  a 
change  in  their  specifications  and  sent  a  copy 
of  the  same,  so  changed,  to  the  plaintiff,  for 
his  assent  under  his  estimate,  which  he  as- 
sented to  by  signing  the  same  and  returning 
it  to  the  defendants. 

On  the  day  following,  the  defendants'  book- 
keeper wrote  the  plaintiff  the  following  note: 

"New  York,  September  29th.  Upon  an 
agreement  to  finish  the  fitting  up  of  offices 
.57  Broadway  in  two  weeks  from  date,  you 
can  begin  at  once.  The  writer  will  call 
again,  probably  between  five  and  six  this  p. 
ni.  W.  H.  K.,  for  J.  W.  Corlies  &  Co.,  32  Dey 
street" 

No  reply  to  this  note  was  ever  made  by  the 
plaintiff;  and  on  the  next  day  the  same  was 
countermanded  by  a  second  note  from  the 
defendants. 

Immediately  on  receipt  of  the  note  of  Sep- 
tember 29th.  and  before  the  countermand  was 
forwarded,  the  plaintiff  commenced  a  perform- 
ance by  the  purchase  of  lumber  and  begin- 
ning work  thereon. 

And  after  receiving  the  countermand,  the 
plaintiff  brought  this  action  for  damages  for 
a  breach  of  contract. 

The  court  charged  the  jury  as  follows: 
"From  the  contents  of  this  note  which  the 
plaintiff  received,  was  it  his  duty  to  go  down 
to  Dey  street  ("meaning  to  give  notice  of  as- 
.sent)  before  commencing  the  work.  In  my 
opinion  it  was  not.  He  had  a  right  to  act  upon 
this  note  and  commence  the  job,  and  that 
was  a  binding  contract  between  the  parties." 

To  this  defendants  excepted. 

L.  Henry,  for  appellants. 

The  manife.station  of  assent  must  be  such 
as  tends  to  give  notice  to  proposing  party. 
Mactier  v.  Frith,  G  Wend.  103;  Vassar  v. 
Camp,  11  N.  Y.  441. 

Mr.  Field,  for  respondent 

It  was  not  necessary  that  the  fact  of  con- 
currence by  one  party  should  be  made  known 
to  the  other.     Mactier  v   Frith,  6  Wend.  103, 


ACCEPTANCE. 

117.  An  agent  acting  with  apparent  authori- 
ty binds  the  principal.  Story,  Ag.  §  443; 
Clark  V.  Bank.  3  Duer,  241;  President,  etc.» 
of  Mechanics'  Bank  v.  New  York  &  N.  H.  R. 
Co.,  13  N.  Y.  599;  Farmers'  &  Mechanics' 
Bank  v.  Butchers'  &  Drovers'  Bank,  16  N. 
Y.  125;  Dunning  v  Roberts,  35  Barb.  46.3; 
Cornell  v.  :Masten,  Id.  157;  Whitbeck  v.  Schuy- 
ler, 44  Barb.  469. 

FOLGER,  J.  We  do  not  think  that  the 
jury  found,  or  that  the  testimony  shows  that 
there  was  any  agreement  between  the  parties 
before  the  written  comnunication  of  the  de- 
fendants of  September  30  was  received  by 
the  plaintiff.  This  note  did  not  make  an 
agreement.  It  was  a  proposition,  and  must 
have  been  accepted  by._th"g^praintitr_jifilore" 
either  party  was  bouiid  in__contract  to.  the 
other.  The  only  overt  action  which  is  claim- 
"""ed  DJT  the  plaintiff  as  indicating  on  his  part 
an  acceptance  of  the  offer,  w^as  the  purchase 
of  the  stuff  necessary  for  the  work,  and  com- 
mencing work  as  we  understand  the  testi- 
mony, upon  that  stuff. 

We  understand  the  rule  to  be  that  where 
an  offer  is  made  by  one  party  to  another 
when  they  are  not  together,  the  acceptance 
of  it  by  that  other,  must  be  manifesto  1  by 
some  appropriate  act  It  does  not  need  that 
the  acceptance  sl]all  come  to  the  knowledge 
of  the  one  making  the  offer  before  he  shall 
be  bound.  But  though  the  manifestation  need 
not  be  brought  to  his  knowledge  before  he 
becomes  bound,  he  is  not  bound  if,J-liat  man- 
ifestation  isnot  put  in  a  Droner  way  to  be  in 
th'eTisual  "course  of  even^,  in  some  reasonnlile 
tLme  comfflum(J5tgg"Toniim^  Thus'  a  letter 
received  by  mail  containing  a  proposal  may 
be  answered  by  letter  by  mail  containing  the 
acceptance.  And  in  general  as  soon  as  the 
answering  letter  is  mailed,  the  contract  is 
concluded.  Though  one  party  does  not  know 
of  the  acceptance,  the  manifestation  thereof 
is  put  in  the  proper  way  of  reaching  him. 

In  the  case  in  hand  the  plaintiff  determined 
to  accept.  But  a  mental  determination  not 
indicated  by  .speech,  or  put  in  course  of  indi- 
cation by  act  to  the  other  party,  is  not  an 
acceptance  which  will  bind  the  other.  Nor 
does  an  act  which  in  itself  is  no  indication  of 
an  ac*ceptance,  become  such  because  accom- 
panied by  an  unevinced  mental  determina- 
tion. Where  the  act  uninterpreted  by  con- 
current evidence  of  the  mental  purpose  ac- 
companying it  is  as  well  referable  to  one 
state  of  facts  as  another,  it  is  no  indication 
to  the  other  party  of  an  acceptance,  and  does 
not  operate  to  hold  him  to  his  offer. 

Conceding  that  the  testimony  shows  that 
the  plaintiff  did  resolve  to  accept  this  offer, 
he  did  no  act  which  indicated  an  acceptance 
of  it  to  the  defendants.  He,  a  carpenter  and 
builder,  purchased  stuff  for  the  work.  But  It 
was  stuff  as  fit  for  any  other  like  work.  He 
began  work  upon  the  stuff,  but  as  he  would 
have  done  for  any  other  like  work.  There 
was  nothing  in   liis  thought  formed  but  not 


NECESSITY  FOR  COMMUNICATION. 


17 


uttered,  or  in  his  acts  that  indicated  or  set 
in  motion  an  indication  to  the  defendants  of 
his  acceptance  of  their  offer,  or  which  could 
necessarily  result  therein. 

But  the  charge  ot  the  learned  judge  was 
fairly  to  be  understood  by  the  jury  as  laying 
down  the  rule  to  them,  that  the  plaintiff  need 
not  indicate  to  the  defendants  bis  acceptance 
of  their  offer;   and  that  the  purchase  of  stuS 

H0PK.8EL.CAS.CONT. — 2 


and  working  on  it  after  receiving  the  note, 
made  a  binding  contract  betsveen  the  p.-.r- 
tles.  In  this  we  think  the  learned  judge  feU 
into  error. 

The  judgment  appealed  from  must  be  re- 
venged and  a  new  trial  ordered,  with  costs  to 
abide  the  event  of  the  action. 

AH  concur,  but  ALLEN,  J.,  not  voting. 

Judgment  reversed,  and  new  trial  ordered. 


IS 


OrrEK  AND  ACCEPTANCE. 


PARKEK  V.  SOUTH  EASTERN  RY.  CO. 
GABELL  V.  SAME. 
(2  C.  P.  Div.  416.) 
Court  of  Appeal.     April  25,  1877. 
Actions   against   the   South  Eastern   Rail- 
way  Company   for   the   value  of   bags   and 
their  contents  lost  to  the  plaintiffs   respec- 
tively by   the   negligence  of  the  company's 
servants. 

The  plaintifE  in  each  case  had  deposited  a 
bag  in  a  cloak-room  at  the  defendants'  rail- 
way station,  had  paid  the  clerk  2d.,  and  had 
received  a  paper  ticket,  on  one  side  of  which 
was  written  a  number  and  a  date,  and  were 
printed  notices  as  to  when  the  oflace  would 
be  opened  and  closed,  and  the  words  "See 
back."  Un  the  other  side  were  printed  sev- 
eral clauses  relating  to  articles  left  by  pas- 
sengers, the  last  of  which  was,  "The  com- 
pany will  not  be  responsible  for  any  package 
exceeding  the  value  of  £10."  In  each  case 
the  plaintiff  on  the  same  day  presented  his 
ticket  and  demanded  his  bag,  and  in  each 
case  the  bag  could  not  be  found  and  had  not 
been  since  found.  Parker  claimed  £24.  10s. 
as  the  value  of  his  bag,  and  Gabell  "claimed 
£50.  IGs.  The  company  in  each  case  plead- 
ed that  they  had  accepted  the  goods  on  the 
condition  that  they  would  not  be  responsible 
for  the  value  if  it  exceeded  £10;  and  on  the 
trial  they  relied  on  the  words  printed  on  the 
back  of  the  ticket,  and  also  on  the  fact  that 
a  notice  to  the  same  effect  was  printed  and 
hung  up  in  the  cloak-room.  Each  plaintiff 
gave  evidence  and  denied  that  he  had  seen 
the  notice,  or  read  what  was  printed  on  the 
ticket.  Each  plaintiff  admitted  that  he  had 
often  received  such  tickets,  and  knew  there 
was  printed  matter  on  them,  but  said  that 
he  did  not  know  what  it  was.  Parker  said 
that  he  imagined  the  ticket  to  be  a  receipt 
for  the  money  paid  by  him;  and  Gabell  said 
he  supposed  it  was  evidence  of  the  company 
having  received  the  bag,  and  that  he  knew 
that  the  number  on  it  corresponded  with  a 
number  on  his  goods. 

Parker's  case  was  tried  at  Westminster  on 
the  27th  of  February,  1876,  before  Pollock, 
B.;  and  GabeU's  case  was  tried  at  Westmin- 
ster on  the  15th  of  November,  1876,  before 
Grove,  J.  The  questions  left  in  each  case 
by  the  judge  to  the  jury  were:  (1)  Did  the 
plaintiff  read  or  was  he  aware  of  the  special 
condition  upon  which  the  articles  were  de- 
posited? (2)  Was  the  plaintiff,  under  the 
circumstances,  under  any  obligation,  in  the 
exercise  of  reasonable  and  proper  caution, 
to  read  or  make  himself  aware  of  the  condi- 
tion? 

The  jury  in  each  case  answered  both  ques- 
tions in  the  negative,  and  the  judge  there- 
upon directed  judgment  to  be  entered  for 
the  plaintiff  for  the  amount  claimed,  re- 
serving leave  to  the  defendants  to  move  to 
enter  judgment  for  them. 

In  Parker's  rase  the  defendants  moved  to 
enter  judgment,  and  also  obtained  from  the 


common  pleas  division  an  order  nisi  foi  a 
new  trial,  on  the  ground  of  misdirection. 
The  order  was  discharged,  and  the  motion 
was  refused  by  the  common  pleas  division. 

See  1  C.  P.  Div.  618,  where  the  words 
printed  on  the  ticket  are  set  out  at  length. 

The  defendants  appealed. 

In  GabeU's  case  the  defendants  applied  to 
the  common  pleas  division  for  the  order  nisi 
for  a  new  trial  on  the  ground  of  misdirection, 
but  the  court  refused  to  grant  the  order. 
The  defendants  then  moved  for  judgment 
and  also  obtained  from  the  court  of  appeal 
an  order  nisi  for  a  new  trial,  on  the  ground 
of  misdirection. 

The  cases  were  heard  together. 

Feb.  6,  7. 

Mr.  Benjamin.  Q.  C,  and  Mr.  Bremner,  for 
the  defendants 

The  plaintiffs  sue  on  an  alleged  contract 
to  keep  the  goods  safely,  but  there  is  no  con- 
tract if  one  party  means  one  thing  and  the 
other  party  means,  something  else;  there 
m;ist  be  a  consensus  ad  idem. 

G.  W.  Digby,  solicitor  for  Parker.  M.  J. 
Pyke,  solicitor  for  GabelL  W.  R.  Stevens, 
solicitor  for  the  company. 

BRAMWELiL.,  J.  A.  Not  so.  One  of  the 
parties  may  so  conduct  himself  as  to  lead  the 
other  to  believe  that  there  was  a  contract. 

A  man  cannot  make  such  a  claim  saying 
that  he  took  the  ticket,  but  took  care  not  to 
read  what  was  printed  on  it,  though  he  knew 
that  it  related  to  the  goods  deposited.  The 
plaintiff  proposes  to  the  company  that  they 
shall  do  something  for  him,  and  they  an- 
swer, "There  are  our  terms."  He  had  often 
taken  similar  tickets,  and  knew  that  they 
had  on  them  printed  matter,  and  he  knew 
that  he  must  give  blck  the  ticket  in  order  to 
get  back  his  goods.  If  the  porter  had  said, 
"Read  this,"  the  plaintiff  could  not  recover 
if  he  asserted  merely  that  he  had  not  read 
what  was  printed;  and  where  is  the  differ- 
ence? Henderson  v.  Stevenson,  L.  R,  2  H, 
L.  Sc.  470,  was  not  a  similar  case.  There 
the  passenger  took  the  ticket  in  a  hurry,  and 
knew  nothing  about  it.  Besides,  in  that 
case  the  company  wera  common  carriers, 
bound  to  take  the  passenger  on  terms  fixed 
by  law;  but  the  company  are  under  no  obli- 
gation to  keep  a  cloak-room,  and  they  have 
an  absolute  right  to  prescribe  the  terms  on 
which  they  will  accept  articles  left  there. 
They  are  not  even  warehousemen,  for  they 
wiU  only  take  small  articles  for  the  con- 
venience of  passengers.  It  is  absurd  to 
hold  that  for  a  charge  of  2d.  a  company 
ought  to  become  liable  to  make  good  a  loss 
of  perhaps  hundreds  of  pounds.  Harris  v. 
Railway  Co.,  1  Q.  B.  Div.  515,  was  a  stronger 
case.  A  man  is  not  compelled  to  read  a 
contract  in  order  to  be  boimd  by  it  Here 
the  plaintiff  took  the  ticket,  and  that  implies 
an  assent.     The  ticket  contains  the  terms  of 


NECESSITY  FOR  COMMUNICATION. 


19 


the  contract,  and  the  plaintiff  cannot,  by  re- 
fusing to  read  it,  force  on  the  company  a 
different  contract  Lewis  v.  M'Kee,  L.  R. 
4  Exch.  581.  The  company  has  not  acted  so 
as  to  Induce  the  plaintiff  to  believe  that  they 
would  be  liable.  Cornish  v.  Abington,  4 
Hurl.  &  N.  540,  28  L.  J,  Exch.  2G2.  And  if 
the  porter  has  done  so  he  has  exceeded  his 
autliority.  The  verdict  ought  to  be  entered 
for  the  defendants,  or  if  not,  then  a  new 
trial  should  be  directed. 

Mr.  Prentice,  Q.  C,  and  D.  Brynmor  Jones, 
for  Gabell. 

The  question  Is  whether  a  man  is  bound 
by  the  contents  of  a  printed  paper  merely 
put  into  his  hands.  It  could  not  be  pretend- 
ed that  any  one  would  be  bound  by  the 
terms  printed  on  o  turnpike  ticket  or  a  thea- 
tre ticket.  The  plaintiff  says  he  thought  the 
ticket  was  a  voucher  for  the  goods,  as  it 
was,  and,  if  so,  why  should  he  read  it?  It 
is  not  a  question  of  law,  but  one  of  common 
sense,  to  be  left  to  the  jury.  The  company 
were  clearly  bailees  for  hire,  and  as  such 
are  prima  facie  liable,  and  it  is  for  them  to 
shew  that  they  are  not. 

F.  Pollock  (Prentice,  Q.  C,  with  him),  for 
Parker. 

Suppose  that  the  company  had  put  on  the 
ticket  that  if  the  goods  were  not  redeemed 
within  twenty-four  hours  they  would  be  for- 
feited, or  could  njt  be  redeemed  except  on 
payment  of  £5,  would  that  have  bound  the 
plaintiff?  It  is  no  answer  that  that  would 
be  unreasonable,  if  the  ticket  is  said  to  con- 
stitute a  conti*act;  nor  is  a  depositor  obliged 
to  know  what  would  be  reasonable.  To  say 
that  he  is  at  peril  obliged  to  read  this  ticket, 
is  to  say  that  the  general  law  of  bailments 
is  so  absurd  that  a  bailor  must  exi)ect  spe- 
cial conditions.  No  one  can  be  expected 
to  know  that  a  receipt  or  a  mere  voucher 
given  in  order  to  secure  the  return  of  the 
article  to  the  proper  person  contains  special 
conditions.  The  questions  were  rightly  put 
to  the  jury,  and  the  verdict  ought  to  stand. 

Mr.  Bremner,  in  reply. 

If  the  companies  are  for  2d.  to  incur  in- 
definite liabilities,  they  will  shut  up  the 
cloak-rooms.  It  is  admitted  that  the  terms 
specified  on  the  ticket  are  reasonable,  and  it 
is  needless  to  speculate  on  what  would  be 
the  consequence  if  the  temis  were  unreason- 
able. The  depositor  had  plenty  of  time  to 
read  what  was  printed,  and  if  he  did  not 
he  must  take  the  consequences. 

Cur.  adv.  vult. 

The  judgments  of  MELLISH  and  BAG- 
GALLAY,  JJ.,  were  read  by  BRAMWELL, 
L.  J. 

MELLISH,  L.  J.  In  this  case  we  have  to 
consider  whether  a  person   who  deposits  In 


the  cloak-room  of  a  railway  company,  articles 
which  are  lost  through  the  carelessness  of  the 
company's  servants,  is  prevented  from  recov- 
ering, by  a  condition  on  the  back  of  the  ticket, 
that  the  company  would  not  be  lialjle  for  the 
loss  of  goods  exceeding  the  value  of  £10.  It 
was  argued  on  behalf  of  the  railway  company 
that  the  company's  servants  were  only  au- 
thorized to  receive  goods  on  behalf  of  the  com- 
pany upon  the  terms  contained  in  the  ticket; 
and  a  passage  from  Mr.  Justice  Blackburn's 
judgment  in  Harris  v.  Railway  Co.,  1  Q.  B. 
Div.,  at  page  533,  was  relied  on  in  support  of 
their  contention:  "1  doubt  much— inasmuch 
as  the  railway  company  did  not  authorize 
their  servants  to  receive  goods  for  deposit 
on  any  other  terms,  and  as  they  had  done 
nothing  to  lead  the  plaintiff  to  believe  that 
they  had  given  such  authority  to  their  serv- 
ants so  as  to  preclude  them  from  asserting, 
as  against  her,  that  the  authority  was  so  lim- 
ited—whether the  true  rule  of  law  Is  not  that 
the  plaintiff  must  assent  to  the  contract  in- 
tended by  the  defendants  to  be  authorized, 
or  treat  tlje  case  as  one  in  which  there  was 
no  contract  at  all,  and  consequently  no  lia- 
bility for  safe  custody."  I  am  of  opinion  that 
this  objection  cannot  prevail.  It  is  clear  that 
the  company's  servants  did  not  exceed  the  au- 
thority given  them  by  the  company.  They 
did  the  exact  thing  they  were  authorized  to 
do.  They  were  authorized  to  receive  articles 
on  deposit  as  bailees  on  behalf  of  the  com- 
pany, charging  2d.  for  each  article,  and  de- 
livering a  ticket  properly  filled  up  to  the  per- 
son leaving  the  article.  This  is  exactly  what 
they  did  in  the  present  cases,  and,  whatever 
may  be  the  legal  effect  of  what  was  done,  the 
company  must,  in  my  opinion,  be  bound  by 
it.  The  directors  may  have  thought,  and  no 
doubt  did  think,  that  the  delivering  the  ticket 
to  the  person  depositing  the  article  would  be 
sufficient  to  make  him  bound  by  the  condi- 
tions contained  in  the  ticket,  and  if  they  were 
mistaken  in  that,  the  company  must  bear  the 
consequence. 

The  question,  then,  is  whether  the  plaintilf 
was  bound  bj*  the  conditions  contained  in  the 
ticket.  In  an  ordinary  case,  where  an  ac- 
tion is  brought  on  a  written  agreement  which 
is  signed  by  the  defendant,  the  agreement  is 
proved  by  proving  his  signature,  and,  in  the 
absence  of  fraud,  it  is  wholly  immaterial 
that  ho  has  not  read  the  agreement  and  does 
not  know  its  contents.  The  parties  may, 
howevei",  reduce  their  agreement  into  writ- 
ing, so  that  the  writing  constitutes  the  sole 
evidence  of  the  agreement,  without  signing  it: 
but  in  that  case  tliere  must  be  evidence  in- 
dependently of  the  agreement  itself  to  prove 
that  the  defendant  has  assented  to  it.  In 
that  case,  also,  if  it  is  proved  that  the  de- 
fendant has  assented  to  the  writing  consti- 
tuting the  agreement  between  the  parties,  it 
is,  in  the  absence  of  fraud,  Immaterial  that 
the  defendant  had  not  read  the  agreement 
and  did  not  know  its  contents.  Now  If,  in  the 
course  of  making  a  contract,  one  party  de- 


20 


OFFER  AND  ACCEPTANCE. 


livers  to  another  a  paper  containing  -nriting, 
and  the  party  receiving  the  paper  knows  that 
the  paper  contains  conditions  which  the  party- 
delivering   it   intends  to   constitute   the   con- 
tract, I  have  no  doubt  that  the  party  receiv- 
ing the  paper  does,  by  receiving  and  keeping 
it,  assent  to  the  conditions  contained  in  it, 
although  he  does  not  read  them,  and  does  not 
know  what  they  are.    I  hold,  therefore,  that 
the  case  of  Harris  v.  Ilailway  Co.,  1  Q.  B. 
Div.  515,  was  rightly  decided,  because  in  that 
case  the  plaintiff  admitted,  on  cross-examina- 
tion, that  he  believed  there  were  some  con- 
ditions on  the  ticket.    On  the  other  hand,  the 
case  of  Henderson  v.  Stevenson,  L.  K.  2  H.  L. 
Sc.  470,  is  a  conclusive  authority  that  if  the 
person  receiving   the   ticket   does   not   know 
that  there  is  any  writing  upon  the  back  of  the 
ticket,  he  is  not  bound  by  a  condition  printed 
on  the  back.    The  facts  in  the  cases  before  us 
differ  from  those  in  both  Henderson  v.  Steven- 
son, L.  R.  2  H.  L.  Sc.  470,  and  Harris  v.  Rail- 
way Co.,  1  Q.  B.  Div.  515,  because  in  both 
the  cases  which  have  been  argued  before  us, 
though  the  plaintiffs  admitted  that  they  knew 
there  wag  writing  on  the  back  of  the  ticket, 
they  swore  not  only  that  they  did  not  read  it, 
but  that  they  did  not  know  or  believe  that 
the  writing  contained  conditions,  and  we  are 
to  consider  whether,  under  those  circumstan- 
ces,  we  can   lay  down  as  a  matter  of  law 
either  that  the  plaintiff  is  bound  or  that  he  is 
not  bound  by  the  conditions  contained  in  the 
ticket,  or  whether  his  being  bound  depends 
on  some  question  of  fact  to  be  determined  by 
the  jury,  and  if  so,  whether,  in  the  present 
ease,  the  right  question  was  left  to  the  juiy. 
Now,  I  am  of  opinion  that  we  cannot  lay 
down,   as  a   matter  of  law,   either  that  the 
plaintiff  was  bound  or  that  he  was  not  bound 
by  the  conditions  printed  on  the  ticket,  from 
the  mere  fact  that  he  knew  there  was  writ- 
ing on  the  ticket,  but  did  not  know  that  the 
writing  contained  conditions.    I  think  there 
may  be  cases  in  which  a   paper  containing 
writing  is  delivered  by  one  party  to  anothei 
in  the  course  of  a  business  transaction,  where 
it  would  be  quite  reasonable  that  the  party 
receiving  it  should  assume  that  the  writing 
contained  la  it  no  conditions,  and  should  put 
it  in  his  pocket  unread.    For  instance,  if  a 
person  driving  through  a  turn-pike  gate  re- 
ceived a  ticket  upon  paying  the  toll,  he  might 
reasonably   assume   that   the   object    of    the 
ticket  was  that  by  producing  it  he  might  be 
free  from  paying  toll  at  some  other  turn-pike 
gate,  and  might  put  it  in  his  pocket  unread. 
On   the  other  hand,   if  a  person   who   ships 
goods  to  be  carried  on  a  voyage  by  sea  re- 
ceives a  bill  of  lading  signed  by  the  master, 
he  would  plainly  be  bound  by   it,  although 
afterwards  in  an  action  against  the  shipown- 
er for  the  loss  of  the  goods,  he  might  swear 
that  he  had  never  read  the  bill  of  lading,  and 
that  he  did  not  know  that  it  contained  the 
terms  of  the  contract  of  carriage,  and  that  the 
shipowner  was  protected  by  the  exceptions 
contained  in  it.    Now  the  reason  why  the  per- 


son receiving  the  bill  of  lading  would  be 
bound  seems  to  me  to  be  that  in  the  great  ma- 
jority of  cases  persons  shipping  goods  do 
know  that  the  bill  of  lading  contains  the 
terms  of  the  contract  of  carriage;  and  the 
shipowner,  or  the  master  delivering  the  bill  of 
lading,  is  entitled  to  assume  that  the  person 
shipping  goods  has  that  knowledge.  It  is, 
however,  quite  possible  to  suppose  that  a  per- 
son who  is  neither  a  man  of  business  nor  a 
lawyer  might  on  some  particular  occasion 
ship  goods  without  the  least  knowledge  of 
what  a  bill  of  lading  was,  but  in  my  opinion 
such  a  person  must  bear  the  consequences  of 
his  own  exceptional  ignorance,  it  being  plain- 
ly impossible  that  business  could  be  carried 
on  if  every  person  who  delivers  a  bill  of  lad- 
ing had  to  stop  to  explain  what  a  bill  of  lad- 
ing was. 

Now  the  question  we  have  to  consider  is 
whether  the  railway  company  were  entitled 
to  assume  that  a  person  depositing  luggage 
and  receiving  a  ticket  in  such  a  way  that  he 
could  see  that  some  writing  was  printed  on 
it  would  understand  that  the  writing  con- 
tained the  conditions  of  contract,  and  this 
seems  to  me  to  depend  upon  whether  people 
in  general  would  in  fact,  and  naturally,  draw 
that  inference.  The  railway  company,  as  it 
seems  to  me,  must  be  entitled  to  make  some 
assumptions  respecting  tlae  person  who  de- 
posits luggage  with  them.  I  think  they  are 
entitled  to  assume  that  he  can  read,  and  that 
he  understands  the  English  language,  and' 
that  he  pays  such  attention  to  what  he  is 
about  as  may  be  reasonably  expected  from  a 
person  in  such  a  transaction  as  that  of  de- 
positing luggage  in  a  cloak-room.  The  rail- 
way company  must,  however,  take  mankind 
as  they  find  them,  and  if  what  they  do  is  suf- 
ficient to  intorm  people  in  general  that  the 
ticket  contains  conditions,  I  think  that  a  par- 
ticular plaintiff  ought  not  to  be  In  a  better 
position  than  other  persons  on  account  of  his 
exceptional  ignorance  or  stupidity  or  careles.s- 
ness.  But  if  what  the  railway  company  do  is 
not  sufficient  to  convey  to  the  minds  of  peo- 
ple in  general  that  the  ticket  contains  condi- 
tions, then  they  have  received  goods  on  de- 
posit without  obtaining  the  consent  of  the 
persons  depositing  them  to  the  conditions  lim- 
iting their  liability.  I  am  of  opinion,  there- 
fore, that  the  proper  direction  to  leave  to  the 
jury  in  these  cases  is,  that  if  the  person  re- 
ceiving the  ticket  did  not  see  or  know  that 
there  was  any  writing  on  the  ticket,  he  is 
not  bound  by  the  conditions;  that  if  he  knew 
there  was  writing,  and  knew  or  believed  that 
the  writing  contained  conditions,  then  he  is 
bound  by  the  conditions;  that  If  he  knew 
there  was  writing  on  the  ticket,  but  did  not 
know  or  believe  that  the  writing  contained 
conditions,  nevertheless  he  would  be  bound, 
if  the  delivering  of  the  ticket  to  him  in  such 
a  manner  that  he  could  see  there  was  writ- 
ing upon  it,  was,  in  the  opinion  of  the  jury, 
reasonable  notice  that  the  writing  coutiiiued 
conditions. 


NECESSITY  FOR  COMIIL'NICATIOX. 


21 


I  have  lastly  to  consider  whether  the  direc- 
tion of  the  learned  judge  was  correct,  name- 
ly, "Was  the  plaintiff,  under  the  circumstan- 
ces, under  any  obligation,  in  the  exercise  of 
reasonable  and  proper  caution,  to  read  or  to 
make  liimself  aware  of  the  conJition?"  I 
think  that  this  direction  was  not  strictly  accu- 
rate, and  was  calculated  to  mislead  the  Jury. 
The  plaintiff  was  certainly  under  no  obliga- 
tion to  read  the  ticket,  but  was  entitled  to 
leave  it  unread  if  he  pleased,  and  the  ques- 
tion does  not  appear  to  me  to  direct  the  at- 
tention of  the  jury  to  the  real  question,  name- 
ly, whether  the  railway  company  did  what 
was  reasonably  sufHcient  to  give  the  plain- 
tiff notice  of  the  condition. 

On  the  whole,  I  am  of  opinion  that  there 
ought  to  be  a  new  trial. 

BAGGALLAY,  L.  J.  A  railway  company, 
in  the  conduct  of  their  cloak-room  business, 
become  bailees  for  reward  of  the  articles  de- 
posited with  them  for  safe  custody;  and,  as 
such,  in  the  absence  of  any  special  contract 
constituted  by  the  delivery  and  acceptance 
of  a  ticket  or  otherwise,  are  responsible  to  the 
deposirurs  for  the  full  value  of  the  deposited 
articles,  if  unable  to  restore  them  when  de- 
manded. This  clearly  would  be  the  nature  of 
the  contract  if  no  ticket  were  delivered,  as 
occasionally  happens. 

In  the  present  cases  the  question  for  con- 
sideration is  whether  the  ordinary  contract  of 
bailment,  which  would  have  resulted  from  the 
receipt  by  the  company  of  the  plaintiff's  prop- 
erty and  the  payment  by  the  plaintiffs  of  the 
prescribed  charges,  has  been  modilied  by  the 
delivery  of  the  tickets  which  were  admitted- 
ly accepted  by  the  plaintiffs,  though,  as  they 
allege,  in  ignorance  of  the  pui-port  or  effect  of 
the  printed  statements  endorsed  upon  tliem. 
If  the  practice  of  issuing  cloak-room  tickets, 
containing  statements  of  conditions  intended 
to  be  binding  on  depositors,  had  become  gen- 
eral, it  might  well  be  that  a  person  deposit- 
ing his  property  and  accepting  a  ticket,  even 
though  himself  ignorant  of  the  practice,  must 
'  be  treated  as  aware  of  it,  and  as  bound  to 
ascertain  whether  any  such  conditions  were 
stated  on  the  ticket  delivered  to  him;  but  no 
such  practice  has  been  shewn  or  even  sug- 
gested in  either  of  the  present  cases,  nor  does 
it,  so  far  as  I  am  aware,  exist.  The  pninary 
pui-pose  of  the  ticket  is  to  identify  the  articles 
deposited  and  the  party  entitled  to  reclaim 
them,  but,  practically,  and  by  reason  of  the 
recognised  practice  of  not  delivering  the 
ticket  until  the  prescribed  charge  has  been 
paid,  it  becomes  a  voucher  for  the  payment. 
So  far  as  these  purposes  are  concerned,  the 
depositor  has  no  occasion  to  look  at  the  ticket 
until  he  desires  to  reclaim  his  property,  and 
if  the  tickets  were  delivered  for  these  pur- 
poses onlj-,  the  ordinary  contract  of  bail- 
ment would  be  in  no  respect  modified  by  the 
deliveiy  of  them;  and  in  the  absence  of  any 
such  general  practice  as  that  to  which  I  have 
alluded,  it  appears  to  me  that  the  depositor  Is 


prima  facie  entith  d  to  regard  the  ticket  as  de- 
livered to  ;:im  for  these  purposes  only,  and 
that  he  is  in  no  way  put  upon  inquiry  whether 
the  company  have  any  further  or  ulterior  ob- 
ject. But  it  is,  of  course,  open  to  the  com- 
pany to  show,  not  only  that  they  intended 
that  the  ticket,  which  was  delivered  to  the 
depositor  primarily  for  his  own  convenience 
and  protection,  should  also  indicate  to  him 
certain  terms  and  conditions  in  favour  of  the 
company,  by  which  he  was  to  be  bound,  but 
also  that  he  was  aware  of  such  intent ii>n  at 
the  time  when  he  accepted  the  ticket  and  that 
ue  agreed  to  give  effect  to  it.  The  onus  of 
proof  is,  however,  upon  the  company  In  re- 
spect of  these  matters.  Of  the  intention  of 
the  company  to  modify  the  contract  of  bail- 
ment in  the  cases  under  consideration  by  lim- 
iting their  liability,  there  can  "be  no  question. 
I  also  think  that,  if  the  plaintiffs  were  aware, 
or  ought,  for  reasons  which  will  be  indicated 
presently,  to  be  treated  as  being  aware  of  the 
intention  of  the  company  at  the  time  when 
they  respectively  received  their  tickets,  and 
did  not  express  their  dissent,  they  .must  be 
regarded  as  having  agreed  to  give  effect  to 
them. 

The  question  then  remains  whether  the 
plaintiffs  were  respectively  aware,  or  ought  to 
be  treated  as  aware,  of  the  intention  of  the 
company  thus  to  modify  the  effect  of  the  ordi- 
nary contract 

Now  as  regards  each  of  the  plaintiffs,  if  at 
the  time  when  he  accepted  the  ticket,  he, 
either  by  actual  examination  of  it,  or  by  rea- 
son of  previous  experience,  or  from  any  other 
cause,  was  aware  of  the  terms  or  puriDoit  or 
effect  of  the  endorsed  conditions,  it  can  hard- 
ly be  doubted  that  he  became  bound  h\  them. 
I  think  also  that  he  would  be  equally  boimd 
if  he  was  aware  or  had  good  reason  to  be- 
lieve that  there  were  upon  the  ticket  state- 
ments intended  to  affect  the  relative  rights  of 
himself  and  the  company,  but  intentionally 
or  negligently  abstained  from  ascertaining 
whether  there  were  any  such,  or  from  mak- 
ing himself  acquainted  with  their  puiqiort 
But  I  do  not  think  that  in  the  absence  of  any 
such  knowledge  or  information,  or  good  rea- 
son for  belief,  he  was  under  any  obligation 
to  examine  the  ticket  with  the  view  of  as- 
certaining whether  there  were  any  such  state- 
ments or  conditions  upon  it 

Whether  the  plaintiff'  had  any  such  knowl- 
edge or  information,  or  good  reason  for  be- 
lief, is  a  question  of  fact  to  be  determined  by 
the  evidence.  Had  the  determination  of  those 
questions  of  fact  in  the  cases  under  consid- 
eration rested  with  myself,  I  should  upon 
the  evidence,  have  decided  in  favour  of  the 
plaintiffs  in  both  cases;  but  having  had  the 
opportunity  of  reading  the  proposed  judg- 
ments of  both  my  colleagues,  I  feel  the  force 
of  the  observations  made  by  them  as  to  the 
directions  given  to  the  juries  by  the  judges 
who  tried  the  actions.  I  do  not  think  that 
the  second  question  was  ouite  right  in  form, 
though  I  think  that  hau  it  been  put  in  tlie 


OFFEli  AND  ACCEPTANCE. 


form  suggested  by  Lord  Justice  Mellish, 
which  appears  to  me  to  be  the  more  correct 
form,  the  same  result  would  have  followed. 
It  is  possible,  however,  chough  1  think  hard- 
ly probable,  that  the  juries  were  misled  by 
the  form  of  the  quertions,  and,  under  all  the 
circumstances,  the  best  coui-se  to  pursue  will 
be.  I  think,  to  direct  a  new  trial. 

BRA^MWELL,  L.  J.     It  is  clear  that  if  the 
plaintiffs  in  these  actions  had  read  the  con- 
ditions on  the  tickets  and  not  objected,  they 
would  have  been  bound  by  them.    No  point 
was  or  could  be  made  that  the  contract  was 
complete   before  the   ticket   was   given.    If, 
then,  reading  the  conditions,  they  would  have 
been  bound,  it  follows  that,  had  they  been 
told    they  were  the    conditions    of  the  con- 
tract and  invited  to  read  them,  and  they  had 
refused,  saying  they  were  content  to  take 
them  whatever  they  might  be,  then  also  they 
would  be  bound  by  them.    So,  also,   would 
they  be  if  they  were  so  told,  and  made  no 
answer,  and  did  nothing,    for  in  that  case 
they  would  have  tacitly  said  the  same  thing, 
viz.,  that  they  were  content  to  take  them, 
whatever  they  might  be.    It  follows,  further, 
that   if  they   knew   that   what   was   on   the 
tickets  was  the  contract  which  the  defend- 
ants  were   willing  to  enter   into,   they,   the 
plaintiffs,  would  be  bound,  though  not  told 
they  were  the  conditions;    for  it  cannot  make 
a  difference  that  they  were  not  told  what 
by  the  hypothesis  they  knew  already.    We 
have  it,  then,  that  if  the  plaintiffs  knew  that 
what  was  printed  was  the  contract  which  the 
defendants  were  willing  to  enter  into,   the 
plaintiffs,   not   objecting,   are   bound   by   its 
terms,  though  they  did  not  inform  themselves 
what  they  were.    The  plaintiffs  have  sworn 
that  they  did  not  know  tnat  the  printing  was 
the  contract,  and  we  must  act  as  though  that 
was  true  and  we  believed  it,  at  least  as  far 
as  entering  the  verdict  for  the  defendants 
is  concerned.     Doe?    this  make  any  differ- 
ence?   The    plaintiff-    knew    of    the    printed 
matter.    Both  admit  they  knew  it  concerned 
them  in  some  way,  though  they  said  they  did 
not   know    what    it    was;    yet    neither   pre- 
tends that  he  knew  or  believed  it  was  not 
the  contracu    Im  either  pretends  he  thought 
it  had  nothing  to  do  with  the  business  in 
hand;    that  he  thought  it  was  an  advertise- 
ment   or  other  matter   unconnected  with    his 
deposit  of  a  parcel  at  the  defendants'  cloak- 
room.   They  admit  that,   for  anything  they 
knew  or  believed,  it  might  be,  only  they  did 
not  know   or  believe   it   was,   the  contract. 
Their  evidence  is  very  much  that  they  did 
not  think,  or,  thinking,  did  not  care  about 
It.    Now  they  claim  to  charge  the  company, 
and  to  have  the  benefit  of  their  own  indiffer- 
ence.   Is  this  justV    Is  it  reasonable?    Is  It 
the  way  in  which  any  other  business  Is  al- 
lowed to  be  conducted?   Is  it  even  allowed  to 
a  man  to  "think  "  "judge,"  "guess,"  '\:a;iu:'.' ' 
a  matter,  without  informmg  himself  when  he 
can,  and   then   when   his   "thought,"   "judg- 


ment," "guess,"  or  "chance"  turns  out  wrong 
or  unsuccessful,  claim  to  impose  a  burthen 
or  duty  on  another  which  he  could  not  have 
done  had  he  informed  himself  as  he  might? 
Suppose  the  clerk  or  porter  at  the  cloak-room 
had  said  to  the  plaintiffs,  "Kead  that;  it  con- 
cerns you,"  and  they  had  not  read  it,  would 
they  be    at    liberty  to  set    up  that    though 
told    to    read    they    did    not    because    they 
thought  something  or  other?    But  what  is 
the    difference   between   that   case    and   the 
present?    Why  is   there   printing   on   the   pa- 
per, except  that  it  may    be  read?    The  put- 
ting of  it  into  their  hands  was  equivalent  to 
saying,  "Kead  that."    Could  the  defendants 
practically  do  more  than  they  did?  Had  they 
not  a  right  to  suppose  either  that  the  plain- 
tiff's knew  the  conditions,  or  that  they  were 
content  to  take  on  trust  whatever  is  printed? 
Let  us  for  the  moment  forget  that  the  de- 
fendants  are   a   caput    lupinum— a    railway 
company.    Take  any  other  case — any  case  of 
money  being  paid  and  a  paper  given  by  the 
receiver,  or  goods  bought  on  credit  and  a  pa- 
per  given   with   them.    Take   also   the   cases 
put  by  Byles,  J.,  in  Van  Toll  v.  Railway  Co., 
12  C.  B.  (N.  S.)  at  page  87;    31  L.  J.  (C.  P.) 
241.     Has  not  the  giver  of  the  paper  a  right 
to  suppose  that  the  receiver  is  content  to  deal 
on  the  terms  in  the  paper?    What  more  can 
be  done?    Must  he  say,  "Read  that?"    As  I 
have  said,  he  does  so  in  effect  when  he  puts 
it  into  the  other's  hands.    The  truth  is,  peo- 
ple are  content  to  take  these  things  on  trust. 
They  know  that  there  is  a  form  which  is  al- 
ways used.    They  are  satisfied  it  is  not   un- 
reasonable, because  people  do  not  usually  put 
um'easonable    terms    into    their   contracts.    If 
they  did,  then  dealing  would  soon  be  stopped. 
Besides,     unreasonable    practices    would     be 
known.    The  very  fact  of  not  looking  at  the 
paper   shows   that   this  confidence   exists.    It 
is  asked:    What  if  there  was  some  unreason- 
able   condition,    as,    for    instance,    to    forfeit 
£1000  if  the  goods  were  not  removed  in  forty- 
eight  hours?    Would  the  depositor  be  bound? 
I  might  content  myself  by  asking:    Would  he 
be,  if  he  were  told  "our  conditions  are  on  this 
ticket,"  and   he  did   not  read   them.    In   my 
judgment,   he  would  not  be  bound   in  either 
case.    I  think  there  is  an  implied  understand- 
ing that  there  is  no  condition  unreasonable  to 
the  knowledge  of  the  party  tendering  the  doc- 
ument and   not   insisting   on  its  being   read; 
no   condition   not   relevant   to   the   matter   in 
hand.    I   am   of   opinion,    therefore,    that   the 
plaintiffs,  having  notice  of  the  printing,  were 
in   the  same   situation  as   though   the   porter 
had  said,  "Read  that;    it  concerns  the  matter 
in  hand;"    that  if  the  plaintiffs  did  not  read  it, 
they  were  as  much  bound  as  if  they  had  read 
it  and  had  not  objected. 

The  difficulty  I  feel  as  to  what  I  have  writ- 
ten is  that  it  is  too  demonstrative.  But,  put 
In  practical  language,  it  is  this:  The  defend- 
ants put  into  the  hands  of  the  plaintiff  a  pa- 
per with  printed  matter  on  it,  whicli  in  all 
good  sense  and  rea.son  must  be  supposed  to 


NECESSITY  FOR  COMMUNICATION. 


23 


relate  to  the  matter  In  hand.  This  printed 
matter  the  plaintiff  sees  and  must  either  read 
it,  and  object  if  he  does  not  agree  to  it, 
or  If  he  does  read  it  and  not  object,  or  does 
not  read  it,  he  must  be  held  to  consent  to 
its  terms.  Therefore,  on  the  facts,  the  jud^'('s 
should  have  directed  verdicts  for  the  defend- 
ants. 

The  second  question  left,  in  my  .:)pinion. 
should  not  have  been  left,  and  was  calculated 
to  mislead  the  jury.  It  might  equally  have 
been  put  if  the  plaintiffs  had  been  told  that 
the  conditions  of  the  contract  were  on  the 
ticket,  and  had  been  asked  to  read  them.  It 
would  then  manifestly  have  been  a  question 
of  law,  and  so  it  is  now.  Besides,  by  its 
terms  it  was  calcula.ted  to  mislead  the  jury. 
The  question  was  whether  the  plaintiff  was 
under  any  obligation,  in  the  exercise  of  rea- 
sonable and  proper  caution,  to  read  the  ticket. 
Obligation  to  whom?  Not  to  himself,  as  peo- 
ple sometimes  say,  for  there  is  no  such  duty, 
or,  if  any,  be  may  excuse  himself  from  per- 
forming it  If  it  means  whether  a  reasonably 
and  properly  cautious  person  might  omit  to 
read  it,  I  say,  "Yes."  At  least  I  hope  so. 
Such  a  person  might  well  take  the  matter 
on  trust,  but  then  he  ought  to  be  content  to 
take  the  consequences  of  so  doing.  But  he 
.  has  no  right,  having  omitted  to  inform  him- 
self, and  having  had  the  means  of  doing  so, 
to  make  a  claim  which  he  might  have  fairly 
made  had  he  had  no  such  means  of  inform- 
ing himself.  The  question  probably  means 
"obligation  to  the  defendants."  That  is,  had 
the  plaintiff  a  right  to  omit  to  do  so,  and  then 
make  his  claim?  I  repeat  that  the  same 
question  might  be  put  if  he  were  told  that  the 
print  contained  the  conditions  of  the  contract, 
and  then  it  would  obviously  be  a  question  of 
law  as  it  Is  now.  The  question  is  imperfect 
The  question  whether  of  law  or  fact  is,  "Can 
a  man  properly  omit  to  inform  himself,  be- 
ing able  to  do  so,  and  then  justly  claim,  when 


he  could  not  have  claimed  if  he  had  inform- 
ed himself?"  The  latter  part  of  the  question 
is  left  out  The  authorities  are  in  favour  of 
this  view.  Stewart  v.  Railway  Co.,  3  HurL 
&  C.  135,  33  L.  J.  Exch.  100;  Van  Toll  v. 
Railway  Co.,  12  C.  B.  (N.  S.)  75,  31  L,  J. 
(C.  P.)  241.  There  is  the  opinion  of  Willes, 
J.,  in  Lewis  v.  McKee,  L.  R.  4  Exch.  58,  and, 
lastly,  the  case  of  Henderson  v.  Stevenson, 
L.  R.  2  H.  L.  Sc.  470.  I  need  not  say,  if  t 
thought  tliat  that  case  supported  the  judg- 
ment I  should  defer  to  it,  but  I  cannot  un- 
derstand how  that  can  be  supposed.  The 
plaintiff  there  said  that  he  had  never  looked 
at  the  ticket  or  seen  the  notice  on  it,  no  one 
having  directed  his  attention  to  either,  and 
on  this  the  house  proceeded.  The  lord  chan- 
cellor says:  "Your  lordships  may  take  it  as  a 
matter  of  fact  that  the  respondent  was  not 
aware  of  that  which  was  printed  on  the  back 
of  the  ticket"  Here  the  plaintiffs  knew  there 
was  printed  matter,  and  must  have  known  it 
concerned  them.  The  lord  chancellor  adds: 
"The  passenger  receiving  the  ticket  in  that 
form,  and  without  knowing  of  anything  be- 
yond, must  be  taken  to  have  made  a  contract 
according  to  that  which  was  expressed  and 
shew'n  to  him."  I  am  of  opinion  therefore, 
that  the  judgment  should  be  reversed,  and  be 
given  for  the  defendants.  If  not  though  I 
think  the  question  one  of  law,  still,  if  it  is  of 
fact  it  has  not  been  left  to  the  jury,  and 
there  should  be  a  new  trial.  The  possible 
question  of  fact  is  that  set  forth  in  the  judg- 
ment of  the  Lord  Justice  MELLISH,  with  a 
penisal  of  which  he  has  favoured  me.  But 
I  repeat  I  think  it  is  a  question  of  law.  I  also 
think  the  verdict  against  evidence,  and  that 
on  that  ground  there  should  be  a  new  triaL 
No  one  can  read  the  evidence  of  the  plaintiffs 
in  this  case  without  seeing  the  mischief  of 
encouraging  claims  so  unconscientious  as  the 
present 
Orders  absolute  for  new  trials. 


24 


OFFER  AND  ACCEPTANCE. 


ELIASON  et  al.   v.   HENSHAW.yl 
(4  Wheat.  225.)  ''^'^  '*^ 


liR^ 


Supreme    Court    of    the    United    States.     Feb. 
Term.  1819. 

Error  to  circuit  coui't  for  the  District  of 
Columbia. 

Jones  &  Key,  for  plaintiffs  In  error.  Mr. 
Swann,  for  defendant  in  error. 

WASHINGTON,  J.  This  is  an  action, 
brought  by  the  defendant  in  error,  to  recov- 
er damages  for  the  non-performance  of  an 
agreement,  alleged  to  have  been  entered  in- 
to by  the  plaintiffs  in  error,  for  the  purchase 
of  a  quantity  of  flour  at  a  stipulated  price. 
The  evidence  of  this  contract  given  in  the 
com't  below,  is  stated  in  a  bill  of  exceptions, 
and  is  to  the  following  effect:  A  letter  from 
the  plaintiffs  to  the  defendant,  dated  the  10th 
of  February,  1813,  in  which  they  say:  "Cap- 
tain Conn  infoi-ms  us  that  you  have  a  quan- 
tity of  flour  to  dispose  of.  We  are  in  the 
practice  of  pxirchasing  flour  at  all  times,  in 
Georgetown,  and  will  be  glad  to  serve  you, 
either  in  receiving  your  flour  in  store,  when 
the  markets  are  difll,  and  disposing  of  it 
when  the  markets  will  answer  to  advantage, 
or  we  will  purchase  at  market  price  when  de- 
livered; If  you  are  disposed  to  engage  two 
or  three  hundred  barrels  at  present,  we  will 
give  you  $9.50  per  barrel,  deliverable  the 
first  water  in  Georgetown,  or  any  service  we 
can.  K  you  should  want  an  advance,  please 
write  lis  by  mail,  and  will  send  you  part  of 
the  money  in  advance."  In  a  postscript  they 
add:  "Please  write  by  return  of  wagon 
whether  you  accept  our  offer."  This  letter 
was  sent  from  the  house  at  which  the  writer 
then  was,  about  two  miles  from  Harpers' 
Ferry,  to  the  defendant  at  his  mlU,  at  Mill 
Creek,  distant  about  20  mUes  from  Harper's 
Ferry,  by  a  wagoner  then  employed  by  the 
defendant  to  haul  flour  from  his  mill  to  Har- 
per's Ferry,  and  then  about  to  return  home 
with  his  wagon.  He  delivered  the  letter  to 
the  defendant  on  the  14th  of  the  same  month, 
to  which  an  answer,  dated  the  succeeding 
day,  was  written  by  the  defendant,  address- 
ed to  the  plaintiffs  at  Georgetown,  and  dis- 
patched by  a  mail  which  left  Mill  Creek  on 
the  19th,  being  the  first  regular  mail  from 
that  place  to  Georgetown.  In  this  letter  the 
writer  says:  "Your  favor  of  the  10th  inst 
was  handed  me  by  Mr.  Chenoweth  last  even- 
ing. I  take  the  earliest  opportunity  to  an- 
swer it  by  post.  Your  proposal  to  engage 
300  barreLs  of  flour,  delivered  in  Georgetown, 
by  the  first  water,  at  $9.50  per  barrel,  I  ac- 
cept, and  shall  send  on  the  flour  by  the  first 
boats  that  pass  down  from  where  my  flour 
Is  stored  on  the  river;  as  to  any  advance, 
will  be  unnecessary— payment  on  delivery  Is 
aH  that  is  required." 

On  the  25th  of  the  same  month,  the  plain- 
tiffs addressed  to  the  defendant  an  answer 
to  the  above,  dated  at  Georgetown,  in  which 


they  acknowledge  the  receipt  of  it,  and  add: 
"Not  having  heard  from  you  before,  had 
quite  given  over  the  expectation  of  getting 
your  flour,  more  particularly  as  we  requested 
an  answer  by  return  of  wagon  the  next  day, 
and  as  we  did  not  get  it,  had  bought  all  we 
wanted." 

The  wagoner,  by  whom  the  plaintiffs'  first 
letter  was  sent,  informed  them,  when  he  re- 
ceived it,  that  he  should  not  probably  return 
to  Harper's  Ferry,  and  he  did  not  in  fact 
return  in  the  defendant's  employ.  The  flour 
was  sent  down  to  Georgetown,  some  time  in 
March,  and  the  delivery  of  it  to  the  plaintiffs 
was  regularly  tendered  and  ref  used. 

Upon  this  evidence,  the  defendants  in  the 
court  below,  the  plaintiffs  in  error,  moved 
that  court  to  instruct  the  jury,  that,  if  they 
believed  the  said  evidence  to  be  true,  as  stat- 
ed, the  plaintiff  in  this  action  was  not  enti- 
tled to  recover  the  amount  of  the  price  of  th«s 
300  barrels  of  flour,  at  the  rate  of  $9.50  per 
barrel.  The  court  being  divided  in  opinion, 
the  instruction  prayed  for  was  not  given. 

The  question  is,  whether  the  court  below 
ought  to  have  given  the  instruction  to  the 
jury,  as  the  same  was  prayed  for?  K  they 
ought,  the  judgment,  which  was  in  favor  of 
the  plaintiff  in  that  court,  must  be  reversed. 

It  is  an  undeniable  principle  of  the  law  of 
contracts,  that  an  offer  of  a  bargain  by  one 
person  to  another,  imposes  no  obligation  up- 
on the  former,  until  it  is  accepted  by  the 
latter,  according  to  the  terms  in  which  the 
offer  was  made.  Any  qualification  of,  or  de- 
parture from,  those  terms,  invalidates  the  of- 
fer, unless  the  same  be  agreed  to  by  the  per- 
son who  made  it  UntU  the  terms  of  the 
agreement  have  received  the  assent  of  both 
parties,  the  negotiation  is  open,  and  imposes 
no  obligation  upon  either. 

In  this  case,  the  plaintiffs  in  error  offered 
to  purchase  from  the  defendant  two  or  three 
hundred  barrels  of  flour,  to  be  delivered  at 
Georgetown,  by  the  first  water,  and  to  pay 
for  the  same  $9.50  per  baiTel.  To  the  let- 
ter containing  this  offer,  they  required  an 
answer  by  the  return  of  the  wagon,  by  which 
the  letter  was  dispatched.  This  wagon  was, 
at  that  time,  in  the  service  of  the  defend- 
ant, and  employed  by  him  in  hauling  flour 
from  his  mill  to  Harper's  Ferry,  near  to 
which  place  the  plaintiffs  then  were.  The 
meaning  of  the  writers  was  obvious.  They 
could  easily  calculate  by  the  usual  length  of 
time  which  was  employed  by  this  wagon,  in 
travelling  from  Harper's  Ferry  to  MiU  Creek, 
and  back  again  with  a  load  of  flour,  about 
what  time  they  should  receive  the  desired 
answer,  and,  therefore,  it  was  entirely  unim- 
portant, whether  it  was  sent  by  that,  or  an- 
other wagon,  or  in  any  other  manner,  pro- 
vided it  was  sent  to  Harper's  Ferry,  and 
was  not  delayed  beyond  the  time  which  was 
ordinarily  employed  by  wagons  engaged  in 
havding  flour  from  the  defendant's  mill  to 
Harper's  Feriy.  Whatever  imcertainty  there 
might  have  been  as  to  the  time  when  the  an- 


MANNER  OF  COMMUNICATION. 


25 


swer  would  be  received,  there  was  none  as 
to  the  place  to  which  it  was  to  be  sent;  this 
was  distinctly  indicated  by  the  mode  pointed 
out  for  the  conveyance  of  the  answer.  The 
place,  therefore,  to  which  the  answer  was  to 
be  sent,  constituted  an  essential  part  of  the 
plaintiff's  offer. 

It  appears,  however,  from  the  bill  of  ex- 
ceptions, that  no  answer  to  this  letter  was 
at  any  time  sent  to  the  plaintiffs,  at  Harper's 
Ferry.  Their  offer,  it  Is  true,  was  accepted 
by  the  terms  of  a  letter  addressed  George- 
town, and  received  by  the  plaintiffs  at  that 
place;  but  an  acceptance  communicated  at  a 
place  different  from  that  pointed  out  by  the 
plaintiffs,  and  forming  a  part  of  their  pro- 
posal,  Imposed   no   obligation   binding   upon 


them,  unless  they  had  acquiesced  In  it,  which 
they  declined  doing. 

It  Is  no  argument,  that  an  answer  was  re- 
ceived at  Georgetown;  the  plaintiffs  in  er- 
ror had  a  right  to  dictate  the  terms  upon 
which  they  would  purchase  the  flour,  and, 
unless  they  were  complied  with,  they  were 
not  bound  by  them.  All  their  arrangements 
may  have  been  made  with  a  view  to  the 
circumstance  of  place,  and  they  were  the 
only  judges  of  its  importance.  There  was, 
therefore,  no  contract  concluded  beto-een 
these  parties;  and  the  court  ought,  therefore, 
to  have  given  the  instruction  to  the  jury, 
which  Avas  asked  for. 

Judgment  reversed.  Cause  remanded,  with 
directions  to  award  a  venire  facias  de  novo. 


26  OFFER  AXD  ACCErTANCE 

FOGG  T.  PORTSMOUTH  ATHENEUmL 
(44  N.  H.  115.)  fi^!l^ 


Supreme  Judicial  Court  of  New  Hampshira./ALJt 
Merrimack.    Dec,  1862.        %XiAir^^ 

Assumpsit,  to  recover  the  following  account 
to  the  writ  annexed,  namely: 

The  Proprietors  of  the  Portsmouth  Atheneum  to 
Fogg  &  Hadley,  Dr. 

1S60.  Jan  1.  To  the  Independent  Dem- 
ocrat from  vol.  5,  No.  i,  to  vol.  15. 
No.  35,  inclusive ?21  37 

Interest  on  same 12  00 


?33  37 


Also  to  recover  the  sum  of  forty  dollars,  for 
the  paper  called  the  Independent  Democrat, 
for  the  space  of  eleven  years  before  the  date 
of  the  writ,  furnished,  sold  and  delivered  to 
the  defendants  at  their  request,  by  the  plain- 
tiffs, at  two  dollars  per  year,  and  for  interest 
on  money  due  and  owing  from  the  defendants 
to  the  plaintiffs  before  the  date  of  the  writ 

The  writ  was  dated  July  2G,  1861.  Plea, 
the  general  issue,  with  the  statute  of  limita- 
tions. 

The  case  was  submitted  to  the  decision  of 
the  court  upon  the  following  agreed  state- 
ment cf  facts: 

The  defendants  are  a  corporation  whose  ob- 
ject is  the  support  of  a  library  and  public 
reading-room,  at  which  latter  a  large  number 
of  newspapers  are  taken.  Some  are  sub- 
scribed and  paid  for  by  the  defendants;  oth- 
ers are  placed  there  gratuitously  by  the  pub- 
lishers and  others;  and  some  are  sent  there 
apparently  for  advertising  purposes  merely, 
and  of  course  grattiitously. 

The  Independent  Democrat  newspaper  was 
furnished  to  the  defendants,  through  the  mail 
by  its  then  publishers,  from  vol.  3,  No.  1  (May 
1, 1847).  On  the  29th  day  of  November,  1818, 
a  bill  for  the  paper,  from  voL  3,  No.  1  (May 
1,  1847),  to  vol.  5,  No.  1  (May  1,  1849),  two 
years,  at  $1.5C  per  year,  was  presented  to  the 
defendants  by  one  T.  H.  Miller,  agent  for 
the  theu  pubUshers,  for  payment.  The  de- 
fendants objectecl  that  they  had  never  sub- 
scribed for  the  paper,  and  were  not  bound 
to  pay  for  it  They  at  first  refused  on  that 
ground  to  pay  for  it,  but  finally  paid  the  bill 
to  said  Miller,  and  took  upon  the  back  there- 
of a  receipt  in  the  following  words  and  fig- 
ures: "Nov.  29,  1848.  The  within  bill  paid 
this  day,  and  the  paper  is  henceforth  to  be 
discontinued.     T.  H.  Miller,  for  Hood  «&  Co." 

Hood  &  Co.  were  the  publishers  of  the  pa- 
per from  May  1,  1847,  until  February  12, 1S49, 
when  that  firm  was  dissolved,  and  the  paper 
was  afterward  published  by  the  present  plain- 
tiffs. The  change  of  publishers  was  announ- 
ced, editorially  and  otherwise,  in  the  paper 
of  February  15,  1849,  and  the  names  of  the 
new  publishers  were  conspicuously  inserted 
in  each  subsequent  number  of  the  paper;  but 
it  did  not  appear  that  the  change  was  actually 
known  to  Mr.  Hatch,  the  secretary  and  treas- 
urer of  the  corporation,  who  settled  the  above- 


named  bill,  and  who  continued  in  the  office 
till  January,  1850. 


-4.The    plaintiffs    had    na    knowledge    of    the 
'  agreement  of  the  agent  of  Hood  &  Co.  to  dis- 


continue the  paper,  as  set  forth  in  the  receipt 
of  November  29,  1848,  until  notified  thereof 
by  the  defendants,  after  they  had  furnished 
the  paper  to  the  defendants  for  a  year  or 
more;  the  books  of  Hood  &  Co.,  which  came 
into  their  hands,  only  showing  that  the  de- 
fendants had  paid  for  the  paper  in  advance, 
to  May  1.  1849. 

After  the  payment  of  the  bill  and  the  giv- 
ing of  the  receipt  above  recited,  the  paper 
continued  to  be  regularly  forwarded  by  its 
publishers,  through  the  mail,  to  the  defend- 
ants, from  the  date  of  said  receipt  until  May 
1,  1849,  the  expiration  of  the  period  named 
in  said  bill;  and  was  in  like  manner  forward- 
ed from  May  1,  1849,  to  January  1,  1860,  or 
from  vol.  5,  No.  1,  to  vol.  15,  No.  35,  in- 
clusive, the  period  claimed  to  be  recovered  for 
in  this  suit;  and  w?s  during  aU  that  time 
constantly  taken  from  the  post-office  by  the 
parties  employed  by  the  defendants  to  take 
charge  of  their  reading-room,  build  fires,  &c., 
and  placed  in  their  reading-room.  Payment 
was  several  times  demanded  during  the  lat- 
ter period,  of  the  defendants,  by  an  agent  or 
agents  of  the  plaintiffs;  but  the  defendants 
refused  to  pay,  on  the  ground  that  they  were 
not  subscribers  for  the  paper. 

Conspicuously  printed  in  each  number  of 
the  paper  sent  to  and  received  by  the  de- 
fendants, were  the  following 

"Terms  of  Publication:  By  mail,  express, 
or  carrier,  $1.50  a  year,  in  advance;  ?2  if  not 
paid  within  the  year.  No  paper  discontinued 
(except  at  the  option  of  the  pubUshers)  un- 
less all  arrearages  are  paid." 

The  questions  arising  upon  the  foregoing 
case  were  reserved  and  assigned  to  the  de- 
termination of  the  whole  court. 

Fowler  &  Chandler,  for  plaintiffs.  W.  H. 
Rollins  and  A.  R.  Hatch,  for  defendants. 

NESMITH,  J.  There  is  no  pretense  upon, 
the  agreed  statement  of  this  case  that  the 
defendants  can  be  charged  upon  the  ground 
that  they  were  subscribers  for  the  plaintiffs' 
newspaper,  or  that  they  were  liable  in  conse- 
quence of  the  existence  of  any  express  con- 
tract whatever.  But  the  question  now  is, 
have  the  defendants  so  conducted  as  to  make 
themselves  liable  to  pay  for  the  plaintiffs' 
newspaper  for  the  six  years  prior  to  tlie  date 
of  the  plaintiffs'  writ,  imder  an  implied  con- 
tract raised  by  the  law  and  made  applicable 
to  this  case? 

If  the  seller  does  in  any  case  what  is 
usual,  or  what  the  nature  of  the  case  makes 
convenient  and  proper  to  pass  the  effectual 
control  of  the  goods  from  himself  to  the  buy- 
er, this  is  always  a  delivery.  In  like  man- 
ner, as  to  the  question  of  acceptance,  we  must 
inquire  into  the  intention  of  the  buyer,  as 
evinced    by    his    declarations    and    acts,    the 


COMMUNICATION  BY  CONDUCT. 


27 


nature  of  the  goods,  and  the  circumstances  of 
the  case.  If  the  buyer  Intend  to  retain  pos- 
session of  the  goods,  and  manifests  this  in-.^ 
tention  by  a  suitable  act,  it  is  an  actual  ac- 
ceptance of  them;  or  this  intention  may  be 
manifested  by  a  great  variety  of  acts  in  ac- 
cordance with  the  varying  circumstances  of 
each  case.     2  Pars.  Gont.  325. 

Again,  the  law  will  imply  an  assumpsit,  and 
the  owner  of  goods  has  been  permitted  to  re- 
cover in  this  form  of  action,  where  they  have 
been  actually  applied,  appropriated  and  con- 
verted by  the  defendant  to  his  own  bcnelicial 
use.  Helepen  v.  Campbell,  2  W.  Bl.  827; 
Johnson  v.  Spiller,  Doug.  1G7;  Hill  v.  Davis, 
3  N.  II.  3S4,  and  the  cases  there  cited. 

Where  there  has  been  such  a  specific  ap- 
propriation of  the  property  in  question,  the 
propertj'  passes,  subject  to  the  vendor's  lien 
for  the  price.  Robae  v.  Thwaites,  6  Barn.  & 
C.  392.  In  Bavin  v.  Jenas,  7  Car.  &  P.  G17, 
the  question  was  whether  the  defendant  had 
purchased  and  accepted  a  fire  engine.  It  was 
a  question  of  fact  for  the  jury  to  determine. 
Lord  Abinger  told  the  jury,  if  the  defendant 
had  treated  the  fire  engine  as  his  own,  and 
dealt  with  it  as  such,  the  plaintiff  was  enti- 
tled to  recover  for  its  price.  And  the  jury 
so  found.     2  Greenl.  Ev.  §  lOS. 

In  Weatherby  v.  Bonham,  5  Car.  &  P.  228, 
the  plaintiff  was  publisher  of  a  periodical 
called  the  Racing  Calendar.  It  appeared  that 
he  had  for  some  years  supplied  a  copy  of  that 
work,  as  fast  as  the  numbers  came  out,  to 
Mr.  Westbrook.  Westbrook  died  in  the  year 
1820.  The  defendant,  Bonham,  succeeded  to 
Westbrook's  property,  and  went  to  live  in  his 
house,  and  there  kept  an  inn.  The  plaintiff, 
not  knowing  of  Westbrook's  death,  continued 
to  send  the  numbers  of  the  Calendar,  as  they 
were  published,  by  the  stage  coach,  directed 
to  Westbrook.  The  plaintiff  proved  by  a 
servant  that  they  were  received  by  the  de- 
fendant, and  no  evidence  was  given  that  the 
defendant  had  ever  offered  to  return  them. 
The  action  was  brought  to  recover  the  price 
of  the  Calendar  for  the  years  lS2o  and  1S2C. 
Talford.  for  the  defendant,  objected  that  there 
never  was  any  contract  between  the  plaintiff 
and  the  present  defendant,  and  that  the  plain- 


tiff did  not  know  him.  But  Lord  Tenterden 
said:  "If  the  defendant  received  the  books 
and  used  them,  i  think  the  action  is  main- 
tainiible.  Where  books  come  addressed  to 
the  deceased  gentleman  whose  estate  has  come 
to  the  defendant,  and  he  keeps  the  books,  I 
think,  therefore,  he  is  clearly  liable  in  this 
form  of  action,  being  for  goods  sold  and  de- 
livered." 

The  preceding  case  [Pembroke  v.  Epsom, 
44  N.  H.  113]  is  very  similar,  in  many  re- 
spects, to  the  case  before  us.  Agreeably  to 
the  defendants'  settlement  with  Hood  &  Co., 
their  contract  to  take  their  newspaper  ex- 
pired on  the  1st  of  May,  1S49.  It  does  not 
appear  that  the  fact  that  the  paper  was  then 
to  stop  was  communicated  to  the  present 
plaintiffs,  who  had  previoiisly  become  the  pro- 
prietors and  pubhshers  of  the  newspaper  es- 
tablishment; having  the  defendants'  name  en- 
tered on  their  books,  and  having  for  some 
weeks  before  that  time  forwarded  numbers  of 
tlieir  newspaper,  by  mail,  to  the  defendants, 
they,  after  the  first  day  of  May,  continued  so 
to  do  up  to  January  1,  18G0.  During  this 
period  of  time  the  defendants  were  occasion- 
ally requested,  by  the  plaintiffs'  agent,  to  pay 
their  bill.  The  answer  was,  by  the  defend- 
ants, "We  are  not  subscribers  to  your  news- 
paper." But  the  evidence  is,  the  defendants 
used,  or  kept  the  plaintiffs'  books,  or  news- 
papers, and  never  offered  to  return  a  nimiber, 
as  they  reasonably  might  have  done,  if  they 
would  have  avoided  the  liability  to  pay  for 
them.  Nor  did  they  ever  decline  to  t;ike  the 
newspapers  from  the  post-office. 

If  the  defendants  would  have  avoided  the 
liability  to  pay  the  plaintiffs,  they  might  rea- 
sonably have  returned  the  paper  to  the  plain- 
tiffs, or  given  them  notice  that  they  declined  to 
take  the  paper  longer. 

We  aie  of  the  opinion  that  the  defendants 
have  the  right  to  avail  themselves  of  the  stat- 
ute of  limitations.  Therefore,  the  plaintiffs 
can  recover  no  more  of  their  accoimt  than  is 
embraced  in  the  six  years  prior  to  the  date 
of  their  writ,  and  at  the  sum  of  $2  per  year, 
with  interest,  from  date  of  writ,  or  the  date 
of  the  earliest  demand  of  the  plaintiffs'  claim 
upon  the  defendants. 


28 


OFFEB  AND  ACCEPTANCE. 


DAY   V.   CATON.  / 

y  (119  Mass.  513.)  I 

^ V     Supreme  Judicial    Court   of   Massachusetts, 
9  Y  Suffolk.    Feb.  29,  1876.  dT 

Contract  to  recover  the  value  of  one-half  of 
a  brick  party  waU  built  by  the  plaintiff. 

The  defendant  requested  the  judge  to  nile 
that:  "(1)  The  plaintiff  can  recover  in  this 
case  only  upon  an  express  agreement.  (2)  If 
the  jurj-  find  there  was  no  express  agreement 
about  the  wall,  but  the  defendant  knew  that 
the  plaintiff  was  building  upon  land  in  which 
the  defendant  had  an  equitable  interest,  the 
defendant's  rights  would  not  be  affected  by 
such  knowledge,  and  his  silence  and  subse- 
quent use  of  the  wall  would  raise  no  implied 
promise  to  pay  anything  for  the  wall." 

The  judge  refused  so  to  rule,  but  instructed 
the  jury  as  follows:  "A  promise  would  not  be 
implied  from  the  fact  that  the  plaintiff,  with 
the  defendant's  knowledge,  built  the  wall  and 
the  defendant  used  it,  but  it  might  be  implied 
from  the  conduct  of  the  parties.  If  the  jury 
find  that  the  plaintiff  undertook  and  complet- 
ed the  building  of  the  wall  with  the  expecta- 
tion that  the  defendant  would  pay  him  for  it, 
and  the  defendant  had  reason  to  know  that 
the  plaintiff  was  so  acting  with  that  expecta- 
tion, and  allowed  him  so  to  act  without  ob- 
jection, then  the  jury  might  infer  a  promise 
on  the  part  of  the  defendant  to  pay  the  plain- 
tiff." 

There  was  a  verdict  for  the  plaintiff.  De- 
fendant alleged  exceptions. 

F.  W.  Kittredgfc,  for  plaintiff.  H.  D.  Hyde 
&  M,  F.  Dickinson,  Jr.,  for  defendant 


DEVENS,  J.  The  ruling  that  a  promise  to 
pay  for  the  wall  would  not  be  implied  from 
the  fact  that  the  plaintiff,  with  the  defend- 
ant's knowledge,  built  the  wall,  and  that  the 
defendant  used  it,  was  substantially  in  ac- 
cordance with  the  request  of  the  defendant, 
and  is  conceded  to  have  been  correct.  Chit. 
Cont  (11th  Ed.)  86;  Wells  v.  Banister,  4  Mass. 
514;  Knowlton  v.  Plantation  No.  4,  14  Me. 
20;  Davis  v.  School  Dist.,  24  Me.  349. 

The  plaintiff,  however,  contends  that  the 
presiding  judge  incorrectly  ruled  that  such 
promise  might  be  inferred  from  the  fact  that 
the  plaintiff  undertook  and  completed  the 
building  of  the  wall  with  the  expectation  that 
the  defendant  would  pay  him  for  it,  the  de- 
fendant having  reason  to  know  that  the  plain- 
tiff was  acting  with  that  expectation,  and  al- 
lowed him  thus  to  act  without  objection. 

The  fact  that  the  plaintiff  expected  to  be 
paid  for  the  work  would  certainly  not  be  suffi- 
cient of  itself  to  establish  the  existence  of  a 
contract,  when  the  question  between  the  par- 
ties  was   whether  one   was   made.     Taft   v. 


Dickinson,  6  Allen,  553.  It  must  be  shown 
that  in  some  manner  the  party  sought  to  be 
charged  assented  to  it.  If  a  party,  however, 
voluntarily  accepts  and  avails  himself  of  val- 
uable services  rendered  for  his  benefit,  when 
he  has  the  option  whether  to  accept  or  reject 
them,  even  if  there  is  no  distinct  proof  that 
they  were  rendered  by  his  authority  or  re- 
quest, a  promise  to  pay  for  them  may  be  in- 
ferred. His  knowledge  that  they  were  val- 
uable, and  his  exercise  of  the  option  to  avail 
himself  of  them,  justify  this  mference.  Ab- 
bot V.  Hermon,  7  Greenl.  118;  Hayden  v. 
Madison,  7  Greenl.  76.  And  when  one  stands 
by  in  silence,  and  sees  valuable  services  ren- 
dered upon  his  real  estate  by  the  erection  of 
a  structure  (of  which  he  must  necessarily 
avail  himself  afterwards  in  his  proper  use 
thereof),  such  silence,  accompanied  with  the 
knowledge  on  his  part  that  the  party  render- 
ing the  services  expects  payment  therefor, 
may  fairly  be  treated  as  evidence  of  an  ac- 
ceptance of  it,  and  as  tending  to  show  an 
agreement  to  pay  for  it 

The  maxim,  "Qui  facet  consentire  videtur," 
is  to  be  construed  indeed  as  applying  only  to 
those  cases  where  the  circumstances  are  such 
that  a  party  is  fairly  called  upon  either  to 
deny  or  admit  bis  liability.  But  if  silence 
may  be  interpreted  as  assent  where  a  propo- 
sition is  made  to  one  which  he  is  bound  to 
deny  or  admit,  so  also  it  may  be  if  he  is 
silent  in  the  face  of  facts  which  fairly  call 
upon  him  to  speak.  Lamb  v.  Bunce,  4  Maule 
&  S.  275;  Conner  v.  Hackley,  2  Mete.  (Mass.) 
613;    Preston  v.  Linen  Co.,  119  Mass.  400. 

If  a  person  saw  day  after  day  a  laborer  at 
work  in  his  field  doing  services,  which  must 
of  necessity  inure  to  his  benefit,  knowing  that 
the  laborer  expected  pay  for  his  work,  when  it 
was  perfectly  easy  to  notify  him  if  his  serv- 
ices were  not  wanted,  even  if  a  request  were 
not  expressly  proved,  such  a  request,  either 
previous  to  or  contemporaneous  with  the  per- 
formance of  the  services,  might  fairly  be  in- 
ferred. But  if  the  fact  was  merely  brought  to 
his  attention  upon  a  single  occasion  and  cas- 
ually, if  he  had  little  opportunity  to  notify 
the  other  that  he  did  not  desire  the  work  and 
should  not  pay  for  it  or  could  only  do  so  at 
the  expense  of  much  time  and  trouble,  the 
same  inference  might  not  be  made.  The  cir- 
cumstances of  each  case  would  necessarily 
determine  whether  silence  with  a  knowledge 
that  another  was  doing  valuable  work  for  his 
benefit,  and  with  the  expectation  of  payment, 
indicated  that  consent  which  would  give  rise 
to  the  inference  of  a  contract.  The  question 
would  be  one  for  the  jury,  and  to  them  it 
was  properly  submitted  in  the  case  before  us 
by  the  presiding  judge. 

Exceptions  overruled. 


COMMUNICATION  BV  CONDUCT. 


29 


A 


f^ 


ROYAL  INS.  CO.  v.  BEATTY. 

(12  Atl.  607,  119  Pa.  St.  G.) 
Supreme  Court  of  Pennsylvania.    Fob.  20,  1888. 

Error  to  court  of  common  pleas,  Philadel- 
phia county. 

This  was  an  action  by  William  Beatty 
against  the  Koyal  Insurance  Company,  on  a 
policy  of  tire  insurance,  averrinj;  a  renewal, 
and  that  it  was  in  force  at  the  time  of  the 
fire.  There  was  a  verdict  and  judgment  for 
plaintiff.     Defendant  brings  error. 

R.  C.  McMurtrie,  for  plaintiff  in  error. 

(1)  If  the  facts  as  stated  by  the  witnesses 
entitled  a  jury  to  infer  that  an  assent  was 
given,  or  that  the  plaintiff's  agent  was  enti- 
tled to  presume  an  assent,  the  judgment  must 
be  affirmed.  It  may  even  be  conceded  that 
if  the  defendant  beard  the  request  and  said 
nothing,  he  may  be  within  the  rule  relied  on 
by  the  court.  But  what  is  the  rule?  It  ap- 
plies only  where  there  is  a  duty  to  speak, 
and  silence  misleads.  It  is  impossible  to  as- 
sert that  If  I  do  not  hear  and  understand,  I 
am  compelled  to  speak  on  the  pain  of  being 
concluded.  Hearing  and  understanding  are 
presupposed  in  the  maxim- 

(2)  The  plaintiff  did  not  pretend  to  assert 
that  the  defendant  heard  him.  He  implies, 
of  course,  that  he  supposed  he  had;  but  when 
the  denial  came  it  was  necessary  to  do  some- 
thing more  than  rely  on  the  presumption  that 
a  remark  had  been  heard.  It  was  quite 
clear  on  the  defendant's  side  that  his  agent 
had  done  nothing  and  said  nothing  to  make 
a  contract.  He  had  told  his  master  there 
was  none  made;  that  he  had  not  been  asked 
to  make  it,  and  his  master  had  acted  on  this. 

(3)  Was  there  any  evidence  that  wananted 
the  inference  that  this  was  mistaken  or  false? 
No  one  asserted  that  he  had  heard,  or  that 
the  speaking  was  such  that  he  must  have 
heard.  And  after  the  denial  and  proof  cor- 
roborative that  defendant  had  acted  on  the 
footing  that  there  was  no  contract,  there  was 
no  attempt  to  give  any  fact  that  could  justify 
the  assumption  of  the  unproved  and  denied 
fact  that  a  request  to  renew  or  bind  was 
heard  and  known  to  have  been  made. 

(4)  Then,  the  case  being  that  the  plaintiff 
must  affirmatively  establish  the  making  of 
the  contract,  and  there  being  nothing  more 
than  a  statement  of  a  request  not  followed  by 
any  act  or  by  any  assertion  that  the  request 
was  so  made  as  to  be  certainly  heard,  in 
judging  between  the  two  the  court  seemed  to 
suppose  it  was  a  mere  question  of  which  was 
to  be  believed,  not  seeing  that  if  both  spoke 
the  truth,  which  was  at  least  possible,  the 
plaintiff  had  certainly  failed  to  prove  his  case. 

George  H.  Earle,  Jr.,  and  Richard  P.  White, 
for  defendant  in  error. 

(1)  It  was  established  beyond  controversy 
that  it  was  the  settled  custom  of  the  defend- 
ant company,   in  cases   where  a  policy  was 


about  to  expire,  to  continue  It  upon  notifica- 
tion that  the  insured  wauled  it  "bound."  The 
broker's  clerk  testiliod  positively  that  he  had 
the  policy  so  continued.  The  insurance  clerk 
admitted  all  the  facts  stated  by  the  witness, 
except  that  the  particular  policies  in  suit 
were  named.  The  sole  question,  therefore, 
was  the  simple  one  whether  it  was  the 
broker's  clerk  or  the  insurance  clerk,  who 
gave  the  con-ect  testimony  as  to  what  took 
place. 

(2)  As  it  is  conceded  that,  if  the  policies  in 
suit  were  mentioned  so  as  to  be  heard,  ac- 
cording to  the  custom  a  verbal  assent  was 
not  necessary,  it  seems  unnecessary  to  quote 
authorities  to  show  that  the  circumstances  as 
testified  to  warranted  the  jury  in  finding  a 
contract.  In  Chisman  v.  Count,  2  M:lu.  &  G. 
307,  several  items  were  submitted,  and,  as 
in  the  present  case,  a  part  only  were  men- 
tioned and  objected  to.  Held,  that  there  was 
evidence  of  a  binding  contract  as  to  the  bal- 
ance. Admission  by  silence  also,  as  well  as 
admission  by  speech,  may  have  a  contractual 
force,  and  may  bind  as  effectually  as  may 
words.  When  such  silent  admissions  so  oper- 
ate as  to  put  the  actor  in  a  specific  attitude 
to  other  persons,  by  which  such  other  per- 
sons are  induced  to  do  or  omit  to  do  a  partic- 
ular thing,  then  he  is  estopped  from  subse- 
quently denying  that  he  occupied  such  posi- 
tion, and  is  compelled  to  make  good  any 
losses  which  such  other  parties  may  have 
sustained  by  his  course  in  this  relation. 
Whart.  Cont.  §  6. 

GREEN,  J.  We  find  ourselves  unable  to 
discover  any  evidence  of  a  contractual  rela- 
tion between  the  parties  to  this  litigation. 
The  contract  alleged  to  exist  was  not  found- 
ed upon  any  writing,  nor  upon  any  words, 
nor  upon  any  act  done  by  the  defendant.  It 
was  founded  alone  upon  silence.  While  it 
must  be  conceded  that  circumstances  may 
exist  which  will  impose  a  contractual  obliga- 
tion by  mere  silence,  yet  it  must  be  admitted 
that  such  circumstances  are  exceptional  in 
their  character,  and  of  extremely  rare  occur- 
rence. We  have  not  been  furnished  with  a 
perfect  instance  of  the  kind  by  the  counsel 
on  either  side  of  the  present  case.  Those 
cited  for  defendant  in  error  had  some  other 
element  in  them  than  mere  silence  which 
contributed  to  the  establishment  of  the  rela- 
tion. But,  in  any  point  of  view,  it  is  diffi- 
cult to  understand  how  a  legal  liability  can 
arise  out  of  mere  silence  of  the  party  sought 
to  be  affected,  unless  he  was  subject  to  a 
duty  of  speech,  which  was  neglected,  to  the 
harm  of  the  other  party.  If  there  was  no 
duty  of  speech,  there  could  be  no  harmful 
omission  arising  from  mere  silence.  Take  the 
present  case  as  an  illustration.  The  alleged 
contract  was  a  contract  of  fire  insurance. 
The  plaintiff  hold  two  policies  against  the 
defendant,  but  they  had  expired  before  the 
loss  occurred,  and  had  not  Iteen  formally  re- 
newed.    At  the  time  of  the  fire  tJie  plain,tiff 


BO 


OFFEK  AND  ACCEPTANCE. 


held  no  policy  against  the  defendant.  But 
he  claims  that  the  defendant  agreed  to  con- 
tinue the  operation  of  the  expired  policies  by 
what  he  calls  "binding"  them.  How  does 
he  prove  this?  He  calls  a  clerli  who  took 
the  two  policies  in  question;  along  with  other 
policies  of  another  person,  to  the  agent  of  the 
defendant  to  have  them  renewed,  and  this 
is  the  account  he  gives  of  what  took  place: 
"The  Royal  Company  had  some  policies  to  be 
renewed,  and  I  went  in  and  bound  them. 
Question.  State  what  was  said  and  done. 
Answer.  I  went  into  the  office  of  the  Royal 
Company,  and  asked  them  to  bind  the  two 
policies  of  Mr.  Beatty  expiring  to-morrow. 
The  Court.  Who  were  the  policies  for?  A- 
For  Mr.  Beatty.  The  Court.  That  is  your 
name,  is  it  not?  A.  Yes,  sir.  These  were 
the  policies  in  question.  I  renewed  the  poli- 
cies of  Mr.  Priestly  up  to  the  1st  of  April. 
There  was  nothing  more  said  about  the  Beat- 
ty policies  at  that  time.  The  Court  What 
did  they  say?  A.  They  did  not  say  anything, 
but  I  suppose  that  they  went  to  their  books 
to  d-o  it.  They  commenced  to  talk  about  the 
night  privilege,  and  that  was  the  only  subject 
discussed."  In  his  further  examination  he 
was  asked:  "Question.  Did  you  say  anythmg 
about  those  policies  [Robert  Beatty's]  at  that 
time?  Answer.  No,  sir;  I  only  spoke  of  the 
two  policies  for  William  Beatty.  Q.  What 
did  you  say  about  them?  A.  I  went  in  and 
said,  'Mr.  Skinner,  will  you  renew  the  Beatty 
policies,  and  the  night  privilege  for  Mr. 
Priestly?'  and  that  ended  it.  Q.  Were  the 
other  companies  bound  in  the  same  way?  A. 
Yes,  sir;  and  I  asked  the  Royal  Company  to 
bind  Mr.  Beatty."  The  foregoing  is  the  whole 
of  the  testimony  for  the  plaintiff  as  to  what 
was  actually  said  at  the  time  when  it  is  al- 
leged the  policies  were  bound..  It  will  be 
perceived  that  all  that  the  witness  says  is 
that  he  asked  the  defendant's  agent  to  bind 
the  two  policies,  as  he  states  at  first,  or  to 
renew  them,  as  he  says  last.  He  received 
no  answer;  nothing  was  said,  nor  was  any- 
thing done.  How  is  it  possible  to  make  a 
contract  out  of  this?  It  is  not  as  if  one  de- 
clares or  states  a  fact  in  the  presence  of  an- 
other, and  the  other  is  silent.  If  the  decla- 
ration imposed  a  duty  of  speech  on  peril  of 
an  inference  from  silence,  the  fact  of  silence 
might  justify  the  inference  of  an  admission 
of  the  truth  of  the  declared  fact.  It  would 
then  be  only  a  question  of  hearing,  which 
would  be  chiefly,  if  not  entirely,  for  the  jury. 
But  here  the  utterance  was  a  question,  and 
not  an  assertion;  and  there  was  no  answer 
to  the  question.  Instead  of  silence  being 
evidence  of  an  agreement  to  do  the  thing  re- 
quested, it  is  evidence,  either  that  the  ques- 
tion was  not  heard,  or  that  it  was  not  in- 
tended to  comply  with  the  request.  Espe- 
cially is  this  the  case  when,  if  a  compliance 
was  intended,  the  request  would  have  been 
followed  by  an  actual  doing  of  the  thing  re- 
quested. But  this  was  not  done;  how,  then, 
can   it  be   said   it   was   agreed  to   be  done? 


There  is  literally  nothing  upon  which  to  base 
the  inference  of  an  agreement,  upon  such  a 
state  of  facts.  Hence  the  matter  is  for  the 
court,  and  not  for  the  jury;  for,  if  there  may 
not  be  an  inference  of  the  controverted  fact, 
the  jury  must  not  be  permitted  to  make  it. 

What  has  thus  far  been  said  relates  only 
to  the  effect  of  the  non-action  of  the  defend- 
ant, either  in  responding,  or  doing  the  thing 
requested.  There  remains  for  consideration 
the  effect  of  the  plaintiff's  non-action.  When 
he  asked  the  question  whether  defendant 
would  bind  or  renew  the  policies,  and  ob- 
tained no  answer,  what  was  his  duty?  Un- 
doubtedly, to  repeat  his  question  until  he  ob- 
tained an  answer;  for  his  request  was  that 
the  defendant  should  make  a  contract  with 
him,  and  the  defendant  says  nothing.  Cer- 
tainly, such  silence  is  not  an  assent  in  any 
sense.  There  should  be  something  done,  or 
else  something  said,  before  it  is  possible  to 
assume  that  a  contract  was  established. 
There  being  nothing  done  and  nothing  said, 
there  is  no  footing  upon  which  an  inference 
of  agreement  can  stand.  But  what  was  the 
position  of  the  plaintiff?  He  had  asked  the 
defendant  to  make  a  contract  with  him,  and 
the  defendant  had  not  agreed  to  do  so;  he 
had  not  even  answered  the  question  whether 
he  would  do  so.  The  plaintiff  knew  he  had 
obtained  no  answer,  but  he  does  not  repeat 
the  question;  he,  too,  is  silent  thereafter,  and 
he  does  not  get  the  thing  done  which  he  asks 
to  be  done.  Assuredly,  it  was  his  duty  to 
speak  again,  and  to  take  further  action,  if  he 
really  intended  to  obtain  the  defendj^nt's  as- 
sent; for  what  he  wanted  was  something  af- 
firmative and  positive,  and  without  it  he  has 
no  status.  But  he  desists,  and  does  and  says 
nothing  further.  And  so  it  is  that  the  whole 
of  the  plaintiff's  case  is  an  unanswered  re- 
quest to  the  defendant  to  make  a  contract 
with  the  plaintiff,  and  no  further  attempt  by 
the  plaintiff  to  obtain  an  answer,  and  no  ac- 
tual contract  made.  Out  of  such  facts  it  is 
not  possible  to  make  a  legal  inference  of  a 
contract.  The  other  facts  proved,  and  of- 
fered to  be  proved,  but  rejected,  improperly 
as  we  think,  and  supposed  by  each  to  be  con- 
sistent with  his  theory,  tend  much  more 
strongly  in  favor  of  the  defendant's  theory 
than  of  the  plainti&"'s.  It  is  not  necessary 
to  discuss  them,  since  the  other  views  we 
have  expressed  are  fatal  to  the  plaintift''s 
claim.  Nor  do  I  concede  that  if  defendant 
heard  plaintiff's  request,  and  made  no  an- 
swer, an  inference  of  assent  should  be  made; 
for  the  hearing  of  a  request,  and  not  answer- 
ing it,  is  as  consistent,  indeed  more  consist- 
ent, with  a  dissent  than  an  assent.  If  one  is 
asked  for  alms  on  the  street,  and  hears  the 
request,  but  makes  no  answer,  it  certainly 
cannot  be  inferred  that  he  intends  to  give 
them.  In  the  present  case  there  is  no  evi- 
dence that  defendant  heard  the  plaintiff's  re- 
quest, and,  without  hearing,  there  was  of 
course  no  duty  of  speech.  Judgment  re- 
versed. 


COMMUNTICATION  BY  CORRESPONDENCE. 


31 


DUNLOP  et  aL  v.  HIGGINS  et  aLi 
'1/  (1  H.  L.  Cas.  381.) 

•^  Feb.  24,  1848. 

This  was  an  appeal  against  a  decree  of  the 
court  of  session,  made  under  the  following 
circumstances:     Messrs.  Dunlop  &  Co.  were 
Iron  masters  in  Glasgow,  and  Messrs.   Ilig- 
gius  &  Co.  were  iron  merchants  in  Liverpool. 
Messrs.  Higgins  had  written  to  Messrs.  Dun- 
lop respecting  the  price  of  iron  and  received 
the  following  answer:     "Glasgow,  22d  Jan- 
uary, 1845.     We  shall  be  glad  to  supply  you 
with  2000  tons,  pigs,  at  Go  shillings  per  ton, 
net,  delivered  here."     Messrs.  Iliggins  wrote 
the  following  reply:     "Liverpool,  25th  Janu- 
ary,   1845.     You   say  65s.   382   net,  for  2000 
tons  pigs.     Does   this   mean   for   our   usual 
four  mouths'  bill?     Please  give  this   infor- 
mation in  course  of  post,  as  we  have  to  de- 
cide with  other  parties  on  Wednesday  next." 
On   the   28th   Messrs.   Duulop    wrote,    "Our 
quotation  meant   65s.    net,   and  not   a   four 
months'  bill."     This  letter  was  received  by 
Messra.    Higgins    on    the    30th    of   January, 
and  on  the  same  day  and  by  post,  but  not 
by  the  first  post,  of  that  day,  they  dispatch- 
ed an  answer  in  these  terms:    "We  will  take 
the  2000  tons  pigs  you  offer  us.    Your  letter 
crossed  ours  of  yesterday,  but  we  shall  be 
glad  to  have  your  answer  respecting  the  ad- 
ditional 1000  tons.     In  your  first  letter  you 
omitted  to  state  any  tei-ms;    hence  the  de- 
lay."    This  letter  was  dated  31st  January, 
It   was    not   delivered    in    Glasgow   until    2 
o'clock  p.  m.  on  the  1st  of  February;   and  on 
the  same  day  Messrs.  Dunlop  sent  the  fol- 
lowing reply:    "Glasgow,  1st   February,  1845. 
We  have  your  letter  of  yesterday,  but  are 
sorry  that  we  cannot   now  enter   the  2000 
tons  pig  iron,  our  offer  of  the  28th  not  hav- 
ing been  accepted  in  course."     Messrs.  Hig- 
gins wrote  on  the  2d  February  to  say  that 
they   had  erroneously  dated  their  letter  on 
the  31st  January;   that  it  was  really  written 
and  posted  on  the  30th,  in  proof  of  which 
they  referred  to  the  post  mark.     They  did 
not,  however,  explain  the  delay  which  had 
taken  place  in  its  delivery.     The  iron  was 
not  furnished   to   them,    and,    having   risen 
very    rapidly    in    the    market,    the   question 
whether  there  had  been  a  complete  contract 
between  these  parties  was  brought  before  a 
court  of  law.     Messrs.  Higgins  instituted  a 
suit  in  the  court  of  session  for  damages  as 
•    for    breach    of    contract.     The    defence    of 
Messrs.  Dunlop  was  that,  their  letter  of  the 
28th,  offering  the  contract,  not  having  been 
answered   in   due   time,   there   had   been  no 
such  acceptance  as  would  convert  that  offer 
into   a   lawful   and   binding   contract;    that 
their  letter  having  been  delivered  at  Liver- 
pool before  eight  o'clock  in  the  morning  of 
the  SOlli  of  January,  Messrs.  Higgins  ought, 
according  to  the  usual  practice  of  merchants, 
to  have  answered  It  by  the  first  post,  which 

1  Irrelevant  parts  of  opinion  omitted. 


left  Liverpool  at  three  o'clock  p.  ra.  on  that 
day.  A  letter  so  dispatched  would  be  due 
in  Glasgow  at  two  o'clock  p.  m.  on  the  31st 
of  January.  Another  post  left  Liverpool  for 
Glasgow  every  day  at  one  o'clock  a.  m.,  and 
letters  to  be  dispatched  by  that  post  must 
be  put  into  the  office  during  the  preceding 
evening,  and  if  any  letter  had  been  sent  by 
that  post  on  the  morning  of  the  31st  it  must 
have  been  delivered  in  Glasgow  in  the  regu- 
lar course  of  post  at  eight  o'clock  In  the 
morning  of  the  1st  of  February.  As  no 
comnmnication  from  Messrs.  Higgins  arriv- 
ed by  either  of  these  posts,  Messrs.  Dunlop 
contended  that  they  were  entitled  to  treat 
their  offer  as  not  accepted,  and  that  they 
were  not  bound  to  wait  until  the  third  post 
delivered  in  Glasgow  at  two  o'clock  p.  m.  of 
Saturday,  the  1st  of  February,  at  which  time 
Messrs.  Higgins'  letter  did  actxially  arrive, 
before  they  entered  into  other  contracts,  the 
taking  of  which  would  disable  them  from 
performing  the  contract  they  had  offered  to 
Messrs.  Higgins. 

The  cause  came  before  Lord  Ivory  as  lord 
ordinary,  who  directed  an  issue,  which  he 
settled  in  following  terms: 

"Whether,  about  the  end  of  January,  1845, 
Messrs.  Iliggins  purchased  from  Messrs. 
Dunlop  2000  tons  of  pig  iron  at  the  price  of 
65s.  per  ton,  and  whether  Messrs.  Dunlop 
wrongfully  failed  to  deliver  the  same,  to 
the  damage,  loss,  and  injury  of  the  pur- 
suers? Damages  laid  at  £6000."  This  is- 
sue was  tried  before  the  lord  justice  general, 
when  it  appeared  that  the  letter  of  Messrs. 
Higgins  accepting  the  offer  was  written  on 
the  30th;  that  it  was  posted  a  short  time 
after  the  closing  of  the  bags  for  the  dispatch 
at  three  o'clock  p.  m.  on  that  day,  and  con- 
sequently did  not  leave  Livei-pool  till  the 
dispatch  at  one  o'clock  in  the  morning  ol 
the  31st;  that  in  consequence  of  the  slippery 
state  of  the  roads  the  bag  then  sent  did  not 
arrive  at  Warrington  till  after  the  departm-t 
of  the  down  train  that  ought  to  have  con- 
veyed it,  and  that  this  circumstance  occa- 
sioned it  to  be  delajed  beyond  the  ordinary 
hour  of  delivery  The  lord  justice  general 
told  the  jury  "that  he  adopted  the  law  as 
duly  expoundetl  in  the  case  of  Adams  v. 
Lindsell,  1  Barn.  &  Aid.  681.  and  which  is  as 
follows:  'A.,  by  a  letter,  offers  to  sell  to  B. 
certain  specified  goods,  receiving  an  answer 
by  return  of  post,  the  letter  being  misdirect- 
ed. The  answer  notifying  the  acceptance  of 
the  offer  arrived  two  days  later  than  it 
ought  to  have  done.  On  the  day  following 
that  when  it  would  have  arrived  if  the  orig- 
inal letter  had  been  properly  directed,  A. 
sold  the  goods  to  a  third  person,'  and  in 
M'hich  it  was  held  'that  there  was  a  contract 
binding  the  parties  from  the  moment  the 
oft'er  was  accepted,  and  that  B.  was  entitled 
to  recover  against  A.  in  an  action  for  not 
completing  his  contract.'  " 

The  counsel  for  Messrs.   Dunlop  tendered 
the  following  exceptions:     The   first  excep- 


OFFER  AND  ACCEPTANCE. 


tion  related  to  evidence,  and  alleged  "that 
no  evidence  to  show  that  the  letter  purport- 
ing to  be  dated  on  the  31st  was  reaUy  writ- 
ten on  the  30th  of  January  ought  to  have 
been  admitted."  The  other  exceptions  re- 
lated to  the  charge,  and  were  as  follows: 

(2)  In  so  far  as  his  lordship  directed  the 
juiy  in  point  of  law  that  if  Messrs.  Higgins 
posted  their  acceptance  of  the  offer  in  due 
time  according  to  the  usage  of  trade,  they 
are  not  responsible  for  any  casualties  in  the 
post-olEce  establishment. 

(3)  In  so  far  as  his  lordship  did  not  direct 
the  jury  in  point  of  law  that  if  a  merchant 
malies  an  offer  to  a  party  at  a  distance  by 
post-letter  requiring  to  be  answered  within 
a  certain  time,  and  no  answer  arrives  with- 
in such  time  as  it  should  arrive  if  the  party 
had  written  and  posted  his  letter  within  the 
time  allowed,  the  offerer  is  free,  though  the 
answer  may  have  been  actually  written,  and 
posted  in  due  time,  if  he  is  not  proved  to  be 
aware  of  accidental  circumstances  prevent- 
ing the  due  arrival  of  the  answer. 

(4)  In  so  far  as  his  lordship  did  not  direct 
the  jury  m  point  of  law  that  in  the  case 
above  supposed,  if  an  answer  arrives,  bear- 
ing a  date  beyond  the  time  limited  as  above 
for  making  answer,  and  arrives  by  a  mail 
and  is  delivered  at  a  tune  corresponding  to 
such  date,  the  offerer  is  entitled  to  consider 
himself  free  to  deal  with  the  goods  as  his 

,  own,  either  to  sell  or  to  hold  if  he  be  not  in 
the  knowledge  that  the  answer  received  was 
truly  written  of  an  earlier  date,  and  de- 
layed in  its  arrival  by  accident. 

(5)  In  so  far  as  his  lordship  did  not  direct 
the  jury  in  point  of  law  that  in  case  of  fail- 
ure to  deliver  goods  sold  at  a  stipulated 
price  and  immediately  deliverable  the  true 
measure  of  damage  is  the  difference  between 
the  stipulated  price  and  the  market  price  on 
or  about  the  day  the  contract  is  broken,  or 
at  or  about  the  time  when  the  purchaser 
might  have  supplied  himself. 

These  exceptions  were  afterwards  argued 
before  the  judges  of  the  First  division,  who 
pronounced  an  interlocutor  disallowing  the 
exceptions,  and  that  interlocutor  was  the 
subject  of  the  present  appeal. 

Mr.  BetheU  and  Mr.  Anderson,  for  appel- 
lants. 

The  question  raised  in  this  case  Is  one  of 
considerable  importance,  and  the  decision  of 
It  in  accordance  with  the  judgment  of  .the 
court  below  will  have  the  effect  of  reuderiug 
the  acceptance  of  contracts  a  matter  oi'  doubt 
and  uncertainty.  If  the  decision  of  the 
judges  of  the  court  of  session  is  right,  a  con- 
tract is  complete  when  the  acceptance  of  the 
offer  to  enter  into  it  is  posted,  although  such 
acceptance  may  not  reach  the  person  who 
made  the  offer  tUl  long  after  the  time  at 
which  by  the  usage  of  trade  he  is  entitled  to 
expect  it.  Such  a  decision,  if  iinreversed, 
wiU  leave  the  person  making  an  offer  under 
the   necessity   of   waiting   for  an   indefinite 


time  in  order  to  know  whether  his  offer  has 
been  accepted.  During  aU  this  time  he  will 
be  restrained  frora  freely  dealing  with  his 
own  property. 

The  exceptions  here  ought  to  have  been 
sustained  by  the  court.  The  first  of  them 
relates  to  the  evidence  offered  at  the  trial. 
That  evidence  was  improperly  admitted. 
The  court  ought  not  to  have  received  evi- 
dence to  contradict  a  written  document. 
When  a  letter  is  sent  to  a  party,  he  has  a 
right  to  assume  that  it  is  properly  written, 
and  is  entitled  to  rely  on  its  contents.  He 
is  at  least  entitled  to  do  so  as  against  the 
writer  of  the  letter.  The  writer  is  not  at 
liberty  to  show  those  contents  to  be  errone- 
ous. At  all  events  he  is  not  at  liberty  to  do 
so  iif ter  the  person  receiving  it  has  acted  up- 
on it,  and  thus  to  affect  the  rights  of  that 
party,  and  to  give  himself  rights  to  which, 
if  the  letter  had  been  correctly  written,  he 
would  not  have  been  entitled.  To  admit 
such  evidence  is  to  unsettle  all  the  rules  of 
business,  and  to  prevent  commercial  men 
acting  with  that  certainty  and  confidence 
which  are  necessary  for  the  proper  conduct 
of  commercial  affairs. 

[THE  LORD  CHANCELLOR:  When  a 
party  sends  a  letter  actually  sent  on  the  30th, 
but  dated  by  mistake  on  the  31st,  may  he  not 
shew  that  that  date  has  been  put  in  by  mis- 
take?] 

It  might  be  difficult  to  maintain  the  simple 
negative  of  that  question,  but  in  consider- 
ing the  admissibility  of  such  evidence,  all 
the  circumstances  of  the  case  must  be  refer- 
red to.  In  the  present  case,  for  instance, 
as  the  letter  was  received  on  a  day  after 
that  of  its  date,  and  when,  therefore,  the 
person  receiving  it  had  no  reason  to  suspect 
that  the  date  was  erroneously  given,  his 
rights  ought  not  to  be  affected  by  a  subse- 
quent explanation;  and  the  evidence  intend- 
ed to  afford  that  explanation  ought  not, 
therefore,  to  have  been  admitted. 

Then,  as  to  the  second  exception,  if  a  let- 
ter sent  is  posted  in  due  time,  but  is  not  re- 
ceived in  due  time,  who  is  to  bear  the  loss 
consequent  upon  its  nondelivery?  Cert:aiuly 
not  the  person  to  whom  it  is  sent.  The  fact 
that  it  is  sent  by  the  post  office  makes  no 
difference  in  the  matter.  It  is  the  same  as 
if  the  letter  was  sent  by  a  special  messenger, 
in  which  case  it  is  plain  that  the  person 
sending  the  messenger  would  be  responsible 
for  any  accident  or  delay.  The  appellants 
are  not  to  be  made  responsible  for  the  casual- 
ties of  the  iKJst  office,  and  surely  they  cannot 
be  made  so  in  a  case  in  which  the  persons 
sending  an  answer  to  an  offer  which  they 
had  made  toUilly  disregarded  the  ordinary 
usages  of  commercial  houses  as  to  the  time 
of  sending  such  answer. 

The  clear  principle  set  forth  in  the  third 
objection  is  that  which  ought  to  be  adopted 
in  all  cases  of  this  kind.  Where  an  individ- 
ual makes  an  offer  by  post,  stipulating  for 
or  by  the  nature  of  the  business,  having  the 


COMMUNICATION  BY  CORRESPONDENCE. 


33 


right  to  expect  an  answer  by  return  of  post, 
the  offer  can  only  endure  for  a  limited  time, 
and  tlie  making  of  it  is  accompanied  by  an 
iiui»lit'(l  stipulation  that  the  answer  shall  be 
sent  i)y  return  of  post.  If  that  implied  stip- 
ulation is  not  satisfied,  the  person  making 
the  offer  is  released  from  it.  When  a  per- 
son seeks  to  acquire  a  right,  he  is  bound  to 
act  with  a  degree  of  strictness,  such  as  may 
not  be  required  where  he  is  only  endeavour- 
ing to  excuse  himself  from  a  liability.  The 
question  of  reasonableness  of  notice  which 
may  be  admitted  in  cases  of  bills  of  ex- 
change cannot  be  introduced  in  a  case  where 
one  party  seeks  to  enforce  on  another  the 
acceptance  of  a  contract.  A  bill  of  exchange 
is  already  a  binding  contract;  no  new  right 
is  acquired  by  notice;  it  is  merely  a  neces- 
sarj'  proceeding  to  enable  the  party  giving  it 
to  enforce  a  right  previously  created.  Then, 
as  to  the  exception.  In  the  case  of  a  con- 
tract, the  acceptance  of  the  off-er  creates  the 
contract.  The  acceptance  implies  that  both 
parties  have  knowledge  of  all  the  circum- 
stances. On  principle,  it  is  plain  that  the 
acceptance  should  be  immediate,  and  that, 
if  there  is  a  delay  in  making  that  acceptance 
known,  the  offerer  is  free.  In  order  to  make 
the  contract  perfect,  there  ought  to  have 
been  a  co-existing  assent.  Countess  of  Dun- 
more  V.  Alexander,  9  Shaw  &  D.  190.  There 
a  lady,  having  written  to  another  to  engage 
a  servant  for  her,  and  then  sent  a  second 
letter  to  countermand  the  first,  and  the  two 
letters  having  been  delivered  to  the  sei'vaut 
simultaneously,  it  was  held  that  there  was 
not  a  complete  contract,  and  that  the  serv- 
ant was  not  entitled  to  wages.  The  coui't  of 
king's  bench  in  Head  v.  Diggon,  3  Man.  «& 
R.  97,  acted  upon  the  same  principle.  There 
A.  and  B.  being  together,  B.  offered  goods  to 
A.  at  a  certain  price,  and  gave  A.  three  days 
to  make  up  his  mind.  The  court  held  that 
this  wiis  not  an  absolute  bargain,  and  that 
within  the  three  days  B.  had  a  right  to  re- 
tract. 

Such  are  the  principles  which  ought  to  gov- 
ern this  case.  Then  as  to  authority:  It  is 
curious  enough  that  this  exact  question  seems 
never  to  have  arisen.  That  circumstance  is 
some  proof  of  the  clearness  of  the  principle 
which  is  applicable  to  such  transactions,  for, 
had  there  btMin  any  question  as  to  that  prin- 
ciple,— had  it  been  doubtful  whether  delay 
might  be  excused,  and  whether  in  spite  of 
delay,  a  party  guilty  of  it  might  not  still  in- 
sist on  a  contract  being  complete, — cases 
must  have  arisen  as  to  the  degree  of  laxity 
permitted  by  the  law  in  accept:ince  of  con- 
tracts. None  such  is  to  be  found.  The  case 
of  Adams  v.  Lindsell,  1  Bam.  &  Aid.  GSl, 
was  the  authority  adopted  by  the  lord  justice 
general  in  his  direction  to  the  jury;  but  that 
case  does  not  justify  his  ruling. 

[THE  LORD  CHANCELLOR:  If  the  let- 
tesT  of  acceptance  is  sent  in  the  usual  ^vay, 
is  the  sender  still  responsible  for  its  due  de- 
livers' ?] 

^OPK.SEL,.CAS.CO^'T. — 3 


If  not,  then  both  parties  are  free.  One 
cannot  be  bound  while  the  other  is  free. 
Each  party  takes  an  equal  risk,  but  suppos- 
ing delay  is  to  be  permitted,  to  what  extent 
is  it  to  be  allowed?  May  the  delay  last  one, 
two,  or  three  days,  or  a  week,  or  a  fortnight, 
or  a  month?  If  any  delay  is  to  be  permit- 
ted, the  extent  of  it  must  be  defined.  Other- 
wise, all  commercial  matters  will  be  in  a 
state  of  perpetual  u^icertainty.  But,  in  fact, 
no  delay  is  allowed.  Each  party  is  boimd  to 
write  by  return  of  post,  and  each  is  liable  to 
the  consequences  of  his  own  letter  arriving 
in  time.  Such  appears  to  be  the  mercantile 
usage  on  the  subject  When  an  offer  Is  made 
by  one  merchant  to  .send  another  a  particular 
commodity  which  varies  in  price,  that  offer 
is  made  subject  to  the  obligation  of  its  being 
answered  by  return  post.  It  is  therefore  an 
offer  subject  to  a  condition.  It  is  condition- 
al in  point  both  of  time  and  manner  of  ac- 
ceptance. As  to  time,  the  offer  enures  till  it 
can  be  answered  by  return  post.  If  it  is 
made  on  a  condition,  then  it  is  clearly  not 
binding  till  that  condition  shall  be  accepted. 
Here,  too,  the  condition  is  a  condition  pre- 
cedent. Nothing,  therefore,  can  be  substi- 
tuted for  it. 

[THE  LORD  CHANCELLOR:  Where  is 
this  condition  imposed?] 

In  mercantile  usage,  founded  on  law.  The 
legal  condition  is  to  return  an  answer  in  a 
particular  time.  Mercantile  usage  has  fixed 
that  time  as  the  return  of  post.  No  decision 
has  ruled  as  a  point  of  legal  principle  that, 
if  an  individual  addressed  fails  in  perform- 
ing this  condition,  still  that  the  person  mak- 
ing the  offer  is  bound.  The  principle  of  the 
Scotch  law,  as  stated  in  M'Douall's  Insti- 
tutes, is  the  other  way.  It  is  there  said 
(Book  1,  tit.  4,  p.  98,  Pol.  Ed.):  "Conditional 
obligations  properly  so  termed,  are  presently 
binding  and  irrevocable,  and  only  the  effect 
is  suspended,  but  sometimes  the  obligation 
is  only  to  be  contracted  upon  a  condition 
which  affects  the  very  substance  of  it.  Thus 
an  offer  has  an  implied  condition  of  accept- 
ance whereby  alone  the  consent  of  the  other 
party  accedes  and  converts  the  offer  into  a 
contract;  so  that  it  is  not  binding,  but  am- 
bulatory or  revocable,  till  it  is  accepted,  and 
therefore  either  revocation  by  the  offerer  or 
death  of  either  party  before  acceptance  voids 
it  The  same  rule  holds  in  mutual  contracts, 
—the  one  party  subscribing  is  not  bound 
till  the  other  subscribe  likewise."  The  law 
of  England  is  in  confonuity  with  the  prin- 
ciple of  the  Scotch  law. 

As  the  revocation  by  either  party  before 
acceptance  makes  the  offer  void,  the  ac- 
ceptance of  the  other  side  must  be  notified 
within  a  definite  period  of  time.  Stair's 
Inst,  tit  2.  §  S.  This  rule  of  notification  is 
a  condition  precedent  in  the  English  as  well 
as  the  Scotch  law.  This  principle  was  acted 
on  by  the  court  of  king's  bench  in  the  case 
of  Davison  v.  Mure.  3  Doug.  28.  That  was 
the  case  of  a  ship  which  was  captured  by 


34 


OFFER  AND  ACCEPTANCE. 


Americans  while  under  convoy.  The  condi- 
tion there  was  that  the  master  should  make 
the  best  defence,  and  without  it  appeared  to 
a  court-martial  that  he  had  done  so,  he  was 
not  to  be  allowed  to  recover.  It  was  held 
that  this  condition  was  a  condition  preced- 
ent. The  same  doctrine  was  applied  by 
that  court  to  the  condition  in  a  policy  of  in- 
surance against  fire,  that  the  party  should 
obtliin  a  certificate  from  the  rector  of  his 
parish  and  a  certain  uimiber  of  the  inhabit- 
ants, before  entitling:  himself  to  payment  of 
his  claim  for  loss.  Worsley  v.  Wood,  6  Term 
R.  710.  If  this  is  a  condition  precedent,  then 
it  must  be  exactly  performed,  and  nothing 
can  be  substituted  for  it.  In  this  respect 
there  is  a  difference  between  a  condition  pre- 
cedent and  a  condition  subsequent  The 
former  must  be  performed  before  an  estate 
can  vest;  while  the  performance  of  the  lat- 
ter, which  is  intended  to  defeat  an  existing 
estate,  may  be  dispensed  with.  The  act  of 
God,  the  li:ing's  enemies,  or  the  impossibility 
of  performance  will  furnish  an  excuse  as  to 
a  condition  subsequent  This  is  a  settled 
principle  of  our  law,  and  the  case  of  Brodie 
T.  Todd,  17  Fac.  Col.,  May  20,  1814,  shows 
that  the  law  of  Scotland  recognises  the 
same  rule.  In  that  case,  Amot  a  merchant 
of  Leith,  agreed  to  purchase  from  Todd  & 
Co.,  of  Hull,  goods  which  were  to  be  paid 
for  by  his  acceptance.  They  put  the  goods 
on  board  a  vessel  at  Hull;  enclosed  a  bill 
of  lading  and  a  draft  for  the  price  in  a  let- 
ter advising  Amot  of  the  shipment,  and  re- 
questing him  to  return  the  draft  accepted  "in 
course.'-  This  letter  was  received  by  Amot 
on  the  morning  of  the  24th  of  April,  and  if 
answered  by  him  by  return  of  post  the  an- 
swer might  have  been  received  by  Todd  & 
Co.  on  the  morning  of  the  2Gth.  Arnot  how- 
ever, did  not  answer  it  till  that  day,  when 
he  sent  back  the  draft  accepted.  In  the 
course  of  the  2Gth,  Todd  &  Co.,  not  having 
received  the  draft  as  expected,  relanded  the 
^oods.  Arnot  brought  an  action,  and  the 
question  was  whether  the  request  to  return 
"in  coui'se"  meant  a  return  by  the  earliest 
post,  and  constituted  a  condition  precedent. 
The  lords  held  that  the  words  meant  by  re- 
turn of  post  and  did  constitute  a  condition 
precedent,  and  consequently  that  no  action 
was  maintainable  by  Amot,  since  he  had  not 
complied  with  the  condition  on  which  the 
bargain  was  made.  That  case  is  completely 
decisive  as  to  what  is  the  doctrine  of  the 
Scotch  law,  and  must  govern  the  decision 
here. 

[THE  LORD  CHANCELLOR:  Is  it  not  a 
question  of  fact  whether  the  posting  of  the  let- 
ter, in  this  case,  on  the  30th  of  January,  was 
not  a  compliance  with  the  duty  of  the  party? 
Here  is  no  distinct  stipulation— it  is  all  mat- 
ter of  inference.  The  question  is  whether 
putting  in  the  post  is  not  a  virtual  accept- 
ance though  by  the  accident  of  the  post  it 
does   not  arrive.    In   the   case   quoted,    one 


whole  day  was  allowed  to  Intervene.  But 
in  this  case  if  putting  the  letter  in  the  post 
is  a  compliance  with  the  condition,  there  is 
an  end  of  the  question.] 

That  would  be  so,  if  it  was  a  condition 
subsequent,  for  then  something  could  be  sub- 
stituted for  actual  performance.  But  this  is 
a  condition  precedent,  and  must  be  literally 
performed. 

In  considering  this  question  Ix»rd  Jeffrey 
observed:  "The  party  here  only  says,  'If 
I  do  not  hear  by  i-eturn  of  post'  I  have  yet 
to  learn  that  the  return  of  post  is  like  the 
return  of  the  sun  to  the  meridian  at  a  par- 
ticular time.  I  do  not  think  that  the  use  of 
such  a  phrase  is  equivalent  to  the  stipula- 
tion of  a  particular  time.  I  am  inclined  to 
hold  that  the  return  of  post  means  the  ac- 
tual return  of  the  post.  And  the  species 
facti  here  was,  the  letter  accepting  the  of- 
fer having  been  sent  in  due  time  to  the  post 
office,  that  it  did  come  to  hand  at  the  hour 
at  which,  according  to  the  usual  time  re- 
quired for  its  transmission.  It  should  have 
come.  But  the  actual  course  of  that  post 
was  not  till  the  morning  of  the  1st  Febru- 
ary." And  the  learned  judge  justifies  his 
doctrine  by  referring  to  the  case  of  the  post 
coming  by  sea,  where  a  general  average 
time  is  fixed,  but  where  return  of  post  is  not 
Galculated  by  that  average,  but  by  the  actual 
arrival  of  the  post;  and  then  he  supposes 
a  universal  snow  storm  affecting  the  deliv- 
ery by  land,  and  argues  that  if  matter  of 
that  geneiTil  notoriety  would  affect  the  ques- 
tion, so  does  any  other  accident  to  the  post, 
although  not  so  generally  known.  But  sure- 
ly this  is  giving  an  entirely  new  inteiipreta- 
tion  to  mercantile  contracts,  and  is  making 
accidental  circumstances  or  natural  delays, 
always  counted  upon,  furnish  ground  for  the 
construction  of  a  delay  occasioned  by  an  ac- 
cident which  neither  party  anticipated.  Be- 
sides, it  is  clear  on  the  facts  here,  that  had 
the  letter  been  put  into  the  early  post  of  the 
30th  Januai-y,  this  accident  would  not  have 
befallen  it;  so  that  the  accidental  delay  in 
the  post  office  was  i-eally  the  consequence 
of  the  delay  in  posting  the  letter,  and  was 
so  far  attributable  to  the  respondents. 

They  cannot  therefore,  claim  any  advan- 
tage, from  their  acceptance  of  the  contract, 
which  acceptance  they  did  not  notify,  nor 
condemn  the  other  parties  for  nonperform- 
ance of  a  contract,  the  acceptance  of  which 
they  did  not  know.  It  is  the  acceptance 
which  comploles  the  contract.  The  agree- 
ment is  not  suspended  till  the  offerer  has  ac- 
tually received  notice  of  the  acceptance,  but 
only  until  he  might  have  received  notice, 
had  that  notice  been  foi-warded  at  the  earli- 
est moment.  That  is  the  nile  declared  in 
Bell's  Principles  of  the  Law  of  Scotland 
(page  35,  §  78),  and  this  rule  must  be  applied 
to  and  must  govern  the  decision  of  the  pres- 
ent case. 


COMMUNICATION  BY  CORRESPONDENCE. 


35 


Stewart  Wortley  and  Hugh  Hill,  for  re- 
Bpondents,  were  not  called  on. 

THE  LORD  CHANCELLOR.  My  lords, 
overj-thing  which  learning  or  ingenuity  can 
suggest  on  the  part  of  the  appellants  has 
undoubtedly  been  suggested  on  tlie  part 
of  the  learned  counsel  who  have  just  ad- 
dressed the  house;  and.  if  your  lordships 
concur  in  my  view,  that  they  have  failed 
in  making  out  their  case,  you  will  have  the 
satisfaction  of  knowing  that  you  have  come 
to  that  conclusion  after  having  had  every- 
Ihiug  suggested  to  you  that  by  possibility 
could  be  advanced  in  favour  of  this  appeal. 

The  case  certainly  appears  to  me  one 
which  requires  great  ingenuity  on  the  part 
of  the  appellants,  because  I  do  not  think 
that  in  the  facts  of  the  case  there  is  any- 
thing to  warrant  the  appeal.  The  contest 
arises  from  an  order  sent  from  Liventool 
to  Glasgow;  or  rather  a  proposition  sent 
from  Glasgow  to  Liven^ool,  and  accepted  by 
the  house  at  Liverpool.  It  is  unnecessary 
to  go  earlier  into  the  history  of  the  case  than 
the  letter  sent  from  Liverpool  by  Iliggius, 
bearing  date  the  31st  January.  A  proposi- 
tion had  been  made  by  the  Glasgow  house  of 
Dunlop,  Wilson  &  Co.  to  sell  2000  tons  of 
pig  iron.  The  answer  is  of  that  date  of  the 
olst  of  January:  "Gentlemen:  We  will  take 
the  2000  tons,  pigs,  you  offer  us."  Another 
part  of  the  letter  refers  to  other  arrange- 
ments; but  there  is  a  distinct  and  positive 
offer  to  take  the  2000  tons  of  pigs.  To  that 
letter  there  is  ajinexod  a  postscript  in  which 
they  say:  "We  have  accepted  your  offer  un- 
conditionally; but  we  hope  you  will  accede 
to  our  request  as  to  delivery  and  mode  of 
payment  by  two  months'  bill." 

That,  my  lords,  therefore,  is  an  uncon- 
ditional acceptance,  by  the  letter  datt^i  tlie 
I'.lst  of  January,  which  was  proved  to  have 
been  put  into  the  post  office  at  Liverpool 
on  the  30th;  but  it  was  not  delivered,  owing 
to  the  state  of  severe  frosts  at  that  time, 
which  delaj-ed  the  mail  from  reaching  Glas- 
gow at  the  time  at  which,  in  the  ordinai"y 
course,  it  would  have  arrived  there.  The 
letter  having  been  put  in  on  the  30th  of 
Januarj',  it  ought  to  have  arrived  at  Glas- 
gow on  the  following  day,  but  it  did  not 
aiTlve  till  the  1st  of  Februaiy.  It  appears 
that  between  the  time  of  writing  the  offer 
and  1st  of  February  the  parties  making  the 
offer  had  changed  tlieir  minds,  instead  of 
being  willing  to  sell  2UO0  tons  of  pig  iron  on 
the  terms  proposed,  they  were  anxious  to 
be  relieved  from  that  stipulation,  and  on 
that  day,  the  1st  of  February,  they  say: 
"We  have  yours  of  yesterday,  but  are  sori-y 
that  we  cannot  enter  the  2000  tons  of  pig 
iron,  our  offer  of  the  2Sth  not  having  been 
accepted  in  course." 

Under  these  circumst<ances,  the  parties 
wishing  to  buy,  and  by  their  letter  accept- 
ing the  offer,  instituted  proceedings  in  the 
court  of  session  for  damages  sustained  by 


the  nonperformance  of  the  contract.  And 
the  first  question  raised  by  the  first  excep- 
tion applies  not  to  the  summing  up  of  the 
learned  judge,  but  to  the  admission  of  evi- 
dence by  him,  for  connected  with  that  ad- 
mission of  evidence  is  the  first  exception.  I 
need  hardly  say  but  little  on  this  point,  but, 
as  it  formed  part  of  the  proct-tdlngs  on 
which  the  judgment  must  ultimately  be  pro- 
noimced,  I  will  verj-  shortly  call  your  lord- 
ships' attention  to  the  proposition  presented 
for  your  decision  by  that  first  exception. 

My  lords,  the  exception  states  "that  tlie 
pursuei-s  having  admitted  that  they  were 
bound  to  answer  the  defenders'  offer  of  the 
2Stli  by  letter  written  and  posted  on  the  30th, 
and  the  only  answer  received  by  the  defend- 
ers being  admitted  to  be  diited  on  the  31st  of 
January-,  and  received  in  Glasgow  by  the 
mail,  which  in  due  course  ought  to  bring  the 
Liverpool  letters  of  the  31st,  but  not  Liver- 
pool letters  of  the  30th,  it  is  not  competent 
in  a  question  as  to  the  right  of  the  defend- 
ers to  withdraw  or  fall  fmm  the  offer,  to 
prove  that  the  letter  bearing  date  the  31st  of 
January  was  written  and  dispatched  from 
Liverpool  on  the  30th,  and  prevented  by 
accident  from  reaching  Glasgow  in  due 
course,  especially  as  it  is  not  alleged  that  the 
defenders  were  aware  (iirevious  to  the  3d  of 
February)  of  any  such  accident  having  oc- 
curred." 

The  counsel  for  the  pursuer  answered  that 
nothing  had  been  stated,  but  that  the  pur- 
suers were  bound  instantly  to  answer  the  de- 
fenders' ofier  of  the  2Sth  of  January,  and 
that,  according  to  the  practice  of  merchants, 
it  was  suflicient  if  tliat  letter  was  answered 
on  that  day  on  which  it  was  received. 

The  lord  justice  general  did  overrule  the 
objection,  and  admitted  the  evidence. 

The  exception  is  thiit  the  learned  judge  was 
wrong  in  permitting  the  pursuer  to  explain 
his  mistake.  The  proposition  is  that  if  a 
man  is  bound  to  answer  a  letter  on  a  partic- 
ular day,  and  by  mistake  puts  a  date  in  ad- 
vance, he  is  to  be  bound  bj'  his  ei'ror,  wheth- 
er it  produces  miscliief  to  the  other  party 
or  not  It  is  unnecessary  to  do  more  than 
state  this  proposition  in  order  to  induce  you 
to  assent  to  the  view  I  take  of  the  objection, 
and  to  come  to  the  conclusion  that  the  learn- 
ed judge  was  right  in  allowing  the  pursuer 
to  go  into  evidence  to  show  the  mistalce. 

I  pass  on  then  to  the  fom-th  exception  which 
is  connected  with  this  point,  and  which 
states  tliat  his  lordship  did  not  direct  the 
jury  in  point  of  law;  that  in  the  case  above 
supposed,  if  an  answer  arrives,  bearing  a 
date  beyond  the  time  limited  as  above  for 
making  answer,  and  arrives  by  mail,  and  is 
delivered  at  a  time  corresponding  to  such 
date,  the  offerer  is  entitled  to  consider  him- 
self free  to  deal  with  the  goods  as  his  own, 
either  to  sell  or  to  hold,  if  he  was  not  in  the 
knowledge  that  the  answer  received  was  du- 
ly written  at  an  earlier  date,  and  delayed  in 
its  arrival  by  accident;    that  is  to  say.  that 


36 


OFFER  AND  ACCEPTAXCE. 


if  a  letter  bears  a  date  which,  on  the  face  of 
it,  shows  that  it  was  written  eiToneously, 
nevertheless  the  party  is  bound  by  the  date 
so  written  on  the  face  of  the  letter,  and  you 
cannot  go  into  the  circumstances  to  explain 
how  it  happened  that  the  letter  did  not  ar- 
rive in  time,  but  that  you  are  bound  to  as- 
sume that  it  arrived  on  the  daj  mentioned, 
and  the  party  cannot  give  any  evidence  in  ex- 
planation. 

My  lords,  that  falls  with  the  other  excep- 
tion, and  the  two  together  go  for  nothing.  I 
merely  state  it  for  the  pui-pose  of  aslcing 
your  lordships  to  concur  in  the  opinion  that 
i  have  formed  that  the  learned  judge  was 
correct  in  the  mode  in  which  he  left  the 
question  to  the  jui-y,  and  consequently  that 
on  that  point  the  bill  of  exceptions  cannot  be 
supported. 

The  next  exception  to  be  considered  is  the 
second,  and  that  raises  a  more  important 
question,  though  not  one  attended  with  much 
ditticulty.  The  exception  is  that  his  lordship 
did  direct  the  jury  in  point  of  law  that  if 
the  pui-suers  posted  their  acceptance  of  the 
offer  in  due  time,  according  to  the  usage  of 
trade,  they  are  not  responsible  for  any  cas- 
ualties in  the  post-office  establishment. 

Now,  there  may  be  some  little  ambiguity  in 
the  construction  of  that  proposition.  It  pro- 
ceeds on  the  assumption  that  by  the  usage  of 
trade  an  answer  ought  to  have  been  returned 
by  the  post,  and  that  the  30th  was  the  right 
day  on  which  that  answer  ought  to  have  been 
notified.  Then  comes  the  question  whether, 
under  those  circumstances,  that  being  the 
usage  of  trade,  the  fact  of  the  letter  being 
delayed,  not  by  the  act  of  the  party  sending 
it,  but  by  an  accident  connected  with  the 
post,  the  party  so  putting  the  letter  in  on 
the  right  day  is  to  lose  the  benefit  which 
would  have  belonged  to  him  if  the  letter  had 
arrived  in  due  course. 

I  cannot  conceive,  if  that  is  the  right  con- 
struction of  the  direction  of  the  leanifed 
judge,  how  any  doubt  can  exist  on  the  point 
If  a  party  does  all  that  he  can  do,  that  is 
all  that  is  called  for.  If  there  is  a  usage  of 
trade  to  accept  such  an  offer,  and  to  return 
an  answer  to  such  an  offer,  and  to  forward  it 
by  means  of  the  post,  and  if  the  party  ac- 
cepting the  offer  puts  his  letter  into  the  post 
on  the  correct  day,  has  he  not  done  every- 
thing he  was  bound  to  do?  How  can  he  be 
responsible  for  that  over  which  he  has  no 
control?  It  is  not  the  same  as  if  the  date  of 
pai-ty's  acceptance  of  the  offer  had  been  the 
subject  of  a  special  contract;  as  if  the  con- 
tract bad  been,  "I  make  you  this  offer,  but 
you  m\Lst  return  me  an  answer  on  the  30th, 
and  on  the  earliest  post  of  that  day."  The 
usage  of  trade  would  require  an  answer  on 
the  day  on  which  the  offer  was  received, 
and  Messrs.  Higgins,  therefore,  did  on  the 
30th,  in  proper  time,  return  an  answer  by 
the  right  conveyance — the  post  office. 

If  that  was  not  correct,  and  if  you  were 
to  have  reference  now  to  any  usage  consti- 


tuting the  contract  between  the  parties  a 
specific  contract,  it  is  quite  clear  to  me  that, 
the  rule  of  law  would  necessarily  be  that 
which  has  obtained  by  the  usage  of  trade. 
It  has  been  so  decided  in  cases  in  England,, 
and  none  has  been  cited  from  Scotland  which 
controverts  that  proposition;  but  the  cases 
in  England  put  it  beyond  all  doubt.  It  is 
not  disputed— it  is  a  very  frequent  occuiTcnce 
—that  a  party  having  a  bill  of  exchange, 
which  he  tenders  for  payment  to  the  accept- 
or, and  payment  is  refused,  is  bound  to  give 
the  earliest  notice  to  the  drawer.  That  per- 
son may  be  resident  many  miles  distant  from 
him.  If  he  puts  a  letter  into  the  post  at  the 
right  time,  it  lias  been  held  quite  sufficient. 
He  has  done  all  that  he  is  expected  to  do  as 
far  as  he  is  concerned.  He  has  put  the  let- 
ter into  the  post,  and  whether  that  letter  be 
delivered  or  not  is  a  matter  quite  immaterial, 
because  for  accidents  happening  at  the  post 
office  he  is  not  responsible. 

My  lords,  the  case  of  Stocken  v.  Collen,  7 
]\Iees.  &  W.  515,  is  precisely  a  case  of  that 
nature,  where  the  letter  did  not  arrive  in 
time.  In  that  case  Baron  Parke  says:  "It 
was  a  question  for  the  juiy  whether  the  let- 
ter was  put  into  the  post  office  in  time  for 
delivery  on  the  2Sth.  The  ]X)st-office  mark 
certainly  raised  a  presumption  to  the  con- 
trai-y,  but  it  was  not  conclusive.  The  ju- 
rors have  believed  the  testimony  of  the  wit- 
ness wljo  posted  the  letter,  and  the  verdict 
was  therefore  right.  If  a  party  puts  a  no- 
tice of  dishonour  into  the  post,  so  that  in  due 
course  of  delivery  it  would  arrive  in  time, 
he  has  done  all  that  can  be  required  of  him,^ 
and  it  is  no  fault  of  his  if  delay  occurs  in 
delivery."  Baron  Alderson  says:  "The  par- 
ty who  sends  the  notice  is  not  answerable 
for  the  blunder  of  the  post  office.  I  remem- 
ber to  have  held  so  in  a  case  on  the  Norfolk 
circuit,  where  a  notice  addressed  to  Norwich 
had  been  sent  to  Warwick.  If  the  doctrine 
that  the  post  office  is  only  the  agent  for  the 
delivery  of  the  notice  was  correct,  no  one 
could  safely  avail  himself  of  the  mode  of 
transmission.  The  real  question  is  whether 
the  party  has  been  guilty  of  laches." 

There  is  also  the  other  ciise  which  has  been, 
referred  to,  which  declares  the  same  doc- 
trine—the case  of  Adams  v.  Liudsell,  1  Bam. 
&  Aid.  681.  That  is  a  case  where  the  letter 
went,  by  the  error  of  the  party  sending  it,  to 
the  wrong  place,  but  the  party  receiving  it 
answered  it,  so  far  as  he  was  concerned,  in 
proper  time.  The  party,  however,  who  origi- 
nally sent  the  offer,  not  receiving  the  answer 
in  proper  time,  thought  he  was  discharged, 
and  entered  into  a  contract  and  sold  the 
goods  to  somebody  else.  The  question  was 
whether  the  pai-tj'  making  the  offer  had  a 
right  to  withdraw  after  notice  of  acceptance. 
He  sold  the  goods  after  the  party  had  writ- 
ten the  letter  of  acceptance,  but  before  it 
arrived  he  said,  "I  withdraw  my  offer." 
Therefore  he  said,  "Before  I  received  your 
acceptance  of  my  offer  I  had  withdrawn  it" 


COMMUNICATION  BY  CORRESPONDENCE. 


87 


Anrl  that  raised  the  question  when  the  ac- 
ceptance took  place,  and  what  constituted  the 
acceptance.  It  was  argued  that  "till  the 
plaintiff's  answer  was  actually  received  there 
could  be  no  binding  contract  between  the 
parties,  and  that  before  then  the  defendants 
had  retracted  their  offer  by  selling  the  wool 
to  other  persons."  But  the  court  said:  "If 
that  was  so,  no  contract  could  ever  be  com- 
pleted by  the  post,  for,  if  the  defendants  were 
not  bound  by  their  offer  when  accepted  by 
the  plaintiffs  till  the  answer  was  received, 
then  the  plaintiffs  ought  not  be  bound  till 
after  thoy  had  received  the  notification  tliat 
the  defendants  had  received  their  answer 
and  ass<'nted  to  it  And  so  it  might  go  on 
ad  infinitum.  The  defendants  must  be  con- 
sidered, in  law,  as  making,  during  everj'  in- 
stant of  the  time  their  letter  was  travelling, 
the  same  identical  offer  to  the  plaintiffs,  and 
then  the  contract  is  completed  by  the  accept- 
ance of  it  by  the  latter." 

Those  two  cases  leave  no  doubt  at  all  on 
the  subject  Common  sense  tells  us  that 
transactions  cannot  go  on  without  such  a 
iTile,  and  these  cases  seem  to  be  the  leading 
cases  on  the  subject;  and  we  have  heard  no 
authority  cited  which  in  the  least  degree  ai- 
fects  the  principle  on  which  they  proceed. 
The  law  of  Scotland  appears  to  be  the  same 
as  the  law  of  England,  for  Mr.  Bell's  Com- 
mentary lays  down  the  same  rule  as  existing 
in  Scotland,  and  nothing  has  been  stated  to 
us  in  contradiction  of  his  opinion. 

Now,  whether  I  take  that  proposition  as 
conclusive  upon  the  objection,  or  whether  I 
consider  it  as  a  question  entirely  open,  wheth- 
er the  putting  the  letter  into  the  post  was, 
or  not,  in  time  to  constitute  a  valid  accept- 
ance, it  appears  to  me  that  the  learned  judge 


was  right  in  the  conclusion  to  which  he 
came,  that  he  was  right  in  the  mode  in 
which  he  left  the  question  to  the  jury,  and 
that  he  was  not  bound  to  lay  down  the  law 
in  the  manner  alleged  in  the  bUl  of  excep- 
tions. 

The  next  exception  Is  the  third,  wliich 
says:  "In  .so  far  as  his  lordship  did  not  di- 
rect the  jury  in  point  of  law  that  if  a  mer- 
chant makes  an  otter  to  a  party  at  a  dis- 
tance, by  post  letter,  requiring  to  be  answer- 
ed within  a  certain  time,  and  no  answer  ar- 
rives within  such  time  as  it  should  arrive.  If 
the  party  had  written  and  posted  his  letter 
witliin  the  time  allowed,  the  offerer  is  free, 
though  the  answer  may  have  actually  been 
written  and  posted  in  due  time,  if  he  is  nut 
proved  to  be  aware  of  accidental  circumstan- 
ces preventing  the  due  arrival  of  the  an- 
swer." 

That,  my  lords,  raises,  first  of  all,  a  prop- 
osition that  does  not  arise  in  this  case  at 
aU.  It  as.sumes  a  contract  that  requires  an 
answer  within  a  certain  stipulated  time,  and 
it  assumes  (which  is  already  disposed  of  liy 
what  I  have  said  in  answer  to  the  second 
exception)  that  the  putting  a  letter  into  the 
post  is  not  a  compliance  with  the  requisition 
of  the  offer.  But  there  is  no  special  contract 
here,  and  therefore  this  exception  ainnot  be 
maintained. 

4>  «  «  *  •  *  • 

I  believe  that  in  these  remarks  I  have  ex- 
hausted the  whole  of  the  objections  made, 
and  my  advice  to  your  lordships  is  to  affirm 
the  judgment  of  the  court  from  which  this  is 
appealed. 

It  was  ordered  that  the  interlocutor  com- 
plained of  should  be  affirmed,  with  costs. 


OFFER  AND  ACCEPTANCE. 


MACTIER'S  ADM'RS  v.   FRITH- 
(6  Wend.  103.) 
^'      Court   of  Errors  of   New   York.      1S30. 

Appeal  from  chancery.  At  New  York,  in 
the  autumn  of  1S22,  the  respondent  and  Hen- 
rj  Mactier  the  intestate,  agreed  to  embark 
In  a  commercial  adventure,  in  which  they 
were  to  be  jointly  and  equally  interested. 
Frith  was  to  direct  a  shipment  of  200  pipes 
of  brandy  from  France  to  N.  Y.,  to  be  con- 
signed to  Mactier,  who  was  to  ship  to  the  re- 
spondent at  Jacmel  in  St.  Domingo,  provisions 
to  the  amount  of  the  invoice  cost  of  the  bran- 
dy, and  the  respondent  was  to  place  the  ship- 
pers of  the  brandy  in  funds  by  shipments 
of  coffee  to  France  in  French  vessels,  and  the 
parties  were  to  share  equally  in  result  of  the 
speculation  all  around.  In  pursuance  of  this 
arrangement.  Frith,  Sep.  5,  1822,  wrote  Fire- 
brace,  Davidson  &  Co.,  a  mercantile  house  at 
Havre,  to  ship  200  pipes  of  brandy  to  N.  Y. 
to  the  consignment  of  Mactier.  Dec.  24, 
Frith,  who  had  returned  to  Jacmel,  where  he 
did  business  as  a  merchant,  wrote  a  letter 
to  Mactier  on  a  variety  of  subjects,  in  which 
was  contained  a  paragraph  in  these  words: 
"I  also  have  the  pleasure  of  handing  you 
copies  of  Messrs.  Firebrace,  Davidson  »&  Co.'s 
letters  regarding  the  brandy  order.  By-the- 
bye,  as  your  brother  before  I  left  New  York, 
declined  taking  the  interest  I  offered  him  in 
this  specuLition,  and  wishing  to  confine  my- 
self in  business  as  much  as  possible,  so  as  to 
bring  my  concerns  to  a  certain  focus,  I  would 
propose  to  you  to  take  the  adventure  solely 
to  your  own  account,  holding  the  value  to 
cover  the  transaction  to  my  account  in  New 
York."  Jan.  17,  1823,  Mactier  wrote  to  Frith, 
acknowledging  tne  receipt  of  his  letter  of  the 
24th  ult.;  thanks  him  for  sending  the  copy  of 
Firebrace,  Davidson  &  Co.'s  letter  on  the  sub- 
ject of  the  brandy  order;  says  that  he  has 
received  a  letter  from  them,  informing  that 
the  brandy  would  be  shipped  and  leave  Bor- 
deaux about  Dec.  1  then  past;  and  adds: 
"This  has  been  from  the  first  a  favorite  spec- 
ulation with  me,  and  am  pleased  to  say  it  still 
promi.ses  a  favorable  result;  but  to  render  it 
complete,  I  am  desirous  the  speculation  should 
go  forward  in  the  way  first  proposed,  thereby 
making  it  a  treble  operation;  as  you  have, 
however,  expressed  a  wish  that  I  should  take 
the  adventure  to  my  own  account,  I  shall  de- 
lay coming  to  any  determination  till  I  again 
hear  from  you.  The  prospect  of  war  between 
France  and  Spain  may  defeat  the  object  of 
this  speculation,  as  far  as  relates  to  the  ship- 
ment of  provisions  hence  to  Hayti  to  be  in- 
vested in  coffee  for  France,  in  which  case  I 
will  at  once  deciae  to  take  the  adventure  to 
my  own  account.  Our  London  accounts,  down 
to  the  fifth  of  December,  speak  confidently  of 
a  war  between  France  and  Spain,  a  measure 
which,  if  carried  into  effect,  would  operate  to 
your  disadvantage."  Also:  "The  next  ar- 
rival from  Europe  will  probably  decide  the 
question  of  peace  or  war,  and  I  will  lose  no 


time  in  commumcating  the  same  to  you;"  and 
also,  "let  what  will  happen,  I  trust  you  will 
in  no  w-ay  be  a  sufferer."  Mar.  7,  1823, 
Frith  wrote  Mactier,  making  no  other  allusion 
to  the  last  letter  of  Mactier  than  the  follow- 
ing: "I  have  received  your  esteemed  favors 
of  the  17th  and  31st  January,  and  note  their 
respective  contents."  Mar.  12,  1S23,  the  ship 
La  Claire  arrived  at  N.  Y.,  laden  with  the 
brandy  in  question,  and  was  at  the  wharf  on 
the  morning  of  Mar.  13.  A  clerk  of  Mactier 
testified  tliat  he  had  a  conversation  with  Mac- 
tier  about  the  time  the  brandy  arrived,  per- 
haps the  morning  after,  and  Mactier  then  said 
he  should  take  it  to  himself.  A  merchant  of 
N.  Y.  also  testified  that  Mactier  consulted 
with  him  on  the  subject  of  some  brandy 
which  he  expected  to  arrive;  there  was  some 
offer  for  his  taking  it  on  his  own  account,  and 
he  appeared  inclined  to  take  it.  From  the 
state  of  things,  he  advised  Mactier  to  take  it. 
and  there  was  a  l--jtter  drafted  by  Mactier  up- 
on the  subject,  in  which  the  merchant  made 
some  alterations.  The  letter  stated  that  he, 
Mactier,  should  take  the  brandy  to  his  own 
account  Mar.  17,  Mactier  entered  the  brandy 
at  the  custom-house  as  owner,  and  not  as  con- 
signee, took  the  usual  oath,  and  gave  a  bond 
for  the  duties.  Mar.  22,  he  sold  150  pipes 
of  the  brandy  on  the  wharf  to  several  com- 
mercial houses,  and  took  their  notes  for  the 
price  of  the  same.  The  remaining  50  pipes 
were  put  in  the  public  store,  and  remained 
there  in  bond,  the  liquidated  duties  not  having 
been  secured  to  be  paid  by  Mactier.  Mar.  25, 
Mactier  wrote  a  letter,  directed  to  Frith  at 
Jacmel,  in  which  he  said,  "I  have  now  to 
advise  the  arrival  of  French  ship  La  Claire 
with  the  200  pipes  of  brandy,  and  that  in 
consequence  of  the  probability  of  war  be- 
tween France  and  Spain,  and  in  compliance 
with  the  wish  expressed  in  your  regarded 
favor  of  the  24th  December  and  my  answer 
thereto  of  the  17th  January  last,  I  have  de- 
cided to  take  this  adventure  to  my  own  ac- 
count. I,  therefore,  credit  you  with  the 
amount  of  the  invoice,"  amounting  to  $14,- 
254.57.  To  this  letter  was  attached  a  post- 
script, dated  Mar.  31.  Mar.  28,  Frith  wrote 
a  letter  to  Mactier,  dated  at  Jacmel,  in  which, 
speaking  of  the  brandy  in  question,  he  says: 
"With  regard  to  this  adventure,  I  would  wish 
to  confirm,  if  altogether  satisfactory  to  you, 
what  I  mentioned  to  you  some  time  ago,  and 
which  I  omitted  to  repeat  to  you  in  my  pre- 
vious letter,  in  reply  to  yours  of  the  17th 
January.  I  fin^  the  more  one  does  in  this 
countiy,  in  the  present  state  of  trade,  the 
more  one's  affairs  get  shackled."  Previous  to 
the  an-ival  of  these  last  two  letters  at  their 
respective  places  of  direction,  Mactier  was 
dead,  he  having  departed  this  life  Apr.  10, 
1823.  Apr.  21,  Frith  again  wrote  a  letter 
addressed  to  Mactier,  in  which  he  acknowl- 
edges the  receipt  of  his  letter  of  Mar.  25,  says 
he  has  noted  its  contents,  and  requests  Mac- 
tier  to  charter  on  his  account  a  staunch  first- 
class  vessel,  and  send  out  to  Jacmel  by  her 


COMMUNICATION   BY  CORRESPONDENCE. 


39 


400  barrels  of  flour,  150  barrels  of  pork,  150 
barrels  of  beef,  100  barrels  of  mackerel,  &c., 
&c.  Ill  the  mean  time,  however,  Mactler  hav- 
ing (lied,  administratioa  of  his  goods,  &c., 
was  granted  to  A.  N.  Lawrence  and  anotlier, 
who  in  May,  182o,  gave  the  requisite  bonds 
to  secure  the  duties  on  the  50  pipes  of  brandy 
which  had  not  been  bonded  for  by  Maclier  in 
his  lifetime,  except  by  the  general  bond  on 
entering  the  goods  at  the  custom-house,  and 
took  the  50  pipes  from  the  public  store  and 
sold  them  at  public  auction. 

The  respondent,  unwilling  to  come  in  as  a 
general  creditor  of  Mactier  and  receive  a  pro 
rata  distribution,  Apr  1,  1824,  tiled  his  bill  in 
the  court  of  chancery,  alleging  that  the  bran- 
dy was  shipped  from  France  on  his  sole  ac- 
count, and  that  Mactier  was  only  the  con- 
signee thereof.  The  respondent,  in  his  bill, 
admits  that  he  proposed  to  Mactier  to  become 
the  purchaser  of  the  brandy,  but  avers  that 
after  the  receipt  of  his  letter  of  Jan.  17,  he 
considered  him  as  having  declined  his  pro- 
posal, and  that  no  other  ofler  was  subsequent- 
ly made  by  the  respondent  He  sets  forth  a 
letter  written  to  him  by  Mactier  Mar.  13, 
1S23,  in  which,  speaking  of  the  brandy  or- 
dered from  France,  he  says:  "I  am  looking 
daily  for  its  arrival;  it  is  to  be  regretted  the 
order  was  not  more  promptly  executed,  as  the 
delay,  I  fear,  will  operate  to  our  disadvantage. 
We  have  London  dates  to  the  30th  Januaiy; 
war  between  France  and  Spain  may  now  be 
considered  inevitable;  France  has  recalled 
her  minister,  and  100,000  Frenchmen  hav4 
been  ordered  to  march  into  Spain."  He  al- 
leges that  the  letter  of  Mactier  to  him  of  Mar. 
25  was  not  received  until  several  days  after 
the  death  of  Mactier,  and  that  his  letter  to 
Mactier  of  Apr.  21  was  written  in  ignorance 
of  the  death  of  Mactier,  and  that  he  did  not 
intend  thereby,  and  he  conceives  he  did  not 
Anally  consummate  the  sale  as  claimed.  He 
avers  that  the  promissory  notes  received  by 
Mactier  from  tlie  purchasers  of  the  150  pipes 
of  brandy  remained  in  Mactier's  possession 
at  the  time  of  his  death,  not  discounted  or 
passed  away,  and  that  the  same  came  into 
the  possession  of,  and  were  at  maturity  col- 
lected by  the  defendants;  that  the  defendants, 
by  wrongfully  and  collusively  representing 
themselves  as  entitled  to  the  50  pipes  of 
brandy  remaining  in  the  public  store,  obtain- 
ed possession  of  and  sold  the  same;  and  that 
July  2,  1823,  he,  by  his  attorney,  claimed  of 
the  defendants  the  part  of  the  shipment  or 
invoice  of  brandy  which  remained  unsold  at 
the  decease  of  Mactier,  and  also  demanded 
the  proceeds  of  that  part  of  the  invoice  sold 
by  Mactier  existing  in  notes  or  otherwise,  and 
the  proceeds  of  the  part  sold  by  the  defend- 
ants. The  bill  concludes  by  praying  an  ac- 
count of  the  sales  of  the  brandy,  and  a  decree 
directing  the  defendants  to  retain  in  their 
hands  sufficient  of  the  funds  belonging  to  the 
estate  of  Mactier  to  pay  and  satisfy  the  re- 
spondent when  his  accounts  shall  be  settled 
and  adjudged  upon  by  the  court 


The  defendants  put  in  their  answer,  insist- 
ing that  the  brandy,  on  its  arrival  at  the  port 
of  New  York,  was  the  sole  and  exclusive 
property  of  Mactier,  and  that  the  purtion 
thereof  which  c.tme  to  their  hands  at  his  de- 
cease, and  the  proceeds  of  that  part  thereof 
which  was  sold  by  him  In  his  lifetime,  and 
which  came  to  their  hands,  rightfully  belong- 
ed to  his  estate,  and  was  subject  to  be  dis- 
posed of  in  a  due  coui-se  of  administration. 
The  defendants  admit  that  they  have  in  their 
hands  $13,035,  belonging  to  the  estate  of  Mac- 
tier,  after  the  payment  of  certain  debts  to  the 
United  States,  and  various  other  sums  of 
money  which  they  were  directed  to  pay,  have 
credit  for  the  payment  of  and  are  authorized 
to  retain,  by  virtue  of  a  decree  of  the  court  of 
chancery  of  June  14,  1S2:{,  in  a  cause  wherein 
A.  Mactier,  Sr.,  in  behalf  of  himself  and  the 
creditors  of  Henry  Mactier,  deceased,  is  com- 
plainant, and  themselves  defendants;  and 
they  contend  that  such  decree  is  in  full  force, 
and  that  by  virtue  thereof  they  are  bound  to 
pay  the  above  mentioned  sum  of  money  and 
such  as  may  come  to  their  hands  pro  rata,  or 
equally  among  all  the  creditors  of  Henry  Mac- 
tier,  pursuant  to  such  decree. 

By  the  answer  it  was  admitted  that  the  de- 
fendants had  found-  among  the  papers  of 
Henry  Mactier  two  invoices  of  the  200  pipes 
of  brandy,  similar  in  all  respects,  except  that 
one  states  the  shipment  to  have  been  made 
"to  the  address  aLd  for  the  account  of  Henry 
Mactier,"  and  the  other  states  it  to  have  been 
made  "for  the  account  of  the  complainant  to 
the  address  of  Henry  Mactier."  The  first  of 
the  invoices  was  used  upon  entering  the 
brandy  at  the  custom-house.  It  also  appeared 
in  evidence  that  ]\Iaf.  1,  1823,  Mactier  effected 
an  insurance  on  commissions  arising  on  a  con- 
signment from  Bordetiux  to  New  York,  to 
the  amount  of  $1,500.  In  a  petty  cash-book 
of  Mactier's  there  is  the  following  entry: 
"1823,  March  17,  John  A.  Frith's  sales  of 
brandy,  paid  entry  at  custom-house,  eighty 
cents."  The  clerk  of  Mactier,  who  made  this 
entry,  testified  that  the  name  of  Frith  pre- 
fixed to  the  entry  in  the  petty  cash-book  does 
not  necessarily  prove  that  the  brandy  was 
Frith's,  but  it  shows  that  he  at  that  time  sup- 
posed the  brandy  to  be  P^'rith's;  if  it  had  then 
belonged  to  Mactier,  or  if  Mactier  had  decided 
to  take  it,  ard  any  entry  in  the  books  had 
been  made  showing  that  fact  he  would  have 
entered  it.  "Sales  of  brandy,  Dr.  for  enter- 
ing, &c."  At  the  time  of  making  the  entry 
he  considered  the  fact  of  ownership  contin- 
gent. Mactier  afterwards  directed  the  ac- 
count to  be  opened  in  the  books,  charging  the 
bmndy  to  himself,  the  account  to  be  "Sales  of 
brandy."  An  entry  was  made  in  the  day- 
book of  Mar.  2S,  crediting  Frith  with  the  in- 
voice amount  of  the  brandy.  Entries,  he  said, 
are  sometimes  made  several  days  after  the 
transaction;  then  the  entry  refers  back  to  the 
true  date  of  the  transaction,  mentioning  the 
time.  The  entry  was  made  by  Mar.  31.  He 
also  testified  that  the  letter  of  Mar.  13,  men- 


40 


OFFER  xVXD  ACCEPTAXCE. 


tionod  in  tie  complainant's  bill,  was  copied 
on  the  night  of  that  daj-,  but  he  had  no  recol- 
lection when  it  left  the  office;  it  possibly 
might  not  have  gone  until  the  La  Claire  ar- 
rived. 

May  20,  1S25.  Chancellor  Sanford  made  an 
order  of  reference  to  a  master  to  examine 
witnesses,  and  to  report  whether,  in  his  opin- 
ion, the  complainant  was  the  owner  of  any 
part,  and  what  part  of  the  shipment  of  brandy 
at  the  time  of  the  sale  of  the  same  or  of  any 
part  thereof,  and  if  so,  whether,  as  such  own- 
er, he  had  a  lien  by  virtue  of  such  ownership 
on  the  brandy,  or  the  proceeds  thereof,  in  the 
hands  of  the  defendants;  and  that  if  the  mas- 
ter should  be  of  opinion  that  he  was  entitled 
as  a  special  creditor,  or  had  a  lien,  that  then 
he  should  take  and  state  an  account,  and  re- 
port the  amount  due  the  complainant  as  such 
special  creditor,  or  having  a  lien.  Under  this 
order  witnesses  were  examined,  and  a  mass 
of  documentary  evidence  produced  before  the 
master,  who,  Oct  10,  1825,  reported  that  the 
complainant  was  not-  the  owner  of  the  ship- 
ment of  brandy,  neither  at  the  time  of  the 
sale  of  the  part  thereof  made  by  Mactier  in 
his  lifetime,  nor  of  the  other  part  thereof 
made  by  the  defendants  as  his  administrators 
since  his  death,  and  had  no  lien  on  the  brandy, 
or  on  the  proceeds  thereof  in  the  hands  of  the 
administrators  To  this  report  the  complain- 
ant excepted,  and  the  cause  was  heard  upon 
the  exceptions  before  Chancellor  Walworth, 
who,  in  Mar.  1829,  allowed  the  exception  to 
that  part  of  the  master's  report  above  stated 
(other  exceptions  to  other  parts  of  the  report, 
which  it  has  not  been  deemed  essential  to 
state,  were  disallowed),  and  decreed  that  the 
report  be  referred  back  to  the  master  to  alter 
and  correct  the  same,  and  to  take  and  state 
an  account,  and  report  the  amount  due  the 
complainant,  on  the  principle  that  he,  as  sur- 
vivor, is  entitled  to  the  net  proceeds  of  the 
adventure  of  brandy  so  far  as  they  can  be 
traced  and  identified,  and  has  a  specific  lien 
on  the  net  proceeds  of  the  50  pipes  of  brandy 
sold  by  the  administrators,  and  of  the  pro- 
ceeds of  the  notes  given  for  the  150  pipes 
which  remained  uncollected  or  not  passed 
away  at  the  time  of  Mactier's  death,  or  on  so 
much  as  is  necessary  to  satisfy  the  balance 
due  complainant  for  payment  and  disburse- 
ments on  account  of  that  adventure,  after  de- 
ducting from  those  proceeds  the  balance  of 
the  amount  paid  for  duties  and  expenses,  if 
any,  over  and  above  the  amount  of  proceeds 
of  the  shipment  of  brandy  which  were  re- 
ceived by  Mactier  in  his  lifetime.  From  this 
decree  the  defendants  appealed.  For  the  rea- 
sons of  the  chancellor,  for  the  decree  pro- 
nounced by  him,  see  1  Paige,  434.  The  cause 
was  argued  here  by 

S.  Boyd  and  S.  A.  Talcott,  for  appellants. 
S.  Stevens  and  G.  Griffin,  for  respondent 

MAIICY,  J.  The  object  of  the  bill  filed  in 
this  case  is  to  obtain  from  the  administrators 


of,  Mactier  the  proceeds  of  the  50  pipes  oi 
brandy  which  came  to  their  possession  after 
his  death,  and  the  amount  of  such  notes  taken 
on  the  sale  of  the  150  pipes.  Mar.  22,  1823, 
as  were  uncollected  and  undisposed  of  at  the 
death  of  Mactier,  or,  at  least,  so  much  there- 
of as  may  be  necessary  to  pay  the  balance 
due  the  respondent  for  disbursements  on  ac- 
count of  the  adventure.  The  question  on 
which  the  decision  in  this  case,  as  I  appre- 
hend, mainly  depends,  relates  to  the  alleged 
sale  of  the  brandy  to  Mactier.  There  are 
many  definitions  of  what  constitutes  a  con- 
tract, but  all  of  them  are,  of  course,  sub- 
stantially alike.  Powell  states  a  contract  to 
be  a  transaction  in  which  each  party  comes 
under  an  obligation  to  the  other,  and  each 
reciprocally  acquires  a  right  to  what  is  prom- 
ised by  the  other.  Pow.  Cont  4.  In  testing 
the  validity  of  contracts,  many  things  are  to 
be  considered.  The  contract  that  the  appel- 
lant sets  up  in  this  case  is  alleged  by  the  re- 
spondent to  be  deficient  in  several  essential 
requisites.  When  that  was  done  which,  on 
the  assumption  of  there  being  parties  capablt- 
of  contracting,  was  necessary,  as  the  respond- 
ent contends,  to  complete  it,  Mactier  was 
dead.  If  the  contract  was  only  in  progress 
of  execution,  and  there  remained  but  a  single 
act  to  be  done  to  complete  it,  his  death  ren- 
dered the  performance  of  that  act  impossible; 
it  suspended  the  proceedings  at  the  very 
point   where  they   were   when  it  occurred. 

The  doctrine  of  relation  was  discussed  on 
the  argument,  and  its  application  urged  on  us. 
It  was  insisted  that  if  notliing  but  a  formal  act 
was  to  be  done,  and  it  was  done  by  the  sur- 
viving party  after  the  death  of  the  other, 
and  in  ignorance  of  it,  this  act  might  be  ad- 
judged to  relate  to  a  period  antecedent  to  the 
death  of  the  party  dying.  If,  as  it  was  held 
in  the  court  below,  the  bargain  in  this  case 
cotild  not  be  closed  until  Frith  received  Mac- 
tier's  letter  accepting  his  ol3'er  to  sell,  the  re- 
ceiving that  letter,  it  was  said,  might  be  con- 
sidered as  having  relation  to  the  time  when  it 
was  sent,  upon  the  principle  that  courts  often 
resort  to  this  doctrine  of  relation  to  prevent 
an  injury  resulting  to  a  party  from  the  act 
of  God.  Where  an  agent  without  competent 
authority  makes  a  contract,  a  subsequent  rat- 
ification by  the  principal  relates  back  to  the 
time  when  the  agent  acted.  The  ratification 
is  equivalent  to  an  original  authority;  it  is 
considered  in  law  as  furnishing  proof  of  an 
authority  in  the  agent  at  the  time  he  assumed 
to  have  it.  If,  however,  he  had  disclosed  his 
want  of  authority,  but  had  settled  the  terms 
of  the  contract,  in  the  belief  that  what  he  did 
would  be  ratified,  the  doctrine  of  relation 
would  not  apply;  the  bargain  would  take 
effect  from  the  time  of  the  ratification.  The 
reason  of  the  distinction  which  I  apprehend 
to  exist  in  the  two  cases,  is,  that  in  the  one 
acts  are  done  which  make  a  perfect  contract, 
provided  the  actors  had  the  authority  they 
assumed  to  have,  and  the  ratification  of  their 
acts  by  those  from  whom  their  power  must 


COMMUNICATION  BY  CORRESPONDENCE. 


41 


have  been  dorived,  if  they  had  it,  is  legal  evi- 
dence that  they  did  have  it  when  they  acted. 
In  Ihe  other  case,  the  fact  being  made  known 
that  there  was  not  competent  power  in  one  of 
the  actors,  the  very  foundation,  on  which 
alone  the  presumption  of  authority  can  rest. 
Is  destroyed.  A  presumption  will  not  be  call- 
ed in  to  supply  an  Impossibility.  In  a  con- 
tract of  sale  all  agree  that  there  must  be  two 
minds,  at  least,  concurring  at  the  moment  of 
its  completion;  l)Ut  this  cannot  be  if  there  be 
but  one  contracting  party  in  existence.  There 
Is  also,  as  I  conceive,  a  difference  between 
acts  essential  to  perfect  an  agreement  and 
those  which  relate  to  the  forms  prescribed  in 
certain  instances  as  modes  of  proof.  This 
dilTerence  is  illustrated  by  those  cases  which 
were  referred  to  on  the  argument  concerning 
the  enrollment  of  deeds.  The  enrollment  is  a 
formal  act,  but  necessary  to  be  done,  to  enable 
the  party  to  prove  the  bargain  and  sale,  but 
when  it  is  done  it  relates  to  the  time  when 
the  indenture  was  executed.  It  is  as  Lord 
Bacon  calls  it,  but  a  perfective  ceremony  of 
the  first  deed  of  bargain  and  sale.  Regula., 
14.  So  where  chancery  decrees  the  execu- 
tion of  a  parol  contract,  on  the  ground  of  part 
perfornwuce,  the  title  certainly,  as  between 
the  parties,  vests  from  the  time  of  the  con- 
tract, and  not  from  the  performance  of  those 
acts  that  remove  the  bar  created  by  the  stat- 
ute of  frauas.  The  doctrine  of  relation  may 
be  permitted  to  operate  on  these  formal  acts, 
but  it  cannot  be  used,  as  it  is  proposed  to 
use  it  here,  to  supply  a  party  to  a  contract 
who  does  not  exist  at  the  time  when  the  act 
is  done  which  fixes  to  it  the  seal  of  vahdity; 
or,  what  is  the  same  thing,  it  cannot  carry 
back  that  act  to  a  time  when  parties  capa- 
ble of  contracting  did  m  fact  exist.  This  view 
of  the  subject  is  conformable  to  the  civil  law 
as  well  as  the  law  of  France.  By  these  laws, 
the  death  of  the  party  offering  to  sell,  is  held 
to  be  a  revocation  of  the  offer,  and  an  ac- 
ceptance subsequent  to  that  event  is  inef- 
fectual to  close  the  bargain.  Poth.  Mar.  Cont. 
p.  1,  §  2,  art.  3,  No.  82.  My  conclusion,  in 
regard  to  this  objection  to  the  alleged  con- 
tract, is,  that  if  any  act  was  required  to  be 
done,  even  by  Frith,  to  complete  the  sale 
when  Mactier  died,  that  act  could  not  be  sub- 
sequently performed. 

I  am  now  to  consider  whether  there  was  a 
contract,  before  Macticr's  death,  which  had 
the  consent  of  the  contracting  parties  so  giv- 
en and  made  known  as  to  be  binding  on  them. 
That  a  consent  is  necessary  all  agree,  but 
what  shall  constitute  it  in  a  given  case  may 
admit  of  much  diversity  of  opinion.  The  con- 
sent of  the  parties  in  a  contract  of  sale,  as 
■explained  by  Pothier,  consists  in  the  concur- 
rence of  the  will  of  the  vendor  to  sell  a  par- 
ticular thing  to  the  purchaser  for  a  specified 
price,  with  the  will  of  the  purchaser  to  buy 
the  same  thing  for  that  price.  Poth.  Mar. 
Cont  pi.  1,  §  2,  art  3,  No.  31.  Delvincourt. 
another  eminent  French  writer  on  the  Civil 
Code  of  EYance,  says,  that  although  it  is  im- 


possible that  there  should  be  a  contract  with- 
out the  consent  of  all  parties,  it  is  not  indis- 
pen.sable  that  the  wills  of  the  parties  should 
concur  at  the  same  instant,  provided  the  will 
of  the  one  that  did  not  concur  at  first  is  de- 
clared before  the  will  of  the  other  is  revoked. 
5  Cours  de  Code  Civil,  03.  Although  the  will 
of  the  party  making  the  offer  may  precede 
that  of  the  party  accepting,  yet  it  must  con- 
tinue down  to  the  time  of  the  acceptance. 
Where  parties  are  together  chaffering  about 
an  article  of  merchandise,  and  one  expresses 
a  present  willingness  to  accept  of  certain 
terms,  that  willingness  is  supposed  to  con- 
tinue, unless  it  is  revoked,  to  the  close  of 
their  interview  and  negotiation  on  the  same 
subject,  and  if  during  this  time  the  other 
party  says  he  will  take  the  article  on  the 
terms  proposed,  the  bargain  is  thereby  closed. 
Poth.  Mar.  Cont  p.  1.  §  2,  art  3,  No.  3L 
What  I  mean  by  its  being  closed  is,  tliat  noth- 
ing mutual  between  the  parties  remains  to  be 
done  to  give  to  either  a  right  to  have  it  car- 
ried into  effect;  either  can  enforce  it  against 
the  other,  or  recover  damages  for  the  non- 
fulfillment of  it:  but  if  there  be  conditions 
expressed  or  implied  to  be  performed  by  the 
purchaser,  he  cannot  compel  the  delivery  un- 
til they  are  performed.  If  the  price  is  to  be 
immediately  paid  or  security  given,  he  cannot 
have  the  propeity  until  payment  made,  or  se- 
curity given,  or  a  tender  thereof.  Touch.  2(>4, 
20.j;   Noy,  Max.  c.  42;   2  Bl.  Comm.  447. 

Where  the  negotiation  between  the  con- 
tracting parties  residing  at  a  distance  from 
each  other  is  conducted,  as  it  usually  is  by 
letters,  it  is  necessary,  in  order  iJiat  their 
minds  may  meet,  that  the  will  of  the  party 
making  the  proposition  to  sell  should  con- 
tinue until  his  letter  shall  have  reached  the 
other,  and  he  shall  have  signified,  or  at  least 
had  an  opportunity  to  signify  his  acceptance 
of  the  proposition.  This  Pothier  holds  to  be 
the  legal  presumption  unless  the  contrary  ap- 
pears. His  language  is:  "Cette  volonte  est 
presumee  tant  qu'il  ne  parait  rien  de  contra- 
rie."  This  doctrine,  which  presumes  the  con- 
tinuance of  a  willingness  to  contract  after  it 
has  been  manifested  by  an  offer  is  not  con- 
fined to  the  civil  law  and  the  codes  of  those 
nations  which  have  constructed  their  systems 
with  the  materials  drawn  from  that  exhaust- 
less  storehouse  of  jurisprudence:  it  is  found 
in  the  common  law;  indeed,  it  exists,  of  ne- 
cessity, wherever  the  power  to  contract  exists 
In  parties  separated  from  each  other.  The 
rule  of  the  common  law  is,  that  wherever  the 
existence  of  a  particular  subject-matter  or 
relation  has  been  once  proved,  its  continuance 
is  presumed  till  proof  be  given  to  the  contrary, 
or  till  a  different  presimiption  be  afforded  by 
the  nature  of  the  subject-matter.  16  East 
5.5;  3  Starkie.  Ev.  12.52.  The  case  of  Adams 
V.  Lindsell,  1  Barn.  &  Aid.  t'.Sl.  proceeds  upon 
and  atlirms  the  principle  that  the  willingness 
to  contract  thus  manifested  is  presumed  to 
continue  for  the  time  limited,  and.  if  that  be 
not  indicated  by  the  offer,  until  it  is  expressly 


42 


OFFEU  AND  ACCEPTANCE. 


revoked  or  countervailed  by  a  contrary  pre- 
sumption. In  that  case  it  was  said,  "Tlie  de- 
fendants must  be  considered  in  law  as  making 
during  every  instant  of  time  their  letter  was 
traveling  the  same  identical  offer  to  the  plain- 
tiffs; and  then  the  contract  is  complete  by 
the  acceptance  of  it  by  tlie  latter."  Against 
the  authority  of  the  case  of  Adams  v.  Lind- 
sell,  we  have  urged  on  us  a  decision  of  a 
court  of  the  highest  respectability  in  one  of 
our  sister  states.  The  case  of  M'CuUoch  v. 
Insui-ance  Co.,  1  Pick.  27S,  conflicts  in  prin 
ciple,  according  to  my  views  of  it,  with  the 
case  decided  by  the  king's  bench.  I  should 
have  been  pleased  to  see  these  tribunals  har- 
monize upon  a  question  of  no  small  impor- 
tance to  the  commercial  world;  and  I  have, 
therefore,  deliberately  weighed  the  ingenious 
attempts  made  to  reconcile  these  decisions  up- 
on this  point;  but  these  attempts  appear  to  me 
to  have  been  unsuccessful.  A  refinement 
which  would  distinguish  between  a  contract 
for  insurance,  and  one  for  the  sale  of  goods  in 
relation  to  the  assent  of  the  parties,  might 
reheve  us  from  the  embarrassment  which 
the  different  principles  of  these  decisions  is 
calculated  to  produce;  but  to  apply  such  a 
distinction  hereafter  would  doubtless  involve 
courts  iu  a  still  more  disti'essing  embarrass- 
ment. Distinctions,  which  are  not  founded 
on  a  difference  in  the  nature  of  things,  are 
not  entitled  to  indulgence;  they  tend  to  make 
the  science  ot  law  a  collection  of  arbitrary 
rules  appealing  to  factitious  reasons  for  their 
support,  consequently  difficult  to  be  acquired, 
and  often  of  uncertain  application.  The  two 
cases  referred  to  should  have  had  applied  to 
them  the  same  rule  of  law,  and  we  are  re- 
quired to  say  what  that  rule  is  in  deciding 
the  case  now  under  consideration. 

The  principle  of  the  decision  of  the  king's 
bench  is  simply  that  the  acceptance  of  an 
offer  made,  through  the  medium  of  a  letter, 
binds  the  bargain  if  the  party  making  the 
offer  has  not  revoked  it,  as  he  has  a  right  to 
do  before  it  is  accepted.  The  rule  laid  down 
by  the  supreme  court  of  Massachusetts  re- 
gards the  contract  as  incomplete  until  the 
party  making  the  offer  is  notified  of  the  ac- 
ceptance, or  until  the  time  when  he  should 
have  received  it,  the  party  accepting  having 
done  what  was  incumbent  on  him  to  give 
notice.  The  chancellor  in  deciding  this  case 
gave  his  sanction  to  the  latter  rule:  "To 
make  a  valid  contract,"  he  says,  "it  is  not 
only  necessary  that  the  minds  of  the  con- 
tracting parties  should  meet  on  the  subject 
of  the  contract,  but  they  must  know  that 
fact."  The  decision  of  the  court  of  Massa- 
chusetts makes  knowledge  by  the  party  ten- 
dering the  offer  of  the  other's  acceptance  es- 
sential to  the  completion  of  the  contract.  If 
one  party  is  not  bound  till  he  knows  or  might 
know,  and  therefore  is  presumed  to  know  that 
the  other  has  accepted,  the  accepting  party, 
on  the  same  principle,  ought  not  to  be  bound 
till  he  knows  the  offering  party  has  not  re- 
called the  offer  before  knowledge  of  the  ac- 


ceptance. The  principle  of  that  case  would 
bring  the  matter  to  the  point  stated  by  the 
chancellor,  viz.:  the  parties  umst  know  that 
their  minds  meet  on  the  subject  of  the  con- 
tract. If  a  bargain  can  be  completed  be- 
tween absent  parties,  it  must  be  when  one  ot 
them  cannot  know  the  fact  whether  it  be  or 
be  not  completed  It  cannot  begin  to  be 
obligatory  on  the  one  before  it  is  on  the 
other;  there  must  be  a  precise  time  when 
the  obligation  attaches  to  both,  and  this  time 
must  happen  when  one  of  the  parties  caimot 
know  that  the  obligation  has  attached  to  him; 
the  obligation  does  not,  therefore,  arise  from 
a  knowledge  of  the  present  concurrence  of 
the  wills  of  the  contracting  parties.  All  the 
authorities  state  a  contract  or  an  agreement 
(which  is  the  same  thing)  to  be  aggregatio 
mentium.  Why  should  not  this  meeting  of 
the  minds,  which  makes  the  contract,  also 
indicate  the  moment  when  it  becomes  obliga- 
tory? I  might  rather  ask,  is  it  not  and  must 
it  not  be  the  moment  when  it  does  become 
obligatory?  If  the  party  making  the  offer  is 
not  bound  until  he  knows  of  this  meeting 
of  minds,  for  the  same  reason  the  party  ac- 
cepting the  offer  ought  not  to  be  bound  when 
his  acceptance  is  received,  because  he  does 
not  know  of  the  meeting  of  the  minds,  for  the- 
offer  may  have  been  withdrawn  before  his 
acceptance  was  received.  If  more  than  a 
concurrence  of  minds  upon  a  distinct  prop- 
osition is  required  to  make  an  obligatory  con- 
tract, the  definition  of  what  constitutes  a  con- 
tract is  not  correct.  Instead  of  being  the 
meeting  of  the  minds  of  the  contracting  par- 
ties, it  should  be  a  knowledge  of  this  meet- 
ing. It  was  said  on  the  argument  that  if 
concurrence  of  minds  alone  would  make  a 
valid  contract,  one  might  be  constructed  oui 
of  mere  volitions  and  uncommunica ted  wishes; 
I  think  such  a  result  would  not  follow.  The 
law  does  not  regard  bare  volitions  and  pure 
mental  abstractions.  When  it  speaks  of  the 
operations  of  the  mind,  it  means  such  as  have 
been  made  manifest  by  overt  acts;  when  it 
speaks  of  the  meeting  of  minds,  it  refers  to 
such  a  meeting  as  has  been  made  known  by 
proper  acts,  and  when  thus  made  known  it  is 
effective,  although  the  parties  who  may  claim 
the  benefit  of,  or  be  bound  by  a  contract  thus 
made,  may  for  a  season  remain  ignorant  of 
its  being  made. 

Testing  the  rules  of  the  law  laid  down  in 
the  two  cases  to  which  I  have  referred  by 
the  authority  of  reason,  and  the  practical 
results  that  are  likely  to  flow  from  them,  it 
does  appear  to  me,  that  we  are  not  left  at 
liberty  to  hesitate  about  the  choice.  If  we 
are  inclined  from  the  force  of  abstract  rea- 
son, to  prefer  the  rule  laid  down  by  the 
court  of  king's  bench,  that  inclination  will  be 
greatly  strengthened  by  a  recurrence  to  the 
opinions  of  courts  and  jurists.  The  crown 
pleas  in  England  seem  to  me  to  have  given 
their  approval  to  the  decision  of  Adams  v. 
Lind.sell,  4  Bing.  653.  Judge  Washington,  in 
delivering  the  opinion  of  the  court,  in  Eliason 


COMMUNICATION  BY  CORRESPONDENCE. 


43 


V.  Henshaw,  4  Wheat.  228,  said,  "Until  the 
terms  of  the  agreoraont  have  received  the  as- 
sent of  both  parties  the  noKoUation  is  open, 
and  imposes  no  obligation  on  either."  The 
inforcnce  from  this  proposition  is  that  the 
assent  of  the  parties  to  the  terms  of  the 
agreement,  and  not  their  knowledge  of  It, 
completes  the  contract  It  was  decided  in 
the  circuit  court  of  the  United  States,  for 
Pennsylvania,  that  contracts  are  formed  by 
the  offer  on  the  one  hand,  and  an  acceptance 
on  the  other.  After  acceptance,  the  contract 
is  obligatory  on  both.  Coxe,  Dig.  192.  In 
this  case,  knowledge  of  the  acceptance  is  not 
brouglit  into  view  as  necessary  to  constitute 
the  obligation.  Both  the  Roman  law  and  the 
French  Civil  Code,  as  we  have  seen  by  the 
references  already  made,  contain  a  doctrine  in 
accordance  with  the  principle  of  tliese  cases. 
I  think  I  am,  therefore,  warranted  in  saying 
that  the  proposition  may  be  considered  as  es- 
tablished, that  the  acceptance  of  a  written 
offer  of  a  contract  of  sale  consummates  the 
bargain,  providing  the  offer  is  standing  at 
the  time  of  the  acceptance. 

What  shall  constitute  an  acceptance  will 
depend,  in  a  great  measure,  upon  circum- 
stances. The  mere  determination  of  the  mind, 
unacted  on,  can  never  be  an  acceptance. 
Where  the  offer  is  bj'  letter,  the  usual  mode 
of  acceptance  is  the  sending  of  a  letter  an- 
nouncing a  con.sent  to  accept;  where  it  is 
made  by  a  messenger,  a  determination  to  ac- 
cept, returned  through  him,  or  sent  by  anoth- 
er, would  seem  to  be  all  the  law  requires,  if 
the  contract  may  be  consummated  without 
writing.  There  are  other  modes  which  are 
equally  conclusive  upon  the  parties:  keeping 
silence,  under  certain  circumstances,  is  an 
assent  to  a  proposition;  anything  that  shall 
amount  to  a  manifestation  of  a  formed  de- 
termination to  accept,  communicated  or  put 
in  the  proper  way  to  be  communicated  to  the 
party  making  the  offer,  would  doubtless  com- 
plete the  contract;  but  a  letter  written  would 
not  be  an  acceptance,  so  long  as  it  remained 
in  the  possession  or  under  the  control  of  tlie 
writer.  An  acceptiince  is  the  distinct  act  of 
one  party  to  the  contract  as  much  as  the  offer 
is  of  the  other;  the  knowledge  by  the  party 
making  the  offer,  of  the  determination  of  the 
party  receiving  it,  is  not  an  ingredient  of  an 
acceptance.  It  is  not  compounded  of  an  as- 
sent by  one  party  to  the  terms  offered,  and 
a  knowledge  of  that  assent  by  tlie  other. 

I  will  now  apply  this  law  to  the  facts  of 
this  case.  FriUi's  offer  to  sell  his  interest  in 
the  bi-andy  certainly  continued  till  his  letter 
of  Dec.  24  was  received  at  New  York  and 
Mactier  had  a  fair  'pportunity  to  answer  it. 
If  the  answer  of  Jan.  17  had  contained  an 
unqualified  acceptance,  the  bargain  would 
have  been  closed  when  it  was  sent  away  for 
Jacmel;  but  the  offer  was  not  then  accepted; 
there  was  a  promise  to  accept  upon  a  con- 
tingency, for  Mactier  says,  after  alluding  to 
the  prospect  of  a  war  between  France  and 
Spain,  "in  which  case,"  that  Is  in  case  of  such 


I  a  war,  "I  will  at  once  decide  to  take  the 
adventure  to  my  own  account."  This  con- 
cluded nothing.  If  the  event  had  actually 
I  happened,  and  Frith  had  insisted  on  enforcing 
\  this  conditional  acceptance,  it  would  not  have 
I  been  in  his  power  to  do  so.  The  most  that 
I  Mactier  said  was,  that  if  an  expected  event 
I  happened,  he  would  do  an  act  which  would 
I  complete  tlie  bargain.  The  happening  of  the 
event  could  not,  without  the  act,  complete  it. 
The  Roman  law  regarded  the  tense  of  the 
verb  used  liy  the  contracting  parties  to  de- 
termine whether  the  bargain  was  concluded: 
"Verbum  imperfecti  temporis  rem  adhuc  im- 
perfectam  significat."  There  is  a  wide  dif- 
ference between  a  promise  to  give  an  assent 
to  a  proposition  for  a  contract  on  the  happen- 
ing of  a  contingency,  and  the  annunciation  of 
a  present  assent  to  it.  If  the  expected  event 
happens,  and  the  act  promised  is  performed, 
the  bargain  is  closed;  but  it  is  the  promised 
acceptance,  and  not  the  happening  of  the 
event,  that  gives  validity  to  the  contract.  If 
in  this  case  the  offer  of  Frith  had  been  to 
Mactier  to  take  the  brandy  on  the  happening 
of  a  French  and  Spanish  war,  and  Mactier 
had  promised  to  decide  to  take  it  in  such  an 
event,  the  simple  fact  of  his  taking  it  after 
the  war  would  have  enabled  Frith  to  treat 
him  as  the  purchaser  of  it.  Such  an  act 
would  have  beer  a  valid  acceptance;  but  a 
conditional  acceptance  of  an  unconditional  of- 
fer, followed  up  by  acts  of  the  acceptor  after 
the  condition  was  fulfilled  on  whicli  the  ac- 
ceptance depended,  might  not  be  considered 
as  completing  the  bargain  without  the  acquies- 
cence of  the  party  making  the  offer  in  those 
acts,  because  the  minds  of  the  parties  would 
not  have  met  on  the  precise  terms  of  the 
contract. 

To  conclude  the  bargain,  ilactier  must  have 
accepted  the  offer  as  tendered  to  him  by 
Frith,  and  that  acceptance  must  have  been 
while  the  offer,  in  contemplation  of  law,  was 
still  held  out  to  him.  That  there  was  an  ac- 
ceptance, or  rather  that  Mactier  did  all  that 
j  was  incumbent  on  him  to  do,  to  effect  an  ac- 
,  ceptance,  was  not  denied;  but  it  was  insisted, 
on  the  part  of  the  respondent,  that  it  was 
noade  after  the  offer  was  withdrawn.  It  will 
be  necessary  to  consider  when  this  accept- 
ance took  place,  as  preparatory  to  settling  the 
fact  of  the  continuance  of  the  offer  down  to 
tliat  time.  There  is  not  the  slightest  evidence 
of  the  determination  on  the  part  of  Mactier  to 
take  the  brandy  before  Mar.  17.  The  insur- 
ance that  he  effected  on  his  commissions  Mar. 
1  disproves  the  existence  of  such  a  deter- 
mination on  that  day;  but  if  the  situation  of 
the  parties  was  changed,  and  Frith  was  now 
endeavoring  to  set  up  the  contract,  I  am  at  a 
loss  to  conceive  how  Mactier"s  representa- 
tives could  withstand  the  force  of  the  facts 
which  took  place  Mar.  17.  In  answer  to  the 
offer,  Mactier  delayed  coming  to  a  determina- 
tion thereon,  but  promised  to  accept  it  if 
there  should  be  a  war;  Mar.  17,  when  that 
event  was  considered  as  settled,   he  entered 


44 


OFFER  AND  ACCEPTANCE. 


the  brandy  as  his  own  property,  and  told  his 
clerk  that  he  had  determined  to  take  it.  But 
If  there  should  be  any  doubt  as  to  the  effect 
of  this  conduct,  there  can  be  none  as  to  his 
subsequent  acts.  By  a  letter  dated  the  25th 
with  a  postscript  of  Mar.  31,  he  accepted  the 
offer.  This  letter  was  immediately  transmit- 
ted to  Frith,  and  as  soon  as  Mar.  28,  entries 
were  made  in  his  books  showing  that  he  had 
become  the  pm'chaser  Enough  was  done  by 
the  31st  to  constitute  an  acceptance  of  Frith's 
offer  and  to  complete  the  bargain,  if  the  offer 
can  be  considered  as  standing  till  that  day. 

An  offer,  wher  once  made,  continues,  as  I 
have  heretofore  shown,  to  the  satisfaction  of 
my  own  mind  at  least,  until  it  is  expressly 
revoked,  or  imtil  circumstances  authorize  a 
presumption  that  it  is  revoked.  The  offer  it- 
self may  show  very  clearly  when  the  pre- 
sumption of  revocation  attaches.  Where  it  is 
made  to  be  replied  to  by  return  mail,  the 
party  to  whom  it  is  addressed  must  at  once 
perceive  that  it  is  not  to  stand  for  an  ac- 
ceptance, to  be  transm'tted  after  that  mail. 
If  an  offer  stands  until  it  is  expressly  with- 
drawn, or  is  presumed  to  be  withdrawn, 
whether  it  is  held  out  to  a  party  at  a  partic- 
ular period  or  not,  is  a  matter  of  fact.  Then 
we  are  to  determine,  as  a  matterof  fact,  wheth- 
er Frith's  offer  was  held  out  for  Mactier's 
acceptance  untO  Mar.  31;  if  Frith  intended  it 
should  stand  on,  and  he  viewed  himself  as 
tendering  it  to  Mactier  down  to  tliat  time,  we 
are  bound  to  regard  it  as  standing,  unless  his 
intention  was  the  result  of  the  fraudulent 
conduct  of  Mactier.  The  acts  of  Frith,  after 
the  death  of  Mactier,  could  do  nothing  to- 
wards completing  an  unfinished  contract;  but 
I  think  they  may  be  fairly  adverted  to  for  the 
purpose  of  ascertaining  his  intentions  in  rela- 
tion to  the  continuance  of  his  offer.  Mar.  7, 
he  acknowledges  Mactier's  letter  of  Jan.  17, 
which  did  not  decline,  as  it  has  been  con- 
strued to  do,  the  offer,  but  apprised  him  that 
it  was  kept  under  advisement;  and  by  using 
the  expression,  "noting  the  contents,"  Frith 
is,  I  think,  tc  be  understood  as  yielding  to 
the  proposed  delay  If  a  doubt  as  to  this 
construction  of  that  letter  could  spring  up  in 
the  mind,  it  would  be  at  once  removed  by  the 
ptTusal  of  the  letter  of  the  28th  of  the  same 
month.  In  that  he  expresses  a  wish  to  con- 
firm what  he  had  said  in  the  letter  making 
the  offer  to  sell,  and  declares  that  he  had  in 
a  previous  letter,  which  must  mean  that  of 
the  7th,  omitted  to  communicate  the  .same 
thing.  In  answering  Mactier's  letter  which 
contained  the  acceptance  of  his  offer,  he  rec- 
ognizes the  bargain  as  closed,  and  gives  di- 
rections as  to  investing  the  proceeds  of  the 
brandy.  All  the  subsequent  correspondence 
acquiesces  in  the  sale.  It  appears  to  me  to 
be  impossible  to  say,  after  reading  the  let- 
ters of  Frith  written  subsequent  to  his  knowl- 
edge of  Mactier's  acceptance,  that  he  did  not 
consider  the  offer  as  held  out  to  Mactier  down 
to  the  time  when  it  was  accepted,  and  the  bar- 
gain closed  by  that  acceptance;    and  I  think 


we  must  adjudge  it  to  have  been  closed,  un- 
less the  agreement  was  nugatory  by  reason 
that  the  thing  to  which  it  related  had  not  an 
actual  or  potential  existence  when  the  con- 
tract was  consummated. 

Where  both  parties  are  under  a  mistake  as 
to  the  existence  of  the  thing  contracted  to  be 
sold,  the  bargain  fails.  The  cases  put  by 
Pothier  and  Chancellor  Kent  ai-e,  the  sale  of 
a  horse  which  happens  to  be  dead,  or  of  a 
house  consumed  by  fire  before  the  contract 
was  concluded.  The  law  which  has  been  ap- 
plied to  such  cases  is  not,  in  my  judgment, 
applicable  to  this.  Property  that  has  no  ac- 
tual existence  is  the  subject  of  a  valid  con- 
tract of  sale,  as  a  carriage  not  yet  made,  or 
a  crop  not  grown;  they  are  considered  to 
have  a  potential  existence.  A  pei-son  may 
sell  an  article  to  which  he  has  no  title  or  pre- 
tense of  title.  Poth.  Traite  du  Contract  de 
Vente,  p.  1,  §  2,  art.  1.  There  is,  I  appre- 
hend, no  just  ground  for  saying  that  the 
principal  part  of  this  brandy  was  not  in  ex- 
istence Mar.  31,  the  time  when  I  consider  the 
contract  to  have  become  perfected.  Fifty 
pipes  were  in  the  public  store;  the  remain- 
der had  been  sold  but  a  few  days  before,  and 
was  probably  but  pailially  consumed;  but 
whether  it  was  or  not  is  not,  in  my  view  of 
it,  material  to  this  case.  If  the  contract  was 
obligatory  on  one,  it  was  on  both.  Could 
Mactier  have  objected  to  it,  and  placed  its 
nullity  on  the  ground  that  he  had  consumed 
a  part  of  the  brandy  before  he  accepted  the 
offer  for  the  purchase?  Such  a  defense 
would  not  be  listened  to  in  any  court;  it 
could  invoke  no  principle  of  justice  to  its  aid. 

Another  objection  to  the  contract  was 
drawn  fi'om  the  alleged  fraudulent  conduct 
of  Mactier.  The  bill  does  not  seem  to  me  to 
put  the  claim  to  the  interference  of  the  court 
below  specifically  upon  that  ground.  It  does 
not  seek  to  avoid  the  oonti-act  on  the  ground 
that  Frith  was  inveigled  into  it  by  the  con- 
trivance and  artifice  of  Mactier,  but  it  de- 
nies the  existence  of  those  formalities  which 
are  requisite  to  conclude  a  contract.  Frith 
complains,  it  is  true,  that  Mactier  did  not, 
by  his  letter  of  Mar.  25,  or  any  other,  in- 
form him  of  the  sale  of  the  brandy,  of  its 
value  in  New  York,  or  of  the  arrival  of  the 
vessel  with  the  brandy  on  board.  The  letter 
of  the  2.5th  did  apprise  him  that  the  brandy 
had  an-ived.  If  any  act  was  to  be  done  by 
Frith  to  complete  the  bargain,  the  conceal- 
ment of  any  fact  that  might  influence  his  de- 
termination with  regard  to  that  act,  might 
give  rise  to  the  imputation  of  fraud;  and  if 
such  fact  was  concealed  with  a  view  to  pro- 
cure an  assent  to  a  contract  to  which,  it  is 
probable,  his  assent  would  not  have  been 
given  had  he  received  information  of  the  fact 
concealed,  he  might  allege  the  concealment  to 
exonerate  himself  from  the  obligation  to  ful- 
fil it;  but  if  he  had  no  affirmative  act  to  per- 
form before  the  bargain  might  be  closed,  and 
Mactier  was  in  a  situation  that  gave  him  tlie 
right  to  close  it,  and  he  did  so  before  the  in- 


COMMUNICATION  BY  CORRESPONDENCE. 


45 


formation  wliirh  is  allo^^cd  to  have  been  kept 
back  could  have  reached  Frith,  if  it  had  been 
duly  transmitted,  he  has  suffered  no  injury; 
indeed  there  is  no  ground  for  a  presumption 
of  fraud.  My  conclusion,  therefore,  is,  that 
the  contract  was  consummated  between  the 
parties  before  the  death  of  Mactier,  by  which 
he  acquired  all  Frith's  right  to  the  200  pipes 
of  brandy. 

The  Uiw  in  relation  to  the  right  of  the 
vendor  of  goods  to  stop  them  during  their 
transit  to  the  purchaser,  was  much' discussed 
on  the  argument;  but  I  have  been  unable  to 
discover  how  a  question,  in  relation  to  such  a 
right,  can  properly  arise  from  the  facts  in 
this  case.  If  there  was  not  a  sale,  such  a 
question  certainly  cannot  arise,  for  then  there 
would  be  no  vendor  or  vendee  and,  conse- 
quently, no  transit  of  the  brandy  from  the 
one  to  the  other.  If  there  was  a  sale,  and  I 
hold  there  was,  the  question  does  not  arise, 
because  there  was,  in  fact,  no  stoppage  or  any 
act  that  can  in  law  be  regarded  as  amount- 
ing to  a  stoppage.  By  virtue  of  the  purchase 
the  title  to  the  brandy  vested  in  Mactier;  no 
actual  deliver}',  if  it  was  not  in  his  ix)sses- 
sion,  was  necessary  to  perfect  his  title;  if 
the  brandy  had  been  destroyed  Apr.  1,  or  the 
notes  taken  for  the  portion  previously  sold 
had  proved  utterly  valueless,  the  loss  would 
have  fallen  entirely  on  Mactier.  The  un- 
sold brandy  was  his  absolute  property,  and 
on  his  death  the  title  to  it  vested  in  his  rep- 
resentatives. On  the  assumption  that  it  was 
on  its  transit,  the  right  of  the  representatives 
to  it  was  subject  to  be  affected  in  the  same 
manner  as  Mactier's  might  have  been  if  he 
had  been  in  life;  it  might  have  been  defeat- 
ed by  a  stoppage  in  transitu.  A  right  to  stop 
goods  in  their  ti'ansit  does  not  arise  from  the 
circumstance  that  the  bargain  is  not  complete 
until  the  purchaser  gets  actual  possession  of 
them,  but  it  is  a  right  taking  its  origin  im- 
doubtedly  in  strong  considerations  of  equity, 
and  dependent  upon  a  fact  usually  happening 
after  the  sale,  and  always  unknown  to  the 
seller  at  the  time  of  it— the  insolvency  of  the 
purchaser.  3  Bos.  &  P.  584;  2  Kent,  Comm. 
393,  428.  The  stoppage  does  not  take  place 
on  the  happening  of  the  insolvency,  but  the 
right  to  stop  is  thereby  acquired.  The  acqui- 
sition of  the  right  works  no  beneficial  result 
to  the  seller  unless  he  intercepts  the  goods 
in  their  transit.  I  have  seen  no  case  where 
this  right  has  been  held  to  attach  on  the 
death  of  the  purchaser,  if  his  estate  was  sol- 
vent I  think  the  seller  could  not,  in  such 
a  case,  justify  an  interference  with  the  goods 
sold  while  on  their  transit.  It  arises  in  case 
of  death  and  insolvency,  but  not  otherwise 
than  it  would  exist  in  the  case  of  insolvency 
alone. 

A  question  asked  by  Lord  Kenyon,  in  Toole 
V.  Hollingworth,  5  Term  R.  226,  has  given 
rise  to  a  suggestion,  that  death  prevents  the 
deliver)-;  but  the  doubt  entertained  by  that 
eminent  judge   did  not  spring  from  a  case 


where  there  had  been  a  sale.     Tlie  property 
there  had  been  sent  to  answer  a  particular 
purpose,  which  was  to  raise  funds  to  meet  the 
consignee's  acceptances;    he  having   become 
unable  by   rea.son   of  his   insolvency   to   use 
them   for  that   purixjse,   had   no   interest   in 
them    that    went    to    his    assignees.     Where 
there  is  a  general  trading  between  two  mer- 
chants residing  at  a  distance  from  each  other, 
and  goods  are  sent  by  one  to  the  other  with- 
j  out  being  ordered,  the  title  to   them   would 
j  not  vest,  as  I  conceive,  in  the  merchant  to 
I  whom   they    were  sent   untU  they   were    re- 
'  ceived  and  accepted.     If  he  at  once  returned 
'  them  as  untit  for  his  use,  or  for  any  other 
I  cause,   the  title  to   them   would   not,   in   my 
!  opinion,  have  bt^en  changed.     In  such  a  case 
i  Lord  Kenyon  might  well  ask,  and  mean  there- 
i  by  to  expit'ss  a  strong  doubt,   whether  the 
'  goods   could   be  received  bj'  the  executor  if 
the  consignee  was  dead  when  they  arrived- 
I  The   sending  of  goods,    under   such   circum- 
stances, amounts  to  no  more  than  an  offer  to 
sell   them  to  the   party   to   whom   they   are 
I  sent,  and  his  acceptance  of  them  would  be 
necessary  to  complete  a  bargain.    If  he  should 
I  be  dead  before  they  arrived,  there  would  be 
no  contracting  party  to  close  the  bargain  by 
an  acceptiince.     Chancellor  Kent's  remarks, 
on  the  question  put  by  Lord  Kenyon,  shows 
that  he  did  not  consider  that  a  doubt  of  the 
nature  of  the  one  suggested  could  be  indulged 
in  a  case  where  the  title  to  the  property  had 
vested  in  the  deceased  person;    for  he  says: 
"Tlie  language  of  the  court,"  in  the  case  last 
referred  to,  "seems  to  be,  that  goods  sent  to 
a  person,  who  at  the  time  was  dead  or  dis- 
abled by  bankruptcy  from  dealing,  and  under 
an  incapacitj-  to  acquire  property,  could  be  re- 
covered back  upon  the  principle  that  there 
was  no  contract."     7  Johns.  Ch.  275. 

Waiving  aU  the  other  diOiculties  that  were 
presented  in  opposition  to  Frith's  right  to  stop 
the  50  pii>es  of  brandy,  and  granting  at  the 
same  time  that  he  had  the  right,  and  that 
they  were  to  be  considered  as  in  their  transit 
while  they  remained  in  the  custody  of  the 
custom-house  officer  at  N.  Y.,  it  may  be  asked 
what  did  he  do  to  stay  the  delivery  of  them 
to  the  administrators  of  MactierV  Did  he 
make  an  effort  to  get  possession  of  them? 
Did  he  forbid  the  public  otficer  to  deliver 
tliem  to  the  administrators?  This  I  believe 
is  not  pretended.  The  administrators  took 
possession  of  them  in  May  or  June,  and  sold 
them  about  that  time  as  a  part  of  the  estate 
of  their  intestate,  and  the  first  act  in  rela- 
tion to  them  on  the  part  of  LMth  was  in 
July.  They  had  a  right  to  the  brandy  as 
property  vested  in  Mactier  at  the  time  of  his 
death  by  virtue  of  the  contract  of  sale;  and 
they  can  rightfully  hold  the  avails  thereof, 
unless  Frith  had  rescinded  the  contract  by 
stopping  the  brandy  in  its  transit  before  it 
came  to  their  actual  possession.  This  he 
did  not  do,  nor  did  he  perform  any  other  act 
equivalent  to  iL 


4G 


OPFER  AND  ACCEPTANCE. 


Upon  the  view  of  the  whole  of  this  case,  I 
entertain  the  opinion  that  the  decree  of  the 
chancellor  ought  to  be  i-eversed. 

By  Mr.  Senator  BENTON.  From  the  plead- 
ings and  testimony  in  the  cause,  there  can 
be  no  ground  for  the  assumption  set  up  by 
the  respondent  that  he  was  the  sole  owner, 
and  was  alone  interested  in  the  brandy.  The 
answer  of  the  appellants  is,  in  my  opinion, 
substantially  supported  by  the  proofs.  We 
are,  then,  to  assume  that  the  intestate  and  re- 
spondent were  partners,  or  jointly  interested 
in  the  200  pipes  of  brandy;  to  share  equally 
In  the  profits,  or  to  bear  the  loss  jointly,  if 
any  should  be  sustained.  The  transaction 
was  to  be  extended  so  as  ultimately  to  pay 
the  invoice  cost  in  France  by  a  shipment  of 
coffee  from  the  West  Indies,  which  latter 
operation  was  to  result  from  provisions  ship- 
ped from  this  country  to  the  West  Indies. 
It  is  worthy  of  notice  that  by  the  aiTange- 
ment  the  brandy  was  to  be  shipped  from 
France  for  New  York,  in  an  American  ves- 
sel, and  the  coffee  was  to  be  sent  in  a  French 
bottom  from  the  West  Indies;  and  this,  un- 
doubtedly, with  a  view  to  advantages  to  re- 
sult to  the  parties  to  the  speculation. 

The  respondent,  by  his  letter,  dated  Sep.  5, 
1S22,  to  his  agents  in  P^rance,  having  ordered 
the  brandy  to  be  sent  out  to  the  consignment 
of  the  intestate,  and  directing  the  invoice 
amount  to  be  insured.  Dec.  24,  1822,  wrote 
the  intestate  to  the  following  effect:  "I  also 
have  the  pleasure  of  handing  you  copies  of 
Messrs.  Firebrace,  Davidson  &  Co.'s  letters 
regarding  the  brandy  order.  By-the-bye,  as 
your  brother,  before  I  left  New  York,  de- 
clined taking  the  interest  I  offered  him  in 
this  speculation,  and  wishing  to  confine  my- 
self on  business  as  much  as  possible,  so  as 
to  bring  my  concerns  to  a  certain  focus,  I 
would  propose  to  you  to  take  the  adventure 
solely  on  your  own  accoimt,  holding  the 
value  to  cover  the  transaction  to  my  account 
In  New  York." 

This,  it  appears  to  me,  is  a  distinct  and  un- 
conditional offer  to  dispose  of  the  interest 
and  property  in  the  shipment  of  brandy  at 
its  value;  that  is,  the  invoice  cost  in  France, 
or  its  value  or  price  in  the  market  of  con- 
sumption. And  in  this  case  it  cannot,  I  ap- 
prehend, be  material  which  was  intended  by 
the  respondent,  because  the  question  here  pre- 
sented does  not  involve  that  particular  in- 
quirj'.  And  if  the  offer  was  accepted,  the 
intestate  was  only  to  carry  the  amount  to  the 
credit  of  the  respondent,  holding  the  same 
to  cover  any  transaction  which  he  might 
deem  it  advisable  to  negotiate  in  New  York. 

On  Jan.  17,  182.3,  the  intestate,  in  answer 
to  this  proposition,  wrote  as  follows:  "I 
thank  you  for  sending  me  the  copy  of  Fire- 
brace,  Davidson  &.  Co.'s  letter  on  the  subject 
of  the  brandy  order.  This  has  been,  from 
the  first,  a  favorite  speculation  with  me,  and 
am  pleased  to  say  it  still  promises  a  favor- 


able result;  but  to  render  it  complete,  I  am 
desirous  the  speculation  should  go  forward 
in  the  way  first  proiwsed,  thereby  making 
it  a  treble  operation.  As  you  have,  however, 
expressed  a  wish  that  I  should  take  the  ad- 
venture to  my  own  account,  I  shall  delay 
coming  to  any  determination  till  I  again  hear 
from  you.  The  prospect  of  war  between 
France  and  Spain  may  defeat  the  object  of 
this  specidation,  as  far  as  relates  to  the  ship- 
ment of  provisions  hence  to  Hayti,  to  be  in- 
vested in  coffee  for  France  per  Fi*ench  ves- 
sels, in  which  case  I  will  at  once  decide  to 
take  the  adventure  to  my  own  account." 
The  intestate  then  states,  as  his  opinion,  that 
the  war  would  operate  to  the  disadvantage  of 
the  respondent,  in  relation,  I  suppose,  to  the 
transactions  connected  with  the  purchase  of 
the  brandy  and  the  shipment  of  coffee  to 
France.  This  letter,  although  it  is  not  an 
acceptance  of  the  proposition  contained  In 
the  respondent's  to  take  immediate  effect,  is 
not  a  rejection  of  it;  the  intestate  replies,  he 
should  delay  coming  to  any  determination  in 
regard  to  the  wish  expressed  that  he  should 
take  the  adventure  on  his  own  account,  until 
he  again  heard  from  the  respondent;  and  in 
another  part  of  the  letter  he  states,  that 
should  a  war  intervene  between  France  and 
Spain,  which  would,  he  assumes,  defeat  the 
objects  of  the  speculation  in  the  particulars 
therein  enumerated,  he  would  decide  to  take 
the  adventure  to  his  own  account. 

Under  date  of  Mar.  7,  1823,  the  respondent 
wrote  the  intestate,  acknowledging  the  re- 
ceipt of  the  letter  dated  Jan.  17,  above  re- 
feiTcd  to;  but  nothing  is  said  about  this  let- 
ter, except  that  the  contents  were  noticed. 
The  letter  from  the  intestate  to  the  respond- 
ent, dated  Mar.  13,  1823,  advised  the  respond- 
ent that  he  had  been  informed  of  the  ship- 
ment of  the  brandy  in  a  French  ship,  that 
he  was  looking  daily  for  its  arrival,  and  ex- 
pressing his  regrets  that  the  order  had  not 
been  more  promptly  executed,  as  the  delay 
would  l>e  likely  to  prove  disadvantageous  to 
him  and  the  respondent.  At  this  time  the 
intestate  was  advised  that  a  war  between 
France  and  Spain  was  inevitable;  that  France 
had  recalled  her  minister,  and  that  a  large 
French  army  had  been  ordered  into  Spain, 
and  that  the  American  insurance  ollices  de- 
clined insuring  on  French  vessels. 

On  Mar.  28,  1823,  the  respondent  wrote  the 
intestate  to  the  following  effect,  in  relation  to 
the  brandy  transaction:  "I  have  not  heard 
anything  more  from  Firebrace,  Davidson  & 
Co.  respecting  the  brandy,  but  I  have  little 
doubt  of  its  having  got  out  to  you  long  ere 
this,  unless  the  rupture  which  we  have  a 
report  of  between  France  and  Spain  took 
place  before  the  sailing  of  the  vessel,  or  that 
she  has  been  captured  by  the  Spaniards;  if 
either  be  the  case,  it  would  be  a  pity,  as  its 
safe  arrival  with  you  would  be  much  en- 
hanced if  there  be  a  war.  With  respect  to 
this  adventure,  I  would  wish  to  confirm,  if 


COMMUNICATION  BY  CORRESPONDENCE 


47 


altogether  satisfactory  to  you,  what  I  men- 
tioned to  you  some  time  ago,  and  wliich  I 
omitted  to  repeat  to  you  in  my  previous 
letter  in  reply  to  yours  of  the  17th  January. 
I  find  the  more  one  does  in  this  country,  in 
the  present  state  of  trade,  the  more  one's  af- 
fairs get  shackled."  The  letter  here  men- 
tioned as  the  one  in  reply  to  that  of  Jan.  17, 
is  the  letter  from  the  respondent  to  tlie  in- 
testate, under  date  of  Mar.  7,  1S2;3.  It  is  al- 
leged that  the  above,  under  date  of  Mar.  28, 
did  not  arrive  at  its  destination  until  after 
the  death  of  the  intestate. 

But  wliat  inference  can  properly,  and  with- 
out violence,  be  drawn  from  the  eoutcnts  of 
this  last  letter  from  the  respondent?  What 
is  the  plain  and  fair  import  of  it?  It  appears 
to  me  the  respondent  fully  acquiesced  in  the 
proposal  of  the  intestate  to  consider  tlie  offers 
made  by  the  letter  of  Dec.  24,  1822,  as  open, 
and  still  at  the  option  of  the  intestate  to  ac- 
cept or  refuse,  as  he  might  think  proper.  The 
respondent's  mind  had  probably  at  all  times 
no  other  inclination  than  to  hold  his  offers 
open  to  the  intestate,  and  he  had  so  intended 
to  have  expressed  himself  in  his  reply  under 
date  of  Mar.  7;  for  he  says  he  wished  to  con- 
firm what  he  mentioned  sometime  ago,  and 
which  he  omitted  to  repeat  in  his  previous 
letter  in  reply  to  the  one  from  the  intestate 
of  Jan.  17.  This  letter,  I  apprehend,  affords 
sufficient  evidence  of  the  fact  that  the  re- 
spondent did  not  consider  his  proiwsitions  as 
rejected  by  the  intestate,  although  they  had 
not  been  in  terms  accepted  by  him,  from  any 
communications  which  had  been  received  at 
its  date.  It  would,  I  apprehend,  be  compe- 
tent for  the  appellants  in  this  case  to  prove 
that  the  respondent  had,  up  to  the  date  of 
this  letter,  considered  the  intestate  at  liberty, 
and  that  he  had  the  right  to  take  the  adven- 
ture to  his  own  account;  that  the  offer  con- 
tained in  the  letter  of  Dec.  24  was  still  open 
to  him.  If  I  axu  correct  in  this  conclusion, 
then  I  do  not  perceive  why  this  letter  does 
not  afford  sufficient  evidence  that  the  respond- 
ent never  considered  the  intestate  as  conclud- 
ed or  barred  from  accepting  them. 

Then,  under  date  of  JNIar.  25,  1S2;>,  and  with- 
in the  time  above  assumed,  the  intestate 
wrote  the  respondent  and  said:  "I  have  now 
to  advise  the  arrival  of  the  French  ship  La 
Claire  with  the  200  pipes  of  brandy,  and  that 
in  consequence  of  the  probability  of  war  be- 
tween France  and  Spain,  and  in  compliance 
with  the  wish  expressed  in  your  regarded  fa- 
vor of  the  24th  December,  and  my  answer 
thereto  of  the  17th  January  last,  I  have  decid- 
ed to  take  this  adventure  to  my  own  account. 
I  therefore  credit  you  with  the  amount  of 
the  invoice,  say  fr.  70,978-58.  which  at  the 
exchange  of  the  day,  5-40,  makes  the  sum  of 
$14,254  57^100  of  which  you  will  please  to 
take  note."  Here  the  intestate  closed  with 
tlie  resi)ondent's  proposal;  and  was  it  done 
in  time  to  constitute  a  contract  binding  upon 
the  parties?  On  Apr.  21,  following,  the  re- 
spondent wrote  the  intestate,  advising   him 


of  the  receipt  of  the  above  letter  of  Mar.  25, 
noting  particularly  the  contents,  to  which 
he  liad  replied,  he  says,  by  his  previous  re- 
spects; and  although  he  was  then  indelned 
to  the  intestate  in  a  considerable  sum,  if  we 
do  not  take  into  view  the  amount  of  the  price 
or  value  of  the  brandy,  he  requested  the  in- 
testate to  charter  on  his  account  a  stauneh 
first  class  vessel,  and  send  out  to  liim  by  lier 
a  valualjle  cargo  of  provisions  and  merchan- 
dise; the  vessel  to  proceed  to  Europe  with 
a  cargo  of  coffee.  The  intestate  resided  in 
New  York,  and  it  is  admitted  by  the  case 
that  he  died  Apr.  10,  1823.  The  respondent, 
at  the  time  this  transaction  and  corresirjud- 
dence  took  place,  was  a  resident  of  Jacmel, 
in  the  Island  of  St.  Domingo.  There  are  sev- 
eral other  letters  from  the  respondent  to  the 
intestate,  which  I  deem  not  necessary  to  ad- 
vert to  in  the  view  here  taken  of  this  case. 

Upon  a  rigid  and  critical  examination  of  tlie 
correspondence  and  the  testimony,  I  am  un- 
able to  ix?rceive  that  the  respondent  ever  in- 
timated to  the  intestate  that  he  withdrew  his 
proposition  of  Dec.  24,  offering  to  dispose  of 
his  interest  in  the  shipment  of  brandy,  or  that 
he  considered  the  intestate's  letter  of  Jan.  17 
as  a  rejection  of  that  offer;  but,  on  the 
other  hand,  the  letter  from  the  respondent  of 
Mar.  28  shows  pretty  clearly,  not  only  that 
this  was  not  so  considered  by  him,  but  that 
he  wished  to  confirm  what  he  had  previously 
written,  urging  the  intestate  to  close  with 
the  offer  upon  the  terms  proposed  in  the  let- 
ter of  Dec.  24.  This  would  not  probably  have 
been  done  in  the  terms  here  used,  if  the  propo- 
sition for  the  sale  had  been  considered  as  re- 
jected. 

It  cannot,  I  apprehend,  be  contended,  with 
any  probability  of  success,  that  the  respond- 
ent's letter  of  Apr.  21  contains  any  matter 
which  goes  to  show  he  did  not  consider  the 
first  offer  of  sale  on  his  part,  as  still  oi>en. 
The  respondent  must  have  known,  and  did 
know  no  doubt,  that  when  he  wrote  this  last 
letter,  his  previous  letter  to  the  intestate, 
dated  Mar.  '28,  had  not  been  received  when 
the  letter  under  date  of  Mar.  25  was  written, 
advising  tliat  tlie  adventure  had  been  talion 
agreeably  to  the  proposition  contained  in  tlie 
respondent's  letter  of  Dec.  24. 

In  my  opinion  it  was  competent  for  the 
respondent  to  have  limited  the  time  in  which 
his  offer  might  have  been  accepted,  and  to 
have  stated,  "If  you  accept  by  Apr.  1  it  will 
be  in  time."  or  he  might  have  left  the  pro- 
posals open  indefinitely.  When  advised  of 
the  safe  arrival  of  the  brandy,  and  that  the 
intestate  had  decided  to  talce  it  to  his  own 
accoimt,  and  while  he  still  supposed  the  in- 
testate was  alive,  the  respondent  made  no 
objection,  but  acquiesced  in  what  had  been 
done.  It  is  not  urged  that  the  contract  de- 
pends upon  either  of  the  letters  written  by 
the  respondent  which  were  not  received  by 
the  intestate  in  his  lifetime,  any  farther  than 
those  letters  afford  evidence  of  the  mind  and 
intent  of  the  party. 


4S 


OFFER  AND  ACCEPTANCE. 


If  this  mode  of  reasoning,  in  relation  to  the 
facts  in  this  case,  be  correct,  and  the  intes- 
tate accepted  of  an  offer  tendered  to  him  by 
the  respondent,  then  was  it  necessary  for  the 
Intestate  to  know,  before  the  contract  was 
finally  closed  and  binding  upon  the  parties  to 
it,  whether  the  respondent  assented  or  not. 

This  brings  me  to  a  consideration  of  the 
law  involved  in  this  case. 

In  the  construction  of  contracts  and  agree- 
ments, the  intention  of  the  parties  and  the 
substance  of  the  contract  ai'e  tx)  be  sought  for 
more  than  the  form  of  the  words.  Pothier 
says  we  ought  to  examine  what  was  the  com- 
mon intent  of  the  contracting  parties,  rather 
than  the  grammatical  sense  of  the  terms  (2 
Com.  Cont.  53o);  and  Plowden  lays  down  a 
rule,  that  in  contracts  it  is  not  material  which 
of  the  parties  speaks  the  words,  if  the  other 
agrees  to  them;  for  the  agreement  of  the 
minds  of  the  parties  is  the  only  thing  the  law 
respects  in  contracts;  and  such  words  as  ex- 
press the  assent  of  the  parties  and  have  sub- 
stance in  them  are  sufficient.  And  again;  if 
any  persons  are  agreed  upon  a  thing,  and 
words  are  expressed  or  written  to  make  the 
agreement,  although  they  are  not  apt  and 
usual  words,  yet,  if  they  have  STibstance  in 
them  tending  to  the  effect  propos»!d,  the  law 
will  take  them  to  be  of  the  same  effect  as 
usual  words;  for  the  law  always  regards  the 
intention  of  the  parties,  and  will  apply  the 
words  to  that  which  in  common  presumption 
may  be  given  to  their  intent.  Ch.  B.  Comyn 
also  states,  that  an  agreement  or  contract 
shall  have  a  reasonable  construction  accord- 
ing to  the  intent  of  the  parties;  and  the 
rule  of  construction  adopted  by  the  courts  in 
this  state  and  in  England,  is  that  in  case  of 
doubt,  the  words  of  a  promise  or  covenant 
shall  be  taken  most  strongly  against  the 
promisor  or  covenanter.  An  agreement  is  ag- 
gregatio  mentium;  that  is,  where  two  or  more 
minds  are  united  in  a  thing  done  or  to  be 
done,  or  where  a  mutual  assent  is  given  to 
do  or  not  to  do  a  particular  act;  and  every 
contract  or  agroement  ought  to  be  so  cer- 
tain and  complete  that  each  party  may  have 
an  action  or  other  remedy  upon  it. 

These  general  principles  appear  to  be  full 
of  sound  sense  and  good  reason.  A  review 
of  the  numerous  adjudged  cases  which  have 
a  bearing  either  directly  or  indirectly  upon 
the  questions  now  under  consideration,  seems 
to  me  not  necessary.  I  shall,  therefore,  ad- 
vert to  one  of  them  only. 

The  case  of  Cook  v.  Ludlow,  5  Bos.  &  P. 
2.  119,  was  this:  The  defendant,  who  re- 
sided near  Bristol,  by  letter,  requested  the 
plaintiff,  who  lived  in  London,  to  send  by 
any  conveyance  which  would  reach  Bristol  a 
patent  chaff-cutter  and  two  or  three  pairs  of 
knives,  and  also  requested  that  he  might  be 
informed  when  the  same  were  sent,  that  he 
might  know  when  and  where  to  send  for  the 
articles.  The  articles  were  sent  to  a  wharf 
in  London,  directed  to  the  defendant,  and  the 
wharfinger's   receipt  taken    by  the   plaintiff. 


The  defendant  was  advised  by  mail  that  the 
articles  had  been  shipped  by  a  vessel  called 
the  Commerce,  Chas.  Forquaroau.  The  pack- 
age containing  the  chaff-cutter  and  knives 
was  not  in  fact  shipped  for  Bristol  by  the 
Commerce,  but  was  put  on  board  the  Nancy, 
which  left  Loudon  about  three  months  after 
the  articles  were  delivered  at  the  wharf.  No 
correspondence  or  communication  passed  be- 
tween the  parties  for  about  fifteen  months 
after  the  goods  were  actually  shipped,  when 
the  plaintiff  applied  for  payment  of  the  de- 
mand, who  shortlj'  afterwards  received  a  let- 
ter from  the  defendant  stating  that  he  had 
not  received  any  chaff-cutter,  although  he 
had  repeatedly  inquired  for  it  at  Bristol  imtil 
the  time  of  the  aiTival  of  the  Commerce.  The 
plaintiff  then  wrote  the  defendant,  informing 
him  that  on  inquiry  it  was  ascertained  that 
the  package,  containing  the  chaft"-cutter,  had 
been  sent  by  the  Nancy  to  Bristol,  and  this 
was  the  first  intimation  the  defendant  re- 
ceived that  the  chaff-cutter  had  been  sent  by 
this  vessel.  The  question  in  this  case  was, 
whether  the  plaintiff  was  entitled  to  recover^ 
and  the  court  held  he  was,  observing,  the 
article  was  sent  in  the  common  course  accord- 
ing to  order,  and  the  defendant  was  bound  to 
give  notice  in  due  time  that  he  had  not  re- 
ceived it.  Heath  and  Kooke,  JJ.,  observing 
that  the  plaintiff"  had  done  everything  in  that 
case  he  was  bound  to  do,  and  the  defendant 
was  guilty  of  gross  negligence  in  not  giving 
earlier  notice.  In  this  case,  I  apprehend,  the 
contract  of  sale  was  consummated  upon  the 
delivery  of  the  goods  agreeable  to  the  defend- 
ant's order,  and  took  effect  from  the  time  of 
such  delivery  at  the  wharf  or  place  from 
whence  they  were  to  be  transported  to  the 
defendant  at  Bristol.  The  whai-finger  or  car- 
rier was  neither  of  them  the  agent  of  the 
plaintiff.  Here  the  minds  of  the  parties  met, 
because  the  orders  of  the  defendant  had  been 
strictly  followed  and  attended  to;  but  did 
the  defendant  know  the  fact  at  the  time  it 
was  done?  Let  us  suppose  a  case  that  might 
have  arisen  in  the  cause  under  consideration, 
and  test  it  by  the  above  rule.  Had  Firebrace, 
Davidson  &  Co.  shipped  the  200  pipes  of 
brandy  in  conformity  to  the  order  of  the  re- 
spondent upon  them,  would  he  have  been  at 
liberty  to  refuse  taking  it,  on  its  arrival  in 
this  country,  and  would  he  have  been  held 
not  liable  to  pay  the  amount  of  the  invoice 
price,  suppose  it  to  have  been  lost  by  ship- 
wreck or  capture.  I  do  not  doubt  but  the 
resi)ondent  would  have  been  liable  to  pay  for 
the  shipment  of  brandy  from  the  time  the 
terms  of  his  order  had  been  fulfilled;  and 
this  too,  although  he  might  not  have  known 
that  the  article  had  been  sent.  The  minds 
of  the  parties  met  at  the  time  the  brandy 
was  actually  shipped  agreeably  to  directions. 
Entertaining  no  doubt  of  the  fact  that  the 
respondent  at  all  times,  up  to  Apr.  21,  con- 
sidered his  offer  of  Dec.  24,  1822,  as  open  to 
the  intestate  for  his  aceptance  upon  the  terms 
offei'ed,  the  letter  of  aceptance  of   Mar.  25. 


COMMUXICATIOX  BY  CORRESPOXDENCE. 


49 


1823,  clasing  with  the  terms  of  the  offer,  con- 
summated a  valid  and  binding  contract  be- 
tween the  parties;  and  from  that  time  the 
intestate  was  liable  to  tlie  respondent  for  the 
full  amount  of  the  value.  But  it  is  now 
urged  by  the  respondent  that  certain  infor- 
mation was  withheld  by  the  intestate,  and 
that  he  has  lost  the  interest  on  the  amount, 
aud  that  there  was  a  difference  in  the  rate 
of  excliange,  which  operated  against  him  be- 
tween the  time  the  offer  was  made  and  the 
acceptance;  such,  however,  was  not  his  com- 
plaint when  he  wrote  the  intestate  on  the 
21st  Api-il.  As  a  general  creditor,  he  might 
be  entitled  to  interest,  and  compensation  for 
any  loss  he  might  have  sustained  in  conse- 
quence of  the  rate  of  exchange,  being  more 
to  his  disadvantage  at  the  time  the  contract 
was  closed,  than  it  was  when  the  offer  was 
made.  Sound  policy  forbids  that  mercantile 
contracts  should  depend  for  their  validity 
upon  considerations  of  this  kind. 

Having  arrived  at  the  conclusion,  that  here 
was  an  absolute  sale  of  all  the  right  and  in- 
terest of  the  respondent  to  the  shipment  of 
brandy,  it  now  remains  to  inquire,  whether 
he  has  a  lien  upon  the  whole  or  any  pai't  of 
it  as  a  creditor,  and  whether  the  doctrine  of 
stoppage  in  transitu,  is  applicable.  K  I  am 
right  in  respect  to  the  sale  of  the  respond- 
ent's Interest,  then  clearly  the  transitus  is 
gone  as  to  150  pipes  of  brandy,  which  were 
sold  in  the  lifetime  of  the  intestate;  the  sub- 
ject was  entirely  out  of  the  possession  of  the 
vendor;  aud  I  did  not  imderstand  that  it 
was  contended  upon  the  argument,  that  the 
right  of  the  respondent  to  this  portion  of  the 
adventure  could  be  sustained  upon  this  prin- 
ciple, if  a  contract  had  been  made. 

The  question  in  regard  to  the  50  pipes 
seems  to  me  to  be  presented  in  the  following 
shape,  and  accompanied  with  these  peculiar 
circumstances.  The  goods  were  in  the  pos- 
session of  the  vendor  and  vendee,  as  partners 
by  legal  construction.  The  respondent  was 
never  in  actual  possession,  except  by  the  in- 
testate; and  according  to  the  iwsition  here 
assumed,  the  goods  were  in  tlie  actual  and 
uncontrollable  possession  of  the  intestate, 
and  when  the  contract  was  finally  closed, 
the  50  pipes  of  brandy  lay  in  the  public  store, 
under  the  direction  of  the  vendee,  who  was 
himself  joint  ovsTier  with  the  respondent. 
The  transitus  of  the  goods  and,  consequent- 
ly, the  right  of  stoppage,  is  determined  by 
the  actual  deliverj'  to  the  vendee,  or  by  cir- 
cumstances which  are  equivalent  to  actual 
delivery.  It  will  continue  until  the  place  of 
deliveiy  be  in  fact  the  end  of  the  journey  of 
the  goods,  and  they  have  arrived  to  tiie  pos- 
session, or  under  the  direction  of  the  vendee 
himself.  2  Kent,  Comm.  430.  If  the  goods 
have  an-ived  at  an  intermediate  place,  where 
they  are  placed  under  the  orders  of  the 
vendee,  and  are  to  remain  statioiiaiy  until 
they  receive  his  directions  to  put  them  again 
in  motion  for  some  new  and  ulterior  desti- 
nation, the  transitus  is  gone.    2  Kent,  Comm. 

HOPK.  SE  L.  CAS.  COST.  — 4 


431.  The  goods  in  this  case  were  not  In 
their  transit;  they  had  amved  at  their  des- 
tination, and  wei"e  under  the  domiuiou,  and 
subject  to  the  ownership  of  the  intestate. 
Nothing  remained  to  be  done  by  the  re- 
spondent to  complete  the  transfer  of  the 
brandy. 

But  in  my  judgment,  another  view  of  the 
case  is  e<iuaUy  fatal  to  the  claim  here  set  up 
in  regard  to  this  lien.  The  brandy  had 
been  actually  sold,  and  was  out  of  the  pos- 
session of  the  defendants,  previous  to  the 
commencement  of  this  suit.  It  had  been 
taken  from  the  custom  house  store,  the  du- 
ties paid,  and  actually  sold  to  bona  tide  ptir- 
chasers  and,  we  must  here  assume,  without 
notice,  before  the  respondent  made  any 
claim.  The  administrators  acting  in  gt-od 
faith,  and  in  pursuance  of  an  equitable  aud 
legal  right,  are  certainly  to  be  protected.  If 
it  should  be  necessary  for  a  court  of  equity 
to  inteipose. 

Entertaining  no  doubt  upon  this  branch  of 
the  case,  and  being  of  opinion  that  the  re- 
spondent is  not  entitled  to  have  the  decree 
modified  so  as  to  give  him  a  claim  upon  the 
50  pipes  of  brandy,  or  the  proceeds  thereof^ 
in  the  hands  of  the  adminisiratore,  I  am  of 
opinion  that  so  much  of  the  decree  of  the 
court  of  chancery  as  is  appealed  from  be  re- 
versed; that  the  respondent's  first  exception 
to  the  master's  report  be  disallowed,  and 
that  the  appellants  recover  their  costs  for 
prosecuting   their   appeal    in    this   court. 

On  the  subject  of  costs  in  this  coui-t,  as 
they  rest  in  discretion,  it  might  perhaps  be 
deemed  equitable  that  neither  party  should 
have  costs;  but  the  appellants  are  prosecut- 
ing this  appeal  not  in  their  own  right,  but  as 
tlie  personal  representatives  of  the  deceased, 
and  to  protect  the  interests  of  the  general 
ci'editors.  And  if,  as  is  here  supposed,  the 
respondent  has  no  rights  but  those  of  a  gen- 
eral creditor,  it  is  not  perceived  why  he 
should  be  entitled  to  any  peculiar  favor, 
when  his  case  is  not  one  of  greater  hardship 
than  any  one  of  those  against  whom  he  has- 
been  litigating. 

By  Mr.  Senator  MAYNARD.  The  most 
materiiU  question  for  decision  in  this  case,  is 
whether  the  respondent,  John  A.  Frith,  was 
the  o\A'ner  of  the  brandy  mentioned  in  the 
case,  or  of  any  part  thereof,  at  the  time  of 
the  sale  of  a  part  by  Henry  Mactier,  and  of 
the  residue  at  the  period  of  his  death;  or 
whether  Frith  had  sold  his  interest,  what- 
ever it  had  been,  in  that  bi~andy  to  Mactier. 
From  the  letter  of  Mactier  to  Frith,  of  Sep. 
4,  1822,  and  the  order  of  i<'rith  of  the  day 
following,  it  is  evident  that  the  brandy  was 
purchased  in  France,  on  the  joint  accoimt  of 
Frith  and  Mactier.  The  agreement  was  that 
Frith  should  order  the  brandy,  that  Mactier 
should  ship  to  Frith  at  Jacmel  the  invoice 
price  of  the  brandy,  in  provisions,  from  the 
sale  of  which.  Frith  was  to  make  a  shipment 
of  coffee  to  France,  to  pay  for  the  brandy. 


50 


OFFER  AND  ACCEPTAXCE. 


and  the  parties  were  to  share  equally  in  the 
spetiilatiou  "all  around."  The  testimony  of 
Alexander  Mactier  proves,  also,  that  such 
was  the  arrangement,  and  that  it  was  clearly 
so  understood  by  Frith.  The  brandy  having 
been  ordered  on  the  joint  account  of  Frith 
and  Mactier,  I  agree  perfectly  with  the 
chancellor  in  opinion,  that  Frith  never  was 
the  "sole  owner  of  the  brandy."  It  is  now 
contended  that  the  decree  is  wrong,  in  giv- 
ing to  Frith  the  proceeds  of  the  whole,  even 
if  he  were  entitled  to  a  specific  lien  upon  the 
brandy,  to  the  extent  of  his  interest.  The 
conclusion  to  which  I  have  arrived  on  the 
main  question,  renders  a  decision  of  this  un- 
necessary. 

On  Dec.  24,  1S22,  Frith  wrote  from  Jacmel 
to  Mactier,  conveying  letters  regarding  the 
order  for  the  brandy,  and  px-oposed  to  him  to 
"take  the  adventure  solely  on  his  own  ac- 
coxmt,  holding  the  value  to  cover  the  trans- 
action to  the  account  of  Frith."  Mactier 
answered  this  letter  Jan.  17,  1S23,  and  in- 
formed Frith  that  he  was  desirous  the  specu- 
lation should  go  forward  in  the  way  first 
proposed,  thereby  making  it  "a  treble  opera- 
tion;" and  declaring  that  "he  should  delay 
coming  to  any  determination  until  he  again 
heard  from  him."  He  promised  also,  in  the 
event  of  war  between  France  and  Spain,  the 
prospect  of  which  he  mentioned  to  decide  at 
once  "to  take  the  adventure  to  his  own  ac- 
count." This  was,  undoubtedly,  such  an  an- 
swer as  absolved  Frith  from  all  obligation 
on  account  of  his  offer,  but  I  cannot  consider 
it  as  an  absolute  refusal  on  the  part  of  Mac- 
tier.  He  engages  absolutely  to  accede  to  the 
proposition  in  the  event  of  a  certain  occur- 
rence deemed  to  be  disadvantageous  to  Frith, 
and  declines  coming  to  a  determination  tm- 
til  he  again  heard  from  him,  in  case  the  con- 
tingency contemplated  should  not  happen. 
He  ceitainly  does  not,  close  the  negotiation, 
but  holds  out  to  Frith,  at  least,  the  iwssibil- 
ity  of  a  compliance  with  his  proposal,  if  he 
should  continue  to  desire  it.  Mar.  13  Mac- 
tier  wrote  to  Frith  that  war  between  France 
and  Spain  might  then  be  considered  as  "in- 
evitable," and  gives  him  the  facts  upon 
which  that  opinion  was  founded;  states  that 
he  was  "looking  daily  for  the  brandy,  and 
regretted  that  the  order  for  it  had  not  been 
more  promptly  executed,  as  the  delay  might 
operate  to  their  disadvantage."  At  that 
time  he  had  heard  nothing  further  from 
Frith  in  relation  to  the  proposal  "to  take 
the  adventure"  to  his  own  account,  and  he 
did  not  then  indicate  a  determination  to  do 
it.  Frith,  Mar.  7,  in  a  hasty  note,  acknowl- 
edged the  receipt  of  Mactier's  letter  of  Jan. 
17,  and  one  of  a  subsequent  date;  and  states 
that  he  "noted  their  respective  contents," 
but  says  nothing  directly  on  the  subject  of 
his  previous  proposition.  On  Mar.  28,  Frith 
wrote  to  Mactier,  that  "he  had  little  doubt  of 
the  brandy  having  got  out  to  him  long  ere 
this."  And  he  adds,  "with  regard  to  this 
adventure,  I  would  wish  to  confirm,  if  alto- 


gether satisfactory  to  you,  what  I  mentioned 
to  you  sometime  ago,  and  which  I  omitted 
to  repeat  to  you  in  my  previous  letter  in  re- 
ply to  yours  of  the  17th  of  January."  I 
know  there  is  a  difficrence  in  the  reading  of 
the  two  copies  of  this  letter  given  in  evi- 
dence, in  the  part  relating  to  this  subject. 
I  adopt  this  as  correct,  because,  according 
to  the  other,  there  is  a  palpable  mistake,  and 
I  cannot  perceive  any  difference  in  the  mean- 
ing so  far  as  they  concern  the  question  lui- 
der  consideration.  According  to  either  there 
is  an  express  confirmation  of  the  proposition 
to  Mactier,  "to  take  the  adventure  to  his 
sole  account;"  and  it  is  evident  also,  from 
that  letter,  that  Frith  intended  to  renew  the 
offer  in  his  letter  of  Mar.  7,  in  answer  to  the 
letter  of  Mactier  of  Jan.  17.  It  furnishes 
evidence,  therefore,  that  his  mind  had  under- 
gone no  change  in  relation  to  the  proposition. 

On  Mar.  25  and  31,  Mactier  wrote  to  Frith 
that  he  had  decided  to  take  the  brandy  to  his 
own  account,  according  to  the  proposition 
contained  in  the  letter  of  Dec.  24,  1S22,  and 
his  own  engagement  in  his  letter  in  answer 
thereto,  the  contingency  upon  which  it  was 
made  having  occurred,  and  informed  him 
that  he  had  carried  to  his  account  the  in- 
voice price  thereof,  at  a  specified  rate  of  ex- 
change. The  21st  of  April,  Frith  answered 
this  letter  and  anotlier  of  the  5th,  and  as- 
sured him  that  he  had  "noted  their  respective 
contents,"  and  refers  him  to  his  own  letters 
of  Mar.  28  and  Apr.  12  for  a  reply.  Frith 
wrote  again  Apr.  22,  confirming  his  letter  of 
the  day  before,  and  again  May  0,  confirming 
both  the  last  mentioned  lettei's,  and  May  15, 
confirming  the  last  preceding  letter.  The 
brandy  arrived,  and  was  landed  Mar.  15, 
and  Apr.  10  Mactier  died. 

The  question  is  then  presented  for  decision, 
whether  this  correspondence  and  these  acts 
of  the  parties  constitute  a  sale  of  the  brandy. 

To  make  a  conti-act  there  must  be  an 
agreement— a  meeting  of  the  minds  of  the 
contracting  parties.  On  Mar.  28  the  minds 
of  these  parties  certainly  did  meet.  On  that 
day.  Frith  wrote  to  Mactier,  renewing  and 
confirming  his  previous  proposition  to  him 
"to  take  the  adventure  to  his  sole  account," 
and  on  that  day  Mactier  actuaUy  did  take  it 
to  his  "sole  account."  Here  was  an  actual 
meeting  of  the  minds  of  the  parties  on  the 
subject  of  the  contract,  and  a  decisive  act 
of  one  of  them,  giving  it  entire  effect.  If 
the  meeting  of  the  minds  of  the  parties,  ac- 
companied by  the  only  act  necessary  to  give 
complete  effect  to  the  contemplated  contract, 
are  all  the  circumstances  retiuisite  to  consti- 
tute a  valid  contract,  then  there  was  in  this 
instance  a  sale  of  the  commo<lity  in  question. 
But  his  honor,  the  chancellor,  has  said,  that, 
"to  make  a  valid  contract,  it  is  not  only  nec- 
essary that  the  minds  of  the  contracting  par- 
ties should  meet,  but  they  should  know  that 
fact."  If  this  be  a  correct  principle,  and  of 
universal  application,  then  surely  in  this  case 
there  was  no  contract.     The  letter  of  Frith, 


COMMUNICATION  BY  COHRESPONDEXCE. 


51 


of  Mar.  28,  and  all  subsequently  written  by 
liiiu,  did  not  reach  this  country  until  after 
the  death  of  Mactier.  Can  this  principle  be 
correct  and  univoi'salV  The  parties  were  dis- 
tant, and  negotiating  for  the  sale  of  a  com- 
modity in  the  possession  of  one  of  them. 
The  adventure  was  agreed  upon,  and  the 
brandy  ordered  Sep.  5,  '"to  be  in  New  York 
by  January  following  or  sooner,  if  possible." 
When  Frith  wrote  his  letter  of  Dec.  24,  he 
must  have  believed  that  the  brandy  would 
have  arrived  at  New  York  before  his  letter, 
or,  at  all  events,  before  he  could  receive  an 
answer.  If  such  had  been  the  fact,  and  the 
brandy  had  been  in  the  actual  possession  of 
Mactier,  to  whom  it  was  consigned,  will  it 
be  contended  that  he  must  have  forborne  "to 
take  the  adventure"'  to  himself,  according  to 
the  proposition,  until  he  had  informed  Frith 
that  he  would  do  so,  aiid  received  intelli- 
gence from  him  that  he  was  in  possession  of 
that  information?  I  cannot  believe  that  the 
principle  can  be  carried  to  that  extent.  Nor 
can  1  perceive  why  it  would  not  have  been 
a  valid  contract,  if  the  brandy  had  actually 
arrived  at  the  receipt  of  Frith's  proposition, 
if  Mactier  had  immediately  'taken  the  ad- 
venture to  himself,"  and  credited  Frith  with 
the  value.  If  that  would  have  been  a  con- 
ti"act,  binding  upon  the  parties,  then  it  is  not 
imiversally  true  that  the  minds  of  contract- 
ing parties  must  not  only  meet,  but  that  they 
must  know  that  they  do  meet,  before  the 
agreement  becomes  a  contract.  K  this  prin- 
ciple be  correct  and  imiversal,  it  is  difficult 
to  conceive  when  a  contract  would  ever  be 
concluded  between  distant  parties.  An  offer 
may  be  revoked  at  any  time  before  it  is  ac- 
cepted. When  a  party,  who  has  received  an 
offer,  sends  his  acceptance,  he  does  not 
know  that  the  minds  of  the  parties  meet, 
because  he  knows  that  a  revocation  of  the 
otfer  may  be  on  its  way.  When  the  party 
who  made  the  offer  receives  the  acceptance, 
he  cannot  know  that  there  is  a  meeting  of 
minds,  because  he  knows  that  the  accept- 
ance may  have  been  revoked.  And  when 
the  party  accepting  receives  information  that 
his  acceptance  is  received  and  the  offer  con- 
tirmed,  he  is  in  etiual  rucertainty  as  to  the 
meeting  of  minds,  because  there  may  have 
been  a  revocation  of  that  contirmation.  Such 
a  negotiation  would  oe  endless,  for  the  par- 
ties could  never  know  that  their  minds  met. 
The  impossibility  of  arriving  at  certainty 
and,  consequently,  the  intrinsic  difficulty  of 
giving  effect  to  this  principle,  shows  that  as 
a  rule,  it  must  have  some  exceptions.  One 
of  these  instances,  it  appears  to  mo,  nmst  be 
wher^  the  parties  are  distant,  and  one  of 
them  has  the  power  by  his  own  act  to  give 
full  effect  to  the  contract,  and  he  does  that 
act  in  accordance  with  the  mind  of  the  other. 
In  support  of  the  chancellor's  opinion,  refer- 
ence has  been  made  to  the  case  of  McCul- 
loch  V.  Insurance  Co.,  1  Pick.  278,  but  1  find 
nothing  in  that  case  decisive  on  this  point. 
That  was  a  case  of  revocation.     On  Dec.  21), 


the  plaintiCf  sent  a  letter  by  mall  to  the  de- 
fendants, making  inquiries  how  they  would 
insure  a  vessel  and  cargo,  but  making  no 
oOer  by  which  he  could  be  bound.  On  Jan. 
1,  the  defendants  wrote  him  that  they  would 
insure  on  certain  terms,  and  the  next  day 
wrote  him  again,  revoking  that  offer,  and 
declining  to  effect  any  insurance.  The  plain- 
tiff received  the  offer  to  insure  on  the  third, 
and  sent  an  acc-eptanee  before  he  received 
the  revocation,  which  reached  him  in  due 
course  of  the  mail.  ITie  parties  rested  until 
the  loss  was  ascertained;  and  the  court  held 
there  was  no  contract;  and  surely,  there  was 
not,  because  the  offer  to  insure  was  revoked 
before  it  was  accepted,  and  on  that  point  the 
•cause  was  decided.  The  case  would  have 
been  very  different  if  the  plaintiff  had  re- 
quested the  defendants  to  make  out  a  policy 
upon  his  vessel  and  cargo  at  a  specified  pre- 
mium, and  deliver  it  to  his  agent,  and  the 
defendants  had  actually  complied  with  his 
request.  In  the  present  case,  Frith  proposed 
to  Mactier  "to  take  the  adventure  solely  to 
his  own  account,"  on  certain  terms.  Mactier 
replied,  not  accepting,  discouraging  but  not 
rejecting  the  proposition;  holding  it  for  fur- 
ther negotiation  in  one  event  and  promising 
absolutely  to  accede  to  it  on  the  occurrence 
of  another  contingency.  The  proposition  re- 
mained, neither  rejected  by  one,  nor  revoktd 
or  moditiod  by  the  other.  The  brandy  arriv- 
ed, preceded  by  information-  of  the  occur- 
rence of  the  contingency  on  which  Mactier 
had  promised  to  take  the  adventure  to  him- 
self. After  a  few  days  employed  in  con- 
sultation with  his  friends  as  to  his  obliga- 
tion, he  did  accede  to  .he  proiK)sition,  and 
did  all  tliat  was  necessary  to  give  effect  to 
the  contract.  It  is  urged  that  the  letters  of 
Frith,  which  reached  this  countrj'  after  the 
death  of  Mactier,  cannot  make  a  contract. 
Most  certainly  they  camiot;  but  they  furnish 
evidence  that  one  had  been  made  before,  by 
proving  an  actual  meeting  of  the  minds  of 
the  parties,  if  a  contract  can  be  made  with- 
out a  mutual  and  reciprocal  knowledge  of 
such  meeting.  And  if  a  contract  cannot  be 
made  without  that  knowledge,  those  letters 
wovdd  not  have  constituted  a  contract,  if 
they  had  reached  this  countrj-  in  the  lifetime 
of  Mactier.  They  prove  all  now.  that  they 
would  have  proved,  if  the  death  had  not  oc- 
curred. They  never  would  have  proved  that 
each  party  knew  their  minds  met.  They 
prove  that  the  mind  of  Frith  had  undergone 
no  change;  that  he  continued  the  proposi- 
tion; that  his  mind  was  the  same.  Mar.  28, 
as  when  Mactier  actually  took  the  adventure 
to  himself,  as  it  was  Dec.  24,  when  he  pro- 
posal to  have  him  do  it.  A  valid  contract 
was,  therefore,  made,  by  the  act  of  Mactier, 
Mar.  28,  if  the  same  act  would  have  made 
one  Jan.  17,  when  he  wrote  his  reply  to  the 
proiKisition. 

It  is  alleged  that  three  fourths  of  the 
brandy  had  been  sold  by  Mactier  at  a  profit, 
before  he  decided  to  comply  with  the  propo- 


52 


OFFER  AND  ACCErXANCE. 


sition,  and  that  a  knowledge  of  that  fact  was 
essential  to  Frith,  to  enable  him  to  act  iinder- 
standingly.  and  that  he  ought  not  to  be 
bound,  because  it  had  not  been  communicat- 
ed. The  parties  intended,  when  they  en- 
gaped  in  the  adventure,  Uaat  the  brandy 
should  arrive  in  New  York  in  or  before  the 
mouth  of  Januaiy.  Frith,  in  his  letter  of 
Mar.  28,  expresses  the  opinion  that  it  had 
arrived  long  before  that  date.  When  he 
made  the  proposition  in  December,  he  acted 
upon  the  belief  that  the  brandy  would  soon 
arrive,  if  it  had  not  already  arrived;  and 
when  he  confirmed  it,  he  acted  upon  the  as- 
sumption that  it  had  then  been  a  long  time 
in  the  possession  of  Mactier.  Frith  there- 
fore acted  pi-ecisely  as  he  would  have  done 
if  he  had  possessed  positive  knowledge  of  its 
arrival.  Can  it  be  contended  that  Mactier 
had  not  a  right  to  sell  the  brandy?  If  it  be 
tnie  that  he  was  bound  to  keep  it  until  the 
completion  of  the  contract  between  him  and 
Frith,  and  if  it  be  essential  to  the  validity  of 
that  contract  that  the  parties  should  recip- 
rocally have  had  knowledge  that  their  minds 
met,  it  is  difficult  to  determine  at  what  pe- 
riod he  would  have  been  at  liberty  to  sell. 
Lf  there  was  a  sale  to  him  of  Frith's  inter- 
est, he  had  a  right  to  sell  it  as  his  own,  and 
if  there  was  not,  he  had  a  right  in  fulfillment 
of  the  onginal  purpose  of  the  adventure.  His 
right  to  sell,  therefore,  in  either  alternative, 
was  indisputable,  and  Frith  must  have  pre- 
sumed that  he  would  embrace  a  good  oppor- 
tunity. I  cannot  perceive  what  bearing  the 
fact  of  profit  or  loss  has  upon  the  question 
of  contract.  The  parties  engaged  in  the  ad- 
venture in  the  hope  of  making  profit  Noth- 
ing had  occurred  to  diminish  their  expecta- 
tions Dec.  24,  when  Frith  made  his  proposi- 
tion; and  Mar.  28,  when  he  renewed  and 
confirmed  it,  he  expresses  the  opinion  that 
its  "'safe  arrival,"  which  he  believed  had 
taken  place,  "would  be  much  enhanced,  if 
there  be  a  war,"  of  which  there  was  then, 
to  his  vision  and  in  fact,  a  clear  prospect. 
He  believed,  at  first  and  always,  that  the  ad- 
venture would  be  profitable;  and  when  he 
confirmed  his  proposition  to  sell,  he,  for  a 
manifest  reason,  anticipated  larger  profits 
than  at  the  time  of  his  engagement.  It 
could  not  have  been  necessary  that  he  should 
have  had  information  of  a  fact  of  which  be 
entertained  a  full  belief,  and  the  amount  of 
profit  actually  realized  was  too  small  to  jus- 
tify an  inference  that  it  exceeded  his  ex- 
pectations. He  believed  the  adventure  would 
be  profitable,  and  it  is  incredible  that  he  in- 
tended Mactier  should  take  it  to  his  sole  ac- 
count, only  in  the  event  of  its  proving  disas- 
trous. The  arrival  and  sale  of  the  brandy 
at  a  moderate  profit  were  to  him  matters  of 
no  importance.  He  believed  both,  and  made 
and  confirmed  his  proposition  to  sell  upon 
that  assumption. 

It  is  further  alleged  in  the  bill,  that  by  the 
rate  of  exchange  specified  in  Mactier's  letter 
of  Mar.  27),  Frith  would  have  been  a  loser  in 


consequence  of  having  placed  his  funds  in 
France  for  the  payment  of  the  brandy  at  a 
higher  rate  of  exchange,  and  also  for  the 
want  of  a  provision  for  the  payment  of  in- 
terest. The  question  is,  did  Mactier  comply 
with  Frith's  proposition?  In  his  letter  of 
Dec.  24,  Frith  proposed  to  Mactier  to  take 
the  adventure  to  his  sole  account,  "holding 
the  value  to  cover  the  transaction  to  his  ac- 
count in  New  York."  What  was  its  value  in 
reference  to  covering  the  transaction?  It 
had  no  value  for  that  purpose  .other  than  its 
cost.  There  was  no  mention  in  the  proposi- 
tion of  interest,  or  the  rate  of  exchange. 
Mactier  certainly  intended  to  meet  that  prop- 
osition. He  assumed  upon  himself  the  pay- 
ment of  all  charges,  and  took  the  brandy  at 
its  invoice  price  as  the  evidence  of  its  value, 
and  at  a  rate  of  e;s:change  which  was  the  ex- 
change of  the  day.  There  was,  in  his  at- 
tempted compliance  with  the  proposition,  no 
intentional  departure  or  omission;  nor  is 
there  evidence  that  there  was  any  in  fact, 
but  there  is  evidence  that  this  allegation  is 
groundless.  When  Frith  wrote  his  letter  of 
Apr.  21,  he  had  Mactier's  letter,  and  knew, 
therefore,  precisely  the  terms  on  which  the 
brandy  had  been  taken.  The  price  and  the 
rate  of  exchange  are  expressly  mentioned. 
He  wrote  three  letters  aftei-wards,  with  his 
mind  turned  to  the  subject,  and  without  ex- 
pressing in  any  one  of  them  a  single  word  of 
disapprobation  or  complaint.  If  the  price  at 
which  Mactier  had  taken  the  brandy  was  not 
what  he  meant  by  its  value,  or  the  rate  of 
exchange  was  inaccurate,  it  became  him  to 
speak  immediately.  When  he  had  all  need- 
ful information,  and  should  have  spoken  if 
he  had  cause  for  dissatisfaction,  he  was  si- 
lent. It  is  time,  those  letters  arriving  after 
the  death  of  Mactier  do  not  make  a  contract, 
but  they  prove  that  Frith  was  then  satisfied, 
and  did  not  imagine  that  injustice  had  been 
done  him.  He  did  more  than  acquiesce;  he- 
sought  to  avail  himself  of  the  funds  which 
the  transaction  had  placed  to  his  credit  in 
the  hands  of  Mactier.  To  that  period.  Frith 
had  been  his  debtor.  In  his  letter  of  Dec. 
24,  he  "promised  it  should  not  be  long  before 
he  made  a  remittance  and,  he  trusted,  to  hi& 
satisfaction."  In  his  letter  of  Mar.  28,  he  re- 
grets that  he  has  not  been  able  "to  remit  fur- 
ther, and  hoped  soon  to  put  him  in  consid- 
erable funds  of  his."  He  had,  pending  the  ne- 
gotiation, supplied  Mactier  with  some  bills;, 
but  if  the  avails  of  them  had  been  realized,  he 
was  still  his  debtor  to  the  amount  Of  several 
thousand  dollars.  In  his  letter  of  Apr.  21, 
written  on  the  I'oceipt  of  information  that 
Mactier  had  taken  the  adventure  to  himself, 
he  requests  Mactier  to  charter  for  him  a 
"first  class  vessel,"  for  a  voyage  to  the  Medi- 
terranean, and  load  her  with  a  specified  car- 
go on  his  accoimt,  and  says  not  a  word  about 
funds,  and  makes  no  provision  for  payment. 
He  had  then  before  him  Mactier's  letter,  in- 
forming him  of  the  amount  of  the  proceeds 
of  the  brandy,  and  that  they  were  placed  lo- 


COMMUNICATION  BY  CORRESPONDENCE. 


53 


his  credit.  He  then  perceived  t-uat  instead 
of  being  the  reluctant  debtor,  he  had  become 
the  creditor  of  Mactier,  to  the  amount  of 
more  than  $9,000.  All  his  regrets  at  not  be- 
ing able  to  supply  him  with  funds  had  van- 
ished, and  he  sought  immediately  to  avail 
him-self  of  those  which  that  transaction  had 
placed  at  his  command.  From  all  this,  1  fti- 
fer  that  he  was  content  and  satislicd  not  only 
with  the  fact  that  Mactier  had  taken  the 
brandy  to  himself,  but  with  all  the  terms 
upon   which  he  had  taken  it 

1  come,  therefore,  to  the  conclusion  that  the 
proposition  from  Frith  to  Mactier  was  con- 
tinued, neither  rejected,  revoked  nor  modi- 
tied;  that  its  acceptance  depended  upon  the 
act  of  Mactier;  that  he  did  the  act  which 
alone  was  necessary  to  meet  the  proposition 
and  complete  the  contract,  in  exact  accord- 
ance with  the  mind  of  i<'rith,  and  to  his  per- 
fect satisfaction  at  the  time;  and  that,  con- 
sequently, a  sale  of  his  interest  was  etlected, 
and  he  was  not  the  owner  of  the  brandy  at 
the  time  of  the  sale  of  a  part  of  it  by  Mac- 
tier,  or  the  residue  at  his  death,  and  that  the 
decree  of  the  chancellor  should  be  i*eversed. 

By  Mr.  Senator  OLIVER.  The  first  ques- 
tion which  I  deem  Importiint  to  the  decision 
of  this  appeal  is,  wa^i  Mactier  originally  a 
joint  owner  with  Frith  in  the  200  pipes  of 
braudy? 

From  the  form  of  the  order  and  letter  of 
Mactier  to  Frith  of  Sep.  4,  1S22,  the  letter  of 
Frith  to  Firebrace,  Davidson  »&  Co.  ordering 
the  brandy,  and  the  testimony  of  Alexander 
Mactier,  and  Frith's  letter  of  Dec.  24,  1822, 
in  which  he  says,  •By-the-bye,  as  your  broth- 
er, before  I  left  New  York,  declined  taking 
the  interest  I  offered  him  in  this  (the  bmudy) 
specidation,  I  would  propose  to  you  take  ihe 
adveutm-e  solely  on  your  own  account."  It 
seems  to  me  that  Mactier  was  originally 
equally  interested  with  Frith  in  the  20U  pipes 
of  brandy;  and  when  he  speaks  of  Mactier 
taking  the  adventure  solely  on  his  own  ac- 
count, he  must  have  meant  that  he  should 
talie  the  other  half  of  the  brandy  oft'  his 
hands.  Again;  this  evidence  proves  the  part- 
nership was  agreed  upon  for  this  adventure 
before  the  brandy  was  bought;  that  it  was 
purchased  by  Frith  for  their  joint  benefit, 
and  so  they  were  joint  vendees,  and  liable 
for  the  purchase  money.     12  East,  421. 

Did  Mactier  purchase  the  other  half  of  the 
brandy  V  To  answer  this  question,  it  be- 
comes important  to  examine  again  a  part  of 
the  corresiHjndence  between  Frith  and  Mac- 
tier.  Frith's  letter  of  Dec.  24  contained,  as 
we  have  seen,  a  distinct  proposition  to  part 
with  his  interest  in  the  adventure  of  brandy; 
that  Mactier  should  take  it  solely  to  his  own 
account;  that  is,  take  the  bi'andy  at  the  in- 
voice price.  All  Frith  wanted  was  to  have 
the  brandy  ofC  his  hands.  Jan.  17,  lS2o, 
Mactier  writes  to  Frith  on  the  subject  of 
their  business,  and  in  answer  to  the  propo- 
sition of  taking  the  brandy  to  his  own  ac- 


count, he  says:  "This  has  been  from  the 
first  a  favorite  speculation  with  me,  and  am 
pleased  to  say  it  still  promises  a  favorable 
result;  but  to  render  it  complete,  I  am  de- 
sirous the  speculation  should  go  forward  in 
the  way  first  proposed,  thereby  making  it  a 
treble  operation;  us  you  have,  however,  ex- 
pressed a  wish  that  I  should  take  the  ad- 
venture to  my  own  account,  I  shall  delay 
coming  to  any  determination  tiU  I  again  hear 
from  you.  Prospects  of  war  between  France 
and  Spain  may  defeat  the  object  of  this 
specidation,  as  far  as  relates  to  the  shipment 
of  provisions  hence  to  Hayti,  to  be  invested 
in  coffee  for  France,  in  which  case  I  wid  at 
once  decide  to  take  the  adventure  to  my  own 
account."  Thus  far,  1  am  inclined  to  think, 
there  was  an  agreement  on  the  part  of  Mac- 
tier  to  accept  the  pnjiX)Sition  on  a  certain 
event,  and  a  mere  postponement  of  accept- 
ing absolutely  until  he  should  hear  from 
Frith,  in  hopes  Frith  would  yet  be  willing  to 
proceed  with  the  speculation.  It  may  be 
said  that  Mactier,  in  his  letter  of  Mar.  13, 
speaks  of  the  brandy  as  joint  property.  This 
is  true;  he  had  written  to  Frith  that  he 
should  wait  until  he  should  hear  from  him. 
Frith  must  have  known  that  Mactier  consid- 
ered the  proposition  as  one  under  considera- 
tion, not  rejected;  for  Mar.  7  he  says,  in  an- 
swer to  Mactier's  letter  of  Jan.  17,  "I  have 
received  your  esteemed  favor  of  the  17th  and 
31st  of  January,  and  note  their  respective 
contents."  The  efficct  of  this  letter  was  ei- 
ther an  assent  to  Mactier's  qualification  to 
take  the  brandy  on  the  happening  of  the 
war,  or  a  continuance  of  his  first  proposal. 
Frith's  answer,  not  declining  this  modifica- 
tion, was  a  virtual  assent  to  it.  If  he  did 
not  mean  to  assent,  he  should  have  said  so 
to  Mactier,  and  not  let  Mactier  go  on  as  if 
he  had  agi-eed.  I  think  good  faith  required 
Frith  to  make  known  his  assent  or  dissent  to 
this  qualification  of  Mactier.  What  was 
Fi-ith's  meaning?  "I  have  received  your  es- 
teemed favors,  and  noted  their  respective  con- 
tents." In  Noy,  Max.  91,  it  is  said:  "In  all 
contracts  he  that  speaketh  obscurely  or  am- 
biguously is  said  to  speak  at  his  own  peril, 
and  such  speeches  are  to  be  taken  strongly 
against  himself."  In  Pow.  Cont.  Si».  and  1 
Liv.  49,  it  is  said:  "A  tacit  assent  may  be 
inferred  from  inaction  or  forbearance  of  act- 
ing: Thus  a  man,  by  his  silence,  in  case  he 
be  present  and  acquainted  with  what  is  do- 
ing, is  supposed  to  give  his  assent,  unless  it 
appear  that  he  was  hindered  from  speaking." 
Again,  if  this  was  not  an  acceptance  of  Mac- 
tiei*'s  modification,  it  was  virtually  permit- 
ting the  original  off*>r  to  stand,  that  Mactier 
might  determine  to  take  the  brandy  or  not, 
as  he  said  he  should  on  hearing  ftirther.  In 
Poth.  Mar.  Cont.  pt.  1,  §  11,  Nos.  31.  32,  it  is 
said  that:  "In  the  contract  of  sale,  as  in  oth- 
er contracts,  the  consent  of  the  parties  can  in- 
tervene, not  only  between  persons  present, 
but  between  the  absent,  by  letters  or  by 
messenger.    In  order  that  the  consent  should 


S4 


UFFER  AND  ACCEPTANCE. 


Intervene  in  the  latter  case,  it  is  uecessary 
that  the  will  of  the  party  who  has  written  to 
the  other  to  propose  to  him  the  bargain  shall 
have  continued  until  the  time  at  which  his 
letter  shall  have  reached  the  other  party, 
and  at  which  the  other  party  shall  have  de- 
clared that  he  accepted  the  bargain.  This 
will  is  presumed  to  have  continued,  so  loug 
as  nothing  appears  to  the  contrary."  Must 
it  not  be  so  upon  general  principles?  Again, 
in  3  Starkie,  Ev.  12C>2,  it  is  said:  "Where  the 
existence  of  a  particular  subject  matter  or 
relation  has  once  been  proved,  its  continu- 
ance is  presumed  till  proof  be  given  to  the 
contraiy."  Lord  EUeuborough,  in  IG  East, 
55,  remarks:  "It  is  fair  to  presume  things 
continue  in  the  same  state,  in  the  absence  of 
all  proof  of  their  having  been  altered." 

I  admit  that  this  presumption  may  be  re- 
butted by  lapse  of  time,  or  by  the  fact  that 
the  brandy  was  in  an  unsafe  or  perishable 
coudition,  which  is  not  the  case  here.  In  the 
present  case  the  continuance  of  the  vendor's 
proposition  is  not  left  to  presumption  alone, 
as  in  ordinary  cases;  Frith  shows  the  con- 
tinuance affirmatively  by  his  letters,  and  tlms 
places  it  beyond  mere  presumption,  either  one 
way  or  the  other.  He  remarks  in  his  letter  of 
Mar.  28,  "with  regard  to  this  adventure,  I 
would  wish  to  confirm,  if  altogether  satisfac- 
tory to  you,  what  1  mentioned  to  you  in  my 
previous  letter,  in  reply  to  yours  of  the  17th 
of  ,Tanuai-y."  It  is  manifest  from  this  that  he 
still  wished  to  sell  as  he  before  offered.  If 
this  is  not  sufficient  to  show  his  intention  to 
sell,  his  letters  of  Apr.  21  and  22  clearly 
prove  that  Frith  never  changed  his  mind  as 
to  selling  the  brandy;  that  he  considered  the 
offer  to  sell  open,  and  not  withdrawn  or  re- 
tracted, but  accepted;  for  his  letter  of  Apr. 
21  was  after  receiving  Mactier's  letter  say- 
ing that  he  had  taken  the  brandy.  Mar.  25 
their  minds  meet.  This  completes  the  sale 
in  the  present  case;  a  formal  delivery  of  the 
brandy  was  not  necessary,  as  it  was  in 
Mactier's  possession.  It  was  iu"ged  on  the 
argument  that  these  letters  of  April  and  May 
could  not  confirm  the  sale,  as  Mactier  died 
before  they  were  written,  to  wit:  Apr.  10; 
but  to  my  understanding  there  is  sufficient 
without  these  letters.  It  appears  to  me,  as 
I  have  before  remarked,  that  Frith's  letter 
of  Mar.  28,  and  the  two  in  April,  and  his  last 
of  May  G,  are  sufficient  to  show  that  the 
complainant's  mind  and  continued  desire  was 
to  sell. 

Again,  what  must  Mactier  have  supposed? 
He  had  done  all  in  his  power  to  the  final  con- 
summation of  this  sale;  Frith,  by  his  subse- 
quent act,  it  seems  to  me,  ratified  it,  and 
Mactier's  death  could  make  no  difference; 
it  related  to  the  time  of  Mactier's  letter,  and 
confirmed  his  acceptance  and  perfected  the 
sale  by  that  relation.  2  East,  227.  Frith 
could  have  insisted  upon  and  enforced  the 
bargain,  and  the  administrators  could  not 
have  refused. 

Again,  in  2  Ld.  Raym.  930,  Holt  says,  "A 


consent  subsequent  will  amount  to  an  au- 
thority precedent."  In  1  Liv.  445,  9,  per  Pow- 
ell, J.,  "A  subsequent  ratification  is  equiva- 
lent to  an  original  authority."  Again,  "There 
are  three  sorts  of  agreements— an  agreement 
executed,  an  agreement  subsequent  to  a  thing 
done,  and  an  agreement  executory."  Flowd. 
5a,"  Ga.  In  Com.  Dig.  tit.  "Agi-eement,"  A,  1, 
these  rules  are  all  cited.  In  12  Johns.  300, 
and  in  3  Cow.  281,  it  is  settled.  "A  subse- 
quent assent  may  be  inferred  from  circum- 
stances which  the  law  considers  equivalent  to 
an  express  ratification."  In  Com.  Dig.  tit. 
"Agreement,"  A,  2.  An  agreement  executed 
often  amounts  to  a  bargain  and  sale.  So 
where  an  assent  subsequent  is  given  to  an  act 
precedent,  by  such  assent  the  agreement  is 
executed.  Is  it  not  then  just  to  say  this  con- 
firmation of  Frith's  shall  relate  to  the  life- 
time of  Mactier'.'  In  Com.  Dig.  tit.  "Bargain 
and  Sale,"  it  is  said:  "If  a  bargainor  or  bar- 
gainee die  after  the  indenture  executed,  and 
before  enrollment,  the  estate  passes  to  the 
bargainee  and  his  heirs,  if  it  be  enrolled  with- 
in six  months,  yet  the  seisin  continues  in  the 
bargainee."  So  in  Cro.  Jac.  512,  and  Vin. 
Abr.  tit  "Relation,"  F,  G,  per  Coke  and  Mon- 
tague, "execution  of  all  things  executory,  re- 
spects the  original  act,  and  have  relation 
thereto,  and  all  make  but  one  act,  though 
done  at  several  times."  So,  where  there  are 
divers  acts  concurrent  to  make  one  estate,  the 
original  act  shall  be  preferred,  and  to  this 
the  other  acts  shall  come.  So,  where  two 
times  are  requisite  to  the  perfection  of  an 
act,  it  shall  be  said  upon  their  consummation 
to  receive  its  perfection  from  the  first.  Dyer, 
244.  So,  of  two  acts,  as  in  Bingham's  Case, 
2  Coke,  93.  "Where  to  the  perfection  or  con- 
summation of  a  thing  two  accidents  are  req- 
uisite, and  the  one  happens  in  the  time  of  one, 
and  the  other  in  the  time  of  the  other,  in 
such  case  neither  the  one  nor  the  other  shall 
take  benefit  of  this,  because  both  are  requisite 
to  the  consummation  of  the  thing."  How, 
then,  does  death  make  any  difference?  If  it 
does,  it  is  to  be  referred  to  the  consumma- 
tion, to  the  first  act,  to  the  lifetime,  where,  if 
neither  party  had  died,  it  would  not  have 
been  referred  to  such  first  act.  See  Cro.  Eliz. 
622. 

The  view  which  I  have  taken  of  this  case, 
renders  it  wholly  unnecessai-y  for  me  to  ex- 
amine the  point  of  stoppage  in  transitu. 

Considering,  then,  that  this  agreement  was 
consummated  in  tlie  lifetime  of  Mactier,  upon 
the  principles  and  cases  above  adverted  to,  I 
have  come  to  the  conclusion  that  the  adminis- 
trators had  a  right  to  act,  and  ^vould  have 
been  justifiable  in  taking,  if  they  had  not  al- 
ready done  so,  the  brandy  into  their  own  po.s- 
session,  as  a  part  of  the  assets  of  the  de- 
ceased. It  is  laid  down  by  Winter's  Office  of 
Executor,  82,  "Goods  contracted  for  by  tes- 
tator, not  delivered  in  his  lifetime,  must  be 
delivered  to  his  executors,"  and  I  can  see  no 
good  reason  why  the  same  rule  should  not  be 
extended  to  administi'ators. 


COMMUNICATION  BY  CORRESPONDENCE. 


55 


The  view,  therefore,  which  I  have  taken  of 
this  case  renders  it  unnecessary  for  me  to 
discuss  the  other  points  made  on  the  argu- 
ment; my  opinion  is,  tliat  the  decree  of  the 
chancellor,  so  far  as  it  relates  to  the  sale  of 
the  brandy,  should  be  reversed. 

By  Mr.  Senator  THKOOP.  Mactier  and  the 
respondent  were  equally  interested  as  part- 
ners In  the  triple  adventure,  of  which  the 
brandy  shipment  was  the  commencement,  but 
which  extended  to  a  second  shipment  of  pro- 
visions to  the  amount  of  tlie  invoice  cost  of 
the  brandy  from  New  York  by  Mactier  to  the 
respondent  :.t  Jacmel,  and  a  third  shipment 
of  coffee,  with  the  proceeds,  from  thence  to 
France  in  French  vessels,  to  be  there  applied 
to  the  payment  of  the  brandy.  The  order  for 
the  brandy  was  sent  by  the  respondent  to  his 
friends  in  Havre,  Sep.  5,  1822,  expectinj,'  the 
arrival  of  the  shipment  "at  New  York,  in 
January  or  before."  As  early  as  Oct.,  how- 
ever, he  evinces  a  desire  to  be  released  from 
the  adventure,  and  offered  his  interest  to  the 
brother  of  Mactier,  without  success.  This 
disposition  appears  to  have  continued,  and  is 
expressed  in  his  letters  on  this  subject. 

The  account  cm-rent,  and  the  correspond- 
ence show,  that  tlie  respondent  was  largely 
in  arrear  to  Mactier,  and  he  frequently  al- 
ludes to  it,  and  excuses  his  inability  or  delay 
to  make  remittances.  To  have  the  value  of 
the  brandy  shipment  placed  to  his  credit,  or 
made  to  cover  his  transactions  on  account  at 
New  York,  seems  to  have  been  one  prevailing 
object  in  offering  to  part  with  his  interest. 
He  also  wished  to  bring  his  concerns  to  a  cer- 
tain focus,  and  to  confine  his  business  as 
much  as  possible;  and  one  other  prevailing 
consideration  was  to  be  released  from  the  two 
shipments  originally  planned,  and  consequent 
upon  the  brandy  adventure.  These  considera- 
tions received  additional  weight  and  urgency 
from  the  prospect  of  a  war  between  France 
and  Spain,  and  the  inevitable  embarrassment 
of  the  trade  of  the  island,  thus  likely  to  en- 
sue, in  which  he  was  engaged.  The  joint  ad- 
venture, in  all  the  three  operations,  would  in 
that  event  be  subject  to  war  risks,  and  even 
the  brandy  shipment  became  a  hazardous  and 
doubtful  speculation.  It  was  his  desire  to  be 
released  from  all;  and  the  tenor  of  all  his  let- 
ters evinces  the  continual  interest  which  he 
had  in  effecting  such  an  object.  But  the 
brandy  had  been  ordered,  and  could  not  be 
refused  by  the  parties;  it  was  afloat,  or  would 
be  so,  before  the  order  could  be  revoked;  and 
the  consequences  of  this  part  of  the  adven- 
ture were  inevitable.  Their  interest  was 
joint,  the  profits  or  losses  were  to  be  ascer- 
tained when  the  third  and  last  shipment  was 
closed,  and  then  to  be  shared  equally;  and 
neither  could  arrest  the  adventure,  or  be  re- 
leased from  any  part  of  it,  except  by  the  con- 
sent of  the  other. 

It  appears  from  the  correspondence  that 
these  parties  were  on  terms  of  intimate  and 
confidential   friendship  and  intercourse,   and 


when  the  respondent  in  his  letter  of  Dec.  24, 
1S22,  proposed  to  Mactier.  "to  take  the  ad- 
venture solely  on  your  own  account,  holding 
the  value  to  cover  the  transactions  to  my  'ac- 
count in  New  York,"  the  proposition  was  not 
probably  new  or  unexpected  to  Mactier.  His 
letter  in  reply  seems  intended,  or  is  calculated 
to  inspire  greater  confidence  of  a  good  issue, 
and  to  quiet  any  doubts  of  a  favorable  result. 
His  answer  is  dated  .Ian.  17,  1S23,  saying  that 
he  is  informed  that  the  brandy  would  be  ship- 
ped, and  leave  Bordeaux  about  Dec.  1.  "This 
has  been  from  the  first  a  favorite  speculation 
with  me,  and  am  pleased  to  say  it  still  prom- 
ises a  favoraljle  result;  but  to  render  it  com- 
plete, I  am  desirous  the  speculation  should  go 
forward  in  the  way  first  proposed,  thereby 
making  it  a  triple  operation;  as  you  have, 
however,  expressed  a  wish  that  I  should  take 
the  adventure  to  my  own  account,  I  shall  de- 
lay coming  to  any  determination,  till  I  again 
hear  from  you.  The  prospect  of  war  between 
France  and  Spain  may  defeat  the  object  of 
this  speculation,  as  far  as  relates  to  ship- 
ment of  the  provisions  hence  to  Ilayti,  to  be 
invested  in  coffee  for  France,  per  French  ves- 
sels; in  which  case  I  will  at  once  decide  to 
take  the  adventure  to  my  own  account.  "The 
next  arrival  from  Europe  will  probably  de- 
cide the  question  of  peace  or  war,  and  I  will 
lose  no  time  in  communicating  the  same  to 
you."  "Let  what  will  happen,  I  trust  you 
will  in  no  way  be  a  sufferer."  He  commimi- 
cates  all  his  information  of  the  prospect  of 
the  war. 

I  consider  this  letter  as  declaring  with  suffi- 
cient certainty,  to  this  effect,  "notwithstand- 
ing my  information  which  I  communicate 
herein,  our  triple  operation  promises  a  favora- 
ble result  and  I  shall  delay  till  I  hear  from 
you  again,  and  then  determine  upon  your 
offer,  either  to  take  or  reject.  But  if  the  pros- 
pect of  war  shall  cut  up  our  two  adventures 
consequent  upon  this,  I  will  at  once  decide  to 
take  your  offer,  and  will  lose  no  time  in  com- 
municating the  same  to  you.  In  either  case, 
I  trust  you  will  not  be  a  sufferer."  I  observe 
here,  that  from  the  tenor  of  this  letter,  and 
also  of  respondent's  inclosing  the  order  for 
the  brandy,  both  parties  expected  its  an-ival 
daily,  and  that  the  respondent's  offer  and  his 
answer  were  written  under  such  expectation, 
and  that  in  the  respondent's  letter  of  Mar. 
28,  the  offer  is  renewed,  when  he  supposed  it 
had  long  since  arrived. 

That  Mactier  considered  his  reply  to  the 
offer  and  obligation  on  his  part  to  take,  so 
soon  as  the  prospect  of  war  was  so  far  con- 
firmed, as  to  render  it  proper  to  break  up  the 
two  succeeding  shipments,  appears  in  two 
ways.  The  clerk  of  Mactier  says,  that  wlien 
the  brandy  arrived,  the  war.  was  uncertain, 
Mactier  then  concluded  that  the  original  voy- 
age should  be  broken  up,  being  unprofitable. 
He  consulted  Bane,  and  referred  to  this  let- 
ter, and  upon  that  consultation,  it  was  con- 
cluded that  "he  was  obliged  to  take  the 
brandy,  whether  it  came  to  a  good  or  bad 


56 


OFFER  AXD  ACCEPTANCE. 


market."  It  appears,  from  Alexander  Mac- 
tier's  testimony,  that  tlie  speculation  was 
profitless  to  Mactier.  The  consultation  with 
Champlin  agrees  throughout  so  well  with  the 
transaction  and  letter  of  Jan.  17,  and  with  no 
other,  that  it  must  have  been  at  that  time; 
for  then,  it  would  seem  from  his  letter,  "he 
was  inclined  to  take  the  brandy." 

But  his  letter  of  Mar.  25,  explains  and  con- 
firms his  idea  that  this  letter  of  Jan.  17  was 
obligatory  upon  him,  whether  the  market  was 
good  or  bad.  He  then  says:  "I  have  to  ad- 
vise the  arrival  of  the  200  pipes  of  brandy, 
and  in  consetiuonce  of  the  probability  of  the 
war  between  France  and  Spain,  and  in  com- 
pliance with  the  wish  expressed  in  your  re- 
garded favor  of  the  24th  December,  and  my 
answer  thereto  of  the  17th  January,  I  have 
decided  to  take  the  adventure  to  my  own  ac- 
count." In  consequence,  he  gave  the  respond- 
ent ."redit.  according  to  his  original  proposi- 
tion. Nothing  more  was  wanting  to  prove 
iind  enforce  this  bargain  against  Mactier  or 
his  representatives,  than  these  letters  and 
acts.  Notwithstanding  the  bargain  was  com- 
plete against  Mactier,  the  fact  of  ownership, 
as  expressed  by  Bane  in  his  testimony,  was 
contingent.  The  assent  of  the  respondent  was 
not  then  known;  it  had  not  been  expressly 
given,  and  if  the  expected  letter  from  the  re- 
spondent, in  reply  to  the  one  of  Jan.  17,  had 
contained  his  dissent  or  a  retraction  of  his 
original  offer,  the  adventure  would  have  been 
thrown  back  to  its  original  state  and  inter- 
ests 

Did  the  respondent  ever  assent  to  this  con- 
tract, so  as  to  vest  the  title  of  the  brandy  ab- 
solutely in  Mactier  before  his  death?  An  as- 
sent to  a  contract  may  be  inferred  from  cir- 
cumstances, from  voluntary  inaction  or  for- 
bearance to  act.  Thus,  a  man  by  his  silence, 
if  he  has  an  opportunity  of  speaking  and 
knowledge  of  what  is  doing,  is  supposed  to 
give  his  assent  to  what  is  done.  On  Mar. 
25,  when  the  credit  was  given,  a  long  time 
had  elapsed  since  .Tan.  17,  and  no  dissent  to 
that  letter  or  retraction  of  the  offer,  had  been 
received;  still  the  respondent's  letter  might 
have  been  sent,  and  the  delay  reasonably  ac- 
counted for,  if  in  fact  he  had  dissented  or  re- 
tracted. And  here,  I  remark,  that  this  cir- 
cumstance siifiiciently  explains  the  contents 
of  Mactier's  letter  of  Mar.  1,3,  in  which  he 
Informs  the  respondent  that  from  the  last 
dates  received  by  him,  war  might  be  con- 
sidered inevitable;  and  says  of  the  brandy: 
"I  am  looking  daily  for  its  arrival;  it  is  to  be 
regretted  the  order  was  not  more  promptly 
executed,  as  the  delay,  I  fear,  will  operate  to 
our  disadvantage."  As  promised  in  his  let- 
ter of  Jan.  17,  he  communicates  the  first  in- 
telligence of  peace  or  war,  but  having  no  let- 
ter from  the  respondent  since  his  of  that  date, 
he  does  not  retract  what  he  had  then  said, 
nor  does  he  treat  the  lapse  of  time  as  an 
assent  or  confirmation  of  it  by  the  respondent. 
The  language,  "our  disadvantage,"  is  used 
in  reference  to  the  then  state  of  the  corre- 


spondence, and  expressed  their  joint  interest 
in  case  the  respondent  had  in  fact  dissented 
or  retracted  his  offer. 

But  I  consider  the  assent  of  the  respondent 
to  this  contract  to  rest  upon  surer  ground  than 
any  circumstance  of  the  unsatisfactorj-  and 
doubtful  character  of  mere  lapse  of  time.  His 
letter  of  Mar.  7,  must,  under  all  the  circum- 
stances, be  considered  a  legal  acquiescence 
and  consent  on  his  part.  And  while  I  would 
admit  that  proof  of  any  attempt  by  a  "swift 
messenger,"  or  any  other  less  rapid  means, 
to  Avithdraw  it,  or  to  dissent  from  the  condi- 
tional acceptance  of  Mactier,  or  to  retract  his 
original  offer,  would  have  materially  weaken- 
ed or  annulled  its  effect,  it  is  manifest  that 
no  such  attempt  was  made,  and  that  all  the 
circumstances  show  a  contrary  intention. 
When  the  respondent  wrote  the  lettter  of 
Mar.  7,  Mactier's  letter  of  Jan.  17  was  be- 
fore him;  and  if  he  did  not  wish  to  have  his 
original  offer  stand  the  chances  mentioned 
by  Mactier,  be  was  bound  to  have  improved 
the  first  opportunity  to  withdraw  it.  In  1 
Liv.  Ag.  48,  and  the  cases  there  cited,  is  found 
this  rule:  "If  a  man  receives  a  letter,  the 
relation  of  the  parties  favoring  the  presump- 
tion, he  is  presumed  to  approve  whatever  is 
contained  in  the  letter  unless  he  immediately 
makes  known  his  dissent.  But  the  reception 
of  a  letter  not  contradicted,  does  not  always 
amount  to  a  ratification  unless  it  is  accom- 
panied with  circumstances  capable  of  show- 
ing an  intention  to  ratify."  Also,  2  .Johns. 
Cas.  424;  12  Johns.  300;  3  Cow.  281.  This  is 
the  rule  of  reason  and  plain  dealing,  as  well 
as  of  the  law.  If  this  letter  contained  no  ref- 
erence to  the  negotiation,  his  silence  and  for- 
bearance to  improve  this  opportunity  to  dis- 
sent should  be  held  to  bind  him.  He,  how- 
ever, says:  "I  have  received  your  esteemed 
favors  of  the  17th  and  21st  January,  and  note 
their  respective  contents."  Is  there  anything 
wanting  to  bring  the  respondent  within  the 
familiar  case  and  known  rule,  of  a  man  who, 
knowing  what  is  doing  and  having  an  oppor- 
tunity of  speaking,  by  his  silence  is  held  to 
give  his  assent  to  what  is  done? 

But  if  there  could  be  any  doubts  of  this  case 
coming  ^'ully  within  the  rule  cited  from  Liv- 
ermore,  the  letter  of  Mar.  7,  is  followed  by 
another  from  the  respondent  of  the  28th,  and 
still  another  of  Apr.  21,  each  capable  of  show- 
ing his  intention  to  ratify  his  original  offer, 
and  confirming  his  assent  to  what  had  been 
done  by  Mactier.  On  Mar.  28,  after  express- 
ing his  expectation  that  the  brandy  had  ar- 
rived long  ere  that  time,  unless  the  rupture 
we  have  a  report  of,  between  France  and 
Spain  took  place  before  the  sailing  of  the  ves- 
sel, he  says:  "With  regard  to  this  adventure 
I  wish  to  confirm,  if  entirely  satisfactory  to 
you.  what  I  mentioned  to  you  some  time  ago, 
and  which  I  omitted  to  repeat  in  my  previous 
letter,  in  reply  to  yours  of  the  17th  JanuaiT-" 
In  his  letter  of  Apr.  21.  he  acknowledges  the 
receipt  of  Mactier's  "esteemed  favor  of  the 
25th,  with  that  of  the  5th  inst,  and  notes  par- 


COMMUNICATION  BY  CORRESPONDENCE. 


57 


ticularly  tboir  respective  contents,  to  which 
principaiiy  mj'  previous  respects  (.being  his  of 
the  2Sth  March  and  12th  current)  reply;"  and 
he  then  ordered  the  shipment  of  a  cargo  to 
him.  Hence  It  appears  that  the  presumed  le- 
gal effect  of  the  letter  of  Mar.  7.  is  precisely 
the  intended  meaning  of  the  respondent,  and, 
as  he  expresses  himself,  "I  note  the  contents," 
it  means,  he  approves  and  assents  to  them. 

Under  all  the  circumstances,  I  can  enter- 
tain no  doubt  that  the  letter  of  Mar.  7,  was 
intended,  and  should  be  considered,  as  an  ex- 
press assent  to  the  conditional  acceptance 
and  the  reply  of  Mactier  in  his  of  Jan.  17. 
He  allowed  his  correspondent  and  confiden- 
tial friend  to  proceed  to  close  the  bargain,  as 
he  had  informed  him  he  should  do  upon  the 
receipt  of  his  letter  then  in  writing,  or  upon 
the  happening  of  the  contingency  then  in 
prospect.  His  letters  show  of  how  little  re- 
gard, in  comparison  to  his  anxiety  to  be  re- 
leased from  the  adventure,  was  the  fact  of 
the  arrival  of  the  brandy  at  New  York,  or  the 
price  at  which  it  would  sell;  his  readiness  to 
bear  the  joint  risks  of  transportation,  if  such 
was  the  intention  of  Mactier,  in  delaying  to 
release  him  before  its  arrival,  and  his  will- 
ingness to  wait  the  happening  of  the  event 
referred  to  by  Mactier,  upon  which  he  would 
determine  to  take  it  to  his  own  account  Mac- 
tier  died  Apr.  10;  but  from  Apr.  21  (if  not  be- 
fore), until  that  event  was  known  at  Jacmel, 
he  could  not  have  doubted,  nor  (as  his  letters 
show)  have  regretted  one  moment  his  release 
from  the  triple  adventure,  nor  the  absolute 
sale  of  the  brandy  to  Mactier.  Shall  he  now 
be  heard  to  complain  that  Mactier  did  not 
close  the  bargain  till  its  safe  arrival  at  New 
York,  and  a  sale  of  three  quarters  of  the 
brandy? — that  he  had  run  all  the  risks  of  the 
s»^a?  Before  he  does  so,  he  must  show  that 
Mar.  7,  or  some  other  early  oppori;uiuty,  or  in 
some  way,  he  refused  to  encounter  such  risks; 
or  dissented  from  any  release  after  the  brandy 
should  have  arrived,  or  expressed,  or  attempt- 
ed to  express  his  non-concurrence  to  the  con- 
ditional acceptance  and  understanding  of  Mac- 
tier.  Both  parties  expected  its  arrival  before 
the  day  when  he  was  writing;  and  from  the 
contents  of  Mactier's  letter  of  Jan.  17,  he 
must  have  supposed  that  it  was  then  a  long 
time  in  New  York;  his  letter  was  to  encounter 
a  further  delay  in  its  transmission,  and  when 
it  should  be  received  Mactier  would  see  in  it 


the  usual  approbatory  expression,  "I  note  Its 
contents."  It  would  be  sanctioning  a  danger- 
ous departure  from  good  faith  and  plain  deal- 
ing in  a  commercial  correspondence  if  any 
other  construction  or  effect  should  be  given 
to  this  letter  of  Mar.  7.  If  this  letter  had 
been  received  by  Mactier  in  his  lifetime,  and 
It  is  stated  by  the  chancellor  to  have  been  so 
received  Apr.  7,  before  which  time  he  had 
taken  the  brandy  to  his  own  account,  and 
given  the  correspondent  credit  according  to 
his  oi'iginal  proposition,  nothing  would  have 
been  wanting,  according  to  my  view  of  the 
effect  of  these  letters,  to  a  perfect  and  con- 
summated bargain  Mar.  25. 

The  doctrine  of  stoppage  in  transitu,  and 
the  question  whether  the  representations  of 
this  or  any  other  vendee  can  ratify,  consent  to 
or  affirm  a  contract  in  fieri  at  the  time  of  the 
death,  do  not  appear  to  me  to  form  appro- 
priate or  necessary  Inquiries  in  this  case. 
The  case  of  Conyers  v.  Ennis,  decided  by 
Judge  Story  (2  Mason,  23<j,  Fed.  Cas.  No. 
3,149),  found  in  G  Cow.  IIG,  Is  strong  upon 
both  these  Inquiries,  as  they  are  raised  in  the 
present  case.  Here  was  a  period  of  from  Mar. 
2.J  or  28  to  Apr.  10,  when  Mactier  died,  and 
long  afterwards,  during  which,  both  parties 
assented  to  the  bargain,  upon  terms  well  un- 
derstood and  acceptable  to  both;  when  such 
consent  had  been  committed  to  writing  and 
dispatched  to  each  other,  and  no  effort  at 
withdrawal  ct  dissent  attempted  by  either, 
until  long  after  the  amval  of  the  letter,  and 
the  actual  sale  of  the  whole,  and  the  probable 
consumption  of  a  considerable  portion  of  the 
subject  of  the  contract 

My  opinion,  therefore,  is,  that  the  letters  of 
Dec.  24  and  Jan.  17,  assented  to,  explained 
and  confirmed  by  the  subsequent  letters,  ac- 
quiescence and  acts  of  the  parties,  fully  es- 
tablish a  contract  of  sale,  and  that  the  decree 
of  his  honor,  the  chancellor,  in  the  points  ap- 
pealed from,  should  be  reversed. 

Whereupon,  on  the  question  being  put— Shall 
the  decree  of  the  chancellor  appealed  from, 
be  reversed?  Chief  Justice  SAVAGE  and 
Justices  SUTHERLAND  and  MARCY,  and 
eighteen  senators  voted  in  the  affirmative; 
and  three  senators  voted  In  the  negative  viz. 
Senators  M'CARTY.  TODD  and  \Y11EET.F.R. 

The  decree  of  the  chancellor  was,  accord- 
ingly, reversed,  with  costs. 


58 


OFFER  AND  ACCEPTANCE. 


C     HOUSEHOLD    FIKE    &    CARRIAGE   ACC. 
^  IX S.  CO.,  Limited,  v.  GRANT. i  Ap 

(4  Exch.  Div.  216.)       (^l   'f^ 

Court  of  Appeals.    July  1,  1S79.   ^ 

Worthington  Evans,  for  plaintiff.  J.  Da- 
yies,  for  defendant. 

Action  to  recover  £94.  15s.,  being  the  bal- 
ance due  upon  100  shares  allotted  to  the  de- 
fendant on  the  25th  of  October,  1874,  in 
pursuance  of  an  application  from  the  de- 
fendant for  such  shares,  dated  the  30th  of 
September,  1874. 

At  the  trial  before  Lopes,  J.,  during  the 
Middlesex  sittings,  1S7S,  the  following  facts 
were  proved:  In  1874  one  Keudriclc  was 
acting  in  Glamorganshire  as  the  agent  of 
the  company  for  the  placing  of  their  shares, 
and  on  the  30th  of  September  the  defend- 
ant handed  to  Kendrick  an  application  in 
writing  for  shares  in  the  plaintiff's  com- 
panj-.  which  stated  that  the  defendant  had 
paid  to  the  bankers  of  the  company  £5,  be- 
ing a  deposit  of  Is.  per  share,  and  requesting 
an  allotment  of  100  shares,  and  agreeing  to 
pay  the  further  sum  of  79s.  per  share  with- 
in twelve  mouths  of  the  date  of  the  allot- 
ment. Kendrick  duly  forwarded  this  appli- 
cation to  the  plaintiffs  in  London,  and  the 
secretaiy  of  the  company,  on  the  20th  of 
October,  1874,  made  out  the  letter  of  allot- 
ment in  favour  of  the  defendant,  which  was 
posted  addressed  to  the  defendant  at  his 
residence,  16  Herbert  street,  Swansea,  Gla- 
morganshire. His  name  was  then  entered 
on  the  register  of  shareholders.  This  letter 
of  allotment  never  reached  the  defendant. 
The  defendant  never  paid  the  £5  mentioned 
in  his  applicati6n  but,  the  plaintiffs'  com- 
pany being  indebted  to  the  defendant  in  the 
sum  of  £5  for  commission,  that  sum  was 
duly  credited  to  his  account  in  their  books. 
In  July,  1875,  a  dividend  at  the  rate  of  21/2 
per  cent,  was  declared  on  the  shares,  and  in 
February,  187G,  a  further  dividend  at  the 
same  rate.  These  dividends,  amounting  al- 
together to  the  sum  of  5s.,  were  also  credit- 
ed to  the  defendant's  account  in  the  books 
of  the  plaintiffs'  company.  Afterwards  the 
company  went  into  liquidation,  and  on  the 
7tn  of  December,  1877,  the  official  liquidator 
applied  for  the  sum  sued  for  from  the  de- 
fendant; the  defendant  declined  to  pay,  on 
the  ground  that  he  was  not  a  shareholder. 

On  these  facts  the  learned  judge  left  two 
questions  to  the  jury:  (1)  Was  the  letter  of 
allotment  of  the  20th  of  October  in  fact 
posted?  (2)  Was  the  letter  of  allotment  re- 
ceived by  the  defendant?  The  jurj-  foimd 
the  first  question  in  the  affirmative  and  the 
last  in  the  negative.  The  learned  judge  re- 
served the  case  for  further  consideration, 
and  after  argument  directed  judgment  to  be 
entered  for  the  plaintiffs  on  the  authority 
of  Dunlop  V.  Higgins,  1  H.  L.  Cas.  381. 

The  defendant  appealed. 


>  Opinion  of  Baggallay,  L.  J.,  omitted. 


Finlay  &  Dillwyn,  for  defendant,  contend- 
ed that  the  defendant  was  not  a  shareholder, 
for  it  was  necessary  that  the  allotment  of 
shares  should  not  only  be  made  but  also 
commiuiicated  to  the  defendant;  that  a  let- 
ter posted  but  not  received  was  not  a  com- 
munication to  the  defendant  of  the  allot- 
ment, and  that  there  was  therefore  no  con- 
tract between  the  parties. 

Mr.  Wilberforce,  and  G.  Arbuthnot  (W. 
G.  Harrison,  Q.  C,  with  them),  for  plain- 
tiffs, contended  that  the  contract  was  com- 
plete by  acceptance  when  the  letter  was 
posted,  and  that  the  plaintiffs  were  not  an- 
swerable for  casualties  at  the  post  office 
preventing  the  arrival  of  the  letter. 

In  addition  to  the  authorities  mentioned  in 
the  judgment,  the  following  cases  were  cited 
during  the  argument:  Reidpath's  Case,  L. 
R.  11  Eq.  8G;  Townsend's  Case,  L.  R.  13 
Eq.  148;  WaU's  Case,  L.  R.  15  Eq.  18; 
Gunn's  Case,  L.  R.  3  Ch.  40;  Dunmore  v. 
Alexander,  9  Shaw  &  D.  190;  Pellatt's  Case, 
L.  R.  2  Ch.  527:  Ex  parte  Cote,  L.  R.  9  Ch. 
27;  Taylor  v.  Jones,  1  C.  P.  Div.  87;  Pol. 
Cont.  p.   13. 

Cur.  adv.  vult. 

THESIGER,  L.  J.  In  this  case  the  defend- 
ant made  an  application  for  shares  in  the 
plaintiffs'  company,  under  circumstances  from 
which  we  must  imply  that  he  authorized  the 
company,  in  the  event  of  their  allotting  to 
him  the  shares  applied  for,  to  send  the  notice 
of  allotment  by  post.  The  company  did  al- 
lot him  the  shares,  and  duly  addressed  to  him 
and  posted  a  letter  containing  the  notice  of 
allotment,  but  upon  the  finding  of  the  jury 
it  must  be  taken  that  the  letter  never  reach- 
ed its  destination.  In  this  state  of  circum- 
stances, Lopes,  J.,  has  decided  that  the  de- 
fendant is  liable  as  a  shareholder.  He  bas- 
ed his  decision  mainly  upon  the  ground  that 
the  point  for  consideration  was  covered  by 
authority  binding  upon  him,  and  I  am  of 
opinion  that  he  did  so  rightly,  and  that  it  is 
covered  by  authority  equally  binding  upon  this 
court. 

The  leading  case  upon  the  subject  is  Dun- 
lop v.  Higgins,  1  H.  L.  Cas.  381.  It  is  true 
that  Lord  Cottenham  might  have  decided  that 
case  without  deciding  the  point  raised  in  this. 
But  it  appears  to  me  equally  true  that  he  did 
not  do  so,  and  that  he  preferred  to  rest  and 
did  rest  his  judgment  as  to  one  of  the  mat- 
ters of  exception  before  him  upon  a  principle 
which  embraces  and  governs  the  present  case. 
If  so,  the  court  is  as  much  bound  to  apply  that 
principle,  constituting  as  it  did  a  ratio  deciden- 
di, as  it  is  to  follow  the  exact  decision  itself. 
The  exception  was  that  the  lord  justice  gener- 
al directed  the  jury  in  point  of  law  that,  if  the 
pursuers  posted  their  acceptance  of  the  offer 
in  due  time,  according  to  the  usage  of  trade 
they  were  not  responsible  for  any  casualties 
In  the  post   office  est.Tblishment    This  direc- 


COMMUNICATION  BY  CORRESPONDENCE. 


59 


tion  was  wide  enough  in  its  terms  to  Include 
the  caae  of  the  acceptance  never  being  deliv- 
ered at  all;  and  I^ord  Cottenham,  in  express- 
ing hLs  opinion  that  it  was  not  open  to  objec- 
tion, did  so  after  putting  the  case  of  a  letter 
containing  a  notice  of  disliuuour  posted  bj'  the 
holder  of  a  bill  of  exchange  in  proper  time, 
in  which  case  he  said  (1  II.  L.  Cas.,  at  page 
300):    "Whether  that  letter  be  delivered  or  not 
is  a  matter  quite  immaterial,  because  for  ac- 
cidents happening  at  the  post  otiice  he  is  not 
responsible."    In   short.   Lord    Cottenham   ap- 
pears to  me  to  have  held  that,  as  a   rule,   a 
contract    formed    by    correspondence    through 
the  post  is  complete  as  soon  as  the  letter  ac- 
cepting an  offer  is  put  into  the  post,  and  is 
not  put  an  end  to  in  the  event  of  the  letter 
never   being   delivered.    My   view   of   the   ef- 
fect of  Dunlop  V.  Higgins,  1  H.  L.  Cas.  3S1, 
is  that  talien  by  James,  L.  J.,  in  Harris'  Case, 
L.  R.  7  Ch.  587.    There,  at  page  502,  he  speaks 
of  the  former  case  as  "a  case  which  is  bind- 
ing  upon    us,    and    in    which    every    principle 
argued  before  us  was  discussed  at  length   by 
the  lord  chancellor  in  giving  judgment."    He 
adds,  the  lord  chancellor  "arrived  at  the  con- 
clusion that  the  posting  of  the  letter  of  ac- 
ceptance  is   the   completion   of   the   contract; 
that  is  to  say,  the  moment  one  man  has  made 
an  offer,  and  the  other  has  done  something 
binding   himself  to  that  offer,   then   the  con- 
tract is  complete,  and  neither  party  can  aft- 
erwards escape  from  it."    Mellish,  J.,  also  took 
the  same  view.    He  says,  at  page  505:    "In 
Dunlop  V.  Higgins,  1  H.  L.  Cas.  3S1,  the  ques- 
tion   was    directly    raised    whether    the    law 
was  truly  expounded  in   the  case  of  Adams 
V.  Lindsell,  1  Barn.  &  Aid.  681.     The  house 
of  lords  approved  of  the  ruling  of  that  case. 
The  Lord  Chancellor  Cottenham  said,   in  the 
course  of  his  judgment,   that  in  the  case  of 
a  bill  of  exchange  notice  of  dishonour,  given 
by  putting  a  letter  into  the  post  at  the  right 
time,  had  been  held  quite  sufficient  whether 
that  letter  was  dehvered  or  not;    and  he  re- 
ferred  to   Stocken  v.   Collin,   7   Mees.    &   W, 
515,  on  that  point,  he  being  clearly  of  opiniou 
that  the  rule  as  to  accepting  a  contract  was 
exactly  the  same  as  the   rule  as  to  sending 
notice  of  dishonour  of  a  biU  of  exchange.    He 
then  referred  to  the  case  of  Adams  v.  Lind- 
sell, 1  Barn.  &  Aid.  681,  and  quoted  the  ob- 
servation of  Lord  Ellenborough,   C.  J.    That 
case  therefore  appears  to  me  to  be  a  direct 
decision  that  the  contract  is  made  from  the 
time  when  it  is  accepted  by  post."    Leaving 
Harris'  Case,  L.  R.  7  Ch.  587,  for  the  moment, 
I  turn  to  Duncan  v.  Topham,  8  C.  B.  1225,  in 
which  Cresswell,  J.,  told  the  jury  that  if  the 
letter   accepting    the    contract    was    put    into 
the  post  office  and  lost  by  the  negligence  of 
the  post  office  authorities,  the  contract  would 
nevertheless  be  complete;    and  both   he  and 
Wilde.   C.   J.,   and   Maule,   J.,   seem   to   have 
understood   this   ruling   to   have   been   in   ac- 
cordance  with    Lord   Cotteuham's   opinion    in 
Dunlop  V.  Higgins,  1   H.   L.   Cas.  3S1.    That 
opinion  therefore  appears  to  me  to  constitute 


an  authority   directly   binding   upon   us.    But 
if  Dunlop  V.  Higgins,  1  H.  L.  Cas.  381,  were 
out  of  the  way,  Harris'  Case,  L.  R.  7  Ch.  5S7, 
would  still  go  far  to  govern  the  pre.sent.   There 
It  was  held  that  the  acceptance  of  the  offer 
at   all    events    binds    both    parties    from    the 
time  of  the  acceptance  being  posted,  and  so 
as  to  prevent  any  retraction  of  the  offer  be- 
ing of  effect  after  the  acceptance   has   been 
posted.    Now,    whatever    In    abstract    discus- 
sion may  be  said  as  to  the  legal  notion  of  its 
being  necessary,  in  order  to  the  effecting  of 
a  valid  and  binding  contract,  that  the  minds 
of  the  parties  should  he  brouglit  togetlier  at 
one   and    the   same    moment,    thiit    notion    is 
practically    the    foundation    of    English    law 
upon  the  subject  of  the  formation  of  contracts. 
Unless    therefore    a    contract    constituted    by 
correspondence  is  absolutely  concluded  at  the 
moment  that  the  continuing  offer  is  accepted 
by  the  person  to  whom  the  offer  is  addressed, 
it  is  difficult  to  see  how  the  two  minds  are 
ever  to  be  brought  together  at  one  and   the 
same  moment.    This  was  pointed  out  by  Lord 
Ellenborough  in  the  case  of  Adams  v.   Luid- 
sell,  1  Barn.  &  Aid.  G81,  which  is  recognized 
authority-  upon   this  branch  of  the  law.    But 
on  the  other   hand   it   is  a  principle  of   law, 
as    well    established    as    the    legal    notion    to 
which  I  have  referred,  that  the  minds  of  the 
two  parties  must  be  brought  together  by  mu- 
tual   communication.     An    acceptance,    which 
only   remains   in   the   breast   of   the   acceptor 
without  being  actually  and  by  legal  imphca- 
tiou  communicated  to  the  offerer,  is  no  bind- 
ing   acceptance.    How.    then,    are    these    ele- 
ments of  law  to  be  harmonized  in  the  case 
of  contracts  formed  by  correspondence  through 
the  post?    I  see  no  better  mode  than  that  of 
treating  the  post  office  as  the  agent  of  both 
parties,   and   it   was   so   considered   by    Lord 
liomilly  in  Hebb's  Case,  L.  R.  4  Eq.,  at  page 
12,  when   in  the  course  of  his  judgment  he 
said:    "Dunlop  v.  Higgins,  1  II.  L.  Cas.  381, 
decides  that  tlie  posting  of  a  letter  accepting 
an   offer   constitutes  a   binding   contract,   but 
the  reason  of  that  is  that  the  post  office  is  the 
common  agent  of  both  parties."    Aldersou,  B., 
also,  in  Stocken  v.  Collin,  7  Mees.  .&  W.,  at 
page  516,— a  case  of  notice  of  dishonour,  and 
the  case  referred  to  by  Lord  Cottenham,— says: 
"If  the  doctrine  that  the  post  office  is  only 
the  agent  for  the  delivery  of  the  notice  were 
correct,  no  one  could  safely  avail  himself  of 
that  mode  of  transmission."    But  if  the  post 
office  be  such  common  agent,  then  it  seems 
to  me  to  follow  that,  as  soon  as  the  letter  of 
acceptance  is  delivered  to  the  post  office,  the 
contract   is   made  as  complete  and   final   and 
absolutely  binding  as  if  Uie  acceptor  had  put 
his  letter  into  the  hands  of  a  messenger  sent 
by   the   offerer   himself  as   his  agent   to   de- 
liver  the    offer   and    receive   the    acceptance. 
What    other    principle    can    be   adopted    short 
of  holding  that  the  contract  is  not  complete 
by  acceptance  until  and  except  from  the  time 
that   the  letter  containing   the   acceptance   is 
delivered  to  the  offerer,  a  principle  which  has 


€0 


OFFER  AND  ACCEPTANCE. 


been     distinctly     negatived?    Tliis     difficulty 
was  attempted  to  be  got  over  in  Telegrapli 
Co.  V.  Colson,  L.  R.  6  Excb.  IDS,  which  was 
a  case  dii-ectly  on  all  fours  witti  the  present, 
and  in  which  Kelly,  C.  B.,  at  page  115,  is  re- 
ported to  have  said:    "It  may  be  that  in  gen- 
eral, though  not  in  all  cases,  a  conti-act  takes 
effect  from  the  time  of  acceptance,  and  not 
from  the  subsequent  notification  of  it    As  in 
the  case  now  before  the  court,   if  the  letter 
of  allotment   had   been   delivered   to   the   de- 
fendant  in   the  due   course   of   the   post,    he 
would   have  become  a  shareholder  from   the 
date  of  the  letter.    And  to  this  effect  is  Pot- 
ter V.  Sanders,  6  Hare,  1.    And  hence  perhaps 
the  mistake   has  arisen   that   the   contract  is 
binding  upon  both  parties  from  the  time  when 
the  letter  is  written  and  put   into  the   post, 
although  never  delivered;    whereas,  although 
it  may  be  binding  from  the  time  of  acceptance, 
it  is  only  binding  at  all  when  afterwards  duly 
notified."     But  with  deference  I  would  ask 
how  a  man  can  be  said  to  be  a  shareholder  at 
a    time   before   he    was    boimd    to    take    any 
shares,  or,  to  put  the  question  in  the  fonn  in 
which  it  is  put  by  Mellish,  L.  J.,  in  Harris' 
Case,  7  Ch.  App.  5S7,  at  page  596,  how  there 
can  be  any   relation  back  in   a   case   of  this 
kind  as  there  may  be  in  bankruptcy.    If,  as  the 
lord  justice  said,  the  contract,  after  the  letter 
has  arrived  in  time,  is  to  be  treated  as  having 
been  made  from  the  time  the  letter  is  posted, 
the  reason  is  that  the  contract  was  actually 
made  at  the  time  when  the  letter  was  posted. 
The   principle   indeed   laid   down   in  Harris' 
Case,  7  Ch.  App.  587,  at  page  596,  as  well 
as  in  Dunlop  v.  Higgins,  1  H.  L.  Cas.  381, 
can  really  not  be  reconciled  with  the  decision 
in  Telegi-aph  Co,  v.  Colson,  L.  R.  6  Exch.  108. 
James,  L.  J.,  in  the  passage  I  have  already 
quoted,— Harris'  Case,  L.  R.  7  Ch.  592,— affij-ms 
the  proposition  that  when  once  the  acceptance 
is    posted   neither   party    can   afterwards    es- 
cape from  the  contract,  and  refers  with  ap- 
proval to  Hebb's  Case,  L.  R.  4  Eq.  9.     There 
a  distinction  was  taken  by  the  master  of  the 
roUs   that   the   company   chose   to   send   the 
letter  of  allotment  to  their  own  agent,    who 
was  not  authorized  by  the  applicant  for  shares 
to  receive  it  on  his  behalf,  and  who  never  de- 
livered it;    but  he  at  the  same  time  assumed 
that  if,  instead  of  sending  it  through  an  au- 
thorized agent,  they  had  sent  it  through  the 
post   office,   the   applicant    would    have    been 
bound   although   the   letter   had   never    been 
delivered.    Mellish,  L.  J.,  really  goes  as  far, 
and  states  forcibly  the  reasons  in  favour  of 
this  view.    The  mere  suggestion  thrown  out 
at  the  close  of  his  judgment,   at  page  597, 
when    stopping   short    of   actually    overruling 
the  decision  in  Telegraph  Co.  v.   Colson,   L. 
R.  6  Exch.  108,  that  although  a  contract  is 
complete  when  the  letter  accepting  an   offer 
is  posted,  yet  it  may  be  subject  to  a  condition 
subsequent  that,  if  the  letter  does  not  arrive 
in  due  course  of  post,  then  the  parties  may  act 
on  the  assumption  that  the  offer  has  not  been 
accepted,   can   hardly,   when  contrasted   with 


the  rest  of  the  judgment,  be  said  to  represent 
his  own  opinion  on  the  law  upon  the  subject. 
The   contract,    as    he   says,    at   page   596,    is 
actually  made  when  the  letter  is  posted.    The 
acceptor,  in  posting  the  letter,  has,  to  use  the 
language  of   Lord  Blackbiu-n,   in   Brogden   v. 
Directors  of  Metropolitan  Railway  Co.,  2  App. 
Cas.  666,  691,  "put  it  out  of  his  control,  and 
done  an   extraneous  act  which   clenches   the 
mattter,    and   shews    beyond    all    doubt    that 
each  side  is  bound."    How,  then,  can  a  casual- 
ty  in  the   post,   whether   resulting   in   delay, 
which  in  commercial  transactions  is  often  as 
bad  as  no  delivery,  or  in  nondelivery,  unbind 
the  parties  or  unmake  the  contract?    To  me 
it   appears   that   in   practice  a  contract   com- 
plete upon  the  acceptance  of  an  offer  being 
posted,  but  liable  to  be  put  an  end  to  by  an 
accident   in    the    post,    would    be    more    mis- 
chievous than  a  contract  only   binding  upon 
the  parties  to  it  upon  the  acceptance  actually 
reaching  the  offerer;    and  I  can  see  no  prin- 
ciple of  law  from  which  such  an  anomalous 
contract  can  be  deduced. 

There  is  no  doubt  that  the  implication  of  a 
complete,  final,  and  absolutely  binding  con- 
tract being  formed,  as  soon  as  the  acceptance 
of  an  offer  is  posted,  may  in  some  cases  lead 
to  Inconvenience  and  hardship.  But  such 
there  must  be  at  times  in  every  view  of  the 
law.  It  is  impossible  in  transactions  which 
pass  between  parties  at  a  distance,  and  have 
to  be  carried  on  through  the  medium  of  cor- 
respondence, to  adjust  conflicting  rights  be- 
tween innocent  parties,  so  as  to  make  the  con- 
sequences of  mistake  on  the  part  of  a  mutual 
agent  fall  equally  upon  the  shoulders  of  both. 
At  the  same  time  I  am  not  prepared  to  admit 
that  the  implication  in  question  will  lead  to 
any  great  or  general  inconvenience  or  hard- 
ship. An  offerer,  if  he  chooses,  may  always 
make  the  formation  of  the  contract  which  he 
proposes  dependent  upon  the  actual  communi- 
cation to  himself  of  the  acceptance.  If  he 
trusts  to  the  post  he  trusts  to  a  means  of 
communication  which,  as  a  rule,  does  not 
fail,  and  if  no  answer  to  his  offer  is  received 
by  him,  and  the  matter  is  of  importance  to 
him,  he  can  make  inquiries  of  the  person  to 
whom  his  offer  was  addressed.  On  the  other 
hand,  if  the  contract  is  not  finally  concluded, 
except  in  the  event  of  the  acceptance  actually 
reaching  the  offerer,  the  door  would  be  open- 
ed to  the  perpetration  of  much  fraud,  and, 
putting  aside  this  consideration,  considerable 
delay  in  commercial  transactions,  in  which 
despatch  is,  as  a  rule,  of  the  greatest  conse- 
quence, would  be  occasioned;  for  the  acceptor 
would  never  be  entirely  safe  in  acting  upon 
his  acceptance  until  he  had  received  notice 
that  his  letter  of  acceptance  had  reached  its 
destination. 

Upon  balance  of  conveniences  and  incon- 
veniences it  seems  to  me,  applying  with  slight 
alterations  the  language  of  the  supreme  court 
of  the  United  States  in  Tayloe  v.  Insurance 
Co.,  9  How.  SOU,  more  consistent  with  the 
acts  and   declarations  of   the   parties   in  this 


COMMUNICATION  BY  CORRESPONDENCE. 


61 


case  to  considor  th^^  contract  complete  and 
absolutely  binding  on  the  transmission  of  the 
notice  of  allotment  through  the  post,  as  the 
medium  of  communication  that  the  parties 
themselves  contemplated,  instead  of  postpon- 
ing its  completion  until  the  notice   had   been 


received  by  the  defendant.  Upon  principle, 
therefore,  as  well  as  authority,  I  think  that 
the  judgment  of  Lopes,  J.,  was  right  and 
should  be  affirmed,  and  that  this  appeal  should 
therefore  be  dismissed. 


62 


OFFEli  AND  ACCEPTANCE. 


^ 


LEWIS  T.  BROWNING. 
(130  Mass.  173.) 


i1 


V         Supreme   Judicial    Court   of    Massachusetts. 
Suffolk.    Jan.  6,   ISSl. 

Action  foi  breach  of  covenants  in  a  lease. 
The  question  was  whether  the  terms  of  a 
proposed  new  lease  had  been  accepted  by  de- 
fendant The  negotiations  with  reference  to 
the  new  lease  were  carried  on  by  letter  and 
telegraph.  The  facts  sufficiently  appear  in 
the  opinion  of  the  court 

O.  T.  Gray,  for  defendant  D.  E.  Ware, 
for  plaintiff. 

GRAY,  C.  J.    In  M'Culloch  v.  Insurance  Co., 

1  Pick.  2TS,  this  court  held  that  a  contract 
made  by  mutual  letters  was  not  complete 
until  the  letter  accepting  the  offer  had  been 
received  by  the  person  making  the  offer; 
and  the  correctness  of  that  decision  is  main- 
tained, upon  an  able  and  elaborate  discus- 
sion of  reasons  and  authorities,  in  Langd. 
Gont.  (2d  Ed.)  989-996.  In  England,  New 
York  and  New  Jersey,  and  in  the  supreme 
court  of  the  United  States,  the  opposite  view 
has  prevailed,  and  the  contract  has  been 
deemed  to  be  completed  as  soon  as  the  letter 
of  acceptance  has  been  put  into  the  post 
office  duly  addressed.  Adams  v.  Lindsell,  1 
Barn.  &  Aid.  681;  Dumop  v.  Higgins,  1  H. 
L.  Gas.  381,  398-400;    Newcomb  v.  De  Roos, 

2  El.  &  El.  271;  Harris'  Case,  L.  R.  7  Gh. 
587;  Lord  Blackburn,  in  Brogden  v.  Rail- 
way, 2  App.  Cas.  666,  691,  692;  Insurance 
Go.  v.  Grant,  4  Exch.  Div.  216;  Lindley,  J., 
in  Byrne  v.  Van  Tienhoven,  5  C.  P.  Div.  344. 
348;  2  Kent,  Comm.  477,  note  c;  Mactier  v. 
Frith,  6  Wend.  103;  Vassar  v  Gamp,  11  N, 
Y.  441;    Trevor  v.  Wood,  36  N.  Y.  307"    Hal- 


lock  V.  Insurance  Co.,  26  N.  J.  Law.  268, 
27  N.  J.  Law,  645;  Tayloe  v.  Insurance  Co., 
9  How.  390. 

But  this  case  does  not  require  a  considera- 
tion of  the  general  question;  for,  in  any 
view,  the  pei-son  making  the  offer  may  al- 
ways, if  he  chooses,  make  the  formation  of 
the  contract  which  he  proposes  dependent 
upon  the  actual  communication  to  himself 
of  the  acceptance  Thesiger,  L.  J.,  in  In- 
surance Go.  V.  Grant,  4  Exch.  Div.  223;  Pol. 
Gont.  (2d  Ed.)  17;  Leake,  Gont.  39,  note. 
And  in  the  case  at  bar,  the  letter  written  in 
the  plaintiff's  behalf  by  her  husband  as  her 
agent  on  July  8,  1878,  in  California,  and  ad- 
dressed to  the  defendant  at  Boston,  appears 
to  us  clearly  to  manifest  such  an  intention. 
After  proposing  the  terms  of  an  agreement 
for  a  new  lease,  he  says,  "If  you  agree  to 
this  plan,  and  will  telegraph  me  on  receipt 
of  this,  I  wiU  forward  power  of  attorney  to 
Mr.  Ware,"  the  plaintiff's  attorney  in  Bos- 
ton. "Telegraph  me  'Yes  or  'No.'  If  'No,' 
I  will  go  on  at  once  to  Boston  with  my  wife, 
and  between  us  we  will  try  to  recover  our 
lost  ground.  If  I  do  not  hear  from  you  by 
the  ISth  or  20th,  I  shall  conclude  'No.' " 
Taking  the  whole  letter  together,  the  offer 
is  made  dependent  upon  an  actual  communi- 
cation to  the  plaintiff  of  the  defendant's  ac- 
ceptance on  or  before  the  20th  of  July,  and 
does  not  discharge  the  old  lease,  nor  bind 
the  plaintiff  to  execute  a  new  one,  imless  the 
acceptance  reaches  California  within  that 
time.  Assuming,  therefore,  that  the  defend- 
ant's delivery  of  a  despatch  at  the  telegraph 
office  had  the  same  effect  as  the  mailing  of 
a  letter,  he  has  no  ground  of  exception  to  the 
ruling  at  the  trial. 

Exceptions  overruled. 


CnARACTER  OF  ACCEPTANCE. 


63 


HARRIS  V.  SCOTT  et  aL 

(32  Atl.  770.) 

fiupremc   Court  of  New   Hampshire.     Rocking- 
ham     July  28,  1893. 

Bill  by  Arthur  Harris  against  Annie  G. 
Scott,  administratrix  of  the  estate  of  George 
Scott,  deceased,  and  others,  for  the  specific 
performance  of  a  contract  for  the  sale  to 
plaintiff  by  defendant  administratrix  of  20 
shares  of  the  capital  stock  of  the  Portsmouth 
Brewing  Company.     Bill  dismissed. 

Tlie  capital  stock  of  the  company  consists 
of  SO  shares,  of  the  par  value  of  $.100  each. 
In  March,  1888,  the  plaintiff,  owning  21 
shares,  and  George  Scott,  owning  20  shares, 
entered  into  the  following  written  agreement: 
"For  the  purpose  of  having  a  better  admin- 
istration of  the  affairs  of  the  Portsmouth 
Brewing  Company,  and  to  prevent  deals  and 
combinations  between  various  stockliolders 
for  unworthy  purposes,  we  hereby  mutually 
and  severally  agree:  (1)  To  vote  the  forty- 
one  shares  we  own,  control,  or  can  influence, 
Invariably,  on  the  same  side,  for  the  purpose 
of  elecUcm,  or  on  any  motion  made  at  any 
meeting.  (2)  To  prevent  any  disagreement 
for  whom,  or  for  what  motions,  our  votes 
should  be  cast,  we  severally  agree  to  vote  at 
every  election  for  every  officer  and  director 
now  in  office,  unless  both  parties  to  this  con- 
tract agree  not  to  so  vote,  and,  in  case  of  any 
vacancy,  not  to  vote  for  any  candidate  unless 
both  parties  are  in  favor  of  his  election,  and, 
further,  not  to  vote  for  any  change  of  any 
kind,  enlargement,  alterations,  improvements, 
purchase  of  real  estate,  or  change  in  salaries 
or  wages,  unless  both  are  willing  to  vote  for 
such  purpose  or  purposes.  (3)  Tliis  agree- 
nient  to  apply  to  directors'  meetings,  the 
same  as  stoc-kholders'.  No  dividend  to  be  de- 
clared unless  both  are  in  favor  of  it,  and  the 
amount  determined  beforehand.  (4)  Neither 
party  to  sell  his  shares,  or  any  of  them,  nor  to 
buy  any  other  shares  at  a  higher  price  than 
the  holder  paid  for  them.  (5)  Either  party 
having  his  .salary  increased  above  the  pres- 
ent amount,  the  other  to  have  an  Increase  of 
similar  amount  (6)  This  agreement  to  re- 
main in  force  two  years  from  date."  Octo- 
ber 8,  1890,  they  agreed  in  writing  that  the 
foregoing  contract,  in  all  its  provisions,  be 
extended  for  five  years  from  that  date,  and 
"that  directions  shall  be  left,  by  will  or  oth- 
erwise, to  the  execTitors  of  eivch,  that,  shoidd 
either  party  to  this  agreement  die  during  the 
continuance  thereof,  the  survivor  shall  have 
a  prior  right,  ovei  any  other  party,  to  pur- 
chase the  shares  of  the  capital  stock  *  ♦  • 
hitherto  the  property  of  the  deceased." 
George  Scott  died  intestate  April  24,  1892, 
and  the  defendant  Annie  Scott  is  administra 
trix  of  his  estate.  About  the  1st  of  July, 
1892,  Annie,  in  answer  to  a  letter  of  the  plain- 
tiff inquiring  what  she  proposed  to  do  with 
the  stock,  wrote  him  that  she  desiretl  to  sell 
it;  that  she  had'  received  several  offers,  and 
would  give  him  the  first  right  to  purchase  the 


20  shares  at  $.800  each.  He  replied  July  5th. 
saying:  "If  you  have  a  bona  tide  offer  of 
$800  for  the  whole  twenty  shares,  I  will  pay 
you  the  same,  provided  you  send  me  the 
names  of  tho.se  who  will  pay  you  thLs  amount, 
so  that  I  may  be  able  to  resell  without  loss 
if  I  wish."  He  inclosed  a  check  for  $100, 
and  an  unconditional  bill  of  sale  for  her  to 
sign.  After  depr)fiiting  the  letter  in  a  letter 
box,  he  received  a  telegram  from  Annie  say- 
ing, "I  wish  to  reconsider  the  letter  I  wrote 
you  for  the  present."  The  next  day,  July 
Cth,  the  plaintiff  replied  as  follows:  "Your 
telegram  received  late  yesterday  afternoon. 
I  had  ineviously  written  you,  accepting  your 
offer."  July  11th  Mrs.  Scott  wrote  the  plain- 
tiff: "I  was  informed,  immedmtely  after 
sending  you  the  letter  aljout  the  twenty 
shares  at  $800  a  share,  that  the  parties  want- 
ed to  take  only  part  of  them,  but  my  lawyer 
Informed  me  that  a  gentleman  wished  to 
take  the  whole  twenty  shares  at  $815  a  share, 
so  I  have  concluded  at  tliat  price.  The  gen- 
tleman's name  is  Mr.  John  Sise.  •  •  •  So, 
if  you  wish  to  accept  that  price,  I  will  comply 
to  your  demands."  And  the  next  day  she  re- 
turned the  check.  This  offer  the  plaintiff,  by 
letter,  July  13th,  declined  to  consider,  claim- 
ing that  the  shares  had  already  been  sold  to 
him.  Mrs.  Scott  afterwards  sold  the  shares, 
through  Sise,  to  the  defendant  Conlon,  but 
the  formal  transfer  has  not  been  executed. 
The  plaintiff  prays  for  a  specific  performance 
of  Mrs.  Scott's  contract  of  sale,  or,  if  that  is 
denied,  that  she  be  decreed  "to  give  him  the 
first  right  to  purchase  the  shares  at  the  ex- 
piration of  the  agreement  of  October  8,  1890." 

S.  W.  Emery  and  W.  H.  Looney,  for  plain- 
tiff. Frink  &  Batchelder,  for  defendant  An- 
nie G.  Scott  C.  Page,  for  defendants  Sise 
and  Conlon.  Mr.  Mai-vin  and  J.  E.  Young, 
for  defendant  Ellen  T.  Scott. 

CARPENTER,  J.  No  contract  for  the  sale 
of  the  shares  to  the  plaintiff  was  completed. 
His  acceptance  of  Mrs.  Scott's  offer  was  con- 
ditional. Their  minds  did  not  meet"  If, 
without  disclosing  the  names  of  those  who 
had  offered  her  $S(X)  a  share,  she  had  signed 
and  returned  to  the  plaintiff  the  bill  of  sale, 
he  would  have  had  the  right  to  reject  it  and 
decline  to  take  the  stock.  His  letter  of  July 
5th  was  a  rejection  of  Mrs.  Scott's  offer,  and 
a  new  proposal.  Benj.  Sales.  §  39.  To  this 
proposal  she  did  not  assent.  If  the  plaintiirs 
letter  of  the  next  day  was  an  unconditional 
acceptance  of  her  offer,  it  was  ineffectual, 
because  too  late.  It  was  made  after  he  had 
notice  that  the  offer  was  withdrawn.  If, 
when  she  dispatched  the  telegram,  she  had 
known  the  contents  of  the  plaintiff's  letter 
of  July  5th,  it  might  be  evidence  tending  to 
show  that  she  did  not  object  to  the  accept- 
ance on  the  ground  that  it  was  conditional. 
But  at  that  time  she  had  neither  actual  nor 
constructive  knowledge  of  the  condition.  She 
made  the  public  post  her  agent  to  receive 
from  the  plaintiff  an  unqualified  acceptance 


64 


OFFER  AND  ACCEPTANCE. 


of  her  offer,  but  not  to  receive  a  counter  pro- 
posal or  conditional  acceptance.  She  was 
not  chargeable  with  knowledge  of  the  con- 
dition until  she  received  the  letter.  Byrne 
V.  Van  Tienhoven,  5  C.  P.  Div.  344;  Dunlop 
T.  Higgins,  1  H.  L.  Gas.  3S1;  Insurance  Co. 
V.  Grant,  4  Exch.  Div.  216.  221,  228;  Benj. 
Sales,  §§  6S-75;  Abbott  v.  Shepard,  48  N.  H. 
14. 

The  plaintiff  is  not  entitled  to  a  decree  re- 
quiring Mrs.  Scott  to  give  him,  now  or  at  any 
time,  the  prior  right  to  purchase  the  stock. 
The  contract  of  March  5,  1888,  was  unlaw- 
ful. Northern  R.  Co.  v.  Concord  R.  Co.,  50 
N.  H.  1G6,  179,  180;  Fisher  v.  Railroad  Co., 
Id.  200.  205,  200,  209-211;  Woodstock  Iron 
Co.  V.  Richmond  &  D.  Extension  Co.,  129  U. 
S.  643,  9  Sup.  Ct  402;  West  v.  Camden,  135 
U.  S.  507,  520,  521,  10  Sup.  Ct  838;  Fuller  v. 
Dame,  18  Pick.  472;  Guernsey  v.  Cook,  120 
Mass.  501;  Woodruff  v.  Wentworth,  133 
Mass,  309;  Mor.  Priv.  Corp.  §§  516-519.  The 
contract  of  October  8,  1890,  in  so  far  as  it 
provides  for  the  survivor's  prior  right  to  buy 


the  shares,  is  not.  In  Itself,  unlawful.  Wheth- 
er it  is  so  connected  with  the  previous  contract ' 
as  to  be  tainted  with  its  illegality  is  a  ques- 
tion not  considered.  If  it  is  construed  liter- 
ally, it  was  broken  when  Scott  died  without 
leaving,  by  will  or  otherwise,  directions  that 
the  plaintiff  should  have  a  prior  right  overany 
other  party  to  purchase  the  shares,  and  the 
plaintiff's  remedy  for  the  breach  is  by  action 
at  law.  Assuming  that  it  may  properly  be 
construed  as  an  agreement  that  the  survivor 
should  have  the  prior  right  to  purchase  the 
shares  of  the  legal  representatives  of  the  de« 
ceased  party,  and  that  such  an  agreement  is 
not  a  testamentary  disposition  of  property 
(Towle  V.  Wood,  00  N.  H.  434),  the  plaintiff 
las  already  received  all  that  the  contract 
secured  to  him.  An  opportunity  to  buy  the 
shares  at  the  price  for  which  they  were  final- 
ly sold  was  offered  to  him,  and  rejected.  Bill 
dismissed. 

CLARK,  J.,  did  not  sit     The  others  con- 
curred. 


CHARACTER  OF  ACCEPTANCE. 


65 


TIIO:\rAS  V.  GREENWOOD,  ct  al.i 
(37  N.  W.  195,  69  Mich.  215.) 

Supreme  Court  of  Michigan.    April  C,  1SS8. 

Appeal  from  circuit  court,  Bay  county;  S. 
M.  Green,  Judge. 

Henry  II.  Tlionias  sued  George  C.  Green- 
wood et  al.  for  damages  for  breach  of  con- 
tract. Judgment  for  defendants.  Plaintiff 
appeals.  All  other  material  facts  appear  in 
the  opinion. 

Simonson,  Gillett  &  Courtright,  for  appel- 
lant    Hatch  &  Cuuley,  for  respondents. 


CIIAMPLIN,  J.  The  defendants  were,  in 
ISSG,  doing  business  at  Duluth,  Minn.,  under 
tlie  firm  name  of  G.  C.  Greenwood  &  Co.  The 
plaintifC  on  the  9th  of  Febniary,  ISSG,  wrote 
to  defendants  from  Bay  City,  Mich.,  as  to 
the  puri3ort  of  which  letter  we  arc  not  in- 
formed. Defendants  replied  February  11, 
1886,  as  foUows: 

"Duluth,  Minn.,  February  11,  1886. 
"Mr.  H.  H.  Thomas,  No.  9  Munger  Blocli, 
Bay  City,  Michigan— Dear  Sir:  We  are  juist 
in  receipt  of  yours  of  the  9th  inst.,  in  refer- 
ence to  Hercules  powder.  Replying,  would 
say  that  we  have  the  following  in  stock:  GOO 
IT)S.  No.  2,  21^  inch;  2,800  lbs.  No.  2,  li^,  inch; 
2,600  lbs.  No.  2.  S.  V^  inch;  1,150  lbs,  No.  2, 
S.  S.  VA  inch;  1,550  lbs.  No.  1,  X.  X.  I14 
inch.  Of  this  we  would  lilce  to  reserve  about 
1,500  lbs.  Our  Mr.  Mundy,  who  was  talking 
with  you,  is  not  at  home,  and  is  bumming 
around  tlie  country  in  the  cant-liook  business. 
We  quote  this  powder  to  you  at  10c.  per  lb.  f. 
0.  b.  here,  we  to  reserve  about  amount  stat- 
ed. We  also  quote  4  X  caps,  see  inclosed 
circular,  which  we  are  told  are  the  best  caps 
made,  at  $5.90  per  thousand.  Fuse,  Lake 
Superior  mining,  single  and  double  tape,  at 
20  per  cent,  off  Toy  &  Biekford  &  Co.'s  or 
Aetna  Powder  Co.'s  list;  terms,  cash  or  ap- 
proved notes.  Should  you  decide  to  order 
these  goods,  you  may  give  us  indorsed  note, 
that  we  can  use  the  same  as  cash,  dated 
March  1st  four  months,  without  interest. 
"Hoping  to  receive  your  order,  we  remain, 
"Yours  truly,      G.  C.  Greenwood  &  Co." 

— Which  said  letter  was  duly  received  by 
said  plaintiff,  and  immediately  on  the  re- 
ceipt of  which  said  plaintiff  wrote  and  mail- 
ed to  said  G.  C.  Greenwood  &  Co.  a  letter 
of  which  the  following  is  a  copy: 

"Bay  City,  Mich.,  February  15,  ISSG. 
"Messrs.  G.  C.  Greenwood  &  Co.,  Duluth, 
Minnesota— Gentlemen:  Your  letter  or  st^ite- 
ment,  showing  amount  of  Hercules  powder 
to  hand,  showing  8,700  lbs.  I  will  take  7,- 
200  lbs.  of  same,  leaving  you  the  1,500  lbs. 
in  reserve,  as  you  wished;  so  please  ship 
promptly  by  freight. 

1  Irrelevant  part  of  opinion  omitted. 

HOPK.  SBL.  CAS.  COST.  — 5 


1,900  lbs.  No.  2,  S.  V,i  Inch,  Hercules. 
2,GU0  Hjs.  No.  2,  S.  V/^  inch,  Hercules. 
1,150  lbs.  No.  2,  S.  S.  V/i  ihch,  Hercules. 
l,r.,"(j  lbs.  No.  1,  X.  X.  11/4  inch,  Hercules. 


$720.00. 

"Plea.se  ship  above  goods  at  once,  and  on 
receipt  of  invoice  will  forward  indorsed  note, 
due  four  mouths  from  March  1,  IS&G.  I  do 
not  undei-stand  what  grade  No.  4  X.  is.  I 
use  l\ipper  force  caps  of  same  brand  in  my 
trade  here.  You  are  too  high  on  caps  and 
fuse. 

"Respectfully,  II.  H.  Thomas." 

These  letters  plaintiff  claims  made  a  bind- 
ing contract  between  the  parties  on  its  re- 
ceipt by  defendants.  They  did  nut  ship  the 
goods  as  requested,  and  plaintiff'  brings  this 
action  to  recover  his  damages  based  upon 
the  alleged  contract.  He  also  added  anoth- 
er count  to  his  declaration,  as  follo-,v.s:"And 
also  for  that  whereas,  the  said  defendants 
heretofore,  to-wit,  at  Bay  City,  in  the  county 
of  Bay,  OL,  to-wit,  the  20th  day  of  Januaiy, 
1887,  were  indebted  to  and  jusUy  owed  siiid 
plaintiff"  the  sum  of  three  thousand  dollars 
for  damages  sustained  by  him  by  rea.sou  of 
the  failure  of  said  defendants  to  ship,  fiu-- 
nish,  and  deliver  to  plaintiff  seven  thousand 
two  hundred  pounds  of  Hercules  powder, 
then  before  bought  by  plaintiff  at  Bay  City 
of  said  defendants  at  Duluth,  in  the  state 
of  Minnesota."  The  court  below  sustained 
a  demurrer  to  the  declaration,  and  this  rul- 
ing presents  the  only  question  for  our  deci- 
sion. 

Do  these  letters  form  a  valid  completed 
contract  between  the  parties?  Counsel  for 
plaintiff  concede  that,  to  have  this  effect,  the 
letter  of  acceptance  must  in  every  respect 
correspond  with  the  offer,  neither  falling 
short  nor  going  beyond  the  terms  proposed; 
and  they  insist  that  it  complies  with  the  re- 
quirements of  the  law  in  this  regard.  Coun- 
sel for  defendants  dispute  this,  and  insist 
that  the  minds  of  the  parties  never  met,  be- 
cause—Fii-st.  The  offer  is  indehnite,  and  left 
two  matters  open  for  further  consideratioo, 
namely,  the  grade,  and  quantity  of  each 
grade,  of  the  1,500  pounds  of  powder  to  be 
reserved  by  Greenwood  &  Co.;  also  the  sutfi- 
ciency  of  the  note  to  be  accepted  in  payment 
of  the  goods.  We  think  the  position  of  the 
counsel  for  defendants  is  correct.  .  The  right 
to  select  the  powder  reserved  is  clearly  im- 
plied in  the  reservation.  It  applied  to  one 
grade  no  more  than  another,  and  the  fact 
the  price  at  which  the  whole  quantity  was 
off'ered  being  a  uniform  price  of  10  cents  a 
pound,  made  no  difference  with  the  exercise 
of  this  right.  Presumably  it  was  reserved  to 
fill  some  other  order,  or  to  supply  the  wants 
of  some  other  customer,  and  the  selection 
must  be  made  before  a  delivery  could  be  en- 
forced. They  did  not  agree  to  take  any  in- 
dorsed note  plaintiff  might  send.  Quality 
was  essential.     It  was  to  be  such  a  note  as 


66 


OFFER  AND  ACCEPTANCE. 


tliey  could  nse  the  same  as  cash.  Who  was 
to  pass  upon  this  qualification?  Not  the  one 
who  gave  the  note,  but  they  who  received  it. 
But  the  plaintiff  annexed  a  new  condition.  It 
was  this:  "On  receipt  of  invoice,  will  forward 
indoi'sed  note."  The  letter  of  Greenwood  &. 
Co.  contains  no  such  proposition.  They  did 
not  say,  "If  you  order  tliese  goods,  we  will 
ship  them  at  once,  and  forward  invoice,  on 
receipt  of  which  you  may  send  us  indorsed 
note  due  four  months  from  March  1,  1SS6." 
Nor  did  the  plaintiff  say  that  he  would  for- 
ward defendants  an  indorsed  note  that  they 
could  use  the  same  as  cash.  Second.  The 
offer  is  for  the  sale  of  the  powder,  and  of 
the  caps  and  fuse.  The  offer  is,  "Should 
you  desire  to  order  these  goods."  The  ac- 
ceptance is  of  the  powder  only.  We  think 
this  point  is  weU  taken.     Caps  and  fuse  can- 


not be  used  without  powder.  Would  it  he 
likely  that  defendants  would  offer  to  sell 
nearly  all  of  their  powder  without  trying  to 
sell  also  the  caps  and  fusel  They  made 
their  prices  on  each  class  of  goods  offered, 
and  then  said,  "Should  you  decide  to  order 
these  goods."  Had  plaintiff  considered  the 
price  for  the  powder  high,  and  caps  and  fuse 
low,  we  do  not  think  he  could  accept  or  or- 
der the  caps  or  fuse  alone  without  the  fur- 
ther assent  thereto  of  defendants.  Offers  of 
this  kind  become  binding  only  when  the 
proposition  is  met  with  an  acceptance  which 
corresponds  with  it  entirely  and  adequately, 
without  qualification  or  the  addition  of  new 
matter.  1  Pars.  Cont.  (7th  Ed.)  476,  477. 
Wo  do  not  think  this  has  been  done  in  this 
case. 


/ 


GENEIIAL  OFFERS. 


G7 


CARLILL    V.    CARBOLIC    SMOKE    RAXL 


CO.i 


ly 


O. 


([1893]  1  Q.  B.  256.)   (^tV  ^  J 

Court  of  Appeals.    Dec.  7,  1892.  ^ 

Appeal  from  a  decision  of  Hawkins,  J. 
[1892]    2  Q.  B.  484. 

The  defendants,  wlio  were  the  proprietors 
and  vendors  of  a  medical  preparation  called 
"The  Carbolic  Smoke  Ball,"  inserted  in  the 
Pall  Mall  Gajcette  of  November  13,  1891,  and 
in  other  newspapers,  the  following  adver- 
tisement: 

"£100  reward  will  be  paid  by  the  Carlwlic 
Smoke  Ball  Ck>mpauy  to  any  person  who 
contracts  the  increasing  epidemic  influenza, 
colds,  or  anj»  disease  caused  by  taking  cold, 
after  having  used  the  ball  three  times  daily 
for  two  weeks  according  to  the  printed  di- 
rections supplied  with  each  ball.  £1000  is 
deposited  with  the  Alliance  Bank,  Regent 
Street  shewing  our  sincerity  in  the  matter. 

"During  the  last  epidemic  of  influenza 
many  thousand  carbolic  smoke  balls  were 
sold  as  preventives  against  this  disease,  and 
in  no  ascertained  case  was  the  disease  con- 
tracted by  those  using  the  carbolic  smoke 
ball. 

"One  carbolic  smoke  ball  will  last  a  family 
several  months,  making  it  the  cheapest  rem- 
edy in  the  world  at  the  price,  10s.,  post  free. 
The  ball  can  be  refilled  at  a  cost  of  5s.  Ad- 
dress, Carbolic  Smoke  Ball  Company,  27 
Princes  Street,  Hanover  Square,  London.** 

The  plaintiff,  a  lady,  on  the  faith  of  this 
advertisement,  bought  one  of  the  balls  at  a 
chemist's  and  used  it  as  directed,  three  times 
a  day,  from  November  20,  1891,  to  January 
17,  1892,  when  she  was  attacked  by  influen- 
za. Hawkins,  J.,  held  that  she  was  entitled 
to  recover  the  £100.  The  defendants  ap- 
pealed. 

Mr.  Finlay,  Q.  C,  and  T.  Terrell,  for  the 
defendants. 

The  facts  shew  that  there  was  no  bind- 
ing contract  between  the  parties.  The  case 
is  not  like  Williams  v.  Carwardine,  4  Barn. 
&  Adol.  G21,  where  the  money  was  to  be- 
come payable  on  the  performance  of  cer- 
tain acts  by  the  plaintiff.  Here  the  plain- 
tiff could  not  by  any  act  of  her  own  es- 
tablish a  claim,  for  to  establish  her  right  to 
the  money  it  was  necessary  that  she  should 
be  attacked  by  influenza, — an  event  over 
which  she  had  no  control.  The  words  ex- 
press an  intention,  but  do  not  amount  to  a 
promise.  Week  v.  Tibold.  1  Rollc,  Abr.  G, 
M.  The  present  case  is  similar  to  Harris  v. 
Nickerson,  L.  R.  8  Q.  B.  28G.  The  adver- 
tisement is  too  vague  to  be  the  basis  of  a 
contract.  There  is  no  limit  as  to  time,  and 
no  means  of  checking  the  use  of  the  ball. 
Any  one  who  had  influenza  might  come  for- 
ward and  depose  that  he  had  used  the  ball 


1  Opiuiou  of  Smith,  L.  J.,  omitted. 


for  a  fortnight,  and  it  would  be  impossible 
to  disprove  it.  Guthing  v.  Lynn,  2  Bam.  & 
Adol.  232,  supix)rts  the  view  that  the  terms 
are  too  vague  to  make  a  contract.  There 
being  no  limit  as  to  time,  a  person  might 
claim  who  took  the  influenza  ten  years  after 
using  the  remedy.  There  is  no  consideration 
moving  from  the  plaintiff.  Gerhard  v.  Bates, 
2  El.  &  Bl.  47G.  Tile  present  case  differs 
from  Denton  v.  Railway  Co.,  5  El.  &  Bl. 
8(W,  for  there  an  overt  act  was  done  by  the 
plaintiff  on  the  faith  of  a  statement  by  the 
defendants.  In  order  to  make  a  contract  by 
fulfilment  of  a  condition,  there  must  either 
be  a  communication  of  intention  to  accept 
the  offer  or  there  must  be  the  performance 
of  some  overt  act.  The  mere  doing  an  act 
in  private  will  not  be  enough.  This  prin- 
ciple was  laid  down  by  Lord  Blackburn  in 
Brogdcn  v.  Railway  Co.,  2  App.  Cas.  GG6. 
The  terms  of  the  advertisement  would  en- 
able a  person  who  stole  the  balls  to  claim 
the  reward,  though  his  using  them  was  no 
possible  benefit  to  the  defendants.  At  all 
events,  the  advertisement  should  be  held  to 
apply  only  to  persons  who  bought  directly 
from  the  defendants.  But,  if  there  be  a  con- 
tract at  all,  it  is  a  wagering  contract,  as  be- 
ing one  where  the  liability  depends  on  an 
event  beyond  the  control  of  the  parties,  and 
which  is  therefore  void  under  8  «&  9  Vict.  c. 
109.  Or,  if  not,  it  is  bad  under  14  Geo.  HI.c. 
48,  §  2,  as  being  a  policy  of  insurance  on  the 
happening  of  an  uncertain  event,  and  not 
conforming  with  the  provisions  of  that  sec- 
tion. 

Mr.  Dickens,  Q.  C,  and  W.  B.  Allen,  for 
plaintiff. 

[The  court  intimated  that  they  required 
no  argument  as  to  the  question  whether  the 
contract  was  a  wager  or  a  policy  of  insur- 
ance.] The  advertisement  clearly  was  an 
offer  by  the  defendants.  It  was  published 
that  it  might  be  read  and  acted  on,  and 
they  cannot  be  heard  to  say  that  it  was  an 
empty  boast,  which  they  were  under  no  ob- 
ligation to  fulfil.  The  offer  was  duly  accept- 
ed. An  advertisement  was  addressed  to  all 
the  public.  As  soon  as  a  person  does  the  act 
mentioned,  there  is  a  contract  with  him.  It 
is  said  that  there  must  be  a  communication 
of  the  acceptance;  but  the  language  of  Lord 
Blackburn  in  Brogden  v.  Railway  Co..  2 
App.  Cas.  GG6,  shews  that  merely  doing  the 
acts  indicated  is  an  acceptance  of  the  pro- 
posal. It  never  was  intended  that  a  person 
proposing  to  use  the  smoke  ball  should  go 
to  the  office  and  obtain  a  repetition  of  the 
statements  in  the  advertisement.  The  de- 
fendants are  endeavoring  to  inti-oduce  words 
into  the  advertisement  to  the  effect  that  the 
use  of  the  preparation  must  be  with  their 
privity  or  under  their  superintendence. 
^^^lere  an  offer  is  made  to  all  the  world, 
nothing  can  be  imported  beyond  the  fulfil- 
ment of  the  conditions.  Notice  before  the 
event    cannot    be    required.    The    advertise- 


68 


OFFER  AND  ACCEPTxVNCE. 


ment  is  an  offer  made  to  any  person  who 
fulfils  the  condition,  as  is  explained  in  Spen- 
cer V.  Harding,  L.  R.  5  C.  P.  5G1.  Williams 
V.  Carwardine,  4  Bam.  &  Adol.  G21,  shews 
stronjrly  that  notice  to  the  person  making 
the  offer  is  not  necessary.  The  promise  is 
to  the  person  who  does  an  act,  not  to  the 
person  who  says  he  is  going  to  do  it  and 
then  does  it.  As  to  notice  after  the  event, 
it  could  have  no  effect,  and  the  present  case 
is  within  the  language  of  Lord  Blackburn 
in  Brogden  v.  Railway  Co.,  2  App.  Cas.  6GG. 
It  is  urged  that  the  tonus  are  too  vague  and 
uncertain  to  make  a  contract;  but  as  re- 
gards parties,  there  is  no  more  uncertainty 
than  in  all  other  cases  of  this  description. 
It  is  said,  too,  that  the  promise  might  apply 
to  a  person  who  stole  any  one  of  the  balls. 
But  it  is  clear  that  only  a  person  who  law- 
fully acquired  the  preparation  could  claim 
the  benefit  of  the  advertisement.  It  is  also 
urged  that  the  terms  should  be  held  to  ap- 
ply only  to  persons  who  bought  directly  from 
the  defendants;  but  that  is  not  the  import 
of  the  words,  and  there  is  no  reason  for 
implying  such  a  limitation,  an  increased 
sale  being  a  benefit  to  the  defendants, 
though  effected  through  a  middleman,  and 
the  use  of  the  balls  must  be  presumed  to 
serve  as  an  advertisement  and  increase  the 
sale.  As  to  the  want  of  restriction  as  to 
time,  there  are  several  possible  construc- 
tions of  the  terms.  They  may  mean  that, 
after  you  have  used  it  for  a  fortnight,  you 
will  be  safe  so  long  as  you  go  on  using  it, 
or  that  you  will  be  safe  during  the  preva- 
lence of  the  epidemic.  Or  the  true  view  may 
be  that  a  fortnight's  use  will  make  a  person 
safe  for  a  reasonable  time.  Then  as  to  the 
consideration.  In  Gerhard  v.  Bates,  2  El.  & 
BI.  476,  Lord  Campbell  never  meant  to  say 
that  if  there  was  a  direct  invitation  to  take 
shares,  and  shares  were  taken  on  the  faith 
of  it,  there  was  no  consideration.  The  de- 
cision went  on  the  foiTn  of  the  declaration, 
which  did  not  state  that  the  contract  ex- 
tended to  future  holders.  The  decision  that 
there  was  no  consideration  was  qualified  by 
the  words  "as  between  these  parties,"  the 
plaintiff  not  having  alleged  himself  to  be  a 
member  of  the  class  to  whom  the  promise 
was  made. 

Mr.  Finlay,  Q.  C,  in  reply. 

There  is  no  binding  contract.  The  money 
is  payable  on  a  person's  taking  influenza 
after  having  used  the  ball  for  a  fortnight, 
and  the  language  would  apply  just  as  well 
to  a  person  who  had  used  it  for  a  fortnight 
before  the  advertisement  as  to  a  person  who 
used  it  on  the  faith  of  the  advertisement. 
The  advertisement  is  merely  an  expression 
of  intention  to  pay  £100  to  a  person  who  ful- 
fils two  conditions;  but  it  is  not  a  request 
to  do  anything,  and  there  is  no  more  con- 
sideration in  using  the  ball  than  in  contract- 
ing the  influenza.  That  a  contract  should 
be  completed  by  a  private  act  is  against  the 


language  of  Lord  Blackburn  In  Brogden  v. 
Metropolitan  Ry.  Co.,  2  App.  Cas.  692.  The 
use  of  the  ball  at  home  stands  on  the  same 
level  as  the  writing  a  letter  which  is  kept 
in  the  writer's  drawer.  In  Denton  v.  Rail- 
way Co.,  5  El.  &  Bl.  S6,  the  fact  was  ascer- 
tained by  a  public,  not  a  secret,  act.  The 
respondent  relies  on  Williams  v.  Carwardine, 
4  Barn.  &  Adol.  021,  and  the  other  cases  of 
that  class;  but  there  a  service  was  done 
to  the  advertiser.  Here  no  service  to  the  de- 
fendants was  requested,  for  it  was  no  bene- 
fit to  them  that  the  balls  should  be  used; 
their  interest  was  only  that  they  should  be 
sold.  Those  cases  also  differ  from  the  pres- 
ent in  this  important  particular:  that  in 
them  the  service  was  one  whic^  could  only 
be  performed  by  a  limited  number  of  per- 
sons, so  there  was  no  difliculty  in  ascertain- 
ing with  whom  the  contract  was  made.  It 
is  said  the  advertisement  was  not  a  legal 
contract,  but  a  promise  in  honor,  which,  if 
the  defendants  had  been  approached  in  a 
proper  way,  they  would  have  fulfilled.  A  re- 
quest is  as  necessai"y  in  the  case  of  an  exe- 
cuted consideration  as  of  an  executory  one 
(Lampleigh  v.  Braithwait,  1  Smith,  Lead. 
Cas.  [9th  Ed.]  pp.  153,  157,  159),  and  here 
there  was  no  request.  Then  as  to  the  want 
of  limitation  as  to  time,  it  is  conceded  that 
the  defendants  cannot  have  meant  to  con- 
tract without  some  limit,  and  three  limita- 
tions have  been  suggested.  The  limitation 
"during  the  prevalence  of  the  epidemic"  is 
inadmissible,  for  the  advertisement  applies 
to  colds  as  well  as  infiuenza.  The  limita- 
tion "during  use"  is  excluded  by  the  lan- 
guage "after  having  used."  The  third  is, 
"within  a  reasonable  time,"  and  that  is  prob- 
ably what  was  intended;  but  it  cannot  be 
deduced  from  the  words;  so  the  fair  result 
is  that  there  was  no  legal  contract  at  all. 

LIXDLEY,  L.  J.  (after  stating  the  facts). 
I  will  begin  by  referring  to  two  points  which 
were  raised  in  the  court  below.  I  refer  to 
them  simply  for  the  purpose  of  dismissing 
them.  First,  it  is  said  no  action  will  lie  upon 
this  contract  because  it  is  a  policy.  You  have 
only  to  look  at  the  advertisement  to  dismiss 
that  suggestion.  Then  it  was  said  that  it  is  a 
bet.  Hawkins,  J.,  came  to  the  conclusion  that 
nobody  ever  dreamt  of  a  bet,  and  that  the 
transaction  had  nothing  whatever  in  common 
with  a  bet  I  so  entirely  agree  with  him  that 
I  pass  over  this  contention  also  as  not  worth 
serious  attention. 

Then,  what  is  left?  The  first  (jbservation  I 
will  make  is  that  we  are  not  dealing  with 
any  inference  of  fact.  We  are  dealing  with 
an  express  promise  to  pay  £100  in  certain 
events.  Read  the  advertisement  how  you 
will,  and  twist  't  about  as  you  will,  here  is  a 
distinct  promise  expressed  in  language  which 
is  perfectly  unmistakable:  "£100  reward  will 
be  paid  by  the  Carbolic  Smoke  Ball  Company 
to  any  person  who  contracts  the  influenza 
after  having  used  the  ball  three  times  daily 


GENERAL  OPFERS. 


69 


for  two  weeks  according  to  the  printed  direc- 
tions supplied  withi  eacli  ball." 

We  must  first  consider  whether  this  was 
intended  to  be  a  promise  at  all,  or  whether  it 
was  a  mere  pu£f  which  meant  nothing.  Was 
it  a  mere  puffV  My  answer  to  that  question 
is  "No,"  and  I  base  my  answer  upon  tliis 
passage:  "£1000  is  deposited  with  the  Al- 
liance Bank,  shewing  our  sincerity  in  the 
matter."  Now,  for  what  was  that  money  de- 
posited or  that  statement  made  except  to 
negative  the  suggestion  that  this  was  a  mere 
puff  and  meant  nothing  at  all-?  The  deposit 
is  called  in  aid  by  the  advertiser  as  a  proof  of 
his  sincerity  in  the  matter— that  is,  the  sin- 
cerity of  his  promise  to  pay  this  £100  in  the 
event  which  he  has  specified.  I  say  this  for 
the  purpose  of  giving  point  to  the  observation 
that  we  are  not  inferring  a  promise;  there  is 
the  promise,  as  plain  as  words  can  make  it. 

Then  it  is  contended  that  it  is  not  binding. 
In  the  first  place,  it  is  said  that  it  is  not  made 
with  anybody  in  particular.  Now  that  point 
is  comuion  to  the  words  of  this  advertisement 
and  to  the  words  of  all  other  advertisements 
offering  rewards.  They  are  offers  to  anybody 
who  performs  the  conditions  named  in  the  ad- 
vertisement, and  anybody  who  does  perform 
the  condition  accepts  the  offer.  In  point  of 
law  this  advertisement  is  an  offer  to  pay 
£100  to  anybody  who  will  perform  these  con- 
ditions, and  the  performance  of  the  condi- 
tions, is  the  acceptance  of  the  offer.  That 
rests  upon  a  string  of  authorities,  the  earliest 
of  which  is  Williams  v.  Carwardine,  4  Barn. 
&  Adol.  G21,  which  has  been  followed  by 
many  other  decisions  upon  advertisements  of- 
fering rewards. 

But  then  it  is  said,  "Supposing  that  the 
performance  of  the  conditions  is  an  accept- 
ance of  the  offer,  that  acceptance  ought  to 
have  been  notified."  Unquestionably,  as  a 
general  proposition,  when  an  offer  Is  made,  it 
is  necessary  in  order  to  make  a  binding  con- 
tract, not  only  that  it  should  be  accepted,  but 
that  the  acceptance  should  be  notified.  But 
is  that  so  in  cases  of  this  kind?  I  apprehend 
that  they  are  an  exception  to  that  rule,  or,  if 
not  an  exception,  they  are  open  to  the  ob- 
servation that  the  notification  of  the  accept- 
ance need  not  precede  the  performance. 
This  offer  is  a  continuing  offer.  It  was 
never  revoked,  and  if  notice  of  acceptance  is 
required,— which  I  doubt  very  much,  for  I 
rather  think  the  true  view  is  that  which  was 
expressed  and  explained  by  Lord  Blackburn 
in  the  case  of  Brogden  v.  Railway  Co.,  2  App. 
Cas.  GGG,  G91,— if  notice  of  acceptance  is  re- 
quired, the  person  who  makes  the  offer  gets 
the  notice  ot  acceptance  contemporaneously 
with  his  notice  of  the  performance  of  the  con- 
dition. If  he  gets  notice  of  the  acceptance 
before  his  offer  is  revoked,  that  in  principle 
is  all  you  want  I,  however,  think  that  the 
true  view,  in  a  case  of  this  kind,  is  that  the 
person  who  makes  the  offer  shews  by  his  lan- 
guage and  from  the  nature  of  the  transaction 
that  he  does  not  expect  and  does  not  require 


notice  of  the  acceptance  apart  from  notice  of 
the  performance. 

We,  therefore,  find  here  all  the  elements 
which  are  uoces.sary  to  form  a  binding  con- 
tract enforceable  in  point  of  law,  subject  to 
two  observations  First  of  all  it  is  said  that 
this  advertisement  is  so  vague  that  you  can 
not  really  construe  it  as  a  promise — that  the 
vagueness  cf  the  language  shows  that  a  legal 
promise  was  never  intended  or  contemplated. 
The  language  is  vague  and  uncertain  in  some 
respects,  and  particularly  in  this,  that  the 
£100  is  to  be  paid  to  any  person  who  contracts 
the  increasing  epidemic  after  having  used  tlie 
balls  three  times  daily  for  two  weeks.  It  is 
said,  when  are  they  to  be  used?  According 
to  the  language  of  the  advertisement  no  time 
is  fixed,  and,  construing  the  offer  most  strong- 
ly against  the  person  who  has  made  it,  one 
might  infer  that  any  time  was  meant.  I  do 
not  think  that  was  meant,  and  to  hold  the 
contrary  would  be  pushing  too  far  the  doc- 
trine of  taking  language  most  strongly  against 
the  person  using  it.  I  do  not  think  that  busi- 
ness people  or  reasonable  people  would  under- 
stand the  words  as  meaning  that  if  you  took  a 
smoke  ball  and  used  it  three  times  daily  for 
two  weeks  you  were  to  be  guaranteed  against 
influenza  for  the  rest  of  your  life,  and  I  think 
it  would  be  pushing  the  language  of  the  ad- 
vertisement too  far  to  construe  it  as  meaning 
that.  But  if  it  does  not  mean  that,  what  does 
it  mean?  It  is  for  the  defendants  to  shew 
what  it  does  mean;  and  it  strikes  me  that 
there  are  two,  and  possibly  three,  reasonable 
constructions  to  be  put  on  this  advertisement, 
any  one  of  which  will  answer  the  purpose  of 
the  plaintiff.  Possibly  it  may  be  limited  to 
persons  catching  the  "increasing  epidemic" 
(that  is,  the  then  prevailing  epidemic),  or  any 
colds  or  diseases  caused  by  taking  cold,  dur- 
ing the  prevalence  of  the  increasing  epidemic. 
That  is  one  suggestion;  but  It  does  not  com- 
mend itself  to  me.  Another  suggested  mean- 
ing is  that  you  are  warranted  free  from  catch- 
ing this  epidemic,  or  colds  or  other  diseases 
caused  by  taking  cold,  whilst  you  are  using 
this  remedy  after  using  it  for  two  weeks.  If 
that  is  the  meaning,  the  plaintiff  is  riglit.  for 
she  used  the  remedy  for  two  weeks  and  went 
on  using  it  till  she  got  the  epidemic.  An- 
other meaning,  and  the  one  which  I  rather 
prefer,  is  that  the  reward  is  offered  to  any 
person  who  contracts  the  epidemic  or  other 
disease  within  a  reasonable  time  after  hav- 
ing used  the  smoke  ball.  Then  it  is  asked, 
what  is  a  reasonable  time?  It  has  been  sug- 
gested that  there  is  no  standard  of  reasonable- 
ness; that  it  depends  upon  the  reasonable 
time  for  a  germ  to  develop!  I  do  not  feel 
pressed  by  that.  It  strikes  me  that  a  reason- 
able time  may  be  ascertained  in  a  business 
sense  and  in  a  sense  satisfactory  to  a  law- 
yer, in  this  way:  Find  out  from  a  chemist 
what  the  ingredients  are;  find  out  from  a 
skilled  physiciau  how  long  the  effect  of  such 
ingredients  on  the  system  could  be  reasonaldy 
expected  to  endure  so  as  to  protect  a  person 


70 


OFFER  AND   ACCEPTANCE. 


from  an  epidemic  or  cold,— and  in  that  way 
you  will  get  a  standard  to  be  laid  before  a 
jury,  or  a  judge  without  a  jury,  by  which 
they  might  exercise  their  judgment  as  to 
what  a  reasonable  time  would  be.  It  strikes 
me,  I  confess,  that  the  true  construction  of 
this  advertiserient  is  that  flOO  will  be  paid 
to  anybody  who  uses  this  smoke  ball  three 
times  daily  for  two  weeks  according  to  the 
printed  directions,  and  who  gets  the  influenza 
or  cold  or  other  diseases  caused  by  taking 
cold  within  a  reasonable  time  after  so  using 
it;  and  if  that  is  the  true  construction,  it  is 
enough  for  the  plaintiff. 

I  come  now  to  the  last  point  which  I  think 
requires  attention:  that  is,  the  consideration. 
It  has  been  argued  that  this  is  nudum  pactum 
— that  there  is  no  consideration.  We  must 
apply  to  that  argument  the  usual  legal  tests. 
Let  us  see  whether  there  is  no  advantage  to 
the  defendants.  It  is  said  that  the  use  of  the 
ball  is  no  advantage  to  them,  and  that  what 
benefits  them  is  the  sale;  and  the  case  is  put 
that  a  lot  of  these  balls  might  be  stolen,  and 
that  it  would  be  no  advantage  to  the  defend- 
ants if  the  thief  or  other  people  used  them. 
The  answer  to  that,  I  think,  is  as  follows:  It 
is  quite  obvious  that  in  view  of  the  adver- 
tisers a  use  by  the  public  of  their  remedy,  if 
they  can  only  get  the  public  to  have  confi- 
dence enough  to  use  it,  will  react  and  pro- 
duce a  sale  which  is  directly  beneficial  to 
them.  Therefore,  the  advertisers  get  out  of 
the  use  an  advantage  which  is  enough  to  con- 
stitute a  consideration. 

But  there  is  another  view.  Does  not  the 
person  who  acts  upon  this  advertisement 
and  accepts  the  offer  put  himself  to  some  in- 
convenience at  the  request  of  the  defend- 
ants? Is  It  nothing  to  use  this  ball  three 
times  daily  for  two  weeks  according  to  the 
directions  at  the  request  of  the  advertiser? 
Is  that  to  go  for  nothing?  It  appears  to  me 
that  there  is  a  distinct  inconvenience,  not 
to  say  a  detriment,  to  any  person  who  so 
uses  the  smoke  baU.  I  am  of  opinion,  there- 
fore, that  there  is  ample  considei-ation  for 
the  promise. 

We  were  pressed  upon  this  point  with  the 
ease  of  Gerhard  v.  Bates,  2  El.  &  Bl.  476, 
which  was  the  case  of  a  promoter  of  com- 
panies who  had  promised  the  bearers  of 
share  warrants  that  they  should  have  divi- 
dends for  so  many  years,  and  the  promise 
as  alleged  was  held  not  to  shew  any  consid- 
eration. Lord  Campbell's  judgment  when 
you  come  to  examine  it  is  open  to  the  ex- 
planation, that  the  real  point  in  that  case 
was  that  the  promise,  if  any,  was  to  the 
original  bearer  and  not  to  the  plaintiff,  and 
that  as  the  plaintiff  was  not  suing  in  the 
name  of  the  original  bearer  there  was  no 
contract  with  him  Then  Lord  Campbell 
goes  on  to  enforce  that  view  by  shewing 
that  there  was  no  consideration  shewn  for 
the  promise  to  him.  I  cannot  help  thinking 
that  Lord  Campbell's  observations  would 
have  been  very  different  if  the  plaintiff  in 


that  action  had  been  an  original  bearer,  or 
if  the  declaration  had  gone  on  to  shew  what 
a  societe  anonyme  was,  and  had  alleged  the 
promise  to  have  been,  not  only  to  the  first 
bearer,  but  to  ajiybody  who  should  become 
the  bearer.  There  was  no  such  allegation, 
and  the  court  said,  in  the  absence  of  such 
allegation,  they  did  not  know  (judicially,  of 
course)  what  a  societe  anonyme  was,  and, 
therefore,  there  was  no  consideration.  But 
in  the  present  case,  for  the  reasons  I  have 
given,  I  cannot  see  the  slightest  difficulty  in 
coming  to  the.  conclusion  that  there  is  con- 
sideration. 

It  appears  to  me,  therefore,  that  the  de- 
fendants must  perform  their  promise,  and, 
if  they  have  been  so  unwaiy  as  to  expose 
themselves  to  a  great  many  actions,  so  much 
the  worse  for  them. 

BOWEN,  L.  J,  [  am  of  the  same  opinion. 
We  are  asked  to  say  that  this  document 
was  a  contract  too  vague  to  be  enforced. 

The  first  observation  which  arises  is  that 
the  document  itself  is  not  a  contract  at  aU: 
it  is  only  an  offer  made  to  the  public.  The 
defendants  contend  next,  that  it  is  an  offer 
the  terms  of  which  are  too  vague  to  be  treat- 
ed as  a  definite  offer,  inasmuch  as  there  is 
no  limit  of  time  fixed  for  the  catching  of  the 
influenza,  and  it  cannot  be  supposed  that 
the  advertisers  seriously  meant  to  promise 
to  pay  money  to  every  person  who  catches 
the  influenza  at  any  time  after  the  inhaling 
of  the  smoke  ball.  It  was  urged  also,  that 
if  you  look  at  this  document  you  will  find 
much  vagueness  as  to  the  persons  with 
whom  the  contract  was  intended  to  be 
made;  that,  in  the  first  place,  its  terms  are 
wide  enough  to  include  persons  who  may 
have  used  the  smoke  ball  before  the  adver- 
tisement was  issued;  at  all  events,  that  it  is 
an  offer  to  the  world  in  general,  and,  also, 
that  it  is  unreasonable  to  suppose  it  to  be  a 
definite  offer,  because  nobody  in  their  senses 
would  contract  themselves  out  of  the  oppor- 
timity  of  checking  the  experiment  which 
was  going  to  be  made  at  their  own  expense. 
It  is  also  contended  that  the  advertisement 
is  rather  in  the  nature  of  a  puff"  or  a  procla- 
mation than  a  promise  or  offer  intended  to 
mature  into  a  contract  when  accepted.  But 
the  main  point  seems  to  be  that  the  vague- 
ness of  the  document  shews  that  no  con- 
tract whatever  was  intended.  It  seems  to 
me  that,  in  order  to  arrive  at  a  right  con- 
clusion, we  must  read  this  advertisement  in 
its  plain  meaning,  as  the  public  would  im- 
derstand  it.  It  was  intended  to  be  issued 
to  the  public  and  to  be  read  by  the  public. 
How  would  an  ordinary  person  reading  this 
document  construe  it?  It  was  intended  un- 
questionably to  have  some  effect,  and  1 
think  the  effect  which  it  was  intended  to 
have,  was  to  make  people  use  the  smoke 
ball,  because  the  suggestions  and  allegations 
which  it  contains  are  directed  immediately 
to  the  use  of  the  smoke  ball  as  distinct  from 


GENERAL  OFFEHS. 


71 


the  purchase  of  it.     It  did  not  follow  that 
the  smoke  ball  was  to  be  purchased  from  the 
defendants  directly  or  even  from  aj;ents  of 
theirs  directly.     The  intention  was  that  the 
circulation  of  the  sinoko  ball  should  he  pro- 
moted, and  that  the  use  of  it  should  be  in- 
creased.    The  advertisement  begins  by  say- 
ing that  a  reward  will  be  paid  by  the  Carbol- 
ic Smoke  Ball  Company  to  any  person  who 
contracts  the  increasing  epidemic  after  us- 
ing   the    ball.     It    has    been    said    that    the 
words  do  not  apply  only  to  persons  who  con- 
tract the  epidemic  after  the  publication  of 
the  advertisement,  but  include  persons  who 
had  previously  contracted  the  influenza.     I 
cjinnot    so    read    the    advertisement.     It    is 
written  in  colloquial  and  popular  language, 
and   I    think   that   it  is   equivalent   to   this: 
"£100  will  be  paid  to  any  person  who  shall 
contract  the  increa.sing  epidemic  after  hav- 
ing used  the  carbolic  smoke  ball  three  times 
daily  for  two  weeks."     And  it  seems  to  me 
that  the  way  in  which  the  public  would  read 
it  would  be  this;    that  if  anybody,  after  the 
advertisement    was    published,    used    three 
times    daily    for    two    weeks    the    carbolic 
smoke  biill,  and  then  caught  cold,  he  would 
be  entitled  to   the   reward.     Then  again   it 
■was  said:     "flow  long  is  this  protection  to 
endure?     Is    it   to   go   on   for  ever,    or    for 
what  limit  of  time?"     I  think  that  there  are 
two  constructions  of  this  document,  each  of 
which    is   good   sense,    and    each    of    which 
seems  to  me  to  satisfy  the  exigencies  of  the 
present  action.     It  may  mean  that  the  pro- 
tection Is  warranted  to  last  during  the  epi- 
demic, and  it  was  during  the  epidemic  that 
the  plaintiff  contracted  the  disease.    I  think, 
more  probably,  it  means  that  the  smoke  ball 
will  be  a  protection  while  it  is  in  use.    That 
seems  to  me  the  way  in  which  an  ordinary 
person  would   understand  an  advertisement 
about  medicine,  and  about  a  specific  against 
mfluenza.     It    coidd    not    be    supposed    that 
after  you  have  left  off  using  it  you  are  still 
to  be  protected  for  ever,  as  if  there  was  to 
be  a  stamp  set  upon  your  forehead  that  you 
were  never  to  catch   influenza  because  you 
had   once  used  the  carbolic   smoke  ball.     I 
think  the  immunity  is  to  last  during  the  use 
of  the  ball.     That  is   the   way   in   which  I 
should  naturally  read  it,  and  it  seems  to  me 
that  the  subsequent  language  of  the  adver- 
tisement supports  that  construction.    It  says: 
"During  the  last  epidemic  of  influenza  many 
thou.sand    carbolic    smoke   balls    were    sold, 
and  in  no  ascertained  case  was  the  disease 
contracted  by  those  using"  (not,   "who  had 
used")    "the    carbolic    smoke    ball,"    and    it 
concludes  with  saying  that  one  smoke  ball 
will  last  a   family    several    months    (which 
imports  that  it  is  to  be  efficacious  while  it 
Is  being  used),  and  that  the  ball  can  be  re- 
filled   at   a   cost   of  5s.     I,    therefore,    have 
myself  no  hesitation  in  saying  that  I  think, 
on   the   construction    of  this   advertisement, 
the  protection  was  to  enure  during  the  time 
that  the  carbolic  smoke  ball  was  used.     My 


brother  the  lord  Justice  who  preceded  me, 
thinks  that  the  contract  would  be  sufficient- 
ly definite  if  you  were  to  read  It  in  the 
sense  that  the  protection  was  to  be  war- 
ranted during  a  reasonable  period  after  use. 
I  have  some  difliculty  myself  on  that  point; 
but  it  is  not  neces.sary  for  me  to  consider  it 
further,  because  the  disease  here  was  con- 
tracted during  the  use  of  the  carbolic  smoke 
ball. 

Was  it  intended  that  the  £100  should,  if 
the  conditions  were  fulfilled,  be  paid?  The 
advertisement  says  £1000  is  lodged  at  the  bank 
for  the  purpose.  Therefore,  it  cannot  be  said 
that  the  statement  that  £100  would  be  paid 
was  intended  to  be  a  mere  puff.  I  think  it 
was  intended  to  be  understood  by  the  public 
as  an  offer  which  was  to  be  acted  upon. 

But  it  was  said  there  was  no  check  on  the 
part  of  the  persons  who  issued  the  adver- 
tisement, and  that  it  would  be  an  insensate 
thmg  to  promise  £100  to  a  person  who  used 
the  smoke  ball  unless  you  could  check  or 
superintend  his  manner  of  using  it.  The  an- 
swer to  that  argument  seems  to  me  to  be  that 
if  a  person  chooses  to  make  extravagant  prom- 
ises of  this  kind  he  probably  does  so  because 
it  pays  him  to  make  them,  and,  if  he  has 
made  them,  the  extravagance  of  the  promises 
is  no  reason  in  law  why  he  should  not  be 
bound   by  them. 

It  was  also  said  that  the  contract  is  made 
with  all  tlie  w-orld,— that  is,  with  everybody, 
—and  that  you  cannot  contract  with  every- 
body.    It  is  not  a  contract  made  with  all  the 
world.     There    is    the    fallacy    of    the    argu- 
ment.    It  is  an  offer  made  to  aU  the  world; 
and  why  should  not  an  offer  be  made  to  all 
the  w'orld  which  is  to  ripen  into  a  contract 
with  anj'body  who  comes  forward  and  per- 
forms the  condition?     It  is  an  offer  to  be- 
come liable  to  any  one  who,  before  it  is  re- 
tracted, performs  the  condition,  and,  although 
the  offer  is  made  to  the  world,  the  contract  is 
made  with  that  Umited  portion  of  the  pubhc 
who  come  forward  and  perform  the  condition 
on  the  faith  of  the  advertisement.     It  is  not 
like  cases  in  which  you  offer  to  negotiate,  or 
you  issue  advertisements  that  you  have  got 
a  stock  of  books  to  sell,  or  houses  to  let,  in 
which  case  there  is  no  offer  to  be  bound  by 
any  contract.     Such  advertisements  are  offers 
to  negotiate,  offers  to  receive  offers,  offers  to 
chaffer,  as,  I  think,  some  learned  judge  in  one 
of  the  cases  has  said.   '  If  tliis  is  an  offer  to 
be  bound,  then  it  is  a  contract  the  moment 
the  person  fulfils  the  condition.    That  seems 
to  me  to  be  sense,  and  it  is  also  the  ground 
on  which  all  these  advertisement  cases  have 
been  decided  during  tlie  century;    and  it  can- 
not be  put  better  than  in  Willes.  J.'s.  judg- 
ment in  Spencer  v.  Harding,  L.  R.  5  C.  P.  oGl, 
563.    "In  the  advertisement  cases,"  he  says, 
"there  never  was  any  doubt  that  the  adver- 
tisement amounted  to  a  promise  to  pay  the 
money  to  the  person  who  first  gave  informa- 
tion.    The    diflEiculty    suggested    was    that    it 
was  a  contract  with  all  the  world.     But  that. 


72 


OFFER  AJ^D  ACCEPTANCE. 


of  course,  was  soon  overruled.  It  was  an 
offer  to  become  liable  to  any  person  who 
before  the  ofEer  should  be  reti-acted  should 
happen  to  be  tlie  ix?rson  to  fulfil  the  con- 
tract, of  which  the  advertisement  was  an 
offer  or  tender.  That  is  not  the  sort  of  dif- 
ficulty which  presents  itself  here.  If  the 
circular  had  gone  on,  'and  we  undertake  to 
sell  to  the  highest  bidder,'  the  reward  cases 
would  have  applied,  and  there  would  have 
been  a  good  contract  in  respect  of  the  per- 
sons." As  soon  as  the  highest  bidder  pre- 
sented himself,  says  Willes,  J.,  the  person 
who  was  to  hold  the  vincvilum  juris  on  the 
other  side  of  the  contract  was  ascertained,  and 
it  became  settled. 

Then  it  was  said  that  there  was  no  notifica- 
tion of  the  acceptance  of  the  contract.  One 
cannot  doubt  that,  as  an  ordinary  rule  of  law, 
an  acceptance  of  an  offer  made  ought  to  be 
notified  to  the  person  who  makes  the  offer, 
in  order  that  the  two  minds  may  come  to- 
gether. Unless  this  is  done,  the  two  minds 
may  be  apart,  and  there  is  not  that  consensus 
which  is  necessary  according  to  the  English 
law — I  say  nothing  about  the  laws  of  other 
countries — to  make  a  contract  But  there  is 
this  clear  gloss  to  be  made  upon  that  doc- 
trine, that  as  notification  of  acceptance  is  re- 
quired for  the  benefit  of  the  person  who  makes 
the  offer,  the  person  who  makes  the  offer  may 
dispense  with  notice  to  himself  if  he  thinks  it 
desirable  to  do  so,  and  I  suppose  there  can 
be  no  doubt  that  where  a  person  in  an  offer 
made  by  him  to  another  person,  expressly  or 
impliedly  intimates  a  particular  mode  of  ac- 
ceptance as  sufiicient  to  make  the  bargain 
binding,  it  is  only  necessary  for  the  other 
person  to  whom  such  offer  is  made  to  follow 
the  indicated  method  of  ac-ceptance;  and  if  the 
person  making  the  offer,  expressly  or  im- 
pliedly intimates  in  his  offer  that  it  will  be 
sufficient  to  act  on  the  proposal  without  com- 
municating acceptance  of  it  to  himself,  per- 
formance of  the  condition  is  a  sufficient  ac- 
ceptance without  notification. 

That  seems  to  me  to  be  the  principle  which 
lies  at  the  bottom  of  the  acceptance  cases, 
of  which  two  instances  are  the  well-known 
judgment  of  Mellish,  L.  J.,  in  Harris's  Case, 
L.  R.  7  Ch.  587,  and  the  very  instructive 
judgment  of  Lord  Blackburn  in  Brogden  v. 
Railway  Co.,  2  App.  Cas.  GGC,  601,  in  which 
he  appears  to  me  to  take  exactly  the  line  I 
have  indicated. 

Now,  if  that  is  the  law,  how  are  we  to  find 
out  whether  the  person  who  makes  the  offer 
does  intimate  that  notification  of  acceptance 
will  not  be  necessary  in  order  to  constitute 
a  binding  bargain?  In  many  cases  you  look 
to  the  offer  itself.  In  many  cases  you  extract 
from  the  character  of  the  transaction  that 
notification  is  not  required,  and  in  the  adver- 
tisement cases  it  seems  to  me  to  follow  as 
an  inference  to  be  drawn  from  the  transac- 
tion itself  that  a  person  is  not  to  notify  his 
acceptance  of  the  offer  before  he  performs  the 
condition,  but  that  if  he  performs  the  condi- 


tion notification  is  dispensed  with.  It  seems 
to  me  that  from  the  point  of  view  of  common 
sense  no  other  idea  could  be  entertained.  K 
I  advertise  to  the  world  that  my  dog  is  lost, 
and  that  anybody  who  brings  the  dog  to  a  par- 
ticular place  wUl  be  paid  some  money,  are  all 
the  police  or  other  persons  whose  business  it 
is  to  find  lost  dogs  to  be  expected  to  sit  down 
and  write  a  note  saying  that  they  have  ac- 
cepted my  proposal?  Why,  of  course,  they 
at  once  look  after  the  dog,  and  as  soon  as 
they  find  the  dog  they  have  performed  the 
condition.  The  essence  of  the  transaction  is 
that  the  dog  should  be  found,  and  it  is  not 
necessary  under  such  circumstances,  as  it 
seems  to  me,  that  in  order  to  make  the  con- 
tract binding  there  should  be  any  notification 
of  acceptance.  It  follows  from  the  nature 
of  the  thing  that  the  performance  of  the  con- 
dition is  sufficient  acceptance  without  the  no- 
tification of  it,  and  a  person  who  makes  an 
offer  in  an  advertisement  of  that  kind  makes 
an  offer  which  must  be  read  by  the  light  of 
that  common  sense  reflection.  He  does,  there- 
fore, in  his  offer  impliedly  indicate  that  he 
does  not  require  notification  of  the  accept- 
ance of  the  offer. 

A  further  argument  for  the  defendants  was 
that  this  was  a  nudum  pactum,— that  there 
was  no  consideration  for  the  promise;  tlmt 
taking  the  infiuenza  was  only  a  condition, 
and  that  the  using  the  smoke  ball  was  only 
a  condition,  and  that  there  was  no  considera- 
tion at  all;  in- fact,  that  there  was  no  request, 
express  or  implied,  to  use  the  smoke  ball. 
Now,  I  will  not  enter  into  an  elaborate  dis- 
cussion upon  the  law  as  to  requests  in  this 
kind  of  contracts  I  will  simply  refer  to 
Victors  V.  Davies,  12  Mees.  &  W.  758,  and 
Serjeant  Manning's  note  to  Fisher  v.  Pyne,  1 
Man.  &  G.  265,  which  everybody  ought  to 
read  who  wishes  to  embark  in  this  contro- 
versy. The  short  answer,  to  abstain  from 
academical  discussion,  is,  it  seems  to  me,  that 
there  is  here  a  request  to  use  involved  in  the 
offer.  Then  as  to  alleged  want  of  considera- 
tion. The  definition  of  "consideration"  given 
in  Selwyn,  N.  P.  (8th  Ed.)  p.  47,  which  is 
cited  and  adopted  by  Tindal,  C.  J.,  in  the  case 
Laythoarp  v.  Bryant,  3  Scott,  238,  250,  is  this: 
"Any  act  of  the  plaintiff  from  which  the  de- 
fendant derives  a  benefit  or  advantage,  or  any 
labour,  detriment,  or  inconvenience  sustain- 
ed by  the  plaintiff,  provided  such  act  is  per- 
formed or  such  inconvenience  suffered  by  the 
plaintiff,  with  the  consent,  either  expressed 
or  implied,  of  the  defendant."  Can  it  be 
said  here  that  if  the  person  who  reads  this 
advertisement  applies  thrice  daily,  for  such 
time  as  may  seem  to  him  tolerable,  the  car- 
bolic smoke  ball  to  his  nostrils  for  a  whole 
fortnight,  he  is  doing  nothing  at  all;  that  it 
Is  a  mere  act  which  is  not  to  count  towards 
consideration  to  support  a  promise  (for  the 
law  does  not  require  us  to  measure  the  ad- 
equacy of  the  consideration).  Inconvenience 
sustained"  by  one  party  at  the  request  of  the 
other  is  enough  to  create  a  consideration.    I 


GENERAL  OFFERS. 


73 


think,  therefore,  that  It  Is  consideration 
enough  that  the  plaintiff  took  the  trouble  of 
using  the  smoke  ball.  But  I  think  also  that 
the  defendant  received  a  benefit  from  this 
u.ser,  for  the  use  of  the  smoke  ball  was 'con- 
templated by  the  defendants  as  being  indirect- 
ly a  benefit  to  them,  because  the  use  of  the 
smoke  balls   would  promote   their  sale. 

Then  we  are  pressed  with  Gerhard  v.  Bates, 
2  El.  &  Bl.  476.  In  Gerhard  v.  Bates,  2  EL 
&  Bl.  47G,  which  ar'^se  upon  demurrer,  the 
point  upon  which  the  action  failed  was  that 
the  plaintiff  did  not  allege  tliat  the  promLse 
was  made  to  the  class  of  which  alone  the 
plaintiff  was  a  member,  and  that  therefore 
there  was  no  privity  between  the  plaintiffs 
and  the  defendants.  Then  Lord  Campbell 
went  on  to  give  a  second  reason.  If  his  first 
reason  was  not  enough,  and  the  plaintiff  and 
the  defendant  there  had  come  together  as 
contracting  parties  and  the  only  question  was 
consideration.  It  seems  to  me  Lord  Campbell's 
reasoning  would  not  have  been  sound.  It  is 
only  to  be  supported  by  reading  it  as  an  addi- 


tional reason  for  thinking  that  they  had  not 
come  into  the  relation  of  contracting  parties; 
but,  if  so,  the  language  was  superfluous.  The 
truth  is,  that  if  in  that  case  you  had  found  a 
contract  between  the  parties  there  would  have 
been  no  diflicultj'  about  consideration;  but 
you  could  not  find  such  a  contract  Here,  in 
the  same  way,  if  you  once  make  up  your  mind 
that  there  was  a  promise  made  to  thi.s  lady 
who  is  the  plaintiff,  as  one  of  the  pubhc,— 
a  promise  made  to  her  that  if  she  used  the 
smoke  ball  three  times  daily  for  a  fortnight 
and  got  the  influenza,  she  should  have  flCXJ, 
— It  seems  to  me  that  her  using  the  smoke  ball 
was  sufficient  consideration.  I  cannot  pic- 
ture to  myself  the  view  of  the  law  on  which 
the  contrary  could  be  held  when  you  liave 
once  found  who  are  the  contracting  parties. 
If  I  say  to  a  person,  "If  you  use  such  and 
such  a  medicine  for  a  week  I  will  give  you 
£5,"  and  he  uses  it,  there  Is  ample  considera- 
tion for  the  promise. 

•  *«••• 

Appeal  dismissed. 


OrrEll  AND  ACCEPTANCE. 


^^ 


\. 


20.    III.    V 


PAINE  V.  CAVE. 
(3  Term  R.  148. 
Hilaiy  Term,  29  Geo. 
This  was  an  action,  tried  at  the  sittings 
after  last  term  at  Gtiildhall  before  Loi-d  Keu- 
yon,  whei-ein  the  declaration  stated  that  the 
plaintiff  on  22d  September,  178S,  was  pos- 
sessed of  a  certain  worm-tub,  and  a  pewter 
worm  in  the  same,  which  were  then  and 
there  about  to  be  sold  by  public  auction  by 
one  S.  M.,  the  agent  of  the  plaintifE  in  that 
behalf,  the  conditions  of  which  sale  were  to 
be  the  usual  conditions  of  sale  of  goods  sold 
by  auction,  &c.  of  all  which  premises  the 
defendant  afterwards,  to  wit,  &c.  had  no- 
tice; and  thereupon  the  defendant  in  consid- 
eration that  the  plaintiff,  at  the  special  in- 
stantii  and  i-equest  of  the  defendant,  did  then 
and  there  undertake,  and  promise  to  perform 
the  conditions  of  the  said  sale,  to  be  per- 
formed by  the  plaintiff,  as  seller,  &c.  under- 
took, and  then  and  there  promised  the  plain- 
tiff to  perform  the  conditions  of  the  sale,  to 
be  perfoi-med  on  the  part  of  the  buyer,  &c. 
And  the  plaintiff  avei-s,  that  the  conditions 
of  sale,  herein  after  mentioned,  are  usual 
conditions  of  sale  of  goods  sold  by  auction, 
to  wit,  that  the  highest  bidder  should  be  the 
purchaser,  and  should  deposit  five  shillings 
in  the  pound,  and  that  if  the  lot  purchased 
were  not  paid  for  and  taken  away  in  two 
days  time,  it  should  be  put  up  again  and  re- 
sold, &c.  [stating  all  the  conditions].  It  then 
stated  that  the  defendant  became  the  pur- 
chaser of  the  lot  in  question  for  £40.  and 
was  requested  to  pay  the  usual  deposit  which 
he  refused,  &c  At  the  trial,  the  plaintiff's 
counsel  opened  the  case  thus;— The  goods 
were  put  up  in  one  lot  at  an  auction;  there 
were  several  biddei-s,  of  whom  the  defend- 
ant was  the  last  who  bid  £40;  the  auction- 
eer dwelt  on  the  bidding,  on  which  the  de- 
fendant said  "why  do  you  dweU,  you  will  not 
get  more;"  the  auctionerr  said  that  he  was 
informed  the  worm  weighed  at  least  1300 
cwt,  and  was  worth  more  than  £40;  the  de- 
fendant then  asked   him  whether  he  would 


warrant  it  to  weigh  so  much,  and  received 
an  answer  in  the  negative,  he  then  declared 
that  he  would  not  take  it,  and  refused  to  pay 
for  it.  It  was  re-sold  on  a  subsequent  day's 
sale 'for  £30  to  the  defendant,  against  whom 
the  action  was  brought  for  the  difference. 
Lord  Kenyon,  being  of  opinion  on  this  state- 
ment of  the  case,  that  the  defendant  was  at 
liberty  to  withdraw  his  bidding  any  time  be- 
fore the  hammer  was  knocked  down,  non- 
suited the  plaintiff. 

Walton  now  moved  to  set  aside  the  non- 
suit, on  the  ground  that  the  bidder  was 
bound  by  the  conditions  of  the  sale  to  abide 
by  his  bidding,  and  could  not  retract  By 
the  act  of  bidding  he  acceded  to  those  con- 
ditions, one  of  which  was,  that  the  highest 
bidder  should  be  the  buyer.  The  hammer 
is  suspended,  not  for  the  benefit  of  the  bid- 
der, or  to  give  him  an  opportunity  of  repent- 
ing, but  for  the  benefit  of  the  seller:  in  the 
mean  time  the  pereon  who  bid  last  is  a  con- 
ditional pui-chaser,  if  nobody  bids  more.  Oth- 
erwise it  is  in  the  power  of  any  person  to 
injure  the  vendor,  because  all  the  former 
biddings  are  discharged  by  the  last:  and,  as 
it  happened  in  this  very  instance,  the  goods 
may  thereby  ultimately  be  sold  for  less  than 
the  person  who  was  last  out-bid  would  have 
given  for  them.  The  case  of  Simon  v.  Metiv- 
ier,  3  Burrows,  1921,  which  was  mentioned 
at  the  trial,  does  not  apply.  That  tiimed  on 
the  statute  of  frauds. 

THE  COURT  thought  the  non-suit  very 
proper.  The  auctioneer  is  the  agent  of  the 
vendor,  and  the  assent  of  both  parties  is 
necessaiy  to  make  the  contract  binding;  that 
is  signified  on  the  part  of  the  seUer,  by 
knodiing  down  the  hammer,  which  was  not 
done  here  till  the  defendant  had  retracted. 
An  auction  is  not  unaptly  called  locus  poen- 
itentiae.  Every  bidding  is  nothing  more  than 
an  offer  on  one  side,  which  is  not  binding  on 
either  side  tUl  it  is  assented  to.  But  accord- 
ing to  what  is  now  contended  for,  one  party 
would  be  bound  by  the  offer,  and  the  other 
not,  which  can  never  be  allowed. 

Rule  refused. 


REVOCATION  OF  OFFER  OR  ACCEPTANCE. 


75 


BARTLETT  et 


^4 


BOSTON  &  M.  R.  R.  V 

(3  Gush.  224.) 

Supreme   Judicial   Court   of    Massachuset 

Suffolk.    Nantucket.    March  \^ 

Term.  1849. 
This  was  a  bill  in  equity  for  the  specific 
performunce  of  a  contract  In  writing.  ; 

The  plaiatilTs  allogcfl,  that  the  defendants, 
on  the  1st  of  April,  1844,  being  the  owners 
of  certain  laud  situated  In  Boston,  and  par- 
ticularly described  in  the  bill,  "in  considera- 
tion  that  said  corporation  would   take   into 
consideration  the  expediency  of  buying  said 
laud  for  their  use  as  a  corporation,  signed 
a    certain    writing,    dated    April    1st,    1844," 
whereby  they  agreed  to  convey  to  the  plain- 
tiffs  "the  said  lot  of  land,  for  the  sum  ot 
twenty  thousand  dollars,  if  the  said  corpo- 
ration  would  take   the   same    within    thirty 
days  from  that  date;"  that  afterwards  and 
within   the   thirty    days,   the  defendants,   at 
the  request  of  the  plaintiffs,  "and  in  consid- 
eration that  the  said  corporation  agreed  to 
keep  in  consideration  the  expediency  of  tak- 
ing said  land,"  etc,  extended  the  said  term 
of  thirtj-  days,  by  a  writing  underneath  the 
written  conti"act  above  mentioned,  for  thirty 
days  from  the  expiration  thereof;    that,  on 
the  29th  of  May,   1844,  while  the  extended 
contract  was  in  full  force,  and  unrescinded, 
the  plaintiffs  elected  to  take  the  land  on  the 
terms  specified  in  the  contract,  and  notified 
the  defendants  of  their  election,  and  offered 
lo  pay  them  the  agreed  price  (producing  the 
same  in    money)   for  a   conveyance    of   the 
land,  and   requested   the   defendants  to  ex- 
ecute a  conveyance  thereof,  which  the  plain- 
tiffs tendered  to  them  for  that  purpose;   and 
that  the  defendants  refused  to  execute  such 
conveyance,  or  to  perform  the  contract,  and 
had  ever  since  neglected  and  refused  to  per- 
form the  same. 
The  defendants  demurred  generally. 
J.    P.    Healy,    for   defendants,    contended, 
that  there  was  no  allegation  in  the  bill  of  a 
consideration  for  the  contract,  as  originally 
made,   or   as   extended;    and,    consequently, 
that  the  same  was  not  enforceable  either  at 
law  or  in  equity.     Howel  v.  George,  1  Madd. 
1;    2  Story,  Eq.  §  787;    Brownsmith  v.  Gil- 
borne,  2  Strange,   738;    Colraan  v.   Sarel,   2 
Brown,  Ch.  12;    1  Madd.  328;    1  Fonbl.  42. 
The   counsel  also   referred   to   1   Harr.    Dig. 
G03;    Burnet  v.  Bisco,  4  Johns.  235;    Tucker 
v.  Woods,  12  Johns.  190;    Bean  v.  Burbank, 
16  Me.  458. 

G.  Minot,  (with  whom  was  R.  Choate.)  for 
the  plaintiffs,  suggested,  that  if  the  demur- 
rer was  sustained,  it  would  uot  be  for  the 
reason  stated,  but  on  the  authority  of  Cooke 
V.  Oxley,  3  Term  R.  G53,  and  Tucker  v. 
Woods,  12  Johns.  190,  which  are  not  now 
law.  The  question  is  one  of  mutuality  rath- 
er than  of  consideration.  The  offer  of  the 
defendants  was  a  continuing  one.  which 
might  have  been  withdrawn  at  any  time; 
but,  when  accepted,  the  effect  was  the  same, 


as  If  the  offer  had  only  been  made  the  mo- 
ment before.  Such  an  offer  requires  no  con- 
sidoi-ation.  When  accepted,  there  is  prom- 
ise for  promise. 

The  case  of  Cooke  v.  Oxley  Is  overruled 
by  Adams  v.  Lindsell,  1  Bam.  &  Aid.  081; 
Maetier  v.  Frith,  G  Wend.  103;  Peru  v. 
Turner,  10  Me.  185;  Kennedy  v.  Lee,  3  Mer. 
441;  Averill  v.  Hedge,  12  Conn.  424;  Carr  v. 
Duval,  14  Pet.  77;  1  Sugd.  Vend.  104;  M'Cul- 
loch  V.  Insurance  Co.,  1  Pick.  278.  It  is  vir- 
tually overruled  by  the  following  cases  de- 
cided by  this  court:  Thayer  v.  Insurance 
Co.,  10  Pick.  320;  Foster  v.  Boston.  22  Pick. 
33;  Bird  v.  Richardson,  8  Pick.  252.  See, 
also,  the  remarks  in  20  Am.  Jur.  17,  on  the 
case  of  Cooke  v.  Oxley,  and  the  case  of 
Hamilton  v.  Insurance  Co.,  5  Pa.  St.  339.  in 
which  it  was  virtually  overruled. 

Mr.  Healy,  in  reply,  said  that  In  all  the 
cases  cited  for  the  plaintiffs,  except  the  last, 
there  was  a  consideration. 

FLETCHER,  J.  In  support  of  the  de- 
murrer, in  this  case,  the  only  groimd  as- 
sumed and  insisted  on  by  the  defendants  is, 
that  the  agreement  on  their  part  was  with- 
out consideration,  and  therefore  not  obliga- 
tory. In  the  view  taken  of  the  case  by  the 
court,  no  importance  is  attached  to  the  con- 
sideration set  out  in  the  bill,  namely,  "that 
the  plaintiffs  would  take  into  consideration 
the  expediency  of  buying  the  land."  The 
argument  for  the  defendants,  that  their 
agreement  was  not  binding,  because  without 
consideration,  erroneously  assumes  that  the 
writing  executed  by  the  defendants  is  to  be 
considered  as  constituting  a  contract  at  the 
time  it  was  made.  The  decision  of  the 
court  in  Maine  in  the  case  of  Bean  v.  Bur- 
bank,  16  Me.  458,  which  was  referred  to  for 
the  defendants,  seems  to  rest  on  the  ground 
assumed  by  thom  in  this  case. 

In  the  present  case,  though  the  writing 
signed  by  the  defendants  was  but  an  offer, 
and  an  offer  which  might  be  revoked,  yet 
while  it  remained  in  force  and  unrevoked,  it 
was  a  continuing  offer  during  the  time  lim- 
ited for  acceptance;  and,  during  the  whole 
\  of  that  time,  it  was  an  offer  every  instant, 
but  as  soon  as  it  was  accepted,  it  ceased  to 
be  an  offer  merely,  and  then  ripened  into  a 
contract.  The  coimsel  for  the  defendants 
Is  most  surely  in  the  right,  in  saying  that 
the  writing  when  made  was  without  consid- 
eration, and  did  not  therefore  form  a  con- 
tract It  was  then  but  an  offer  to  contract; 
and  the  parties  making  the  offer  most  un- 
doubtedly might  have  withdrawn  it  at  any 
time  before  acceptance. 

But  when  the  offer  was  accepted,  the 
minds  of  the  parties  met,  and  the  contract 
was  complete.  There  was  then  the  meeting 
of  the  minds  of  the  parties,  which  consti- 
tutes and  is  the  definition  of  a  contract.  The 
acceptance  by  the  plaintiffs  constituted  a 
sufhoieut  legal  consideration  for  the  eng;age- 
ment  on  the  part  of  the  di-fou'hints.     There 


76 


OFFER  AND  ACCEPTANCE. 


was  then  nothing  wanting,  in  order  to  per- 
fect a  valid  contract  on  the  part  of  the  de- 
fendants. It  was  precisely  as  if  the  parties 
had  met  at  the  time  of  the  acceptance,  and 
the  offer  had  then  been  made  and  accepted 
and  the  bargain  completed  at  once. 

A  different  doctrine,  however,  prevails  In 
France,  and  Scotland,  and  Holland.  It  is 
there  held,  that  whenever  an  offer  is  made, 
granting  to  a  party  a  certain  time  within 
which  he  is  to  be  entitled  to  decide,  whether 
he  will  accept  it  or  not,  the  party  making 
such  offer  is  not  at  liberty  to  withdraw  it 
before  the  lapse  of  the  appointed  time. 
There  are  certainly  very  strong  reasons  in 
support  of  this  doctrine.  Highly  respecta- 
ble authors  regard  it  as  inconsistent  with 
.Uie  plain  principles  of  equity,  that  a  person, 
who  has  been  induced  to  rely  on  such  an 
engagement,  should  have  no  remedy  in  case 
of  disappointment  But,  whether  wisely 
and  equitably  or  not,  the  common  law  im- 
yieldingly  insists  upon  a  consideration,  or  a 
paper  with  a  seal  attached. 

The  authorities,  both  English  and  Ameri- 


can, in  support  of  this  view  of  the  subject, 
are  very  numerous  and  decisive;  but  it  is  not 
deemed  to  be  needful  or  expedient  to  refer 
particularly  to  them,  as  they  are  collected 
and  commented  on  in  several  reports  as  well 
as  in  the  text  books.  The  case  of  Cooke  v. 
Oxley,  '6  Term  R.  6-53,  in  which  a  different 
doctrine  was  held  has  occasioned  consider- 
able discussion,  and,  in  one  or  two  instances, 
has  probably  influenced  the  decision.  That 
case  has  been  supposed  to  be  Jnaccurately 
reported ;_and  thaj  in  facLJilsrejgag^in  that 
'gtrggTlg'acceptaace!  ButThowever  that  may 
'^eTTT^'n^'case  has  not  been  directly  over- 
ruled, it  has  certainly  in  later  cases  been 
entirely  disregarded,  and  cannot  now  be 
considered  as  of  any  authority. 

As,  therefore,  in  the  present  case,  the  bill 
sets  out  a  proposal  in  writing,  and  an  ac- 
ceptance and  an  offer  to  perform,  on  the 
part  of  the  plaintiffs,  within  the  time  lim- 
ited, and  while  the  offer  was  in  fuU  force, 
all  which  is  admitted  by  the  demurrer,  so 
that  a  valid  contract  in  writing  is  shown  to 
exist,  the  demurrer  must  be  overruled. 


REVOCATION  OF  OFFER  Oil  ACCEPTANCE. 


77 


DICKINSON  V.  DODDS. 

(2  Ch.  Div.  463.) 

Chancery  Division,  Court  of  Appeal. 
187G. 


April  1, 


On  Wednesday,  the  10th  of  June,  1874,  the 
defendant  John  Dodds  signed  and  delivered 
to  tlie  phiintiir,  (Jeorgo  Dicliinsou,  a  mem- 
orandum, of  which  the  material  part  was  as 
follows: 

"I  hereby  agree  to  sell  to  Mr.  George  Dick- 
inson the  whole  of  the  dwelling-houses,  gar- 
den ground,  stabling,  and  outbuildings  there- 
to belonging,  situate  at  Croft,  belonging  to  me, 
for  the  sum  of  £800.  As  witness  my  hand 
this  tenth  day  of  June,  1874. 

"fSOO.  [Signed]    John  Dodds." 

"P.  S.— This  offer  to  be  left  over  until  Fri- 
day, 9  o'clock  a.  m.  J.  D.  (the  twelfth),  12th 
June,  1874, 

"[Signed]  J.  Dodds." 

The  bill  alleged  that  Dodds  understood  and 
intended  that  the  plaintiff  should  have  until 
Friday,  9  a.  m.,  within  which  to  determine 
whether  he  would  or  would  not  purchase,  and 
that  he  should  absolutely  have  until  that 
time  the  refusal  of  the  property  at  the  price 
of  fSOO,  and  that  the  plaintiff  in  fact  de- 
termined to  accept  the  offer  on  the  morning 
of  Thursday,  the  11th  of  June,  but  did  not 
at  once  signify  his  acceptance  to  Dodds,  be- 
lieving that  he  had  the  power  to  accept  it  un- 
til 9  a.  m.  on  the  Friday. 

In  the  afternoon  of  the  Thursday  the  plain- 
tiff was  informed  by  a  Mr.  Berry  that  Dodds 
had  been  offering  or  agreeing  to  sell  the  prop- 
erty to  Thomas  Allan,  the  other  defendant.  ! 
Tiiereupon  the  phiintiff,  at  about  half  past  ' 
seven  in  the  evening,  went  to  the  house  of 
Mrs.  Burgess,  the  mother-in-law  of  Dodds, 
where  he  was  then  staying,  and  left  with  her 
a  formal  acceptance  in  writing  of  the  offer 
to  sell  the  property.  According  to  the  evi- 
dence of  Mrs.  Burgess  this  document  never 
in  fact  reached  Dodds,  she  having  forgotten 
to  give  it  to  him. 

On  the  following  (Friday)  morning,  at  about 
seven  o'clock.  Ben-y,  who  was  acting  as 
agent  for  Dickinson,  found  Dodds  at  the  Dar- 
lington railway  station,  and  handed  to  him  a 
duplicate  of  the  acceptance  by  Dickinson, 
and  explained  to  Dodds  its  puri)ort.  lie  re- 
plied that  it  was  too  late,  as  he  had  sold  the 
property.  A  few  minutes  later  Dickinson 
himself  found  Dodds  entering  a  railway  car- 
riage, and  handed  him  another  duplicate  of 
the  notice  of  acceptance,  but  Dodds  declined 
to  receive  it,  saying:  "You  are  too  late.  I 
have  sold  the  property." 

It  appeared  that  on  the  day  before,  Thurs- 
day, the  11th  of  June,  Dodds  had  signed  a 
formal  contract  for  the  sale  of  the  property  to 
the  defendant  Allan  for  fSOO,  and  had  re- 
ceived from  him  a  deposit  of  £40. 

The  bill  in  this  suit  prayed  that  the  de- 
fendant Dodds  might  be  decreed  specifically 


to  perform  the  contract  of  the  10th  of  June. 
1874;  that  he  miglit  be  restrained  from  con- 
veying the  prop<.'i-ty  to  Allan;  that  Allan 
might  be  restrained  from  taking  any  such 
conveyance;  that,  if  any  such  conveyance 
had  been  or  should  be  made,  Allan  might  be 
declared  a  trustee  of  the  property  for.  and 
might  be  directed  to  convey  the  property  to, 
the  plaintiff;    and  for  damages. 

The  cause  came  on  for  hearing  before  Vice 
Chancellor  BACON  on  the  25th  of  January 
1870. 

Mr.  Kay,  Q.  C,  and  Mr.  Caldecott,  for  pUiin- 
tiff. 

The  memorandum  of  the  10th  of  June,  1874, 
being  in  writing,  satisfies  the  statute  of 
frauds.  Though  signed  by  the  vendor  only, 
it  is  effectual  as  an  agreement  to  sell  the 
property. 

Supposing  it  to  have  been  an  offer  only,  an 
offer,  if  accepted  before  it  is  withdrawn,  be- 
comes, upon  acceptance,  a  binding  agreement. 
Even  if  signed  by  the  person  only  who  is 
sought  to  be  charged,  a  proposal,  if  accepted 
by  the  other  party,  is  within  the  statute. 
Reuss  V.  Picksley,  L.  R.  1  Exch.  342,  follow- 
ing Warner  v.  Willington,  3  Drew,  523. 

In  Kennedy  v.  Lee,  3  Mer.  441,  4.54,  Lord 
Eldon  states  the  law  to  be  that:  "If  a  per- 
son communicates  his  acceptance  of  an  offer 
within  a  reasonable  time  after  the  offer  being 
made,  and  if,  within  a  reasonable  time  of  the 
acceptance  being  communicated,  no  variation 
has  been  made  by  either  party  in  the  terms 
of  tlie  offer  so  made  and  accepted,  the  ac- 
ceptance must  be  taken  as  simultaneous  with 
the  offer,  and  both  together  as  constituting 
such  an  agreement  as  tue  court  wiU  execute." 
So  that,  not  only  is  a  parol  acceptance  sutfi- 
cient,  but  such  an  acceptance  relates  back  to 
the  date  of  the  offer.  This  is  further  shewn 
by  Adams  v.  Lindsell,  1  Barn.  &  Aid.  GSl, 
where  an  offer  of  sale  was  made  by  letter  to 
the  plaintiffs  "on  receiving  their  answer  in 
course  of  post."  The  letter  was  misdirected, 
and  did  not  reach  the  plaintiffs  imtil  two 
days  after  it  ought  to  have  reached  them. 
Tlie  plaintiffs,  immediately  on  receiving  the 
letter,  wrote  an  answer  accepting;  and  it 
was  held  that  they  were  entitled  to  the  bene- 
fit of  the  contract. 

The  ruling  in  Adams  v.  Lindsell,  1  Barn.  & 
Aid.  GSl,  was  appi-oved  by  the  house  of  lords 
in  Dunlop  v.  Iliggins,  1  H.  L.  Cas.  3S1.  as 
appears  from  the  judgment  of  Sir  G.  Mellish, 
L.  J.,  in  Han-is'  Case,  L.  R.  7  Ch.  587,  595; 
and  it  is  now  settled  that  a  contract  which 
can  be  accepted  by  letter  is  complete  when  a 
letter  containing  such  accept;! nee  has  been 
posted.  The  leaving  by  the  plaintiff  of  the 
notice  at  Dodds'  residence  was  equivalent  to 
the  delivery  of  a  letter  by  a  postman. 

That  Allan  is  a  necessary  party  appears 
from  Potter  v.  Sanders,  G  Hare,  1;  and  if 
Allan  has  had  a  conveyance  of  the  legal  es- 
tate, the  court  will  decree  specific  perform- 
ance against  him. 


OrrEli  AND  ACCEPTANCE. 


Mr.  Swanston,  Q.  C,  aud  Mr.  Crosslcy,  for 
defendant  Dodds. 

The  bill  puts  the  case  no  higher  than  that  of 
an  offer.  Taking  the  memorandum  of  the 
10th  of  June,  1S74.  as  an  offer  only,  it  is  well 
established  that,  until  acceptance,  either  par- 
ty may  retract.  Cooke  v.  Oxley,  3  Term  R. 
653;  Beuj.  Sales  (2d  Ed.)  p.  52. 

After  Dodds  had  retracted  by  selling  to  Al- 
lan, the  offer  was  no  longer  open.  Having  an 
option  to  retract,  he  exercised  that  option. 
Humphries  v.  Carvalho,  16  East,  45;  Pol. 
Cout.  p.  S;   Routledge  v.  Grant,  4  Bing.  G53, 

In  delivering  judgment  in  Martin  v.  Mitch- 
ell. 2  Jac.  &  W.  413,  Sir  T.  Plumer,  M.  R.,  put 
the  case  of  a  contract  signed  by  one  party 
only.  He  asked  (page  42S),  "What  mutuality 
is  there,  if  the  one  is  at  liberty  to  renounce 
the  contract,  and  the  other  not?"  And  in 
Meyuell  v.  Surtees.  1  Jur.  (N.  S.)  737,  the  dis- 
tinctions between  an  offer  and  an  agreement 
in  respect  of  binding  land  were  pointed  out. 
Fry,  Spec.  Perf.  p.  80. 

The  postserip^^  being  merely  voluntary,  with- 
out consideration,  is  nudum  pactum;  and  the 
memorandum  may  be  read  a^  if  it  contained 
no  postscript. 

Mr.  .Jackson,  Q.  C,  and  Mr.  Gazdar,  for  de- 
fendant Allan. 

Allan  is  an  unnecessary  party.  If  Dodds 
has  not  made  a  valid  contract  with  the  plain- 
tiff, he  is  a  trustee  for  Allan;  if  Dodds  has 
made  a  binding  contract,  rights  arise  be- 
tween Allan  and  Dodds  which  are  not  now  in 
controversy. 

We  agree  with  the  co-defendant  that,  in 
order  that  the  plaintiff  may  have  a  locus 
standi,  there  must  have  been  a  contract.  If 
the  postscript  is  a  modification  of  the  offer, 
it  is  nudum  pactum,  and  may  be  rejected. 

It  may  be  conceded  that  if  there  had  been 
an  acceptance,  it  would  have  related  back  in 
point  of  date  to  the  offer.  But  there  was  no 
acceptance.  Notice  of  acceptance  sem^ed  on 
Mrs.  Burgess  was  not  enough. 

Even  if  it  would  have  been  otherwise  suf- 
ficient, here  it  was  too  late.  Dodds  had  no 
property  left  to  contract  for.  The  property 
had  ceased  to  be  his.  He  had  retracted  his 
offer;  and  the  property  had  become  vested  iu 
some  one  else.    Hebb's  Case,  L.  R.  4  Eq.  9,  12. 

The  plaintiff  would  not  have  delivered  the 
no'tice  if  he  had  not  heard  of  the  negotiation 
between  Dodds  and  Allan.  What  retracta- 
tion could  be  more  effectual  than  a  sale  of  the 
property  to  some  one  else? 

The  defendant  Allan  was  a  bona  fide  pur- 
chaser without  notice. 

Mr.  Kay,  in  reply. 

The  true  meaning  of  the  document  was  a 
sale.  The  expression  is  not  "open,"  but 
"over."  The  only  liberty  to  be  allowed  by 
that  was  a  liberty  for  the  plaintiff  to  reti'act. 

But,  taking  it  as  an  offer,  the  meaning  was 
that  at  any  day  or  hour  within  the  intoiTal 
named  the  plaintiff  had  a  right  to  indicate  to 


the  defendant  his  acceptance,  and  from  that 
moment  the  defendant  would  have  had  no 
i'ight  of  retractation.  Then  was  there  a  re- 
tractation before  acceptance?  To  be  a  retrac- 
tation, there  must  be  a  notification  to  the  oth- 
er party.  A  pure  resolve  within  the  recesses 
of  the  vendor's  own  mind  is  not  sufficient. 
There  was  no  communication  to  the  plaintiff'. 
He  accepted  on  two  several  occasions.  There 
could  have  been  no  parting  with  the  property 
without  conmaunciation  with  him.  He  was 
told  that  the  offer  was  to  be  left  over. 

The  groimds  of  the  decision  in  Cooke  v. 
Oxley,  3  Term  R.  653,  have  been  abimdantly 
explained  by  ^Ir.  Benjamin  in  his  work  on 
Sales.  It  was  decided  simply  on  a  point  of 
pleading. 

BACON,  V.  C,  after  remarking  that  the 
case  involved  no  question  of  unfairness  or 
inequality,  and  after  stating  the  terms  of  the 
document  of  the  10th  of  Jime,  1874,  and  the 
statement  of  the  defendant's  case  as  given 
in  his  answer,  continued: 

I  consider  that  to  be  one  agreement,  and  1 
think  the  terms  of  the  agreement  put  an  end 
to  any  question  of  nudum  pactum.  I  think 
the  inducement  for  the  plaintiff  to  enter  into 
the  conti-act  was  the  defendant's  compliance 
with  the  plaintiffs  request  that  there  should 
be  some  time  allowed  to  him  to  determine 
whether  he  would  accept  it  or  not.  But 
whether  the  letter  is  read  with  or  without  the 
postscript,  it  is,  in  my  judgment,  as  plain  and 
clear  a  contract  for  sale  as  can  be  expressed 
in  words,  one  of  the  terms  of  that  contract 
being  that  the  plaintiff  shall  not  be  called 
upon  to  accept  or  to  testify  his  acceptance, 
matil  9  o'clock  on  the  morning  of  the  12th  of 
June.  I  see,  therefore,  no  reason  why  the 
court  should  not  euforc-e  the  specific  perform- 
ance of  the  contract,  if  it  finds  that  all  the 
conditions  have  been  complied  with. 

Then,  what  are  the  facts?  It  is  clear  that 
a  plain,  explicit  acceptance  of  the  conti'act 
was,  on  Thursday,  the  11th  of  June,  delivered 
by  the  plaintiff  at  the  place  of  abode  of  the 
defendant,  and  ought  to  have  come  to  his 
hands.  Whether  it  came  to  his  hands  or  not. 
the  fact  remains  that,  within  the  time  limit- 
ed, the  plaintiff  did  accept  and  testify  his  ac- 
ceptance. From  that  moment,  the  plaintiff 
was  bound,  aud  the  defendant  could  at  any 
time,  notwithstanding  Allan,  have  filed  a  bill 
against  the  plaintiff  for  the  specific  per- 
formance of  the  contract  which  he  had  en- 
tered into,  and  which  the  defendant  had  ac- 
cepted. 

I  am  at  a  loss  to  guess  upon  what  ground 
it  can  be  said  that  it  is  not  a  contract  which 
the  court  will  enforce.  It  cannot  be  on  the 
ground  that  the  defendant  had  entered  into 
a  contract  with  Allan,  because,  giving  to  the 
defendant  all  the  latitude  which  can  be  de- 
sired, admitting  that  he  had  the  same  time 
to  change  his  mind  as  he,  by  the  agreement, 
gave  to  the  plaintiff,  the  law,  I  take  it,  is 
clear  on  the  authorities,   that  if  a   contract, 


REVOCATION  OF  OFFER  OR  ACCEPTANCE. 


79 


unilateral  in  its  shape,  is  completed  by  the 
acceptauee  of  the  party  on  the  other  side, 
It  becomes  a  perfect  valid  and  binding  con- 
tract. It  may  be  withdrawn  from  by  one  of 
the  parties  iu  the  meantime,  but,  in  order 
to  be  withdrawn  from,  information  of  thai 
fact  must  be  conveyed  to  the  mind  of  the  per- 
son who  is  to  be  affected  by  it.  It  will  not 
do  for  the  defendant  to  say:  "I  njade  up  my 
mind  that  I  would  withdraw,  but  I  did  not 
tell  the  plaintiff.  I  did  not  say  anything  to 
the  plaintiff  until  after  he  had  told  me  by  a 
written  notice  and  with  a  loud  voice  that  he 
accepted  the  option  which  had  been  left  to 
him  by  the  agreement."  In  my  opinion,  after 
that  liour  on  Friday,  earlier  than  9  o'clock, 
when  the  plaintiff  and  defendant  met,  if  not 
before,  the  contract  was  completed,  and  nei- 
ther party  would  retire  from  it. 

It  is  said  that  the  authorities  justify  the  de- 
fendimt's  contention  that  he  is  not  bound  to 
lx?rform  this  agreement,  and  the  case  of 
Cooke  V.  Oxley,  3  Term  R.  G53,  was  referred 
to.  But  I  find  that  the  judgment  in  Cooke 
V.  Oxley  went  solely  upon  the  pleadings.  It 
was  a  rule  to  shew  cause  why  judgment 
should  not  be  arrested,  therefore  it  must  have 
been  upon  the  pleadings.  Now,  the  plead- 
ings were  tliat  the  vendor  in  that  case  pro- 
posed to  sell  to  the  defendant.  There  was 
no  suggestion  of  any  agreement  which  could 
be  enforced.  The  defendant  proposed  to  the 
plaintiff  to  sell  and  deliver,  if  the  plaintiff 
would  agree  to  purchase  upon  the  terms  of- 
fered, and  give  notice  at  an  earUer  hour  tlian 
4  of  the  afternoon  of  that  day;  and  the  plain- 
tiff says  he  agreed  to  purchase,  but  does 
not  say  the  defendant  agreed  to  sell.  He 
agreed  to  purchase,  and  gave  notice  before 
4  o'clock  in  the  afternoon.  Although  the  case 
is  not  so  clearly  and  satisfactorily  reported 
as  might  be  desired,  it  is  only  necessary  to 
ri'ad  the  judgment  to  see  that  it  proceeds 
solely  upon  this  allegation  in  the*  pleadings. 
Mr.  Justice  Buller  saj-s:  "As  to  the  subse- 
quent time,  the  promise  can  only  be  supported 
upon  the  ground  of  a  new  contract  made  at 
4  o'clock;  but  there  was  no  pretense  for  that." 
Nor  was  there  the  slightest  allegation  in  the 
pleadings  for  tliat;  and  judgment  was  given 
agjiinst  the  plaintiff. 

Routlcdge  v.Grant,4  Bing.653, is. plainly  dis- 
tinguishable from  this  case  upon  the  grounds 
which  liave  been  mentioned.  There  the  con- 
tract was  to  sell  on  certain  terms;  possession 
to  be  given  upon  a  particular  day.  Those 
terms  were  varied,  and  therefore  no  agree- 
ment was  come  to;  aud  when  the  intended 
purchaser  was  willing  to  relinquish  the  con- 
dition which  he  imposed,  the  other  said:  "No; 
I  withdiaw.  I  have  made  up  my  mind  not 
to  sell  to  you;"  and  the  judgment  of  the 
court  was  that  he  was  perfectly  right. 

Then  Warner  v.  Wellington,  3  Drew.  523, 
seems  to  point  out  the  law  in  the  clearest 
and  most  distinct  manner  possible.  An  offer 
was  made,— call  it  an  agreement  or  offer,  it 
is  quite  indififerent;    it  was  so   far  an  offer, 


that  It  was  not  to  be  binding  unless  there 
was  an  acceptiiuce,— and  before  acceptance 
was  made,  the  offer  was  retracted,  the  agree- 
ment was  rescinded,  and  the  person  who  had 
then  the  character  of  vendor  declined  to  go 
further  with  the  arrangement,  which  had 
been  begim  by  what  had  passed  between 
them.  In  the  i)resent  case  I  read  the  agi-ee- 
ment  as  a  positive  engagement  on  the  part  of 
the  defendant  Dodds  that  he  will  sell  for  £800, 
and,  not  a  promise,  but  an  agreement,  part  of 
the  same  instrument,  that  the  plaintiff  shall  not 
be  called  upon  to  express  his  acquie.scence  in 
that  agreement  until  Fridiiy  at  U  o'clock.  Before 
Friday  at  9  o'clock  the  defendant  receives  no- 
tice of  acceptance.  Upon  what  ground  can  the 
defendant  now  be  let  off  his  contract?  It  is 
said  that  Allan  can  sustain  his  agreement 
with  the  defendant,  because  at  the  time  they 
entered  into  the  contract  the  defendant  was 
possessed  of  the  property,  and  the  plaintiff 
had  notliing  to  do  with  it.  But  it  would  be 
opening  the  door  to  fraud  of  the  most  flagrant 
description  if  it  was  permitted  to  a  defendant, 
the  owner  of  property,  to  enter  into  a  bind- 
ing contract  to  sell,  and  then  sell  it  to  som'e- 
body  else  and  say  that  by  the  fact  of  such 
second  sale  he. has  deprived  him.'self  of  the 
property  which  he  has  agreed  to  sell  by  the 
first  contract  That  is  what  Allan  says  in  sub- 
stance, for  he  says  that  the  sale  to  him  was 
a  retractation  which  deprived  Dodds  of  the 
equitable  interest  he  had  in  the  propertj-,  al- 
though the  legal  estate  remained  in  him.  But 
by  the  fact  of  the  agreement,  and  by  the  re- 
lation back  of  the  acceptance  (for  such  I  must 
hold  to  be  the  law)  to  the  date  of  the  agree- 
ment, the  property  in  equity  was  the  property 
of  the  plaintiff,  and  Dodds  had  nothing  to  sell 
to  Allan.  The  property  remained  intact  un- 
affected by  any  contract  with  Allan,  and  there 
is  no  ground,  in  my  opinion,  for  the  contention 
that  the  contract  with  Allan  can  be  support- 
ed. It  would  be  doing  violence  to  principles 
perfectly  well  known  and  often  acted  upon 
in  this  com-t.  I  think  the  plaintiff  has  made 
out  very  satisfactorily  his  title  to  a  decree 
for  specific  performance,  both  as  having  the 
equitable  interest,  which  he  asserts  is  vested 
in  him,  and  as  being  a  purchaser  of  the  prop- 
erty for  valuable  consideration  without  no- 
tice against  both  Dodds,  the  vendor,  aud  Al- 
lan, who  has  entered  into  the  contract  with 
him. 

There  will  be  a  decree  for  specific  perform- 
ance, with  a  declaration  that  Allan  has  no 
interest  in  the  property;  and  the  plaintiff  will 
be  at  liberty  to  deduct  his  costs  of  the  suit 
out  of  his  purchase-money. 

From  this  decision  both  the  defendants  ap- 
pealed, and  the  appeals  were  heard  on  the 
31st  of  March  aud  the  1st  of  April,  1S76. 

JAMES,  L.  J.,  after  referring  to  the  docu- 
ment of  the  10th  of  June,  1ST4,  continued: 

The  doi.'umeut,  though  beginning  "I  here- 
by agree  to  sell,"  was  nothing  but  an  offer. 


80 


OFFER  AND  ACCEPTANCE. 


and  was  only  intended  to  be  an  offer,  for  the 
plaintiff  himself  tells  us  that  he  required 
time  to  consider  whether  he  would  enter 
into  an  a^eement  or  not.  Unless  both  par- 
ties had  then  agreed,  there  was  no  con- 
cluded agreement  then  made;  it  was  in  ef- 
fect and  substance  only  an  offer  to  sell  The 
plaintiff,  being  minded  not  to  complete  the 
bargain  at  that  time,  added  this  memoran- 
dum: "This  offer  to  be  left  over  until  Fri- 
day, 9  o'clock  a.  m.  12th  June,  1874."  That 
shows  it  was  only  an  offer.  There  was  no 
consideration  given  for  the  undertaliing  or 
promise,  to  whatever  extent  It  may  be  con- 
sidered binding,  to  keep  the  property  un- 
sold until  9  o'clock  on  Friday  morning;  but 
apparently  Dickinson  was  of  opinion,  and 
probably  Dodds  was  of  the  same  opinion, 
that  he  (Dodds)  was  bound  by  that  promise, 
and  could  not  in  any  way  withdraw  from  it, 
or  retract  it,  until  9  o'clock  on  Friday  morn- 
ing, and  this  probably  explains  a  good  deal 
of  what  afterwards  took  place.  But  it  is 
clear  settled  law,  on  one  of  the  clearest  prin- 
ciples of  law,  that  this  promise,  being  a 
mere  nudum  pactum,  was  not  binding,  and 
that  at  any  moment  before  a  complete  ac- 
ceptance by  Dickinson  of  the  offer,  Dodds 
was  as  free  as  Dickinson  himself.  Well, 
that  being  the  state  of  things,  it  is  said  that 
the  onlj-  mode  in  which  Dodds  could  assert 
that  freedom  was  by  actually  and  distinctly 
saying  to  Dickinson,  "Now  I  withdi'aw  my 
offer."  It  appears  to  me  that  there  is  nei- 
ther principle  nor  authority  for  the  propo- 
sition that  there  must  be  an  express  and  ac- 
tual withdrawal  of  the  offer,  or  what  is 
called  a  retractation.  It  must,  to  constitute  a 
contract,  appoar  that  the  two  minds  were  at 
one,  at  the  same  moment  of  time,  that  is, 
that  there  was  an  offer  contmuing  up  to  the 
time  of  the  acceptance.  If  there  was  not 
such  a  continuing  offer,  then  the  acceptance 
comes  to  nothing.  Of  course  it  may  well  be 
that  the  one  man  is  bound  in  some  way  or 
other  to  let  the  other  man  know  that  his 
mind  with  regard  to  the  offer  has  been 
changed;  but  in  this  case,  beyond  all  ques- 
tion, the  plaintiff  knew  that  Dodds  was  no 
longer  minded  to  sell  the  property  to  him 
as  plainly  and  clearly  as  if  Dodds  had  told 
him  in  so  many  words,  "I  withdraw  the  of- 
fer." This  is  evident  from  the  plaintiff's 
own  statements  in  the  bill. 

The  plaintiff  says  in  effect  that,  having 
heard  and  knowing  that  Dodds  was  no  lon- 
ger minded  to  sell  to  him,  and  that  he  was 
selling  or  had  sold  to  some  one  else,  think- 
ing that  he  could  not  in  point  of  law  with- 
drav/  his  offer,  meaning  to  fix  him  to  it,  and 
endeavoring  to  bind  him:  "I  went  to  the 
house  where  he  was  lodging,  and  saw  his 
mother-in-law,  and  left  with  her  an  accept- 
ance of  the  offer,  knowing  all  the  while  that 
he  had  entirely  changed  his  mind.  I  got  an 
agent  to  watch  for  him  at  7  o'clock  the  next 
morning,  and  I  went  to  the  train  ju-st  before 
9  o'clock,  in  order  that  I  might  catch  him 


and  give  him  my  notice  of  acceptance  just 
before  9  o'clock,  and  when  that  occurred 
he  told  my  agent,  and  he  told  me,  'You  are 
too  late,'  and  he  then  threw  back  the  pa- 
per." It  is  to  my  mind  quite  clear  that  be- 
fore there  was  any  attempt  at  acceptance  by 
the  plaintiff,  he  was  perfectly  well  aware 
that  Dodds  had  changed  his  mind,  and  that 
he  had  in  fact  agreed  to  sell  the  property  to 
Allan.  It  is  impossible,  therefore,  to  say 
there  was  ever  that  existence  of  the  same 
mind  between  the  two  parties  which  is  es- 
sential in  point  of  law  to  the  making  of  an 
agreement.  I  am  of  opinion,  therefore,  that 
the  plaintiff  has  failed  to  prove  that  there 
was  any  binding  contract  between  Dodds 
and  himself, 

MELLISH,  L.  J.  I  am  of  the  same  opin- 
ion. The  fii-st  question  is,  whether  this  doc- 
ument of  the  10th  of  June,  1874,  which  was 
signed  by  Dodds,  was  an  agreement  to  sell, 
or  only  an  offer  to  sell,  the  property  therein 
mentioned  to  Dickinson;  and  I  am  clearly 
of  opinion  that  it  was  only  an  offer,  although 
it  is  in  the  first  part  of  it,  independently  of 
the  postscript,  worded  as  an  agreement.  I 
apprehend  that,  until  acceptance,  so  that 
both  parties  are  bound,  even  though  an  in- 
strument is  so  worded  as  to  express  that 
both  parties  agree,  it  is  in  point  of  law  only 
an  offer,  and,  until  both  parties  are  bound, 
neither  party  is  bound.  It  is  not  necessary 
that  both  parties  should  be  boimd  within  the 
statute  of  frauds,  for,  if  one  pax-ty  makes  an 
offer  in  writing,  and  the  other  accepts  it 
verbally,  that  will  be  suflBcient  to  bind  the 
person  who  has  signed  the  written  docu- 
ment. But,  if  there  be  no  agreement,  either 
verbally  or  in  writing,  then,  until  acceptance, 
it  is  in  point  of  law  an  offer  only,  altogether 
worded  as  if  it  were  an  agreement.  But  it 
is  hardly  necessary  to  resort  to  that  doc- 
trine in  the  present  case,  because  the  post- 
script calls  it  an  offer,  and  says,  "This  of- 
fer to  be  left  over  until  Friday,  9  o'clock 
a.  m."  Well,  then,  this  being  only  an  offer, 
and  the  law  says— and  it  is  a  perfectly  clear 
rule  of  law — that,  although  it  is  said  that 
the  offer  is  to  be  left  open  until  Friday  morn- 
ing at  9  o'clock,  that  did  not  bind  Dodds. 
He  was  not  in  point  of  law  bound  to  hold 
the  offer  over  until  9  o'clock  on  Friday  morn- 
ing. He  was  not  so  bound  either  in  law  or 
in  equity.  Well,  that  being  so,  when  on  the 
next  day  he  made  an  agreement  with  Al- 
lan to  sell  the  property  to  him,  I  am  not 
aware  of  any  ground  on  which  it  can  be  said 
that  that  contract  with  Allan  was  not  as 
good  and  binding  a  contract  as  ever  was 
made.  Assuming  Allan  to  have  known 
(there  is  some  dispute  about  it,  and  Allan 
does  not  admit  that  he  knew  of  it,  but  I  will 
assume  that  he  did)  that  Dodds  had  made 
the  offer  to  Dickinson,  and  had  given  him 
till  Friday  morning  at  9  o'clock  to  accept 
it,  still  in  point  of  law  that  could  not  pre- 
vent Allan  from  making  a  more  favorable 


REVOCATION  OF  OFFER  OR  ACCEPTANCE. 


81 


offer  than  Dickinson,  and  entorini?  at  once 
into  a  binding  agreement  with  Dodds. 

Then  Dieliinson  is  infonned  by  Berry  that 
the  property  has  been  sold  by  Dodds  to  Al- 
lan. Berry  does  not  tell  us  from  whom  he 
hoard  it,  but  he  says  that  he  did  hoar  it, 
that  he  knew  it,  and  that  he  informed  Dick- 
inson of  it.  Now,  stopping  there,  the  ques- 
tion wJiich  arises  is  this:  If  an  offer  has 
been  made  for  the  sale  of  property,  and  be- 
fore that  offer  is  accepted  the  person  who 
has  made  the  offer  enters  into  a  binding 
agreement  to  sell  the  property  to  somebody 
olse.  and  the  person  to  whom  the  offer  was 
lirst  made  receives  notice  in  s<Jine  way  that 
the  property  has  been  sold  to  another  per- 
son, can  he  after  that  make  a  binding  con- 
tract by  the  acceptance  of  the  offer?  I  am 
of  opinion  that  he  cannot.  The  law  may  be 
right  or  wrong  in  saying  that  a  person  who 
lias  given  to  another  a  certain  time  within 
which  to  accept  an  offer  is  not  bound  by 
his  promise  to  give  that  time;  but,  if  he 
is  not  boxmd  by  that  promise,  and  may  still 
sell  the  property  to  some  one  else,  and  if  it 
be  the  law  that,  in  order  to  make  a  contract, 
the  two  minds  must  be  in  agreement  at 
pome  one  time,  that  is,  at  the  time  of  the 
acceptance,  how  is  it  possible  that  when  the 
person  to  whom  the  offer  has  been  made 
knows  that  the  person  who  has  made  the 
offer  has  sold  the  property  to  some  one  else, 
and  that,  in  fact,  he  has  not  remained  in  tlie 
same  mind  to  sell  it  to  him,  lie  can  be  at 
liberty  to  accept  the  offer  and  thereby  make 
a  binding  contrnct?  It  seems  to  me  that 
Avould  be  simply  absurd.  If  a  man  makes  an 
offer  to  sell  a  particular  horse  in  his  stable, 
and  says,  "I  will  give  you  until  the  day 
after  to-morrow  to  accept  the  offer."  and 
the  next  day  goes  and  sells  the  horse  to 
somebody  else,  and  receives  the  purchase 
money  from  him,  can  the  person  to  whom 
the  offer  was  originally  made  then  come 
and  say,  "I  accept,"  so  as  to  make  a  bind- 
ing contract,  and  so  as  to  be  entitled  to  re- 
cover damages  for  the  non-delivery  of  the 
horse?  If  the  rule  of  law  is  that  a  mere 
offer  to   sell  property,   which   can  be   with- 

nOPK.SEL.CAS.CONT. — 6 


drawn  at  any  time,  and  which  is  made  de- 
p'ndeut  on  the  acceptance  of  the  person  to 
whom  it  is  made,  is  a  mere  nudum  ijac- 
turu.  how  is  it  possible  that  the  person  to 
whom  the  offer  has  been  made  can  by  ac- 
ceptance niake  a  binding  contract  after  he 
knows  that  the  person  who  has  made  the 
offer  has  sold  the  property  to  some  one 
else?  It  is  admitted  law  that.  If  a  man  who 
makes  an  offer  dies,  the  offer  cannot  be 
accepted  after  he  is  dead;  and  parting  with 
the  property  has  very  much  the  same  effect 
as  the  death  of  the  owner,  for  it  makes  the 
performance  of  the  offer  impossible.  I  am 
clearly  of  opinion  that,  just  as  when  a  man 
who  has  made  an  offer  dies  before  it  is  ac- 
cepted it  is  impossible  that  it  can  then  be 
accepted,  so  when  once  the  person  to  whom 
the  offer  was  made  knows  that  the  property 
has  been  sold  to  some  one  else,  it  is  too  late 
for  him  to  accept  the  offer,  and  on  that 
ground  I  am  clearly  of  opinion  that  there 
was  no  binding  contract  for  the  sale  of  this 
property  by  Dodds  to  Dickinson;  and,  even 
if  there  had  been,  it  seems  to  me  that  the 
sale  of  the  property  to  Allan  was  first  in 
point  of  time.  However,  it  is  not  necessary 
to  consider,  if  there  had  been  two  binding 
contracts,  which  of  them  would  be  entitled 
to  priority  in  equity,  because  there  is  no 
binding  contract  between  Dodds  and  Dick- 
inson. 

BAG  GALL  AY,  J.  A.  I  entirely  concur  in 
the  judgments  which  have  been  pronounced. 

JAMES.  L.  J.  The  bill  will  be  dismissed, 
with  costs. 

Swanston.  Q.  C.  We  shall  have  the  costs 
of  the  appeal. 

Kay,  Q.  C.  There  should  only  be  the  costs 
of  one  appeal. 

Sir  H,  Jackson,  Q.  C.  The  defendant  Al- 
lan was  obliged  to  protect  himself. 

MELLTSII.  L.  J.  He  had  a  separate  case. 
There  might,  if  two  contracts  had  been  ptx»v- 
ed,  have  been  a  question  of  priority. 

JAMES.  L. 'J.  I  think  the  plaintiff  must 
pay  the  costs  of  both  appeals. 


'TX  ^^  IDE  V.  LEISER. 

\^j  (24  Pac.  G95,  10  Mout.  5.) 

Supreme  (Dourt  of  Montana.     July  23,  1890. 

Appeal  from  district  court,  Lewis  and 
Clarke  county;   \Yii.li.\m  H.  Hunt,  Jud^e. 

Tlie plaintiff  pleads  the  following  instru- 
ment in  writing  :  "For  and  in  considera- 
tion of  one  dollar  ($1.00)  to  me  in  hand 
paid,  I  hereby  agree  to  give  Frank  L.  Ida 
the  sole  right  and  option  to  purchase 
from  me  at  any  time  within  ten  days 
from  the  date  of  this  insti'ument  the  fol- 
lowing described  property,  to-wit,  [de- 
scribing the  property'.]  I  furthermore 
agree  to  furnish  a  good  and  sufficient 
deed  of  ccmveyance  of  said  property,  and 
of  the  whole  thereof.  The  price  of  said 
property  to  be  one  thousand  dollars, 
($1,000.)  Helena,  Montana,  September  24, 
ISsy.  J.J.  Leisek."  "1  hereby  extend  the 
above  option  for  a  period  of  ten  days  from 
this  date.  Helena,  Oct.  3rd,  18S9.  J.  J.  Lei- 
sek." The  complaint  further  sets  forth 
that  on  October  11,  1SS9,  the  plaintiff  ten- 
dered defendant  fl,O0O.  and  demanded  a 
conveyance  of  the  property.  That  de- 
fendant refused  to  give  the  conveyance 
and  still  refuses.  That  i)laintiff  is  still 
willing  to  pay  said  $1,000.  Plaintiff  de- 
mands judgment  that  defendant  make 
conveyance  to  him  of  the  real  estate  de- 
scribed. The  defendant  demurred  to  the 
complaint  on  the  ground  that  it  did  not 
set  forth  facts  sufficient  to  constitute 
a  cause  of  action.  Demurrer  was  sustained, 
and  judgment  entered  for  the  defendant. 
Plaintiff  appeals  from  the  judgment.  The 
question  raised  by  the  record,  and  dis- 
cussed by  counsel,  is  whether  the  instru- 
ment in  writing  pleaded,  and  the  tender 
of  $1,000  by  plaintiff  to  defendant,  October 
11,  ls>59,  are  sufficient  to  entitle  plaintiff  to 
a  conveyance  as  demanded.  No  tender  of 
money  or  demand  for  a  deed  was  made 
during  the  10  days  limited  in  the  original 
instrument;  but  were  made  during  the 
period  defined  in  the  extension  indorsed  on 
the  instrument. 

A.  C.  Botkin,  for  appellant.  McCutebeon 
&  Mclntire,  for  respondent. 

DE  WITT,  J.,  (after  stating  the  facts  a« 
above.)  For  convenience  of  terms  we  will 
designate  the  oi'iginal  document  pleaded  as 
the  first  instrument, and  the  option  therein 
as  the  first  option, and  the  indorsement  ex- 
tending the  time  as  the  second  instrument 
and  option.  We  will  not  discuss  the  validity 
of  the  first  instrument  as  a  foundation  for 
an  action  for  specific  performance.  We  will 
assume,  for  the  purpose  of  this  decision, 
that  it  is  good.  The  option  assumed  to 
be  granted  therein  was  not  exercised  with- 
in the  time  limited,  and  expired  October  4. 
The  consideration  for  this  option  was  one 
dollar,  whether  paid  b.y  Ide  to  Leiser,  or 
still  a  debt  owing  from  Ide  to  Leiser,  is 
immaterial.  That  consideration  was  ex- 
hausted by  the  expiration  of  the  option  on 
October  4.  Ide  paid  his  money,  the  one 
dollar,  and  received  his  g(H")ds,  tiie  option. 
Leiser  took  the  one  dollar,  and  deliveied 
a  consideration  therefor,  viz.,  the  option. 
The  transaction  was  complete,  and  the 
terms  performed  by  each  party  to  the 
agreement. 


OFFER  AND  ACCEPTAXCE. 


We  come  to  the  second  instrument  :ind 
option.  No  consideration  is  named  there- 
in, specifically  or  by  reference.  The  con- 
sideration for  the  first  option  cannot  do 
service  for  the  second.  That  considera- 
tion was  functus  officio  in  the  first  instru- 
ment. A  consideration  determined  by  the 
parties  to  be  the  consideration  for  the  sale 
of  one  article  on  one  day,  and  so  declared 
in  writing,  cannot,  in  the  face  of  such  de- 
claration, be  construed  by  the  court  as  a 
declaration  for  the  sale  of  another  article 
on  another  day.  The  first  10  days'  oi)tion 
was  a  thingof  value,  and  paid  for  as  such. 
The  second  was  another  separate  valuable 
article.  Was  there  any  consideration  for 
its  sale?  We  believe  the  same  definitions 
and  distinctions  will  aid  this  discussion. 
There  may  be  (1)  a  sale  of  lands;  (2)  an 
agreement  to  sell  lands;  and  (3)  what  is 
popularly  called  an  "option."  The  first  is 
the  actual  transferor  title  from  grantor  to 
grantee  by  appropriate  instrument  of  con- 
veyance. The  second  is  a  contract  to  be 
performed  in  the  future,  and  if  fulfilled  re- 
sults in  a  sale.  It  is  a  preliminary  to  a 
sale,  and  is  not  the  sale.  Breaches,  rescis- 
sion, or  release  maj-^  occur  by  which  the 
(Contemplated  sale  never  takes  place. 
The  third,  an  option  originally,  is  neither 
a  sale  nor  an  agreement  to  sell.  It  is 
simply  a  contract  by  which  the  owner  of 
property  (real  estate  being  the  species  we 
are  now  discussing)  agrees  with  another 
person  that  he  shall  have  the  right  to  buy 
his  property,  at  a  fixed  price, within  a  time 
certain.  He  does  not  sell  his  land  ;  he  does 
not  then  agree  to  sell  it;  but  he  does 
then  sell  something,  viz.,  the  right  or 
privilege  to  buy  at  the  election  or  option 
of  the  other  party.  The  second  party 
gets,  in  pr^senii,  not  lands,  or  an  agree- 
ment that  he  shall  have  lands,  but  he  does 
get  something  of  value;  that  is,  the  right 
to  call  for  and  receive  lands  if  he  elects. 
The  owner  parts  with  his  right  to  sell  his 
lands,  except  to  the  second  party,  for  a 
limited  period.  The  second  party  receives 
this  right,  or  rather,  from  his  point  of 
view,  he  receives  the  right  to  elect  to  buy. 
That  which  the  uecond  party  receives  is 
of  value,  and  in  times  of  rapid  inflations 
of  prices,  perhaps  of  great  value.  A  con- 
tract must  be  supported  by  a  considera- 
tion, whether  it  be  the  actual  sale  oi 
lands,  an  agreement  to  sell  lands,  or  the 
actual  sale  of  the  right  to  demand  the 
conveyance  of  lands.  A  present  convey- 
ance of  lands  is  an  executed  contract.  An 
agreement  to  sell  is  an  executory  contract. 
The  sale  of  an  option  is  an  executed  con- 
tract; that  is  to  say,  the  lands  are  not 
sold;  the  contract  is  not  executed  as  to 
them;  but  the  option  is  as  completely 
sold  and  transferred  in  pnesenti  as  a  piece 
of  personal  property  instantly  delivered 
on  payment  of  the  price.  Now  this  op- 
tion, this  article  (if  value  and  of  commerce, 
must  have  a  consideration  to  support  its 
sale.  As  it  is  distinct  from  a  sale  of  lands, 
or  an  agreement  to  sell  lands,  so  its  con- 
sidei-ation  must  be  distinct;  although,  if 
a  sale  of  the  lands  afterwards  follows  the 
option,  the  consideration  for  the  option 
may  be  agreed  to  be  applied,  and  often  is, 
as  apart  payment  on  the  price  of  the  land. 
But   there  must    be    some  consideration 


IIEVOCATIOX  OF  OFFER  OR  ACCEPTANCE. 


83 


upon  which  the  finger  may  be  placed,  and 
of  whicli  it  may  be  saicl,  "This  was  f?ivqn 
by  tlie  proposed  vendee  to  the  proposed 
vtMulor  of  the  lands  as  the  iirice  for  liie 
option,  or  privilege  to  ])nrehase. "  We 
have  been  led  into  this  endeavor  to  make 
clear  our  views  of  these  distinctions,  l)e- 
cause,  in  the  argument,  counsel  did  not 
seem  to  give  them  »s  much  weight  as  they 
seem  to  us  to  demand.  We  refer  to  the 
following  authorities:  Gordon  v.  Darnell, 
5Colo.  ;!tJL';  Bradford  v.  Foster,  87  Tenn. 
4,  0  S.  \V.  Kep.  11).');  Railroad  Co.  v.  Bart- 
lett,  3  Cush.  224;  Bean  v.  Burbank,  16  Me. 
45S;  De  Rutte  v.  Muldrovv,  ]6  Cal.  fjO."); 
Johnston  v.  Trippe,  ;13  Fed.  Rep.  5:10; 
Thomason  v.  Dill,  :K)  Ala.  444;  Mers  v.  In- 
surance Co.,  6s  Mo,  ll!7;  Thorne  v.  Deas, 
4  .Johns.  H4;  Burnet  v.  Biscoe,  Id.  li^.j; 
Lees  v.  Whitoomb,  o  Bing.  'M;  Bish.  Cout. 
§<^  77,78;  McDonald  v.  ]5eAvick,  51  Mich. 
7'J,  16  N.  \V.  Rep.  240;  Schroeder  v.  Ge- 
meinder,  10Nev.o.")6;  Woodruff  v.  Woodruff, 
44  N.  J.  Kq.  055,  IB  Atl.  Rep.  4;  Perkins  v. 
Hadsell,  50  111.  216;  AVat.  Sj-ec   Perf.  §  200. 

Examine  the  two  options  granted  in  the 
case  before  us.  L.  sold  I.  an  option  for  10 
days  from  September  24th  for  one  dollar. 
He'  then  gives  an  option  for  another  10 
days  from  October  3d,  for  what?  For 
noVliing.  L.  transfers  this  option,  this  in- 
corporeal valuable  something,  for  noth- 
ing. The  transfer  of  the  option  was  nu- 
dum pactum,  and  void.  But.  the  point 
jnst  discussed  being  conceded,  ai)pellant 
still  contends  that  this  second  instrument 
ov  option  was  a  continuing  offer  to  sell, 
at  a  given  price,  and  was  accepted  by  re- 
spondent before  retracted,  and  that  such 
acceptance,  evidenced  by,  and  accompanied 
with,  the  tender  of  the  price,  and  demand 
for  a  deed,  constitute  an  agreement  to  sell 
land,  which  n^ay  be  enforced  in  equity. 
We  leave  behind  now  our  views  of  op- 
tions, and  consideration  therefor,  and 
meet  a  wholly  different  proposition. 

Reading  the  two  instruments  together 
we  find  that  on  October  3d  L.  extended  to 
I.  an  offer  to  sell  his  lands  at  the  price  of 
.i!!l,000.  There  was  no  consideration  for 
the  offer,  and  it  could  have  been  nullilied 
by  L.  at  any  time  by  withdrawal.  But  it 
was  accepted  by  I.,  while  outstanding, 
the  price  tendered,  and  deed  demanded. 
It  must  be  plain  from  the  previous  discus- 
sion that  we  do  not  hold  that  the  offer, 
when  made,  or  at  any  moment  before  ac- 
ceptance, was  a  sale  of  lands,  an  agree- 
ment to  sell  lands,  or  an  option.  But  ui)- 
on  acceptance  and  tender  was  not  a  con- 
tract completed?  If  one  person  offers  to 
another  to  sell  his  property'  for  a  named 
price,  and  while  the  offer  is  unretracted 
the  other  accepts,  tenders  the  money,  and 
demands  the  property,  that  is  a  sale.  The 
l)roposition  is  elementary.  The  prt^perty 
belongs  to  the  vendee,  and  the  money  to 
the  vendor.  Such  is  precisely  the  situ- 
ation of  the  parties  herein.  L.  offered  to 
sell  for  .?1.000,  I.  accepted,  tendered  the 
price,  and  demanded  the  property.  Every 
element  of  a  contract  was  present,  jiarties, 
subject-matter,  consideration,  meeting  of 
the  minds,  and  mutuality.  And  as  to  the 
matter  of  mutuality  we  are  now  beyond 
the  defective  option.  We  have  simi)!y  an 
offer  at   a   price,  acceptance,  iiaymeut  or 


tender,  and  demand.  That  this  was  a 
valid  contract  we  cannot  for  a  moment 
doubt.  In  discussing  a  transaction  of 
this  nature,  in  Gordon  v.  Darnell,  5  Colo. 
304,  BiccK,  C.  J.,  in  one  of  his  clear  opin- 
ions, says:  "Its  legal  effect  is  that  of  a 
continuing  offer  to  sell,  which  is  capable 
of  being  converted  into  a  valid  contract 
b3'  a  tender  of  the  purchase  money,  oj-  per- 
formance of  its  c(jnditi<jns,  whatever  they 
may  be,  within  the  time  stated,  and  be- 
fore the  seller  withdraws  the  offer  to  sell.  " 
LL'KTo.\,J.,in  Bradford  v.  Foster, 87  Tenn. 
8,  9  .S.  W.  Rep.  P.)5,  says:  "Before  accept- 
ance, such  an  agreement  can  be  regarded 
only  as  an  offer  in  writing  to  sell  upon 
specified  terms  the  lands  referred  to.  Such 
an  offer,  if  based  upon  no  consideration, 
could  be  withdrawn  by  the  seller  at  any 
time  before  acceptance.  It  is  the  accept- 
ance while  outstanding  which  gives  an 
o[)tion,  not  given  upon  a  consideration, 
vitality."  In  Railroad  Co.  v.  Bartlett,  3 
Cush.,  227,  we  find  the  f(dlowing.  by 
Fi-KTcnici:,  J.:  "In  the  present  case, 
though  the  writing  signed  by  the  defend- 
ants was  but  an  offer,  and  an  offer  that 
might  be  revoked, yet  while  it  remained  in 
force  and  unrevoked  it  was  a  continuing 
offer  during  the  time  limited  for  accept- 
ance, and  during  the  whole  of  that  time  it 
was  an  offer  every  instant ;  but  as  s*)tm 
as  it  was  accepted  it  ceased  to  be  an  offer 
merely',  and  then  ripened  into  a  contract." 
This  case  readily  distinguishes  Bean  v. 
Burbank,  16  Me.  458,  which  may  seem  to 
hold  a  contrary  doctrine.  It  also  repu- 
diates Cooke  V.  Oxiey,  3  Term.  R.  653,  and 
claims  that  the  English  case  is  said  to  be 
inaccurately  reported,  and,  in  any  event, 
entirely  disregarded  in  the  later  decisions. 
See  also  De  Rutte  v.  Muldrow,  16  Cal.  5t)5; 
Thomason  v.  Dill, 30  Ala.  444;  Goodpaster 
V.  Porter.  11  Iowa,  161;  Vassault  v.  Ed- 
wards, 43  Cal.  4.58;  Black  V.  Woodrow,  39 
Md.  194;  Bish.  Cont.  §§  77.78:  Woodruff  v. 
Woodruff,  44  N.  J.  Eq.  3.55,  16  Atl.  Rep.  4; 
Shirlev  v.  Shirlev,7  Blackf.  452;  Perkins  v. 
Hadsell,  50  III.  216;  Lowber  v.  Connit,  36 
Wis.  170;  Pom.  Cont.  §  160,  note  1. 

We  cannot  but  conclude  that  the  trans- 
action in  the  case  at  bar  constituted  a 
valid  contract,  upon  which  specific  per- 
formance may  be  had.  But,  conceding 
that  the  contract  is  per  se  good,  it  is  urged 
that  it  is  void,  under  the  statute  of  frauds. 
The  statute  is  as  follows:  "Every  con- 
tract for  the  leasing  for  a  hmger  term 
than  one  year,  or  for  the  sale  of  any  lands, 
or  inteies't  in  lands,  shall  be  void,  unless 
the  contract,  or  some  note  or  memoran- 
dum thereof  expressing  the  consideration, 
be  in  writing,  ami  be  subscribed  by  the 
party  by  whom  the  lease  or  sale  is  to 
be  made".  "  Section  219,  p.  652,  div.  5,  Com  p. 
St.  It  is  argued  that  the  contract 
could  not  be  enforced  against  the  plaii.iifl 
if  he  were  the  i)arty  sought  to  be  charged, 
as  he  has  not  signed  the  instrument  in 
writing,  and  that  if  it  cannot  be  invoked 
against  the  [ilaintiff,  by  reason  of  the  stat- 
ute of  frauds,  it  also  cannot  be  urged 
against  the  defendant.  But  our  statute 
does  not  re(iuire  the  writing  to  be  signed 
by  the  party  st)ught  to  be  charged,  bul 
onlv  bv  the  party  by  whom  the  sale  is  to 
be  made.    We  have  these  facts:    Thepartj 


84 


OFFER  AND  ACCEPTANCE. 


by  whom  the  sale  was  to  be  made  {L.) 
signed  the  memorandum  expressing  the 
consideration.  The  buyer  accepted.  Not 
only  was  the  contract  conii)lete,  but  the 
statute  was  satisfied.  Bean  v.  Burbank, 
16  Me.  45S;  Vassault  v.  Edwards,  43  (^al. 
45S;  Shirley  v.  Shirley.  7  Blackf.  452; 
Champlin  v.  Parish,  11  Paige,  405;  Cla- 
son  V.Bailey,  14  Johns.  4S4;  Lowber  v. 
Connit,  3G  Wis.  17(5.  We  believe  that  this 
discussion  leaves  it  clear  that  these  views 
are  not  in  conflict  -with  Ryan  v.  Dunphy, 
4  .Mont.  342,  1  Pac.  Rep.  710;  Mayger  v. 
Cruse,  5  Mont.  4S5,  6  Pac.  Rep.  333;  Ducie 
V.  Ford,  S  Mont.  233,  19  Pac.  Rep.  414. 
The  demurrer  on  the  point  just  investi- 
gated should  have  been  overruled. 

On  behalf  of  the  demurrer  it  is  again  ar- 
gued that  the  complaint  is  defective,  in 
that  it  does  not  state  that  the  plaintiff 
has  no  complete  and  adequate  remedj'  at 
law  in  damages.  It  is  undoubtedly  the 
general  rule  that  "in  suits  for  specific  per- 
formance the  party  complaining  must  not 
only  show  the  acts  relied  on  as  part  per- 
formance, his  willingness  and  ability  to 
perform  his  part  of  the  contract,  but  it 
must  also  appear  that  his  position  is  such 
that  an  action  at  law  for  damages  will 
not  afford  him  an  adequate  relief."  Ducie 
V.  Ford,  8  Mont.  240, 19  Pac.  Rep.  414.  But 
actions  for  the  conveyance  of  real  estate 
are  an  exception,  or  perhaps  not  an  excep- 
tion, but  rather  the  presumption  exists, 
from  the  nature  of  the  case,  that  dam- 
ages are  not  ade(]uate  relief.  In  Baumann 
v.  Pinckney,  23  N.  E.  Rep.  918.  the  court 
says,  (  Vann,  J. :)  "Thus  it  happened  that 
the  court  directed  that  the  complaint 
should  be  dismissed.  *  *  *  because  the 
plaintiff  had  an  adequate  remedy  at  law. 
According  to  a  long  and  unbroken  line  of 
decisions  the  latter  ground  is  clearly  un- 
tenable. As  early  as  1835  it  was  said  by 
Chancellor  Walworth  that  a  suit  in  eq- 
uity against  the  vendee  to  compel  a  spe- 
cific performance  of  a  contract  to  purchase 
land  had  always  been  sustained  as  a  part 
of  the  appropriate  and  acknowledged  ju- 
risdiction of  a  court  of  equity,  although 
thevendor  has  in  most  cases  another  rem- 
edy, by  an  action  at  law  upon  the  agree- 
ment to  purchase  ♦  •  *;  the  right  of 
the  vendee  to  maintain  specific  perform- 
ance is  too  well  settled  to  require  further 
discussion."  And  see  cases  there  cited. 
See  also  Pom.  Eq.  Jur.  §§  221,  1402;  Story, 
Eq.  Jur.  §  746.  We  are  of  opinion  that  the 
demurrer  on  this  ground  also  should  have 
been  overruled. 

We  are  again  asked  to  sustain  the  de- 
murrer for  the  reason  that  the  complaint 
does  not  allege  that  it  is  within  the  power 
of  the  defendant  to  make  the  conveyance 
in  pursuance  of  a  decree  of  the  court  so 
requiring  him;  that  is  to  say,  the  com- 
plaint should  allege  that  the  defendant 
was  still,  at  the  time  of  filing  the  com- 
plaint, the  owner  of  the  land.  The  inca- 
pacity of  the  defendant  to  perform,  to  be 
an  excuse,  must  exist  at  the  time  of  the 
hearing.  If  he  did  not  possess  the  subject- 
matter  at  the  time  of  making  the  con- 
tract, this  does  not  constitute  a  legal  im- 
possibility, if  he  acquired  it  subsequently, 


at,  or  before  the  hearing.  Pom.  Eq.  Jur.' 
§  1405,  note  1,  cases  cited.  We  do  not  now 
know  what  maj'  be  made  to  appear  on 
the  hearing.  That  is  not  reached.  We  ex- 
amine now  only  a  demurrer  to  the  com- 
plaint,which  confesses  all  the  fa<-.ts  al](>ged 
in  the  complaint.  The  complaint  alleges 
that  the  defendant  was  the  owner  on  Sep- 
tember 24th,  when  he  executed  the  writ- 
ing. He  has  never  withdrawn  his  offer  to 
sell.  The  offer  ripened  into  a  contract  Oc- 
tober 11th.  The  complaint  was  filed  the 
same  day.  If  a  person,  having  executed 
a  contract  forthe  sale  of  lands,  knowingly 
executes  any  other  agreement  to  sell  or 
dispose  of  the  same  lands  to  another  per- 
son, he  is  guiltj'  of  a  felony.  Section  200, 
Crim.  Laws.  5lust  the  complaint  allege 
that  defendant  has  not  committed  a  fel- 
ony? If  defendant  has  parted  with  the 
land  ad  interim  it  is  a  fact  peculiarly  with 
in  his  own  knowledge;  knowledge  whict 
it  may  well  be  impossible  to  come  to  the 
plaintiff.  "It  must  be  that  in  an  action 
of  this  kind  the  complaint  must  make 
a  case  in  which  the  defendant  is  at 
least  prima  facie  able  to  perform."  Jo- 
seph V.  Holt,  37  Cal.  256;  Elliott,  C. 
J.,  in  Cottrell  v.  Cottrell,  81  Ind.  8^, 
says:  "The  princii)al  objection  urged 
against  it  [the  complaint]  is  that  the  first 
paragraph  does  not  allege  that  the  ances- 
tor of  the  appellants  had  any  title  to  the 
property,  which  it  is  alleged  he  agreed  t« 
convey,  and  is  therefore  bad.  There  are 
facts  stated  which  show  title  in  the  de- 
cedent. »  »  *  If  the  appellee  is  con- 
tent with  such  title  as  a  conveyance  from 
the  heirs  of  the  deceased  vendor  will  con- 
vey, the  appellants  should  not  be  allowed 
to  prevent  him  from  securing  it.  The  an- 
cestor had  bai-gained  away  all  the  title  he 
had,  and,  whether  that  was  much  or  little, 
the  appellee's  contract  vested  in  him  the 
right  to  have  that  for  which  he  had  con- 
tracted. It  cannot  be  of  importance  to 
appellants  whether  that  title  was  perfect 
or  imperfect,  for  the  appellee  has  a  right 
to  it,  whatever  its  character  may  be.  If 
he  is  satisfied,  they  cannot  complain,  for  it 
never  descended  to  them,  but  had  vested 
in  the  appellee  prior  to  the  death  of  their 
ancestor. " 

In  the  case  before  us  the  plaintiff  could 
preserve  the  status  in  quo  against  inno- 
cent purchasers  from  the  defendant,  by  fil- 
ing a  notice  of  lis  pendens.  It  is  not  neces- 
sary to  say  what  might  be  our  views 
upon  the  question  of  the  inability  of  the 
defendant  to  perform  on  the  api^earance 
of  further  facts  at  the  hearing.  We  are  of 
the  opinion  under  all  the  circumstances  of 
this  case  that  the  comi)laint  shows  a 
prima  facie  case,  as  to  this  point,  and  that 
the  demurrer  in  this  behalf  should  be  over- 
ruled. These  views  seem  to  us  to  be  the 
exercise  of  a  sound  discretion.  Schrocder 
V.  Gemeinder,  10  Kev.  3G9;  Poul  Eq.  .lur. 
§§  SGO,  1404.  The  judgment  of  the  district 
court  is  reversed,  and  the  cause  is  i-emand- 
ed,  with  directions  to  that  court  to  over- 
rule the  demurrer. 

BLAKE,  C.  J.,  and  HARWOOD,  J.,  con- 
cur. 


LATSE  OF  OFFER. 


85 


fr.   f      LONGWORTH  ct  al.  v.  MITCHELL.! 
\   r  (26  Ohio  St.  334.) 

Supreme  Court  of  Ohio.     Dec.  Term,  1875. 

Ou  the  1st  of  August,  1857,  Nicholas  Long- 
worth,  the  testator,  being  seised  in  fee  of 
the  uudivided  half  of  a  lot  iu  city  of  Cin- 
ciuuati,  by  his  deed  of  that  date  leased  tOie 
entire  lot  to  the  defendant,  Mitchell,  for  the 
term  of  fourteen  years,  reserving  an  annual 
rent  of  fifteen  dollars  per  "front  foot"  for 
the  lii-st  seven  years;  of  eighteen  dollars  per 
front  foot  for  the  last  seven  years.  The 
lease  contained  a  covenant  for  quiet  enjoy- 
ment, and  Mitchell  believed  at  the  time  of 
its  execution  that  Lougworth  was  the  owner 
of  the  entire  lot.  The  lease  also  contained 
a  provision  that  Mitchell  might  elect  to  be- 
come the  pui'chaser  of  the  lot,  and  have  a 
general  wari*antj'  deed  therefor,  at  any  time 
within  the  first  seven  years,  at  the  rate  of 
$2.">0  per  front  foot,  or  at  any  time  within  the 
last  seven  years,  at  the  rate  of  $300  per  front 
foot,  with  interest  from  the  date  of  the 
lease,  and  that,  in  case  of  such  election,  the 
ground  rent  paid  should  be  deducted  from 
the  interest 

Just  before  the  close  of  the  first  seven 
years,  Mitchell  elected  to  become  the  pur- 
chaser of  the  lot,  and  tendered  to  the  execu- 
tors of  Longworth  the  stipulated  $2o0  per 
front  foot,  togetlier  with  some  $400  of  ground 
rent  then  due,  and  demiuided  a  deed  for  the 
lot,  the  executors  being  authorized  and  re- 
quired by  the  will  of  the  testator  to  execute 
and  fulfil  all  his  real  estate  contracts.  The 
tender  was  made  in  United  States  treasuiy 
notes,  and  the  executoi-s  refused  to  make  a 
deed,  but  made  no  objection  to  the  kind  of 
money  tendered,  placing  their  refusal  on  oth- 
er grounds;  and  the  case  below  was  an  ac- 
tion brought  by  Mitchell  against  the  execu- 
toi-s  to  compel  a  specific  execution  of  the  con- 
tract by  conveyance  of  the  lot  agreeably  to 
the  stipulations  of  the  lease. 

To  this  action  the  executors  set  up  three 
several  grounds  of  defense: 

(1)  That  the  testator  owned  only  a  moiety 
of  the  lot,  and  the  contract  could  not  the-e- 
fore  be  specifically  executed. 

(2)  That  the  tender  should  have  been  made 
in  gold,  the  contract  having  been  made  prior 
to  the  passage  of  the  legal  tender  act. 

(3)  That  prior  to  the  making  of  tlie  ten- 
der, the  executors  being  in  negotiation  with 
the  Cincinnati  and  Indiana  Railroad  Com- 
pany for  the  sale  of  the  lot  to  that  company, 
Mitchell,  who  was  aware  of  said  negotiation, 
agreed  with  the  executors  that  he  would  sur- 
render his  lease  to  them  if  they  would  pay 
him  .*?2.000  and  receipt  for  tlie  rent  due.  and 
gave  them  two  weeks  in  which  to  accept  and 
comply  with  the  offer;  that  the  executors, 
relying  upon  the  faith  of  said  agreement  or 
offer,  verbally  contracted  to  sell  the  lot  to 
the  railroad  company,  and  within  said  peri- 

1  Irrelevant  parts  omitted. 


od  of  two  weeks,  to  wit,  on  the  29th  of  May, 
1SG4,  accepted  said  offer,  and  demanded  of 
Mitchell  a  surrender  of  his  lease,  tendering 
him  at  the  same  time  said  sum  of  .^2,0  JU  and 
a  receipt  fur  the  rent;  but  that  Mitchell  re- 
fused to  accipt  the  tender,  or  to  surrender 
the  lease;  and  the  executors  say  that  they 
have  since  conveyed  all  their  interest  in  the 
lot  to  said  railroad  company,  in  pursuance 
of  their  said  verbal  contract  with  the  com- 
pany. 

Mitchell  replied,  denying  that  he  ever  made 
"any  agreement"  with  the  executors  to  sur- 
rend'^u*  the  lease,  and  alleging  that  his  "offer" 
to  do  so  was  obtained  by  misrepreseutatioua 
as  to  the  value  of  the  lot,  and  the  price 
which  the  railroad  company  were  to  pay 
therefor. 

Subsequently,  the  railroad  company,  and 
also  the  heirs  of  Nicholas  Longworth,  were 
made  parties  defendant,  and  the  company 
filed  an  answer,  insisting  that  the  company 
was  a  bona  fide  i)urchaser  without  notice  of 
Mitchell's  alleged  rights. 

At  the  hearing,  it  was  proven  that  Mitch- 
ell, at  the  time  of  these  negotiations,  was  in 
possession  of  the  lot.  The  fact  that  Mitch- 
ell made  the  offer  to  surrender  the  lease,  on 
the  terms  set  up  in  the  answer  of  the  exec- 
utors, and  that  they  accepted  the  offer,  and 
offered  to  comply  therewith  on  the  said  2'Jih 
of  May,  was  also  provcA,  or  admitted;  but 
there  was  a  conflict  of  evidence  as  to  wheth- 
er this  acceptance  and  offer  by  the  execu- 
tors was  made  within  the  two  weeks  al- 
lowed. The  court  found  that  the  offer  was 
made  on  the  13th  of  May,  sixteen  days  be- 
fore it  was  accepted  by  the  executors,  and 
thereupon  rendered  a  judgment  in  favor  of 
Mitchell,  ordering  a  specific  execution  of  the 
contract  as  to  one  moiety  of  the  lot,  with  a 
release  of  title  by  tlie  railroad  company,  and 
a  compensation  in  money  by  the  executors 
for  the  value  of  the  other  moiety.  The  rec- 
ord sets  forth  aU  the  evidence  in  the  case, 
and  shows  that  a  motion  for  a  new  trial  was 
made  by  the  plaintiff's  in  error,  and  over- 
ruled by  the  court 

The  plaintiffs  in  error  now  seek  to  reverse 
the  judgment  of  the  superior  court  assi.irn- 
ing  the  following  as  grounds  of  error: 

(1)  The  finding  of  the  court  that  the  offer 
of  Mitchell  wps  not  accepted  by  the  execu- 
tors within  the  two  weeks  allowed  is  con- 
trary to  the  evidence. 

(2)  The  time  allowed  for  acceptance  of  the 
offer  was  not  material,  and  its  acceptance 
two  days  after  the  expiration  of  the  two 
weeks  was  sufficient 

Hoadly,  Johnson  &  Colston,  for  plaintiffs 
in  error.  Lincoln,  Smith  &  Stephens,  for  de- 
fendant in  error. 

WELCH,  C.  J.  A5  to  tlie  question  wheth- 
er the  finding  of  the  court  that  the  offer  of 
Mitcliell  was  not  accepted  within  the  two 
weeks  is  supported  by  the  evidence,  it  need 


OFFER  A^'D  ACCEPTANCE. 


86 

only  be  said  that  a  majority  of  us  c^^J^t  an- 
swer the  question  in  the  negative  with  that 
^rtaintv  which  would  justify  us  in  revers- 
ing the  judgment  and  granting  a  new  trial. 

Nor  do  we  think  that  the  ground  assumed 
bv  counsel  for  the  plaintiffs  in  error  that 
time  was  not  of  the  essence  of  Mitchell  s  of- 
fer is  maintainable.  The  rule  frequently 
adopted  in  a  court  of  equity  that  time  is  not 
of  the  essence  of  a  contract  does  not  apply, 
a^  we  understand  tlie  law,  to  a  mere  ofter 
to  make  a  contract.     The  offer  rests  upon  no 


consideration,  and  may  be  withdrawn  at  any 
time  before  acceptance.  An  offer  without 
time  given  for  its  acceptance  must  be  ac- 
cepted immediately,  or  not  at  all;  and  a  lim- 
itation of  time  for  which  a  standing  offer  is 
to  run  is  equivalent  to  the  withdrawal  of 
the  offer  at  the  end  of  the  time  named.  A 
standing  offer  is  in  the  nature  of  a  favor 
granted  to  the  opposite  party,  and  cannot  on 
any  just  principle  be  made  available  after 
the  time  limited  has  expired. 


LAPSE  OF  OFFER. 


87 


^ 


MINNESOTA   LINSEED   OIL   CO.   ▼.   COL- 
LIER WHITE  LEAD  CO.        ^ 

(Fed.  Cas.  No.  9.G35.)  ^^'^I, 


Circuit    Court,    D.    Minnesota.      18 


176.  ^1 


This  action  was  removed  from  the  state 
court  and  a  trial  bj'  jury  waived.  The  plain- 
tiff seeks  to  recover  the  sum  of  !?12, 151.50,  with 
Interest  from  September  20,  1875— a  balance 
claimed  to  be  due  for  oil  sold  to  the  defend- 
ant. The  defendant,  in  its  answer,  alleges 
that  on  August  3d,  1875,  a  contract  was 
entered  into  between  the  parties,  whereby 
the  plaintiff  agreed  to  soli  and  deliver  to 
the  flofenclant,  at  the  city  of  St.  Louis,  dur- 
ing the  said  month  of  August,  twelve  thou- 
sand four  hundred  and  fifty  (12,450)  gallons 
of  linseed  oil  for  the  price  of  fifty-eight  (58) 
cents  per  gallon,  and  that  the  plaintiff  has 
neglected  and  refused  to  deliver  the  oil  ac- 
cording to  the  contract;  that  the  market 
value  of  oil  after  August  3d  and  during  the 
month  was  not  less  than  seventy  (70)  cents 
per  gallon,  and  therefore  claims  a  set-off  or 
counter-claim  to  plaintiff's  cause  of  action. 
The  reply  of  the  plaintiff  denies  that  any 
contract  was  entered  into  between  it  and  de- 
fendant. 

The  plaintiff  resided  at  Minneapolis,  Min- 
nesota, and  the  defendant  was  the  resident 
agent  of  the  plaintiff,  at  St  Louis,  Missouri. 
The  contract  is  alleged  to  have  been  made 
by  telegraph. 

The  plaintiff  sent  the  following  dispatch  to 
the  defendant:  "Minneapolis,  July  29,  1875. 
To  Alex.  Easton,  Secretary  Collier  White 
Load  Company,  St.  Louis,  Missouri:  Ac- 
count of  sales  not  enclosed  in  yours  of  27th. 
Please  wire  us  best  offer  for  round  lot  named 
by  you — one  hundred  barrels  shipped.  Min- 
nesota Linseed  Oil  Company." 

The  following  answer  was  received:  "St. 
Louis,  Mo.,  July  30,  1875.  To  the  Minne- 
sota Linseed  Oil  Company:  Three  hundred 
barrels  fifty-five  cents  here,  thirty  days,  no 
commission,  August  delivery.  Answer.  Col- 
lier Company." 

The  following  reply  was  returned:  "Minne- 
apolis, July  31,  1875.  Will  accept  fifty-eight 
cents  (5Sc),  on  terms  named  in  your  tele- 
gram.   Minnesota  Linseed  Oil  Company." 

This  dispatch  was  transmitted  Saturday, 
July  31,  1875,  at  9:15  p.  m.,  and  was  not  de- 
livered to  the  defendant  in  St.  Louis,  until 
Monday  mornim,',  August  2,  between  eight 
and  nine  o'clock. 

On  Tuesday,  August  3,  at  8:53  a.  m.,  the 
following  dispatch  was  deposited  for  trans- 
mission in  the  telegraph  ofhce:  "St.  Louis, 
Mo.,  August  3,  1875.  To  Minnesota  Linseed 
Oil  Company,  Minneapolis:  Offer  accepted — 
ship  three  hundred  barrels  as  soon  as  pos- 
sible.   Collier  Company." 

The  following  telegrams  passed  between  the 
parties  after  the  last  one  was  deposited  in 
the  office  at  St.  Louis:  "Minneapolis,  August 
3,  1875.    To  Collier  Company,  St.  Louis:    We 


must  withdraw  our  offer  wired  July  31st. 
Minnesota   Lin-fcd  Oil   Company." 

Answered:  "St  Louis,  August  3,  1875. 
Minnesota  Linseed  Oil  Company:  Sale  effect- 
ed before  your  refpiest  to  withdraw  was  re- 
ceived. When  will  you  ship?  Collier  Com- 
pany." 

It  ai)poarcd  that  the  market  was  very  much 
unsettled,  and  that  the  price  of  oil  was  sub- 
ject to  sudden  fluctuations  during  the  mouth 
previous  and  at  the  time  of  this  negotiation, 
varying  from  day  to  day,  and  ranging  be- 
tween fifty-five  and  seventy -five  cents  per 
gallon.  It  Is  urged  by  the  defendant  that 
the  dispatch  of  Tuesday,  August  3(1.  1875, 
accepting  the  offer  of  the  plaintiff  transmit- 
ted July  31st,  and  delivered  Monday  morn- 
ing, August  2d,  concluded  a  contract  for  the 
sale  of  the  twelve  thousand  four  hundred 
and  fifty  gallons  of  oil.  The  plaintiff,  on  the 
con'.rary,  claims,  1st,  that  the  dispatch  ac- 
cepting the  proposition  made  July  31st,  waa 
not  received  until  after  the  offer  had  been 
withdrawn;  2d,  that  the  acceptance  of  the 
offer  was  not  in  due  time;  that  the  delay  was 
unreasonable,  and  therefore  no  contract  waa 
completed. 

Young  &  Newel,  for  plaintiff. 

Geo.  L.  &  Chas.  E.  Otis,  for  defendant. 

NELSON,  District  Judge.  It  is  well  set- 
tled by  the  authorities  in  this  country,  and 
sustained  by  the  later  English  decisions,  that 
there  is  no  difference  in  the  rules  governing 
the  negotiation  of  contracts  by  corespond- 
ence  through  the  post-office  and  by  telegraph, 
and  a  contract  is  concluded  when  an  ac- 
ceptance of  a  proposition  is  deposited  in  the 
telegraph  office  for  transmission.  See  14  Am. 
Law  Reg.  401,  "Contracts  by  Telegraph,"  arti- 
cle by  Judge  Redfield,  and  authorities  cited; 
also,  Trevor  v.  Wood,  3G  N.  Y.  307. 

The  reason  for  this  rule  is  well  stated  in 
Adams  v.  Lindsell,  1  Bam.  &  Aid.  GSl.  The 
negotiatirvn  in  that  case  was  by  post  The 
court  saia:  "That  if  a  bargain  could  not  be 
closed  by  letter  before  the  answer  was  re- 
ceived, no  contract  could  be  completed 
through  the  medium  of  the  post-office;  that 
If  the  one  party  was  not  bound  by  his  offer 
when  it  was  accepted  (that  is,  at  the  time 
the  letter  of  acceptance  is  deposited  in  the 
mail),  then  the  other  party  ought  not  to  be 
bound  until  after  they  had  received  a  notifi- 
cation that  the  answer  had  been  received  and 
assented  to,  and  that  so  it  might  go  on  ad 
infinitum."  See,  also.  5  Pa.  St.  330;  11  N. 
Y.  441;  Mactier  v.  Frith,  6  Wend.  103;  48 
N.  H.  14;  8  C.  B.  225.  In  the  case  at  bar  the 
delivery  of  the  message  at  the  telegraph  of- 
fice signified  the  acceptance  of  the  offer.  If 
any  contract  was  entered  into,  the  meeting 
of  minds  was  at  8:53  of  the  clock,  on  Tues- 
'  day  morning,  August  od.  and  the  subsequent 
dispatches  are  out  of  the  case.  1  Pars.  Cont 
482.  483. 

This  rule  is  not  strenuously  dissented  from 


88 


OFFER  AND  ACCEPTANCE. 


on  the  argument,  and  it  is  substantially  ad- 
mitted that  the  acceptance  of  an  offer  by 
letter  or  by  telegraph  completes  the  contract, 
•when  such  acceptance  is  put  in  the  proper 
and  usual  way  of  being  communicated  by  the 
agency  employed  to  carry  it;  and  that  when 
an  offer  is  made  by  telegraph,  an  acceptance 
by  telegraph  takes  effect  when  the  dispatch 
containing  the  acceptance  is  deposited  for 
transmission  in  the  telegraph  ofhce,  and  not 
when  it  is  received  by  the  other  party.  Con- 
ceding this,  there  remains  only  one  question 
to  decide,  which  will  determine  the  issues: 
Was  the  acceptance  of  defendant  deposit- 
ed in  the  telegraph  office  Tuesday,  August 
3d,  within  a  reasonable  time,  so  as  to  con- 
summate a  conti'act  binding  upon  the  plain- 
tiff? 

It  is  undoubtedly  the  rule  that  when  a 
proposition  is  made  under  the  circumstances 
In  this  case,  an  acceptance  conclu(Ees  the  con- 
tract if  the  offer  is  still  open,  and  the  mu- 
tual consent  necessary  to  convert  the  offer 
of  one  party  into  a  binding  contract  by  the 
acceptance  of  the  other  is  established,  if 
such  acceptance  is  within  a  reasonable  time 
after  the  offer  was  received. 

The  better  opinion  is,  that  what  is,  or  is 
not.  a  reasonable  time,  must  depend  upon  the 
circumstances  attending  the  negotiation,  and 
the  character  of  the  subject  matter  of  the 
contract,  and  In  no  better  way  can  the  in- 
tention rf  the  parties  be  determined.  If  the 
negotiation  is  in  respect  to  an  article  stable 
in  price,  there  is  not  so  much  reason  for  an 


immediate  acceptance  of  the  offer,  and  the 
same  rule  would  not  apply  as  in  a  case  where 
tlie  negotiation  related  to  an  article  subject 
to  sudden  and  great  fluctuations  in  the  mar- 
ket. 

The  rule  in  regard  to  the  length  of  the  time 
an  offer  shall  continue,  and  when  an  accept- 
ance completes  the  contract,  is  laid  down  in 
Parsons  on  Contracts  (volume  1,  p.  482).  He 
says:  "It  may  be  said  that  whether  the  offer 
be  made  for  a  time  certain  or  not,  the  in- 
tention or  understanding  of  the  parties  is  to 
govern.  *  *  *  If  no  definite  time  is  stated, 
then  the  inquiry  as  to  a  reasonable  time  re- 
solves itself  into  an  inqtiiry  as  to  what  time 
it  is  rational  to  suppose  the  parties  contem- 
plated; and  the  law  will  decide  this  to  be 
that  time  which  as  rational  men  they  ought 
to  have  understood  each  other  to  have  had 
in  mind."  Applying  this  nile,  it  seems  clear 
that  the  intention  of  the  plaintiff,  in  making 
the  offer  by  telegraph,  to  seU  an  article  which 
fluctuates  so  much  in  price,  must  have  been 
upon  the  understanding  that  the  acceptance. 
If  at  all,  should  be  immediate,  and  as  soon 
after  the  receipt  of  the  offer  as  would  give  a 
fair  opportunity  for  consideratiort  The  de- 
lay here  was  too  long,  and  manifestly  unjust 
to  the  plaintiff,  for  it  afforded  the  defendant 
an  opportunity  to  take  advantage  of  a  change 
in  the  market,  and  accept  or  refuse  the  offer 
as  would  best  subsei-ve  its  interests. 
I  Judgment  will  be  entered  in  favor  of  the 
i  plaintiff  for  the  amount  claimed.  The  eoun- 
i   ter-claim  is  denied.    Judgment  accordingly. 


LAPSE  OF  OFFER. 


89 


/  HYDE  V.  WRENCH. 

0.^  (3  Beav.  334.) 

9  Rolls  Court.    Dec.  8.  1840. 

This  case  came  en  upon  general  deranrrer 
to  a  bill  for  specific  performance,  which 
stated  to  the  effect  following: 

The  defendant  being  desirous  of  disposing 
of  an  estate,  offered,  by  his  agent,  to  sell  it 
to  the  plaintiff  for  £1200,  which  the  plaintiff, 
by  his  agent,  declined;  and  on  the  Gth  of 
June  the  defendant  wrote  to  his  agent  as 
follows:  "I  have  to  notice  the  refusal  of 
your  friend  to  give  me  £1200  for  my  farm. 
I  will  only  make  one  more  offer,  which  I 
shall  not  alter  from;  that  is,  £1000  lodged  in 
the  bank  until  Michaelmas,  when  title  shall 
be  made  clear  of  expenses,  land  tax,  <S:c.  I 
expect  a  reply  by  return,  as  1  have  another 
application."  This  letter  was  forwarded  to 
the  plaintiff's  agent,  who  immediately  called 
on  the  defendant;  and,  previously  to  accept- 
ing the  offer,  offered  to  give  the  defendant 
£950  for  the  purchase  of  the  farm,  but  the 
defendant  wished  to  have  a  few  days  to  con- 
sider. 

On  the  11th  of  June  the  defendant  wrote 
to  the  plaintiff's  agent  as  follows:  "I  have 
written  to  my  tenant  for  an  answer  to  cer- 
tain enquiries,  and,  the  instant  I  receive  his 
reply  will  communicate  with  you,  and  en- 
deavour to  conclude  the  prospective  pur- 
chase of  my  farm.  I  assiire  you  I  am  not 
treating  with  any  other  person  about  said 
purchase." 

The  defendant  afterwards  promised  he 
would  give  an  answer  about  accepting  the 
£950  for  the  purchase  on  the  26th  of  June; 
and  the  27th  he  wrote  to  the  plaintiff's  agent, 
stating  he  was  sorry  he  could  not  feel  dis- 
posed to  accept  his  offer  for  his  farm  at 
Luddenham  at  present. 

This  letter  being  received  on  the  29th  of 
June,  the  plaintiff's  agent  on  that  day  wrote 
to  the  defendant  as  follows:  "I  beg  to 
acknowledge  the  receipt  of  your  letter  of  the 
27th  instant,  informing  me  that  you  are  not 
disposed  to  accept  the  sum  of  £950  for  your 
farm  at  Luddenham.  This  being  the  case, 
I  at  once  agree  to  the  terms  on  which  you 
offered  the  fai-m,  viz.  £1000  through  your 
tenant,  Mr.  Kent,  by  your  letter  of  the  Gth 
instant.  I  shall  be  obliged  by  your  instruct- 
Jng  your  solicitor  to  communicate  with  me 


without  delay  as  to  the  title,  for  the  reason 
which  I  mentioned  to  you." 

The  bill  staled,  that  the  defendant  "re- 
turned a  verbal  answer  to  the  last-mentioned 
letter,  to  the  effect  he  would  see  his  solicitor 
thereon;"  and  it  charged  that  the  defend- 
ant's offer  for  sale  had  not  been  withdrawn 
previous  to  its  acceptance. 

To  this  biU  filed  by  the  alleged  purchaser 
for  a  specific  performance,  the  defendant 
filed  a  general  demurrer. 

Mr.  Kindersley  and  Mr.  Keene,  in  support 
of  the  demurrer. 

To  constitute  a  valid  agreement  there 
must  be  a  simple  acceptance  of  the  terras 
proposed.  Holland  v.  Eyre,  2  Sim.  &  S.  194. 
The  plaintiff,  instead  of  accepting  the  al- 
leged proposal  for  sale  for  £1000  on  the  Gth 
of  June,  rejected  it,  and  made  a  counter  pro- 
posal. This  put  an  end  to  the-  defendant's 
offer,  and  loft  the  proposal  of  the  plaintiCC 
alone  under  discussion.  That  has  never  been 
accepted,  and  plaintiff  could  not,  without  the 
concurrence  of  the  defendant,  revive  the  de- 
fendant's original  proposal. 

Mr,  Pemberton  and  Mr.  Freeling.  contra. 

So  long  as  the  offer  of  the  defendant  sub- 
sisted, it  was  competent  to  the  plaintiff  to 
accept  it.  The  bill  charges  that  the  defend- 
ant's offer  had  not  been  withdrawn  pre- 
vious to  its  acceptance  by  plaintiff.  There, 
therefore,  exists  a  valid  subsisting  contract 
Kennedy  v.  Lee  3  Mer.  454;  Johnson  v. 
King,  2  Bing.  270,  were  cited. 

The  i\L\STER  OF  THE  ROLLS.  Under 
the  circumstances  stated  in  this  bUl,  I  think 
there  exists  no  valid  binding  contract  be- 
tween the  parties  for  the  purchase  of  the 
property.  The  defendant  offered  to  sell  it 
for  £1000,  and  if  that  had  been  at  once  un- 
conditionally accepted,  there  would  undoubt- 
edly have  been  a  perfect  binding  contract; 
instead  of  that,  the  plaintiff  made  an  offer 
of  his  own,  to  purchase  the  property  for 
£950,  and  he  thereby  rejected  the  offer  pre- 
viously made  by  the  defendant  1  think 
that  It  was  noc  afterwards  competent  for 
him  to  revive  the  proposal  of  the  defendant, 
by  tendering  an  acceptance  of  it;  and  that 
therefore,  there  exists  no  obligation  of  any 
sort  between  the  parties.  The  demurrer 
must  be  allowed. 


90 


OFFER  AND  ACCEPTAXCE. 


WALLACE  V.  TOWNSEND.      ^-1 

(3  N.  E.  GOl,  43  Ohio  St.  537.) 

Supreme  Court  of  Ohio.     Nov.  17,  1SS5. 

Error  to  district  court,  Jefferson  county. 
The  Cleveland,  Tuscarawas  Valley  &  Wheel- 
ing Railway  Company  brought  its  action  in 
the  court  of  common  pleas  of  Jefferson  coun- 
ty, upon  the  subscriptions  set  out  in  the  find- 
ings of  fact,  which  appear  below,  against  Wil- 
liam H.  Wallace  and  Spalding  K.  Wallace, 
executors  of  Henry  Wallace,  deceased,  for 
the  rccoveiT  of  the  amount  claimed  to  be  due 
upon  such  subscriptions.  The  trial  court,  up- 
on the  request  of  each  pai-ty,  stated  its  find- 
ings of  fact  and  conclusions  of  law  separate- 
ly, as  follows: 

"That  in  the  early  part  of  the  year  1S77, 
the  Cleveland,  Tuscarawas  Valley  &  Wheel- 
ing Railway  Company,  being  a  railroad  com- 
pany duly  incorporated  under  the  laws  of  the 
state  of  Ohio,  owning  and  operating  a  rail- 
road from  the  mouth  of  Black  river,  on  Lake 
Erie,   to  Urichsville,   in  Tuscarawas  county, 
and  contemplating  an  extension  of  its  road 
beyond    Urichsville,   proposed   to   make   such 
extension,  by  way  of  the  valley  of  Stillwater 
and  the  valley  of  Wheeling  creek,  to  the  Ohio 
river    at     Bridgeport,     opposite    the   city    of 
Wheeling,  provided  that  subscriptions  to  the 
capital  stock  of  said  company  would  be  made 
by   persons   residing  along  the  line  of  such 
proposed  extension,  and  in  the  neighborhood 
of  the  southern  terminus  thereof,  aggregating 
the  sum  of  .?250,000.    That  citizens  of  Wheel- 
ing, knowing  of  such  proposition,  and  being 
desirous   to  promote  such  extension,   held  a 
public  meeting,  and  at  such  meeting  appoint- 
ed a  committee  to  solicit  subscriptions  to  the 
capital  stock  of  said  company.    That  Henry 
Wallace,  the  testator  of  the  defendants,  then 
in  full  life,  was  present  at  the  meeting,  and 
thereafter,  at  the  solicitation  of  said  commit- 
tee,  subscribed,  in  a  book  furnished  by  the 
committee,  a  paper  writing,  of  which  the  fol- 
lowing is  a  copy:  'We,  the  undersigned,  do 
hereby  respectively   subscribe  to  the  capital 
stock  of  the  Cleveland,  Tuscarawas  Valley  & 
Wheeling  Railway  Company  the  number  of 
shares,  (.50)  fifty  dollars  each,  we  have  set  op- 
posite our  respective  signatures,  upon  the  con- 
ditions that  the  contemplated   extended  line 
of  the  railroad  of  said  railway  company  shall 
be  located   in  the  valleys  of  Stillwater  and 
Wheeling  creeks   to   the  Ohio   river,   In   the 
town  of  Bridgeport,   Ohio,   opposite  the  city 
of  Wheeling,  and  thence  along  the  west  bank 
of  said  river  to  a  point  on  said  river  in  the 
town  of  West  Wheeling,  Ohio;  and  as  soon 
as  said  railroad  shall  be  so  located,  and  the 
work  of  construction  commenced  in  Wheeling 
Creek  valley,  we  agree  to  take  the  number 
of  shares  aforesaid,   and   then  agree  to  pay 
five  (5)  dollars  on  each  share  of  said  stock  so 
by  us  subscribed,  and  the  residue  thereafter 
in  such  installments  and  at  such  times  and 
places  as  may  be  required  by  the  directors  of 


said  company;  but  said  installments  shall  not 
exceed  ten  (10)  per  cent,  per  month  from  the 
time  when  said  first  payment  shall  become 
due  as  aforesaid.    It  is  hereby  further  condi- 
tioned that  these  subscriptions  shall  not  be 
binding  unless  the  work  of  construction  shall 
be    commenced    on    or    before  July  1,  1S77. 
[Signed]    H.  Wallace,  20  shares,'— and  deliv- 
ered said  book  to  said  committee;  such  paper 
writing  having  been  previously  subscribed  by 
divers  other  persons.    And  said  Henry  Wal- 
lace afterwauls.at  the  solicitations  of  said 
committee,   subscribed,   in  another  book  fur- 
nished by  the  committee,  another  paper  writ- 
ing, of  which  the  following  is  a  copy:    'We, 
the  undersigned,  do  hereby  respectively  sub- 
scribe to  the  capital  stock  of  the  Cleveland. 
Tuscarawas    Valley     &    Wheeling     Railway 
Company  the  number  of  shares  set  opposite 
our  names,  of  fifty  dollars  each,  on  the  con- 
ditions that  said  railway  shall  be  construct- 
ed   to    the    Ohio  river  opposite  the   city   of 
Wheeling,  by  the  valley  of  Wheeling  creek; 
and  as  soon  as  the  work  of  construction  is 
commenced   of  said   railway   on   said   creek, 
before  July  1,  1877,  we  agree  to  pay  five  dol- 
lars  on   each   share   so   subscribed,    and    the 
residue    thereafter   in   such    installments,    at 
such  times  and  places,  and  to  such  person  or 
persons,  as  may  be  required  by  the  directors 
of  said  railway;  but  said  installments  shall 
not  exceed  ten  per  centum  per  month  after 
said  first  payment  shall  become  due  as  afore- 
said.   Wheeling,    West   Va.,   March   1,    1S77. 
[Signe*d]    H.  Wallace,  by  D.  C.  L.,  20  shares,' 
—and  delivered  said  last-mentioned  book  to 
said   committee;   such    last-mentioned   paper 
writing  having  been  previously  subscribed  by 
divers    other    persons.     Afterwards  the  said 
Henry  Wallaee  departed  this  life;  said  books 
still  remaining  in  the  custody  of  said  commit- 
tee.   After  the  death  of  said  Henry  Wallace, 
and  all  the  subscriptions  to  the  capital  stock 
of   said    company    which    could    be   procured 
along  the  line  of  said  proposed  extension,  and 
in  the  neighborhood  of  the  southern  teniiinus 
thereof,  had  been  obtained,  and  which  aggre- 
gated a  sum  less  than  .'?2.")0,000,  at  the  instance 
of  surviAing  subscribers  the  evidences  of  all 
subscriptions  which  had  been  so  procured,  in- 
cluding the  books  aforesaid,   were  tendered 
to  said  company,  and  said  company  accepted 
xhe  same  as  subscriptions  to  the  capital  stock 
of  the  company,  and  agreed  to  extend  said 
railroad  as  had  been  proposed  as  aforesaid, 
and  from  the  town  of  Bridgeport,  along  the 
west  bank  of  the  Ohio  river,  to  a  point  on 
said    river   in   the   town   of   West   Wheeling, 
Ohio.    That  at  the  time  when  said  company 
accepted    said    subscriptions   and   agreed  to 
make  such  extension,  the  officers  of  the  com- 
pany had  no  notice  or  information  whatever 
of  the  death  of  Henry  Wallace;  and  that  the 
company  did,  before  the  first  day  of  July,  A. 
D.   1877,  commence  the  construction  of  said 
railroad  in  the  valley  of  Wheeling  creek,  and 
did,  within  a  reasonable  time  thereafter,  fully 
complete  the  same.    And  the  court  being  of 


LAPSE  OF  OFFER. 


91 


the  opinion  that  upon  the  facts  so  found  the 
law  of  this  case  is  with  the  plaintiff,  does 
consider  and  adjudge  that  the  plaintiff  recover 
of  the  defendant  the  sum  of  twenty-six  hun- 
dred and  four  dollars  and  forty-four  cents, 
and  also  their  costs  herein  expended,  taxed  at 

$ .  to  be  made  of  the  goods  and  chattels 

and  effects  which  were  of  the  said  Uenry 
Wallace  remaining  in  their  bands  to  be  ad- 
ministered." 

The  district  court  aflirmed  the  judgment  so 
rendered  upon  these  findings  of  fact.  To  re- 
vei^se  these  judgments  the  present  proceed- 
ing is  prosecuted  against  Oscar  Townsend, 
receiver  of  the  plaintiff  below. 

Daniel  Pecii  and  Wm.  P.  Hayes,  for  plain- 
tiffs in  error.  J.  W.  Tyler  and  Alexander  & 
Macdonald,  for  defendants  in  error. 

OWEN,  J.  As  we  rest  the  disposition  of 
this  case  upon  the  single  question  whether 
the  facts  found  by  the  trial  court  were  suffi- 
cient to  authorize  the  judgment  rendered  by 
it.  none  of  the  other  numerous  questions 
which  the  record  presents  are  discussed  in 
this  opinion.  By  the  findings  of  fact  it  will 
be  seen  that  the  railroad  company  proposed  to 
construct  its  line  of  road,  over  a  designated 
"•oute,  to  the  Ohio  river  opposite  the  city  of 
Wheeling,  provided  that  subscriptions  to  its 
capital  stock  would  be  made  by  persons  re- 
siding along  the  proposed  lino,  and  near  the 
southern  terminus  thereof,  aggregating  the 
sum  ot  $250,000;  that  Henry  Wallace,  with 
other  citizens  of  Wheeling,  knowing  of  such 
proposition,  and  being  desirous  to  promote 
such  extension,  held  a  public  meeting  and  ap- 
pointed a  committee  to  solicit  subscriptions 
to  the  capital  stock  of  the  company;  that  Wal- 
lace thereafter,  at  the  solicitation  of  this  com- 
mittee, signed  the  two  papers  declared  upon, 
each  in  a  book  furnished  by  the  committee; 
that  other  persons  had  previously  signed 
these  subscriptions;  that  upon  his  signing 
these  writings,  respectively,  he  delivered 
them  to  the  committee;  that  he  soon  there- 
after died,— these  books  remaining  In  the 
hands  of  the  committee;  that  after  his  death, 
and  when  all  the  subscriptions  to  stock  had 
been  procured  along  the  proposed  line,  and 
near  the  southern  terminus,  that  the  commit- 
tee was  able  to  secure,  which  aggregated  less 
than  the  proposed  ."?'2.50,O00,  the  evidences  of 
all  these  subscriptions  were,  at  the  instance  of 
the  surviving  subscribers,  tendered  to  and  ac- 
cepted by  the  company,  which  then  agreed 
to  extend  its  line  of  road  as  had  before  been 
proposed;  that  at  the  time  of  such  acceptance 
and  agreement  the  officers  of  the  company 
had  no  notice  or  information  of  the  death  of 
Henry  Wallace;  that  before  the  first  day  of 
July,  1S77,  the  company  commenced  the  con- 
struction of  the  proposed  extension,  and  did, 
within  a  reasonable  time  thereafter,  fully 
complete  it. 

Did  the  estate  of  Henry  Wallace  become 
boimd  by  these  subscriptions  upon  their  de- 


livery to  and  acceptance  by  the  railroad  com- 
pany? 

The  proposition  of  the  company  was  made 
at  large,  and  not  to  these  subscribers  more 
than  to  any  others  who  should  first  subscribe 
the  required  $2.")0,0<J0.  It  does  not  even  ap- 
pear that  the  company  knew,  at  any  time 
prior  to  Wallace's  death,  of  the  existence  of 
this  committee,  or  that  these  subscriptions 
were  being  procured.  The  company  was  not 
bound  to  accept  Wallace's  subscription  at  any 
time  during  his  life.  It  had  made  no  agree- 
ment with  Wallace  nor  witli  his  co-subscrib- 
ers. So  far  as  the  findings  show,  the  company 
had  no  knowledge  that  Wallace  had  sub- 
scribed, and  nothing  was  done  by  it  on  the 
faith  of  his  subscription  prior  to  his  death. 
Suppose  that  another  committee,  having 
heard  of  the  proposition  of  the  company,  had 
succeeded  in  procuring  the  requisite  .?2.yt.- 
000  in  subscriptions,  tendered  it  to  the  com- 
pany, which  had  accepted  it,  and  agreed  to 
perform  its  conditions,  before  this  committee 
had  tendered  its  subscriptions,  would  it  be 
contended  that  the  company  would  have  been 
under  any  obligations  to  accept  them?  If 
anything  is  claimed  from  the  proposition  of 
the  company,  and  its  acceptance  by  the  sub- 
scribers, it  is  a  sufficient  answer  to  say  that 
the  conditions  of  the  proposition  have  never 
to  this  day  been  performed;  that,  after  the 
death  of  Wallace,  his  sTirviving  subscribers, 
finding  that  they  had  failed  to  raise  the 
amount  which  the  company  had  demanded 
in  its  proposition,  proposed  new  terms  to  the 
company, — tendered  a  less  amount  in  subscrip- 
tions, which  was  accepted,— and  thereupon, 
for  the  first  time  in  the  history  of  these  trans- 
actions, the  company  agreed,  on  its  part,  to 
perform  the  conditions  upon  which  the  sub- 
scriptions were  made.  And  this  was  a  new 
contract,  to  which  Wallace  was  never  a  con- 
senting party.  Thus  we  see  that  the  negotia- 
tions which  actually  led  to  the  creation  of 
mutual  and  binding  obligations  between  the 
company  and  the  surviving  subscribers  tran- 
spired after  the  death  of  Wallace. 

It  is  maintained,  however,  that  various  per- 
sons subscribed  after  Wallace,  and  on  the 
faith  of  his  subscription.  This  does  not  ap- 
pear from  the  findings  of  fact.  For  all  that 
is  shown  by  this  finding  Wallace  may  have 
been  the  very  last  subscriber.  If  these  sur- 
viving subscribers  consented  to  the  delivery 
to  the  company  of  a  dead  man's  subscription, 
they  are  m  no  situation  to  complain.  It  is 
also  maintained  that  the  company  built  the 
road  on  the  faith  of  the  subscription  of  Wal- 
lace and  his  co-subscribers.  It  appears  that, 
at  the  time  of  the  company's  acceptance  and 
agreement,  its  officers  had  no  knowledge  of 
Wallace's  death,  but,  so  far  as  the  record 
shows  to  the  contrary,  it  began  the  work  with 
full  knowledge  that  this  committee  had  ten- 
dered it  a  dead  man's  paper.  Counsel  for  the 
comp.any  maintain  that  "the  committee  so 
often  referred  to.  which  took  these  subscrip- 
tions,   was    rather  the  agent  of  the   railway 


92 


OFFER  AND  ACCEPTANCE. 


company  than  of  Wallace;  *  ♦  ♦  the  com- 
pany having  ratified  tlieir  action."  If  this 
view  is  tenable,  then,  by  a  familiar  rule,  no- 
tice to  this  committee  was  notice  to  the  com- 
pany of  the  death  of  Wallace;  for  it  will  be 
observed  that  there  is  no  finding  that  the 
company  had  no  notice  of  Wallace's  death, 
but  that  its  officers  had  none.  Ordinarily,  no- 
tice is  carried  to  a  corporation  through  its 
officers,  but  not  necessarily  so.  While  its  offi- 
cers are,  in  a  sense,  agents,  its  agents  are 
not  necessarily  officers.  Hence,  if  this  com- 
mittee was  the  agent  of  the  company,  by 
reason  of  the  ratification  of  its  acts  by  the 
latter,  notice  to  the  committee  was  notice  to 
the  company;  and  it  would  be  incumbent  on 
the  latter  to  show  that  its  agent  had  no  no- 
tice of  the  death  of  Wallace.  This  is  not 
shown.  We  do  not  deem  it  necessary,  how- 
ever, to  rest  our  determination  upon  this 
view. 

Until  some  action  is  taken  on  the  basis  of 
a  subscription  to  a  benevolent  or  other  enter- 
prise, it  may  be  revoked.  "The  promise  in 
such  case  stands  as  a  mere  offer,  and  may, 
by  necessary  implication,  be  revoked  at  any 
time  before  it  is  acted  on.  It  is  the  expend- 
ing of  money,  etc.,  or  incurring  of  legal  lia- 
bility on  the  faith  of  a  promise,  which  gives 
the  right  of  action,  and  without  which  there 
is  no  right  of  action.    Until  action  upon  it. 


there  is  no  mutuality,  and  being  only  an  offer, 
and  susceptible  of  revocation  at  any  time 
before  being  acted  upon,  it  follows  that  the 
death  (or  insanity)  of  the  promisor,  before  the 
offer  is  acted  upon,  is  a  revocation  of  the 
offer."  Pratt  v.  Trustees,  93  111.  475.  See, 
also.  Beach  v.  Church,  96  111.  179;  1  Whart. 
Cont  §§  12,  528;  Poll.  Cont  20;  Dickinson  v. 
Dodds,  2  Ch.  Div.  475;  Tayloe  v.  Insurance 
Co.,  9  How.  390;  1  Redf.  Ry.  *203. 

Here  was  an  unaccepted  conditional  sub- 
scription by  Wallace  to  the  capital  stock  of 
the  company.  Indeed,  looking  to  its  sub- 
stance and  plain  intent,  rather  than  to  its 
form,  we  find  it  to  be  no  more  than  an  offer  to 
subscribe  to  stock  upon  certain  named  condi- 
tions. It  was  not  a  subscription- to  stock  in 
the  ordinary  sense  of  that  term.  The  com- 
pany was  not  a  party  to  it,  and  was  under 
no  obligation  to  accept  it  at  any  time  during 
the  life  of  Wallace.  It  was  at  best  an  unac- 
cepted proposal.  Before  its  acceptance,  and, 
indeed,  (so  far  as  it  is  made  to  appear  to  us,) 
before  the  party  to  whom  it  was  made  had 
notice  of  it,  the  proposer  died.  It  vra.s  a  pro- 
posal capable  of  revocation  at  any  time  before 
acceptance,  and  death  worked  its  complete 
revocation.  There  was  error  in  renderuig 
judgment  upon  it  a-gainst  the  defendants  be- 
low, for  which  error  the  judgments  below  are 
reversed. 


1> 


CONTRACTUAL  INTEXTION. 
6 


93 


f 


STAMPER  V.  TEMPLE  et  al 

(6  Humph.  113.) 

Supreme  Court  of  Tennessee.     Doc  Term,  1845. 

This  i.s  an  action  of  as.sumpsit  brought  in 
the  county  of  Franklin.  The  declaration 
avers  that  defendant  eharj^ed  that  G.  B.  and 
A.  D.  Alexander  had  murdered  his  son,  D. 
M.  Stamper;  that  he  promised  that  if  any 
person  should  arrest  the  said  G.  B.  and  A.  D. 
Alexander,  so  that  they  should  be  brought  to 
justice,  he  would  pay  to  such  person  two 
hundred  doUai-s;  and  that  plaintiffs,  after 
said  promise,  and  confiding  in  the  .same,  did 
arrest  them  and  commit  them  to  the  custody 
of  the  sheriff  of  the  county. 

The  defendant  pleaded  non  assumpsit,  and 
the  case  came  on  for  ti'ial,  and  was  tried  by 
Judge  Marchbanks  and  a  jury,  and  a  verdict 
and  judgment  were  rendered  for  the  plain- 
tiffs for  $200.     The  defendant  appealed. 

Mr.  Turney,  for  plaintiff  in  error.  Mr. 
Venable,  for  defendants  in  error. 

TUIILEY,  J.  This  is  an  action  brought  by 
Lassater  and  Temple  against  Stamper  to  re- 
cover the  sum  of  two  hundred  dollars,  which 
they  allege  is  due  to  them  as  a  reward  for 
arresting  Granville  B.  and  Alfred  D.  Alex- 
ander, charged  with  murdering  the  son  of 
Stamper. 

The  bill  of  exceptions  discloses  the  follow- 
ing state  of  facts: 

Some  time  in  the  month  of  September,  1S43, 
the  sou  of  Stamper  was  killed,  and  himself 
severely  wounded  by  the  two  Alexanders. 
On  the  evening  after  the  unfortunate  affi'ay 
there  were  several  persons  at  Stamper's  house. 
He  was  lying  on  a  bed,  laboring  under  great 
bodily  pain  from  his  wounds,  and  great  men- 
tal anguish  for  the  loss  of  his  son,  who  was 
at  the  time  a  corpse  in  his  house,  his  wife 
and  daughters  half  distracted.  The  subject 
of  arresting  the  Alexanders  was  spoken  of. 
Stamper  said  that  he  did  not  expect  they 
would  be  taken  that  night;  that  he  would  put 
out  a  reward  ahead  of  them;  that  he  got  up 
and  went  into  the  yard,  where  most  of  the 
company  were  assembled,  and  observed  that 
he  would  give  a  reward  of  two  hundred  dol- 
lars to  any  person  who  would  apprehend  the 
Alexanders.  To  this  remark  one  of  the  coyi- 
pany  observed,  "Mr.  Stamper,  I  don't  want 
your  money;"  to  which  Stamper  replied, 
"Gentlemen,  I  did  not  mean  it  for  you." 

This  is  all  the  proof  as  to  the  reward  for  the 
arrest  being  offered  by  Stamper. 

.Joseph  iS'ewman,  the  sheriff  of  the  county, 
deposes  that  on  the  evening  of  a  day  in  Sep- 
tember, 1843,  he  received  a  message  from 
Stamper  informing  him  that  his  son  had 
been  murdered  and  himself  severely  wound- 
ed, and  requesting  him  to  come  immediately 
to  his  house.  Witness  having  just  returned 
from  Nashville,  and  being  much  fatigued,  de- 
clined going,  but  sent  his  deputy  Jonathan 
I>assater,  one  of  the  plaintiffs,  who.  on  ihe 
next  morning,  delivered  to  him  the  bodies  of 


the  two  Alexanders,  whom  he  had  arrested 
without  process. 

This  was  all  ♦^he  testimony  in  the  case.  The 
court  charged  the  jury,  "that  to  entitle  the 
plaintiffs  to  recover  against  the  defendant,  he 
must  have  made  hinuself  liable  to  them  by 
contract.  If  the  Alexanders  murdered  his 
son  and  fled,  and  were  arrested  by  the  plain- 
tiffs, the  defendant,  In  the  absence  of  a  con- 
tract to  that  ef-^ct,  would  not  be  bound  to 
pay  them  any  reward.  If  the  Alexanders 
killed  defendant's  son  and  fled,  and  upon  that 
defendant  offered  a  reward  of  two  hundred 
dollars  to  any  person  who  would  arrest  them, 
saying  at  the  sam?  time  that  he  did  not  make 
his  proposition  to  any  person  who  was  pres- 
ent, and  the  plaintiffs  were  present,  they 
would  not  bfc  entitled  to  a  recovery;  that  if 
the  defendant  offered  a  reward  of  two  hun- 
dred dollars  to  any  person  who  would  arrest 
the  Alexanders,  and  the  phiintiffs  after  the 
offering  the  reward  by  the  defendant,  but  be- 
fore they  knew  tliat  it  had  been  offered,  ar- 
rested the  Alexanders  for  the  murder,  the 
fact  that  they  were  at  the  time  ignorant  that 
the  reward  had  been  offered  would  be  no 
ground  of  defence  against  a  suit  brought  for 
its  recovery." 

In  this  charge,  the  whole  court  agree  that 
there  is  error.  The  judge  in  the  first  place 
charged  the  jury  that  there  must  be  a  con- 
tract of  reward  to  be  paid  before  a  suit  could 
be  maintained  for  the  recovery  of  the  reward. 
To  make  a  good  contract  there  must  be  an 
aggregatio  mentium,  an  agreement  on  the  one 
part  to  give  and  on  the  other  to  receive.  How 
could  there  be  such  an  agreement  if  the  plain- 
tiffs in  this  case  made  the  arrest  in  ignorance 
that  a  reward  had  been  offered?  The  arrest 
would  have  been  made  not  for  the  reward, 
but  in  discharge  of  the  public  duty. 

But  there  are  other  objections  arising  out 
of  the  proof  of  higher  character  than  this  er- 
ror in  the  charge  of  the  judge. 

We  do  not  think  that  the  proof  establishes 
the  fact  that  a  reward  of  two  hundred  dol- 
lars was  actually  offered. 

It  appears  that  the  defendant  and  his  fam- 
ily were  in  deep  aflliction  at  the  loss  of  his 
son;  that  he  himself  was  laboring  under  the 
effect  of  severe  wounds  received  from  the 
same  persons  who  had  killed  his  son;  that 
when  the  arresting  of  the  persons  who  had 
perpetrated  the  outrage  was  spoken  of  he  ob- 
served that  he  would  givt  two  hundred  dol- 
lars to  have  them  arrested.  But  to  a  remark 
of  one  of  the  company  that  he  did  not  want 
any  of  his  money,  he  said  he  did  not  intend 
it  for  them.  Who  did  he  intend  it  for  then? 
For  others  who  were  not  present?  How  did 
he  suppose  they  were  to  know  it?  He  made 
no  public  offer.  He  authorized  no  one  to 
make  it  for  him.  We  are  constrained  to  be- 
lieve that  what  is  called  an  offered  reward 
of  two  hundred  dollars  was  nothing  but  a 
strong  expression  of  his  feelings  of  anxiety 
for  the  arrest  of  those  who  had  so  severely 
injured  him,  and  this  greatly  increased  by  the 


94 

distracte<l  staW  of  his  own  mind,  and  that  of 
his  family;  as  we  frequently  hear  persons 
excMim  Oh!  I  would  give  a  thousand  dollars 
if  such  an  event  were  to  happen,  or.  vice 
versa  No  contract  can  be  made  out  of  such 
expressions.  They  are  evidence  of  strong  ex- 
citement, but  not  of  a  contracting  intention. 
But  furthermore,  Jonathan  Lassater,  in 
malcing  the  arrest,  was  in  the  line  of  his 
duty      He  was  deputy  sheriff  of  the  county 


OFFER  AND  ACCEPTANCE. 


where  the  outrage  had  been  committed.  He 
had  been  sent  by  the  principal  sheriff  to  at- 
tend to  it  in  his  stead.  Under  such  circum- 
stances, a  majority  of  the  court  hold  that  as 
a  matter  of  public  policy  he  would  not  have 
been  entiUed  to  claim  the  reward  had  it  been 

offered. 

Upon  the  whole  view  of  the  case  then,  we 
reverse  the  judgment  of  the  court,  and  re- 
mand the  case  for  a  new  trial. 


s 


HEFFIiON 
(40   N.   E.  583,   155   111.   322.) 
Supreme   Court  of  Illinois.      April   1, 


CONTRACTUAL  INTENTION. 
BROWN,    l^fl^ 


95 


1895. 


Appeal  from  api)ell.ite  court,  First  district. 

Assumpsit  by  .Ma^'i,'ie  Brown  auainst  Pat- 
rick H.  lleffron.  riainliff  obtained  judj?- 
uieut,  which  was  allirmod  by  the  appellate 
court.  54  111.  App.  377.  Defendaut  appeals. 
Atlirmed. 

Osborn  Bros.  &  Burpett  and  W.  J.  Candlish, 
for  appellant.  L.  M.  Ackley  and  G.  W. 
Brandt,  for  appellee. 

MAGRUDEIl,  J.  This  Is  an  action  of  as- 
sumpsit brought  by  appellee  against  appel- 
lant for  sei-viccs  as  housekeeper  and  attend- 
ant in  his  household  for  a  period  of  about 
five  years  and  six  months,  from  April,  1882, 
to  November,  1887.  Verdict  and  judgment 
were  in  favor  of  plaintiff  below.  The  judg- 
ment has  boon  affirmed  by  the  appellate 
court,  and  the  case  is  brought  here  by  appeal 
from  the  latter  court. 

Prior  to  April,  1SS2,  the  family  of  appel- 
lant, who  was  a  bachelor  at  that  time,  con- 
sisted of  himself,  his  sister,  and  his  mother, 
the  latter  being  in  feeble  health.  In  April, 
1882,  his  sister  died  of  the  smallpox,  and  he 
at  once  telegraphed  to  appellee,  an  adult  wo- 
man, to  come  to  Chicago,  and  take  charge  of 
his  mother  and  the  house.  Appellee  was  a 
niece  of  his  mother  and  his  own  cousin.  She 
had  worked  for  many  years,  from  the  time 
she  was  a  little  girl,  in  a  family  living  in 
one  of  the  suburban  towns  near  Chicago, 
and  had  been  in  the  habit  of  visiting  her 
aunt  and  cousin  at  appellant's  house  about 
once  in  each  month.  She  had  never  received 
her  wages  regularly  while  at  work  in  the 
family  employing  her,  but  had  allowed  them 
to  accumulate  in  their  hands.  She  had  $250 
in  money,  saved  from  her  previous  earn- 
ings, when  she  went  to  live  with  ajipellant 
and  his  mother.  She  came  to  his  house  in. 
response  to  his  telegram,  and  remained  an 
inmate  of  his  family  during  said  period  of 
five  years  and  a  half,  leaving  shortly  after 
his  marriage,  which  occurred  in  the  latter 
part  of  her  stay  there.  When  she  came,  ap- 
pellant was  living  in  a  small  cottage,  but  at 
the  end  of  a  month  he  moved  into  a  three- 
storj'  brick  house,  with  dining  room  and 
kitchen  in  the  basement,  and  sleeping  rooms 
on  the  top  floor.  During  said  period,  appel- 
lee was  housekooper,  and  had  charge  of  the 
household  generally.  She  did  the  marketing 
and  cooking,  and  took  care  of  the  house,  and 
acted  as  nurse  and  attendant  for  appellant's 
mother,  who  was  sick  with  the  asthma  and 
rheumatism,  and  whose  meals  had  to  be 
carried  to  her.  During  the  first  three  years 
there  was  a  washerwoman  to  do  the  wash- 
ing, and  during  the  rest  of  the  time  a  female 
servant  was  hired,  on  account  of  the  in- 
creasing illness  of  the  mother.     There  is  evi- 


dence tending  to  show  that  appellee  was 
treated  as  a  member  of  the  family,  and  came 
and  went  as  she  please<l,  and  received  pres- 
ents of  money  at  Christmas,  and  sometimes 
used  her  cousin's  carriage  to  ride  in,  and 
contracted  some  bills  which  were  paid  by 
hiui  or  his  mother,  but  she  roce'ved  no  com- 
pensation for  her  services,  the  money  iinid 
her  for  presents  amounting  during  the  whole 
time  to  not  more  than  .?S0.  It  appeare  that 
she  paid  for  her  clothes,  except  one  or  two 
garments  which  were  given  her.  and  for 
some  music  lessons  taken  by  her,  out  of  her 
own  money. 

1.  It  is  insisted  that  the  court  erred  in  ad- 
mitting the  teistimony  of  two  witnesses  as 
to  the  value  of  appellee's  services  as  house- 
keeper. We  see  no  reason  why  the  testi- 
mony was  not  properly  admitted.  As  there 
was  notliing  to  show  that  there  was  any 
agreement  to  pay  appellee  a  partictilar 
amount,  or  at  a  particular  rate,  it  was  com- 
petent to  show  what  her  services  were 
worth,  if  she  was  entitled  to  recover  any- 
thing at  all.  One  of  these  witnesses  swore 
that  she  was  a  housekeeper,  and  had  been 
such  for  four  years,  and  knew  the  value  of 
a  housekeei>er's  services.  The  other  swore 
that  she  had  been  11  years  in  the  employ- 
ment business  in  Chicago,  and  was  acquaint- 
ed with  the  wages  of  housekeepers  during 
that  time.  A  sufficient  foundation  was  laid 
to  justify  the  expression  of  an  opinion  by 
each  witness  as  to  the  value  of  the  services 
rendered  by  appellee. 

2.  Objection  is  made  to  two  instructions 
given  for  the  plaintiff,  and  to  the  modifica- 
tion of  two  instructions  asked  by  the  defend- 
ant, and  to  the  refusal  of  one  instruction 
asked  by  the  defendant  As  to  the  latter,  its 
substance  is  sufficiently  embodied  in  the  in- 
structions given,  and  therefore  no  injury 
was  done  by  its  refusal.  All  the  points 
urged  against  the  instmctions  given  and  the 
instructions  modified  may  be  summed  up  in 
one  objection, — that  those  instructions  au- 
thorize the  jury  to  find  whether  there  was  a 
contract,  express  or  implied,  to  pay  for  ap- 
pellee's services.  It  is  claimed  that  no  re- 
covery could  be  had  by  the  plaintiff  unless 
there  was  an  express  conti-aet  by  the  appel- 
lant to  pay  her  for  her  services,  and  that,  if 
there  was  no  express  contract,  none  could  be 
implied  from  the  facts  or  circumstances. 
Where  services  are  rendered  by  one  admit- 
ted into  the  family  as  a  relative,  the  pro- 
sumption  of  law  is  that  such  sersMces  are 
gratuitous,  and  that  the  parties  do  not  con- 
template the  payment  of  wages  therefor. 
This  presumption,  however,  may  be  over- 
come by  proof.  The  proof  necessary  to  over- 
come the  presumption  may  be  either  of  an 
express  contract  or  of  a  contract  established 
by  such  facts  and  circumstances  as  show 
that  both  parties,  at  the  time  the  services 
were  rendered,  contemplated  or  intended  pe- 
cuniary recompense  other  than  that  which 
arises  naturally  out  of  the  family  relation. 


96 


OFFER  AND  ACCEPTANCE. 


Miller  v.  Miller,  IG  111.  296.  A  contract  is 
express  "when  it  consists  of  words  written 
or  spoken,  expressing  an  actual  agreement 
of  the  parties."  It  is  implied  "when  it  is 
evidenced  by  conduct  manifesting  an  inten- 
tion of  agreement."  3  Am.  &  Eng.  Enc. 
Law,  p.  842.  Anderson,  in  his  Law  Diction- 
aiy.  says  that  a  contract  is  express  "when 
the  agreement  is  formal,  and  stated  either 
verbally  or  in  writing,  and  is  implied  when 
the  agreement  is  matter  of  inference  and  de- 
duction." In  Ex  parte  Ford,  16  Q.  B.  Div. 
307,  it  was  said  that  "whenever  circumstan- 
ces arise  in  the  ordinary  business  of  life  in 
which,  if  two  persons  were  ordinarily  honest 
and  careful,  the  one  of  them  would  make  a 
promise  to  the  other,  it  may  properly  be 
infeiTed  that  both  of  them  understood  that 
such  a  promise  was  given  and  accepted." 
In  Marzetti  v.  Williams,  1  Bam.  &  Adol.  415, 
Lord  Tenterden  said:  "The  only  difference 
between  an  express  and  an  implied  contract 
is  in  the  mode  of  substantiating  it.  An  ex- 
press contract  is  proved  by  an  actual  agree- 
ment; an  implied  contract,  by  circumstan- 
ces, and  the  general  course  of  dealing  be- 
tween the  parties."  In  the  same  case  Parke, 
J.,  said:  "The  only  difference,  however,  be- 
tween an  express  and  an  implied  contract  is 
as  to  the  mode  of  proof.  An  express  con- 
tract is  proved  by  direct  evidence,  an  implied 
contract  by  cii'cumstantial  evidence."  And 
Patterson,  J.,  said:  "Bt.t  the  only  distinc- 
tion between  the  two  species  of  conti-acts  is 
as  to  the  mode  of  proof.  The  one  is  proved 
by  the  express  words  used  by  the  parties; 
the  other,  by  circumstances  showing  that 
the  parties  intended  to  contract."  An  agree- 
ment may  be  said  to  be  implied  when  it  is 
inferred  from  the  acts  or  conduct  of  the 
parties,  instead  of  their  spoken  words.  "The 
engagement  is  signified  by  conduct,  instead 
of  words."     Bixby  v.  Moor,  51  N.  H.  402. 

This  question  has  been  before  the  supreme 
court  of  Wisconsin  in  a  number  of  cases.  In 
Hall  v.  Finch,  29  Wis.  278,  where  the  plain- 
tiff presented  a  claim  against  the  estate  of 
her  deceased  brother  for  the  value  of  her 
services  as  hoasekeeper  during  several  years 
while  she  resided  in  his  house,  acting  and 
ti'eated  as  the  mistress  thereof,  the  coxirt, 
after  stating  the  general  rule  that  the  rela- 
tion existing  between  the  parties,  as  parent 
and  child,  stepparent  and  stepchild,  brother 
and  sister,  and  the  like,  raises  a  presumption 
that  no  payment  or  compensation  was  to  be 
made  beyond  that  received  by  the  claimant 
at  the  time,  holds  that  this  presumption  can 
only  be  overcome  by  clear  and  unequivocal 
proof  to  the  contrary;  that  the  evidence  must 
be  clear,  direct,  and  positive  that  the  relation 
between  the  parties  was  that  of  debtor  and 
creditor;  that  the  party  seeking  to  recover 
compensation  for  services  rendered  under 
euch  circumstances  must  show  an  "agree- 
ment or  understanding  that  they  were  to  be 
paid  for."  And  the  court  there  uses  the  fol- 
lowing language:     "In  regard  to  such  agree- 


ment or  understanding,  it  is  manifest  from' 
the  nature  of  the  case  that  it  can  in  general 
be  arrived  at  only  by  express  stipulation  be- 
tween the  parties,  and  accordingly  we  find 
the  best  considered  authorities  holding  that 
an  express  contract  must  be  shown."  Then 
follows  a  review  of  quite  a  number  of  author- 
ities, mostly  Pennsylvania  decisions,  two  of 
which  (Hai-tman's  Appeal,  3  Grant's  Gas.  271, 
and  Lynn  v.  Lynn,  29  Pa.  St.  3G9)  hold  that 
there  can  be  no  recoveiy  for  services  in  such 
cases  without  proof  of  an  express  conti-act 
In  Pcllage  v.  Pellage,  32  Wis.  130,  where  the 
action  was  by  a  son  against  his  father  for 
services  rendered  to  the  latter  by  the  former 
after  he  became  of  age,  it  was  held  that, 
where  such  a  relation  of'  kindred  exists,  the 
law  will  imply  no  promise  on  the  part  of  the 
father  to  pay  for  the  services  of  the  son,  the 
presumption  being  that  he  rendered  them 
gratuitously,  or  in  consideration  of  having  a 
home  with  his  father,  and  being  furnished 
with  board  and  clothing  and  care  and  atten- 
tion in  sickness;  that  the  son  cannot  recover 
for  his  services  in  such  a  case  without  show- 
ing that  a  contract  existed  between  him  and 
his  father  by  which  the  latter  agreed  to  pay 
for  such  services;  that  the  proof  of  such  con- 
tract is  not  to  be  placed  upon  the  same 
grounds  as  a  contract  between  strangers,  un- 
affected by  any  personal  relation;  that  the 
evidence  of  the  contract  must  be  positive  and 
direct;  that  the  contract  cannot  bo  inferred 
from  circumstances  and  probabilities;  and 
that  "there  should  be  evidence  which  would 
warrant  a  jury  in  finding  that  there  was  an 
express  contract  or  agreement  to  that  effect." 
In  Tyler  v.  Burrington,  39  Wis.  376,  where 
the  plaintiff,  having  been  received  in  infancy 
into  a  family  not  of  kin  to  her,  sought  to  re- 
cover for  services  rendered  to  such  family, 
the  doctrine  of  the  Hall  and  Pellage  Cases 
seems  to  be  somewhat  modified,  it  being  held 
that  "an  express  contract  to  pay,  or  the  rela- 
tion of  master  and  servant,  may  be  as  fairly 
and  incontrovertibly  established  by  circum- 
stantial evidence  as  by  direct  evidence";  that 
the  mere  fact  of  plaintiff's  reception  in  her  in- 
fancy into  the  family  of  the  deceased  implied 
no  contract  to  pay  her  for  any  services  she 
might  render  to  it,  "though  such  a  contract 
might  be  implied  from  the  surrounding  cir- 
cumstances"; "that,  if  it  appeared  expressly 
or  from  the  surrounding  circumstances  that 
she  was  so  received  in  the  relation  of  a  child, 
the  law  excludes  an  implied  contract  to  pay 
her  wages  for  her  services;  but  that  she 
could  recover  upon  an  express  contract  to  pay 
her,  which  might  be  established  by  direct  and 
positive  evidence,  or  by  circumstantial  evi- 
dence equivalent  to  direct  and  positive";  that, 
failing  to  prove  an  express  contract,  "it  rest- 
ed with  her  to  establish  an  implied  contract 
by  the  surrounding  circumstances";  that 
"mere  expectation  on  his  part  to  pay,  and  on 
her  part  to  receive,  wages,  would  not  consti- 
tute an  express  contract,  unless,  by  mutual 
expression  of  the  expectation,  it  became  con- 


CONTRACTUAL  INTENTION. 


97 


sensual";  that  "expectation  looks  rather  to 
an  implied  tlian  an  express  contract";  and 
that,  "if  established  by  competent  evidence  as 
entering  into  the  res  gestaj,  such  expectations 
of  these  parties  might  give  color  to  circum- 
stances tending  to  show  that  they  ripened 
Into  a  mutual  understanding,— an  express  "con- 
tract." In  Wells  V.  Perkins,  43  Wis.  IGO, 
whore  a  stepson  sued  his  stepfatlier  for  serv- 
ices rendered  the  latter  after  the  plaintiff 
reached  his  majority,  an  instimction  was  con- 
demned because  it  was  open  to  the  objection 
"of  confounding  circumstances  from  which  a 
contract  might  be  implied  with  circumstan- 
tial evidence  of  an  express  cttntract";  and  it 
was  held  that  the  law  excludes  an  implied 
contract,  and  that  the  plaintiff  could  only  re- 
cover upon  an  express  contract,  which  "might 
bo  established  by  direct  and  positive  evidence, 
or  by  circumstantial  evidence  equivalent  to 
direct  and  positive,"  It  will  be  noticed  that 
the  cases  in  Wisconsin  differ  from  the  Eng- 
lish cases  in  holding  tliat  an  express  contract 
may  be  established  by  circumstantial  evi- 
dence. 

In  Ayers  r.  Hull,  5  Kan.  419,  It  was  held 
that  where  the  sister  resides  in  the  family  of 
her  brother,  performing  the  ordinary  services 
of  a  housekeeper,  and  receiving  clothing  and 
the  benefit  of  a  house  for  nearly  eight  years, 
without  keeping  any  account,  and  witiiout 
any  promise  or  contract  or  understanding  that 
she  should  receive  wages,  the  law  will  not 
imply  a  contract  for  services  rendered,  nor 
hold  the  brothei-'s  estate  chargeable  with  a 
claim  made  for  such  services  for  the  first 
time  after  the  death  of  the  brother.  See,  also, 
Williams  v.  Hutchinson,  3  N.  Y.  319,  5  Barb. 
128.  In  Mills  v.  Joiner,  20  Fla.  479,  where  a 
daughter  of  full  age  brought  suit  against  her 
father  for  services  while  li>ing  with  him  at 
his  house  and  as  one  of  his  family,  it  was 
held  to  be  a  presumption  of  law  that  he  was 
not  bound  to  pay  her,  but  that  "tliis  presump- 
tion may  be  overcome  by  proof  of  a  special 
contract,  express  promise,  or  an  implied  prom- 
ise, and  such  implied  promise  or  undersUind- 
ing  may  be  inferred  from  the  facts  and  cir- 
cumstances shown  in  evidence;  and  that  "the 
jury  should  have  been  furtlier  instructed  that 
if,  under  all  the  eircumstiinces  of  tlie  case, 
the  services  were  of  such  a  nature  as  to  lead 
to  a  reasonable  belief  that  it  was  the  under- 
standing of  the  parties  that  compensation 
should  be  made  for  such  services,  then  the 
jury  should  find  an  implied  promise."  In 
Scully  V.  Scully,  28  Iowa,  548,  where  a  sis« 
ter  filed  a  claim  against  the  estate  of  her  d» 
ceased  brother,  a  bachelor,  for  services  in  do 
ing  his  housework  while  a  member  of  his 
family,  It  was  said:  "AVhere  it  is  shown 
that  the  person  rendering  the  soi-vice  is  a 
member  of  tlie  family  of  the  person  served, 
and  receiving  support  therein,  either  as  a 
child,  a  relative,  or  a  visitor,  a  presumption  of 
law  arises  that  such  services  were  gratuitous; 
and  in  such  case,  before  the  person  rendering 
the  service  can  recover,  the  express  promise 

HOPK.  SEL.  CAS.  CONT. — 7 


of  the!  party  served  must  be  shown,  or  such 
facts  or  circumstances  as  will  authorize  the 
jury  to  find  that  the  services  were  rendered 
in  the  expectation  by  one  of  receiving,  and 
by  the  other  of  making,  compensation  there- 
for." In  Smith  v.  Johnson,  4~}  Iowa,  308,  it 
was  held  that  no  recovery  can  be  had  in  such 
cases  where  there  is  no  express  contract,  and 
"it  is  not  shown  in  the  record  that  the  serv- 
ices were  i)erformed  with  the  expectation  06 
the  part  of  either  that  they  were  to  ba  paid 
for." 

We  are  inclined  to  hold   that  an   express 
contract   may    be   proved,    not   only    by   an 
actual  agreement,  by  direct  evidence,  by  tha 
express  words  used  by  the  parties,  but  also 
by    circumstantial    evidence;     and    that    ao 
implied  contract  may  be  proved  by  circnim- 
stances    showing    that    the    parties    intend- 
ed to  contract,  and  by  general  course  of  deal- 
ing between  them.     In  Miller  v.  Miller,  su- 
pra,   an    instruction     was     approved    which 
stated  that  it  was  "incumbent  on  the  plain- 
tiff  to  prove  an   express   hiring  or  circum- 
stances    from     which     an     express     hiring 
may   be   reasonably  inferred,"  etc.     And   in 
Brush  V.  Blanchard,  18  111.  4G,  It  was  said: 
"There  is  no  evidence  of  an  express  contract 
to  pay  for  services,  nor  are  there  any  facts 
in  evidence  from  whiclr  such  contract  can  be 
implied."     Similar  langn.Tgo  is  also  used  in 
Faloon   v.   Mclntyre,    IIS  IIL   2U2,   8   N.   E. 
315,  and  in  Collar  v.  Patterson,  137  111.  403, 
27  N.  E.  G04.     The  strict  rule  laid  down  in 
the  cases  in  Wisconsin  and  Pennsylvania  has 
its  basis  in  the  danger  of  fraud  and  perjury 
by  permitting  any  member  of  a  family   to 
insist  on  a  greater  share  of  the  property  of 
an  estate  than  is  given  by  the  law,  or  by  a 
will,  upon  the  ground  that  it  is  due  for  serv- 
ices.    The  encouragement  of  claims  for  such 
services  is  to  destroy  the  peace  and  harmony 
of   families   through   the  strife   and    contro- 
versy resulting  therefrom.     The  rule  in  this 
state   is   stated   in   Miller   y.   Miller,   supra, 
where  we  said:     "Where  one  remains  with 
a  parent,  or  with  a  person  standing  in  the 
relation  of  parent  after  arriving  at  major- 
ity, and  remains  in  the  same  apparent  rela- 
tion as  when  a  minor,  the  presumption   is 
that    the    parties    do    not    contemplate    pay- 
ment of  wages  for  services.     This  presump- 
tion  may   be   overthrown,   and   the   reverse 
establisliod,   by  proof  of  an  express  or  im- 
plied contract,  and  the  implied  contract  may 
be  proven  by  facts  and  circumstances  which 
show  that  both  parties,  at  the  time  the  serv- 
ices were  performed,  contemplated  or  intend- 
ed   pecuniary    recompense    other    than    such 
as   naturally   arises   out   of  the   relation   of 
parent  and  child."    This  lan.guage  was  quot- 
ed and  approved  in  the  recent  case  of  Switzer 
v.  Kee,  146  111.  577,  35  N.  E.  100.    But.  where 
it  is  said  that  a  contract  to  pay  for  such  serv- 
ices may  bo  implied. something  more  is  meant 
than   the    more   promise    to   pay    which    the 
law  implies  where  one  person  does  work  for 
another  with  the  knowledge  and  approbatioa 


ys 


OFFER  AND  ACCEPTANCE. 


of  that  other.  The  implied  promise  thus 
raised  by  the  law  is  rebutted  when  there  is 
shown  such  a  relation  between  the  pai-ties  as 
to  exclude  the  inference  that  they  were  deal- 
ing on  the  footii:!,'  of  a  contract.  Ayers  v. 
Hull,  supra;  3  Am.  &  Eng.  Enc.  Law,  p. 
$61.  The  evidence  must  show  that,  when  the 
services  were  rendered,  both  i)arties  expected 
them  to  be  paid  for.  Miller  v.  Miller,  supra; 
Byers  v.  Thompson,  66  111.  421;  Fruitt  v. 
Anderson,  12  111.  App.  421.  The  facts  and 
circumstances  must  be  such  as  to  show  that, 
at  the  time  the  services  were  rendered,  the 
one  expected  to  receive  payment  and  the 
other  to  make  payment.  Fruitt  v.  Anderson, 
supra. 

If  the  expectation  of  each  would  not  con- 
stitute a  contract  unless  there  was  an  ex- 
pression of  that  expectation,  such  criticism 
would  not  apply  here,  because  the  jury  were 
instracted  as  follows:  "If  the  jury  believe 
from  the  evidence  that  the  defendant  re- 
quested the  plaintiff  to  do  the  services  in 
question,  and,  by  words  or  acts,  knowingly 
gave  her  to  understand  that  she  would  be 
paid  for  doing  it,  and  that  plaintiff,  in  com- 
pliance with  such  request  (if  there  was  any), 
did  the  work  in  question  for  the  defendant, 
then  she  is  entitled  to  recover."  "The  re- 
lationship existing  between  the  parties,  and 
the  fact  that  they  and  defendant's  mother 
lived  together  as  a  single  household  while 
the  work  was  being  done  for  which  this  suit 
is  brought,  will  not  bar  a  recovery  in  this 
case  if  the  jury  believe  from  the  evidence 
that  the  defendant  requested  the  plaintiff  to 
do  the  service  in  question,  and  promised  to 
pay  her  for  it,  or,  by  words  or  acts,  know- 
ingly led  her  to  believe  that  she  wotild  be 
paid  for  doing  it."  The  jm-y  were  further  in- 
structed that,  where  voluntary  services  are 
rendered  by  those  sustaining  family  rela- 
tions, the  presumption  of  law  is  that  the 
parties  do  not  contemplate  payment  or  re- 
ceipt of  wages;  and  that  where  services  are 
rendered  by  those  near  of  kin,  or  by  those 
sustaining  family  relations,  the  law  will  im- 
ply no  contract  for  compensation;  and  that, 
unless  a  contract  to  pay  is  shown  in  such 
case,  no  recovery  can  be  had.    It  is  true  that 


in  instructions  asked  by  the  defendant,  and 
given  for  him,  the  jury  were  told  that  the 
plaintiff  could  not  recover  unless  she  proved 
by  the  preponderance  of  the  evidence  an 
express  contract  to  pay  for  her  services;  but 
they  were  told,  in  another  instruction,  that 
an  express  contract  might  be  established 
by  circumstances  and  the  conduct  of  the  par- 
ties, or  by  words  in  connection  therewith; 
and  we  do  not  think  that  the  jury  could  have 
been  misled  when  all  the  instructions  are 
considered  together  as  one  charge,  and  in 
view  of  the  evidence  heretofore  and  here- 
inafter referred  to.  In  Morton  v.  Rainey,  82 
111.  215,  plaintiff  presented  a  claim  for  serv- 
ices against  the  estate  of  his  deceased  uncle, 
in  whose  family  he  had  lived  from  the  time 
he  was  11  years  old  until  he  reached  his 
majority,  and  during  that  time  had  labored 
for  the  deceased,  and  received  his  board, 
clothing,  and  medical  attendance;  and  we 
there  said:  "While  appellee,  during  minor- 
ity, was  provided  by  the  deceased  with  cloth- 
ing, medical  attendance,  and  all  the  neces- 
saries furnished  by  a  parent  to  a  child,  after 
his  majority  he  provided  his  own  clothing, 
paid  for  his  own  washing,  and  in  fact  re- 
ceived nothing  from  the  deceased  except  his 
board.  Under  such  circumstances,  the  pre- 
sumption that  appellee  was  working  as  he 
did  when  a  minor  is  removed,  and  the  facts 
are  sufficient  to  establish  an  implied  contract 
on  the  part  of  the  deceased  to  pay  appellee 
what  his  services  were  reasonably  worth." 
Such  facts  as  were  there  held  sufficient  to  es- 
tablish an  implied  contract  exist  in  the  case 
at  bar.  In  addition,  appellee  swore  that, 
on  three  different  occasions  while  she  lived 
in  appellant's  house,  she  talked  with  his 
mother,  in  his  presence,  about  her  compen- 
sation, and  during  these  conversations  he 
said  that  he  would  pay  her  for  her  time.  It 
is  true  that  he  contradicted  her  in  reference 
to  this  matter,  but  it  was  for  the  jury  to 
pass  upon  the  evidence.  The  facts  are  set- 
tled by  the  judgment  of  the  appellate  com-t 
so  far  as  we  are  concerned.  We  find  no  error 
in  the  record  which,  in  our  opinion,  would 
justify  a  reversal.  The  judgment  of  the  ap- 
pellate com't  is  affirmed.     Affirmed. 


COXTHACTUAL  INTENTION. 


99 


n  MOULTON  v.  KERSHAW  et  aj.  d/| 

J^f^  (18  W.  W.  172,  59  Wis.  31G.)   \Jl 

I?     Supreme  Court  of  Wisconsin.     Jan.  8.   1SS4. 

\-        Appeal  from  circuit  court,  Milwaukee  coun- 
ty. 

Fiucbes,  Lynde  &  Miller,  for  appellants. 
Jenkins,  Winkler  &  Smith,  for  respondent. 

TAYLOR,  J.  The  complaint  of  the  respond- 
ent alk'Ki'S  that  the  appellants  were  dealers 
in  salt  in  the  city  of  Milwaukee,  including 
salt  of  the  Michigan  Salt  Association;  tliat 
the  respondent  was  a  dealer  in  salt  in  the 
city  of  La  Crosse,  and  accustomed  to  buy  salt 
in  large  quantities,  which  fact  was  known  to 
the  appellants;  that  on  the  nineteenth  daj- 
of  September,  1882,  the  appellants,  at  Milwau- 
kee, wrote  and  posted  to  the  respondent  at 
La  Crosse  a  letter,  of  which  the  following  is 
a  copy: 

"Milwaukee,  September  19,  1SS2. 
"J.  H.  Moulton,  Esq.,  La  Crosse,  Wis.— 
Dear  Sir:  In  consequence  of  a  rupture  in  the 
salt  trade,  we  are  authorized  to  offer  Michi- 
gan fine  salt,  in  full  car-load  lots  of  SO  to  95 
bbls.,  delivered  at  your  city,  at  S5c.  per  bbl., 
to  be  shipped  per  C.  &  N.  W.  R.  R.  Co.  only. 
At  this  price  it  is  a  bargain,  as  the  price  in 
general  remains  unchanged.  Shall  be  pleased 
to  receive  your  order. 

"Yours  truly.  C.  J.  Kershaw  -fc  Son.';. 

The  balance  of  the  compla*/!!  reads  as  fol- 
lows: 

"And  this  plaintitT  alleges,  upon  information 
and  belief,  that  sai<a  defendants  did  not  send 
said  letter  and  offer  by  authority  of,  or  as 
agents  of,  the  Michigani  SaU  ^Associa'ion,  o/, 
any  other  party,  but  o?i  tTieif  ovvn  r^'spoiisi' 
bility.  And  the  plaintiff  further  shows  that 
he  received  said  letter  in  due  course  of  mail, 
to-wit,  on  the  twentieth  day  of  September, 
1SS2,  and  that  he,  on  that  day,  accepted  the 
offer  in  said  letter  contained,  to  the  amount 
of  two  thousand  barrels  of  salt  therein  named, 
and  immediately,  and  on  said  day,  sent  to 
said  defendants  at  Milwaukee  a  message  by 
telegraph,  as  follows: 

"  'La  Crosse,  September  20,  1S82. 
"  'To  C.  J.  Kershaw  &  Son,  Milwaukee, 
Wis.:  Your  letter  of  yesterday,  received  and 
noted.  You  may  ship  me  two  thousand  (2,000) 
barrels  Michigan  fine  salt,  as  offered  in  your 
letter.    Answer.  J.  H.  Moulton.' 

"That  said  telegraphic  acceptance  and  or- 
der was  duly  received  by  said  defendants  on 
the  twentieth  day  of  September,  1SS2,  afore- 
said; that  two  thousand  barrels  of  said  salt 
was  a  reasonable  quantity  for  this  plaintiff 
to  order  in  response  to  Siiid  offer,  and  not 
in  excess  of  the  amount  which  the  defend- 
ants, from  their  knowledge  of  the  business  of 
the  plaintiff,  might  reasonably  expect  him  to 
order  in  response  thereto. 

"That  although  said  defendants  received 
said  acceptance  and  order  of  this  plaintiff  on 
said  twentieth  day  of  September,  1SS2,  they 


attempted,  on  the  twenty-first  day  of  Septem- 
ber. 1SS2,  to  withdraw  the  offer  contained  in 
their  said  letter  of  September  19,  1882,  and 
did,  on  .said  twenty-lirst  day  of  September, 
1SS2,  notify  this  plaintiff  of  the  withdrawal 
of  .said  offer  on  their  part;  that  this  plaintiff 
thereupon  demanded  of  the  defendants  the 
delivery  to  him  of  two  thou.sand  barrels  of 
Michigan  fine  salt,  in  accordance  with  the 
terms  of  said  offer,  accepted  by  this  plaintiff 
as  aforesaid,  and  offered  to  pay  them  there- 
for in  accordance  with  said  terms,  and  this 
plaintiff  was  ready  to  accept  said  two  thou- 
sand barrels,  and  ready  to  pay  therefor  in 
accordance  with  said  terms.  Nevertheless, 
the  defendants  utterly  refused  to  deliver  the 
same,  or  any  part  thereof,  by  reason  where- 
of this  plaintiff  sustained  damage  to  the 
amount  of  eight  hundred  dollars. 

"Wherefore  the  plaintiff  demands  judgment 
against  the  defendants  for  the  sum  of  eight 
hundred  dollars,  with  interest  from  the  twen- 
ty-first day  of  September,  1882,  besides  tbe 
costs  of  this  action." 

To  this  complaint  the  appellants  interposed 
a  general  demurrer.  The  circuit  court  over- 
ruled the  demurrer,  and  from  the  order  over- 
ruling the  same  the  defendants  appeal  to  this 
court. 

The  only  question  presented  Is  whether  the 
appellant's  letter,  and  the  telegram  sent  by 
the  respondent  in  reply  thereto,  constitute  a 
contract  for  the  sale  of  2,000  ban  els  of  Mich- 
,  Igjjn  fine  salt  by  the  appellants  to  the  re- 
spondent .at  the  price  named  in  such  letter. 
We  are  v^rv  clear  that  no  contract  was  per- 
fected by.  tiie  prder  telegraphed  by  the  re- 
spondent in' answer  to  appellants'  letter.  The 
learned  CQunsei  tor  the  respondent  clearly 
^ai^pre'ciakd  the  necessity  of  putting  a  con- 
's'truction  upon  the  letter  which  is  not  appar- 
ent on  its  face,  and  in  their  complaint  have 
interpreted  the  letter  to  mean  that  the  appel- 
lants by  said  letter  made  an  express  offer  to 
sell  the  respondent,  on  the  terms  stated,  such 
reasonable  amount  of  salt  as  he  might  order, 
and  as  the  appellants  might  rea.sonably  expect 
him  to  order,  in  response  thereto.  If  in  or- 
der to  entitle  the  plaintiff  to  recover  in  this 
action  it  is  necessary  to  prove  the  allegatiiins, 
then  it  seems  clear  to  us  that  the  writings 
between  the  parties  do  not  show  the  con- 
tract. It  is  not  insisted  by  the  learned  coun- 
sel for  the  respondent  that  any  recovery  can 
be  had  imless  a  proper  construction  of  the 
letter  and  telegram  constitutes  a  binding  con- 
tract between  the  parties.  The  alleged  con- 
tract being  for  the  sale  and  delivery  of  per- 
sonal property  of  a  value  exceeding  $50,  is 
void  by  the  statute  of  frauds,  unless  in  writ- 
ing. Section  2308.  Rev.  St.  1S7S.  The  coun- 
sel for  the  respondent  claJm  that  the  letter 
of  the  appellants  is  an  offer  to  sell  to  the 
respondent,  on  the  terms  mentioned,  any  rea- 
sonable quantity  of  Michigan  fine  salt  that 
he  might  see  fit  to  order,  not  less  than  one 
car-load.  On  the  other  hand,  the  counsel  for 
the  appellants  claim  that  the  letter  is  not  an 


100 


OFFER  AND  ACCEPTANCE. 


offer  to  sell  any  specific  quantity  of  salt,  but 
simply  a  letter  such  as  a  business  man  would 
send  out  to  customers  or  those  with  whom 
he  desired  to  trade,  soliciting  their  patronage. 
To  give  the  letter  of  the  appellants  the  con- 
struction claimed  for  it  by  the  learned  counsel 
for  the  respondent,  would  introduce  such  an 
element  of  uncertainty  into  the  contract  as 
would  necessarily  render  its  enforcement  a 
matter  of  difficulty,  and  in  every  case  the 
jury  trying  the  case  would  be  called  upon  to 
determine  whether  the  quantity  ordered  was 
such  as  the  appellants  might  reasonably  ex- 
pect from  the  party.  This  question  would  nec- 
essarily involve  an  inquiry  into  the  nature 
and  extent  of  the  business  of  the  person  to 
whom  the  letter  was  addressed,  as  well  as 
to  the  extent  of  the  business  of  the  appel- 
lants. So  that  it  would  be  a  question  of  fact 
for  the  jury  in  each  case  to  determine  wheth- 
er there  was  a  binding  contract  between  the 
parties.  And  this  question  would  not  in  any 
way  depend  upon  the  language  used  iu  the 
MTitten  contract,  but  upon  proofs  to  be  made 
outside  of  the  writings.  As  the  only  com- 
munications between  the  parties,  upon  which 
a  contract  can  be  predicated,  are  the  letter 
and  the  reply  of  the  respondent,  we  must 
look  to  them,  and  nothing  else,  in  order  to 
determine  whether  there  was  a  contract  in 
fact.  We  are  not  at  liberty  to  help  out  the 
written  contract,  if  there  be  one,  by  adding 
by  parol  evidence  additional  facts,  to  help 
out  the  writing  so  as  to  make  out, a,  contract 
not  expressed  therein.  If  the .  letf;3i  of  the 
appellants  is  an  offer  to  sell  sail  to'  ♦^'he  respond- 
ent on  the  terms  stated,  th^n  ijt  must  be  held 
to  be  an  offer  to  sell  any  quantity  ^at^.tte 
option  of  the  respondent  not  les'4  than  .'one 
car-load.  The  difficulty  and  injustice  of  con- 
struing the  letter  into  such  an  offer  is  so  ap- 
parent that  the  learned  coimsel  for  the  re- 
spondent do  not  insist  upon  it,  and  conse- 
quently insist  that  it  ought  to  be  construed 
as  an  offer  to  sell  such  quantity  as  the  appel- 
lants, from  their  knowledge  of  the  business 
of  the  respondent,  might  reasonably  expect 
him  to  order.  Rather  than  introduce  such 
an  element  of  uncertainty  into  the  contract, 
we  deem  it  much  more  reasonable  to  con- 
strue the  letter  as  a  simple  notice  to  those 
dealing  in  salt  that  the  appellants  were  In 
_a;~?<m(]ltl!JU  -l(y^p2ll_  that    article    for'TEe 


r-3*in«  (iiiSti  Is  UUH  WllWy  iFlS  e"mifl6nily  pi'upe'r 
to  heed  the  injunction  of  .Justice  Foster  in  the 
opinion  in  Lyman  v.  Robinson,  14  Allen,  254: 
"That  care  should  always  be  taken  not  to 
construe  as  an  agreement  letters  which  the 
parties  intended  only  as  preliminary  negotia- 
tions." 

We  do  not  wish  to  be  understood  as  hold- 
ing that  a  party  may  not  be  bound  by  an 
offer  to  sell  personal  property,  where  the 
amount  or  quantity  is  left  to  be  fixed  by  the 
person  to  whom  the  offer  is  made,  when  the 
offer  is  accepted  and  the  amount  or  quantity 


fixed  before  the  offer  is  withdrawn.  We 
simply  hold  that  the  letter  of  the  appellants 
in  this  case  was  not  such  an  offer.  If  the  let- 
ter had  said  to  the  respondent,  "We  will  sell 
you  aU  the  INIichigan  fine  salt  you  will  order, 
at  the  price  and  on  the  terms  named,"  then  it 
is  undoubtedly  the  law  that  the  appellants 
would  have  been  bound  to  deliver  any  reason- 
able amount  the  appellant  might  have  order- 
ed, possibly  any  amount,  or  make  good  their 
default  in  damages.  The  case  cited  by  the 
coun.sel  decided  by  the  California  supreme 
court  (Kleler  v.  Ybarru,  3  CaL  147)  was  an 
offer  of  this  kind  with  an  additional  limita- 
tion. The  defendant  in  that  case  had  a  crop 
of  growing  grapes,  and  he  offered  to  pick 
from  the  vines  and  deliver  to  the  plaintiff,  at 
defendant's  vineyard,  so  many  grapes  then 
growing  in  said  vineyard  as  the  plaintiff 
should  wish  to  take  during  the  present  year 
at  10  cents  per  pound  on  delivery.  The  plain- 
tiff, within  the  time  and  before  the  offer  was 
withdrawn,  notified  the  defendant  that  he 
wished  to  take  1,900  pounds  of  his  grapes  on 
the  terms  stated.  The  court  held  there  was 
a  Contract  to  deliver  the  1,900  pounds.  In 
this  case  the  fixing  of  the  quantity  was  left 
to  the  person  to  whom  the  offer  was  made, 
but  the  amount  which  the  defendant  offered, 
beyond  which  he  could  not  be  bound,  was  also 
fixed  by  the  amount  of  grapes  he  might  have 
■n  his'  "vineyard  in  that  year.  The  case  is 
C(yit,e  JjiffarFnr  in  its  facts  from  the  case  at 
bar.  The  cases  i-'ited  ,by  the  learned  counsel 
for  the  appellant,  tKeaupre  v.  Tile  Co.,  21 
Minn.  155,  and  Kinghorne  v.  Telegraph  Co., 
U.  C.  18  Q.  B.^60,)  are  'iearer  in  their  main 
lasts' to  t;hfj.  (a'se  at  bar,  and  in  both  it  was 
"  LeJ(J  there' v/jIs"  no  contract.  We,  however, 
place  our  opinion  upon  the  language  of  the 
letter  of  the  appellants,  and  hold  that  it  can- 
not be  fairly  construed  into  an  offer  to  sell 
to  the  respondent  any  quantity  of  salt  he 
might  order,  nor  any  reasonable  amount  he 
might  see  fit  to  order.  The  language  is  not 
such  as  a  business  man  would  use  in  making 
an  offer  to  sell  to  an  individual  a  definite 
amount  of  property.  The  word  "sell"  is  not 
u.sed.  They  say,  "We  are  authorized  to  offer 
INIichigan  fine  salt,"  etc.,  and  volunteer  an 
opinion  that  at  the  terms  stated  it  is  a  bar- 
gain. They  do  not  say,  "We  offer  to  sell  to 
you."  They  use  general  language  proper  to 
be  addressed  generally  to  those  who  were 
interested  in  the  salt  trade.  It  is  clearly  in 
the  nature  of  an  advertisement  or  business 
circular,  to  attract  the  attention  of  those  in- 
terested in  that  business  to  the  fact  that  good 
bargains  in  salt  could  be  had  by  applying  to 
them,  and  not  as  an  offer  by  which  they  were 
to  be  bound,  if  accepted,  for  any  amount  the- 
persons  to  whom  it  was  addressed  might  see 
fit  to  order.  We  think  the  complaint  fails  to 
show  any  contract  between  the  parties,  and 
the  demurrer  should  have  been  sustained. 

The  order  of  the  circuit  court  is  reversed, 
and  the  cause  remanded  for  further  proceed- 
ings, according  to  law. 


a 


CONTRACTUAL  INTENTION. 


101 


MISSISSIPPI   &    DOMINION   STEAMSHIP 
CO.,  Limted,  v.  SWIFT  et  al. 

(29  Atl.  1063.  8G  Me.  248.) 

Supreme   Judicial    Court   of    Maine.      Feb.    24, 
1894. 

Report  from  supreme  judicial  court,  Cum- 
berland county.  j 

Action  by  the  Mississippi  &  Dominion 
Steamship  Company,  Limited,  against  Gus- 
tavus  F.  Swiit  and  others.  On  report 
Jud;;uient  for  defendants. 

This  was  an  action  for  the  recovery  of 
$24,690.08  damages  for  breach  of  a  contract 
claimed  by  the  plaintiff  to  have  been  made 
with  the  defendants,  by  which  it  chartered 
to  the  defendants  certain  space,  at  a  price 
designated,  on  the  three  steamers,  Vancou- 
ver, Sai-nia,  and  Oregon,  owned  by  the  plain- 
tiff company,  which  space  was  to  be  fitted 
with  refrigerators,  and  used  by  the  defend- 
ants for  the  shipping  of  dressed  meat 

The  principal  part  of  the  evidence  consists 
of  letters  and  telegrams  between  David  Tor- 
rance &  Co.,  steamboat  agents  of  the  plaintiff 
company,  who  had  an  office  both  in  Mont- 
real and  Portland,  and  these  defendants,  rep- 
resented by  Mr.  Edwin  C.  Swift  at  Boston. 
The  correspondence,  beginning  November  19, 
18S9,  and  continuing  until  the  latter  part  of 
1S90,  is  stated  in  the  opinion  of  the  court 

The  plaintiff  claimed  that  the  minds  of  the 
parties  were  together,  and  that  the  contract 
was  complete  April  5,  1890.  Plea,  general 
issue,  and  the  statute  of  frauds.  The  defend- 
ants denied  that  any  contract  was  made  or 
signed. 

Symonds,  Snow  &  Cook,  for  plaintiff.  Sav- 
age &  Oakes,  Freedom  Hutchinson,  and  Clar- 
ence Hale,  for  defendants. 

EMERY,  J.  A  full  exposition  of  our  judg- 
ment in  this  case  requires  an  extended  state- 
ment of  the  evidence  and  the  authorities,  not- 
withstanding constmt  eflort  at  abridgment. 

The  plaintiff  steamship  company  owned 
and  operated  a  line  of  ocean  steamships  ply- 
ing between  Livei-pool  and  Montreal  in  the 
summer,  and  between  Liverpool  and  Portland 
in  the  winter.  The  American  agents  of  the 
company  were  David  Torrance  &  Co.,  with 
offices  in  Montreal  and  in  Portland.  Three 
of  the  steamships  were  named,  respectively, 
Sarnia,  Oregon,  and  Vancouver. 

The  defendants.  Swift  &  Co.,  located  at 
Boston,  were  large  shippers  of  di'essed  meats 
from  the  United  States  to  Europe.  This  kind 
of  mercliandise,  being  fresh  meat  could  not 
be  shipped,  stowed,  and  transported  across 
the  oce:tn  like  ordinary  merchandise,  upon 
mere  bill  of  lading.  Its  suitable  transporta- 
tion required  that  certiiin  spaces  in  the 
steamship  should  be  set  apart  for  its  recep- 
tion, refrigeration,  and  c-aro  during  the  voy- 
age. This  space  was  necessarily  engaged 
for  some  time  prior  to  the  shipping,  that  It 
might  be  properly  fitted  up;   and  it  was  nec- 


essarily, to  some  extent  at  the  disposal  of  the 
shipper,  and  under  his  control,  during  the 
term  of  the  contract  There  were  two  modes 
of  refrigeration  in  use, — one  by  ice,  and  a 
new  one  by  tlie  Kilbourn  process,  so  calle<l. 

In  this  condition  of  affairs,  Torrance  &  Co., 
November  19,  1889,  opened  a  correspond- 
ence with  Swift  &  Co.  relative  to  space  on 
the  company's  steamers  for  the  tran.sporta- 
tion  of  dressed  beef.  In  the  first  letter,  No- 
vember 19th,  Torrance  &  Co.  advised  Swift 
&  Co.  that  they  were  prepared  to  negotiate 
for  such  space  on  tlie  Sarnia  and  Oregon, 
and  were  prepared  to  offer  such  space  at  20 
shillings  per  40  cubic  feet  on  those  steamere, 
retaining  liberty  to  substitute  the  Vancouver 
for  one  of  the  others  later  on.  There  was  no 
reply  to  this  letter,  and  on  January  19,  ISIX), 
Tormnce  &  Co.  again  wrote  Swift  &  Co., 
naming  the  sailing  dates  of  the  vaiious  steam- 
ers, and  inviting  bids.  No  reply  being  re- 
ceived, Torrance  &  Co.,  on  February  6th, 
again  invited  the  attention  of  Swift  &  Co.  to 
the  matter.  Swift  &  Co.,  February  12th, 
wrote  Torrance  &  Co.  that  one  of  their  nn-n 
would  call  upon  them  with  reference  to  the 
matter.  There  seems  then  to  have  been 
some  verbal  conference,  for,  on  March  3d, 
ToiTance  &  Co.  wrote  that  the  Liverpool  man- 
agers were  not  inclined  to  accept  the  price 
named  by  Swift  &  Co.,  and  "would  only 
agree  to  fix:  the  ships  provided  you  are  ^^ill- 
ing  to  pay  twenty  shillings,  and  take  the 
space  where  we  think  it  would  be  most  profit- 
able for  the  ship,"  and  suggested  that,  if 
Swift  &  Co.  were  inclined  to  do  anything 
on  these  terms,  they  might  communicate  with 
either  the  Montreal  or  Portland  house.  March 
24th,  Torrance  &  Co.  again  ^VT•ote  (this  time 
from  Portland,  the  other  letters  having  been 
from  Montreal)  that  they  would  not  be  pre- 
pai'ed  to  enter  into  a  conti-act  for  the  Van- 
couver, Saraia,  and  Oregon  unless  for  one 
year,  from  Montreal  in  summer,  and  Port- 
land in  winter,  they  reserving  the  right  to 
withdraw  the  Vancouver  in  the  winter. 

The  next  day,  March  2oth,  Swift  &  Co. 
wired  in  answer  as  follows:  "Answering 
your  letter,  24th,  if  accepted  at  once,  we  will 
take  space  in  the  three  ships  named,  to  be 
mutually  agreed  on  at  twenty  shillings  flat 
for  summer  navigation;  we  agreeing  to  con- 
tinue shipments  dm'ing  the  winter,  if  ships 
go  from  Portland  or  Boston,  we  paying  your 
mai'ket  price  for  beef  space.  As  we  are  ne- 
gotiating with  other  parties,  would  appre- 
ciate your  answer  at  once."  Torrance  iS:  Co. 
wired  same  day  from  Montreal  as  follows: 
"We  cannot  change  offer  already  made  by  c'ur 
Portlaud  house  under  insUnictions  from  Liv- 
erpool." Their  Portland  house,  on  the  next 
day.  March  2<;th,  wrote  for  an  answer  to  their 
proposition.  On  March  27th.  Swift  &  Co. 
wired  to  the  Portland  house  as  follows: 
"Your  favor  of  2Gth  just  received.  We  ac^ 
cept  your  proposition  of  24th  on  three  steam- 
ers. Please  confirm  by  wire." 
In   the   meantime,   between   the   24th  and 


102 


OFFER  AND  ACCEPTANCE. 


27th  of  March,  Ton-anco  i<L-  Co..  not  hcarinc: 
from  Swift  &  Co.,  begau  negotiatious  with 
ether  parties,  and  so  informed  Swift  &  Co. 
In  answer  to  their  telegram  of  the  27th. 
March  2901.  Swift  &  Co.  wired  that  they 
wanted  the  space,  and  thought  it  should  be 
accorded  to  them.  April  1st,  Torrance  & 
Co.  wired  as  follows:  "The  decision  has  bei?n 
given  in  your  favor,  and  the  three  ships  men- 
tioned are  at  your  disposal.  Sarnia  expected 
rordand  Thui-sday.  Will  sail  following 
Thm-sday."  On  the  same  day  Torrance  & 
Co.  wrote  that  they  had  been  relieved  of  thoir 
negotiations,  and  said,  "We  hasten  to  ad'vise 
you  that  we  are  willing  to  conti-act  with  you 
for  the  three  steamers  on  the  terms  ah-eady 
mentioned,  and  conditional  on  your  putting 
in  the  cold  air  blast  instead  of  the  ice,  and  we 
have  wired  you  accordingly  in  these  words: 
'The  decision  has  been  given  in  yom*  favor 
and  the  three  ships  mentioned  are  at  yoiu: 
disposal.  Sarnia  expected  Portland  Thurs- 
day, and  will  sail  the  following  Thursday.' 
You  can  arrange  with  our  Portland  house  in 
.reference  to  the  contract.  *  *  *"  To  this 
telegram,  Swift  &  Co.  wired  answer  as  fol- 
lows: "Your  message  received.  Thanks  for 
same.  Shall  we  refrigerate  Sarnia  by  old 
process  this  trip,  or  wait  till  first  of  May, 
and  use  Kilboum  machine?  We  have  two 
machines  to  be  delivered  early  in  May."  Tor- 
rance t&  Co.  replied  by  wire  same  day,  April 
1st,  as  follows:  "Wait  till  May.  We  don't 
want  old  process."  On  AprU  5th,  Swift  & 
Co.  wrote  as  follows:  "Your  favor  of  April 
1st  received.  Replying  to  same,  will  say  we 
will  arrange  for  fitting  the  thi'ee  ships  by  the 
Kibourn  process,  as  per  your  request.  I  no- 
tice you  say:  'The  Toronto,  one  of  our  steam- 
ers sailing  between  here  and  Liverpool  all  next 
season,  is  due  at  Portland  on  the  10th  instant, 
and  should  sail  about  the  15th.  We  are 
open  to  negotiation  for  her,  if  you  are  so  in- 
clined.' I  suppose  'all  next  season'  means 
the  coming  summer  navigation  for  Montreal. 
Will  you  kindly  write  us,  saying  where  this 
ship  wiU  sail  from  dvu*ing  next  winter.  If 
she  is  to  be  in  the  regular  service,  we  shall 
be  pleased  to  negotiate  with  you." 

Here  the  correspondence  ceased  for  a  time. 
In  the  meantime,  about  the  last  of  March, 
Mr.  Foster,  agent  of  Swift  &  Co.,  visited  the 
steamers  in  Portland,  took  measurements  of 
space  in  different  steerages,  and  had  some 
convei-sation  with  the  company's  marine  su- 
perintendent about  the  location  of  spaces  for 
refilgerators.  He  indicated  what  spaces  he 
should  want,  but  no  express  stipulation  was 
made  that  he  should  have  them,  or  would 
take  them.  Swift  &  Co.  did  nothing  toward 
refrigerating  any  space,  and  the  steamers 
carried  cargo  in  all  the  steerages  as  usual, 
leaving  no  space  imoccupied. 

July  8,  1S90,  Swift  &  Co.  wired  as  follows: 
"Have  no  copy  of  contract  Please  mail  one 
to-day."  On  the  same  day,  Torrance  &  Co. 
replied  as  follows:  "We  must  apologize  for 
not  having  earUer  sent  you  copy  of  the  con- 


tract for  dead-meat  space.  We  shall,  how- 
ever, mail  it  to  you  to-morrow  without  fail." 
The  next  day,  July  9th,  they  further  wrote 
as  follows:  "Owing  to  this  being  our  English 
mail  day,  we  have  been  unable  to  put  your 
contract  in  form,  as  promised,  but  we  will 
send  it  to  you  to-moiTow."  July  10th,  they 
wrote  again  as  follows:  "We  now  inclose  you 
copy  of  om*  proposed  contract,  which  we  trust 
may  be  found  to  be  in  accordance  with  the 
understanding  arrived  at  last  March.  We 
must  apologize  for  not  sending  this  yesterday, 
but,  as  it  was  om*  mail  day,  we  were  more 
than  busy,  and  this  must  be  our  excuse.  We 
trust  you  may  soon  be  prepared  to  begin  yom* 
shipments."  The  draft  of  conti-acts  inclosed 
was  quite  long.  The  only  date  on  the  draft 
was,  "Montreal,  1S90."  This  di-aft  was  never 
signed. 

July  24th,  Swift  &  Co.  wired  that  they 
could  not  use  Kilbourn  process,  and  must 
use  ice,  and  inquired  if  that  would  be  satis- 
factory. July  2Gth,  Torrance  &  Co.  replied  by 
wire  as  follows:  "Have  cable  authorizing 
you  using  ice,  but  the  other  preferred.  Can 
you  refrigerate  Vancouver?  Will  be  here  to- 
moiTow.    Sails  Wednesday  week." 

Swift  &  Co.  replied  on  July  2Sth  that  they 
could  not  refrigerate  the  Vancouver,  and  that 
their  Mr.  Foster  would  call  on  Torrance  & 
Co.  Wednesday  morning.  At  this  point  the 
draft  of  contract  had  not  been  signed.  Swift 
&  Co.  had  taken  no  spaces,  and  had  made  no 
shipments.  The  company  had  set  apart  no 
spaces,  but  had  filled  them,  as  us\ial,  with 
cargo. 

This  state  of  affairs  continued  till  Septem- 
ber 24,  1S90,  when  Torrance  &  Co.  wrote  to 
persuade  Swift  &  Co.  to  hasten  matters. 
Swift  &  Co.  replied,  September  25th,  that  they 
did  not  feel  like  assuming  the  responsibility 
of  shipments  in  warm  weather  by  either  pro- 
cess, as  at  present  working.  There  was  other 
correspondence  following  this,  and  running 
up  to  October,  1891,  in  which  Torrance  &  Co. 
insisted  that  Swift  &  Co.  should  caiTy  out 
the  arrangement,  and  Swift  &  Co.  refused  to 
recognize  any  ari-angement  as  concluded. 
The  result  was  that  March  19,  1892,  this  suit 
was  brought  to  recover  damages  for  the  re- 
fusal of  Swift  &  Co.  to  can-y  out  the  contract 
claimed  by  the  plaintiffs  to  have  been  made. 
The  company  only  claims  as  damages  the 
profits  at  20  shillings  per  40  cubic  feet,  inas- 
much as  it  filled  the  spaces,  though  at  a  less 
rate. 

The  plaintiff  now  contends  that  it  appears 
from  this  coiTespondence,  as  explained  by  the 
oral  testimony,  that  the  terms  of  a  complete 
contract  were  mutually  agreed-  upon,  April 
5th,  by  Swift  &  Co.'s  letter  of  that  date,  and 
that  the  parties  then  had  mutually  signified 
an  intention  to  be  bound.  The  defendants 
contend  that  the  con-espondence  and  the  cir- 
cumstances do  not  show  that  the  terms  of 
such  a  contract  wore  then  or  ever  agreed  up- 
on, and,  further,  that  the  correspondence  and 
circumstances  do  show  that  the  pai-ties  con- 


CONTRACTUAL  INTENTION. 


103 


templatod  that  such  terms  as  should  be 
agreed  upon  should  be  expressed  in  some 
formal  instrument,  to  be  written  and  sij^ied 
before  any  contract  should  be  considered  as 
complete.  A  formal  draft  of  the  terms  of  a 
contract  was  prepared  by  the  plaintiCf,  but 
was  not  signed  by  either  party.  Was  there  a 
complete  contract  without  that  signing? 

The  burden  is  upon  the  plaintiff  to  main- 
tain the  aflirmative. 

Upon  tills  question  the  diligent  counsel 
have  cited  nmncrous  cases  where  a  similar 
question  has  arisen  and  been  discussed.  A 
study  of  these  cases  has  not  been  profitless. 
We  summarize  a  few,  and  quote  from  the 
opinions  of  several  eminent  judges.  In  Chin- 
nock  V,  Ely,  4  De  Gex,  J.  &  S.  CiS,  the  defend- 
ant's solicitors  wrote  to  the  plaintiff,  naming 
the  price  for  an  estate  about  which  they  had 
been  negotiating.  The  plaintiff  wrote  a  let- 
ter in  which  he  agreed  to  give  the  price 
named,  and  then  added,  "I  shall  be  obligetl  if 
you  will  forward  me  the  usual  contract"  In 
reply  the  defendant's  solicitors  wrote:  "We 
have  been  instructed  by  the  Marchioness  of 
Ely  to  proceed  with  the  sale  to  you  of  these 
premises.  The  draft  contract  is  being  pre- 
pared, and  will  be  forwardetl  to  you  for  ap- 
proval in  a  few  days."  Ix»rd  Chancellor 
Westbury  held  that,  so  far,  the  parties  were 
in  treaty,  merely,  and  that  without  the  exe- 
cution of  the  draft  mentioned  there  Avas  no 
contract  concluded.  In  Bonnewell  v.  Jen- 
kins, 8  Ch.  Div.  70,  the  defendant's  agents 
offered  certain  premises  for  sale.  The  plain- 
tiff vsTote  the  agents,  making  an  offer  of  fSOO 
for  the  estate.  The  agents  wrote  in  reply  as 
follows:  "We  are  instructed  to  accept  your 
offer  of  £S00  for  these  premises,  and  have 
asked  Mr.  Jenkins'  solicitor  to  prepare  con- 
tract" The  lord  justices  of  appeal  held  that 
there  was  a  concluded  contract  Thesiger,  L. 
J.,  said,  "The  mere  reference  to  a  preparation 
of  an  agreement  by  which  the  terms  agreed 
upon  would  be  put  into  a  more  formal  shape, 
does  not  prevent  the  existence  of  a  binding 
contract"  In  Kossiter  v.  Miller,  5  Ch.  Div. 
648,  there  was  much  correspondence  about  a 
sale  of  certain  lots  of  land,  and  the  question 
arose  whether  the  coirespondence  showed  a 
completed  contract,  without  the  formal  draft 
which  had  been  refeiTcd  to  in  some  of  the 
letters.  James,  L.  J.,  said,  "The  reasonable 
view  of  the  case  is  that  the  parties  intended 
the  signing  of  the  formal  contract  to  be  a 
condition  precedent"  Coleridge,  C.  J.,  said, 
"If  a  set  of  terms  be  agreed  upon  in  writing, 
they  constitute  a  contract  although  it  may  be 
the  intention  of  the  parties  tliat  they  should 
be  put  into  a  more  formal  shape;  but  here  a 
set  of  terms  was  never  agreed  to."  Baggal- 
lay,  L.  J.,  said,  "The  letters  left  the  defend- 
ant a  right  to  believe  that  the  signing  of  a 
formal  contract  was  necessary  to  create  a 
binding  agreement"  In  the  same  case,  up- 
on an  appeal  to  the  house  of  lords  (8  App. 
Cas.  1124),  Lord  Hatherly  said:  "Although 
the  correspondence  may  not  set  fonh,  In  a 


form  which  a  solicitor  would  adopt  if  he  were 
instructed  to  draw  an  agreement  in  writing, 
that  which  is  an  agreement  between  the  par- . 
ties,  yet  if  the  parties  to  the  agreement,  the 
thiug  to  be  sold,  tlie  price  to  be  paid,  and  all 
those  matters,  be  clearly  and  distinctly  slated, 
though  only  by  letter,  an  acceptance  clearly 
by  letter  will  not  the  less  constitute  an  agree- 
ment in  the  full  sense,  between  the  parties, 
merely  because  the  letter  may  say,  'We  will 
have  this  agreement  put  in  due  form  by  a  so- 
licitor.' "  Lord  O'llagan  said,  "The  corre- 
spondence gives  no  color  to  the  suggestion 
that  the  contract  was  not  final,  and  was  not 
considered  to  be  final  by  all  the  parties  to  it 
because  the  formal  agreement  embo<lying  its 
already  settled  terms,  had  not  been  fur- 
nished." Lord  Bhiciburn  said:  "The  mere 
fact  that  the  parties  have  expressly  stipu- 
lated that  there  shall  be  afterwards  a  formal 
aprreement  prepared,  embodying  the  terms, 
which  shall  be  signed  by  the  parties,  docs 
not,  by  itself,  show  that  they  continue  merely 
a  negotiation.  It  is  a  matter  to  be  taken  into 
account  in  construing  the  evidence,  and  de- 
termining whether  the  parties  have  really 
come  to  a  final  agreement  or  not;  but  as 
soon  as  the  fact  is  established  of  the  final 
mutual  assent  of  the  parties,  so  that  those 
who  draw  up  the  final  agreement  have  not 
the  power  to  varj'  the  terms  already  settled, 
I  think  the  conti-act  is  completed."  In  the 
same  opinion,  Lord  Blackburn  further  said: 
"Parties  do  often  enter  into  negotiation, 
meaning  that  when  they  have  (or  think  they 
have)  come  to  one  mind,  the  results  shall  be 
put  into  formal  shape,  and  then  (if,  on  seeing 
the  result  in  that  shape,  they  find  they  are 
agreed)  signed  and  made  binding,  but  that 
each  party  is  to  reserve  to  himself  the  right 
to  retire,  if,  on  looking  at  the  formal  contract 
he  finds  that,  though  it  may  represent  what 
he  said,  it  does  not  represent  what  he  meant 
to  say.  Whenever,  on  the  true  construction 
of  the  evidence,  this  appears  to  be  the  inten- 
tion, I  think  the  parties  ought  not  to  be  held 
bound  till  they  have  executed  the  formal 
agi-eement."  In  Ridgway  v.  Wharton.  G  H. 
L.  Cas.  '2:>8,  Lord  Chancellor  Cranworth  said: 
"If  parties  have  entered  into  an  agreement, 
they  are  not  the  less  bound  by  that  agree- 
ment because  they  say,  'We  sent  it  to  a  so- 
licitor to  have  it  reduced  into  form;'  but  when 
the  parties  negotiate,  and  do  not  say  so,  the 
mere  fact  that  they  do  send  it  to  a  solicitor 
to  have  the  matter  reduced  into  form  affords 
to  my  mind  generallj^  cogent  evidence  that 
they  do  not  intend  to  bind  themselves  till  it 
is  reduced  into  form."  Lord  Wensleydale 
said:  "I'hese  cases  often  occur  in  courts  of 
law,  and  the  question  then  always  is  whether 
the  parties  mean  to  embody  the  contract 
made  by  parol  in  writing.  If  they  do,  noth- 
ing binds  them  till  it  is  written.  If  they  en- 
ter into  a  contract  with  a  view  to  a  written 
agreement  nothing  will  bind  them  btit  that 
written  agreement  and  that  quite  independ- 
ently of  the  statute  of  fi-auds,  applying  to  all 


104 


OFFER  AND  ACCEPTANCE. 


agreements.  *  »  *  If  the  parties  agree 
finallv  to  be  bound  by  auy  terms,  and  then, 
for  the  sake  of  preserving  a  memorial,  hav- 
ing agreed  to  the  original  terms,  they  get  a 
document  drawn  up,  there  is  no  doubt  they 
are  boimd  by  the  original  terms."  In  Mor- 
rill V.  Mining  Co.,  10  Nev.,  at  page  135,  the 
com-t  declai-ed  the  genei*al  rule  to  be  tliat 
where  the  parties  enter  into  any  general 
agi-eement,  and  the  undei-standing  is  tliat  it 
is  to  be  reduced  to  writing,  or,  if  it  is  al- 
ready in  a  written  form,  that  it  is  to  be 
signed  before  it  is  to  be  acted  on  or  to  take 
effect,  it  is  not  binding  until  it  is  so  written 
or  signed.  In  Methudy  v.  Ross,  10  Mo. 
App.  106,  the  court  said:  "The  mere  fact  that 
a  written  contract  was  to  be  subsequently 
prepared  does  not  show  that  a  final  agree- 
ment between  the  parties  was  not  made,  but 
it  tends  to  show  it;  and  in  this  case  we  think 
it  clear  that  there  was  to  be  a  more  explicit 
agi-eement,  which  was  to  be  reduced  to  writ- 
ing, that  this  was  not  done,  and  that  there 
was  no  meeting  of  minds."  In  Eads  v.  Ca- 
rondelet,  42  Mo.  113,  the  plaintiff  made  to  the 
city  of  Carondelet  a  written  proposition,  con- 
taining the  terms  on  which  he  would  build 
gunboats  in  that  city.  The  city  council 
passed  an  ordinance  reciting  the  proposition, 
and  expressly  accepting  it  as  made,  but,  in 
the  second  section  of  the  ordinance,  directed 
and  empowered  the  mayor  to  enter  into  a 
written  contract  with  the  plaintiff,  and  em- 
ploy counsel  to  draft  the  contract.  The 
plaintiff  carried  out  his  proposition,  but  the 
city  failed  to  perform  any  part.  Held,  that 
the  city  was  not  boimd,  as  further  formality 
was  contemplated.  In.  Commissioners  v. 
Brown,  32  N.  J.  Law,  504,  Brown  made  a 
proposition  to  the  commissioners  to  do  cer- 
tain work  in  laying  pipe.  The  commission- 
ers accepted  the  proposition,  and  directed  a 
written  contract  to  be  prepai*ed.  This  was 
done,  but  it  was  not  signed.  Held,  that  the 
commissioners  were  not  boimd.  In  this  case, 
however,  the  law  provided  that  the  contracts 
of  the  water  commissioners  should  be  in 
vsTiting.  This  fact  showed  conclusively  that 
a  written  contract  must  have  been  contem- 
plated. In  Congdon  v.  Darcy,  46  Vt.  478,  the 
negotiation  was  for  building  a  dwelling 
house  by  the  plaintiff  for  the  defendant 
Everything  was  agreed  upon,  and  it  was  also 
agreed  that  the  contract  should  be  put  in 
writing  if  the  defendant  desired-  The  de- 
fendant afterwards  expressed  such  desire, 
and  a  writing  was  prepared,  embodying  the 
agreement,  but  the  defendant  refused  to  sign 
it    Held,  there  was  no  completed  contract 

From  those  expressions  of  courts  and  ju- 
rists, it  is  quite  clear  that,  after  all,  the  ques- 
tion is  mainly  one  of  intention.  If  the  party 
sought  to  be  charged  intended  to  close  a  con- 
tract prior  to  the  formal  signing  of  a  written 
draft,  or  if  he  signified  such  an  intention  to 
the  other  party,  he  will  be  bound  by  the  con- 
tract actually  made,  though  the  signing  of 
the  written  draft  be  omitted.     If,  on  the  oth- 


er hand,  such  party  neither  had  nor  signified 
such  an  intention  to  close  the  contract  until 
it  was  fully  expressed  in  a  written  instru- 
ment, and  attested  by  signatiu'cs,  then  he 
will  not  be  bound  until  the  signatures  are 
affixed.  The  expression  of  the  idea  may  be 
attempted  in  other  words:  If  the  written 
draft  is  viewed  by  the  parties  merely  as  a 
convenient  memorial  or  record  of  their  pre- 
vious conti'act  its  absence  does  not  affect  the 
binding  force  of  the  contract-  If,  however, 
it  is  viewed  as  the  consummation  of  the  ne- 
gotiation, there  is  no  contract  until  the  writ- 
ten draft  is  finally  signed. 

In  determining  which  view  is  entertained 
in  any  particular  case,  several  circumstances 
may  be  helpful,  as  whether  the  contract  is 
of  that  class  which  are  usually  found  to  be  in 
writing,  whether  it  is  of  such  nature  as  to 
need  a  formal  writing  for  its  fuU  expres- 
sion, whether  it  has  few  or  many  details, 
whether  the  amount  involved  is  large  or 
small,  whether  it  is  a  common  or  unusual 
contract,  whether  the  negotiations  them- 
selves indicate  that  a  written  draft  is  con- 
templated as  the  final  conclusion  of  tlie  nego- 
tiations. If  a  written  draft  is  proposed,  sug- 
gested, or  referred  to  dm-ing  the  negotiations, 
it  is  some  evidence  that  the  parties  intended 
it  to  be  the  final  closing  of  the  contract 

Still,  with  the  aid  of  all  rules  and  sugges- 
tions, the  solution  of  the  question  is  often  dif- 
ficiilt,  doubtf;il,  and  sometimes  unsatisfac- 
tory. An  illustration  of  this  is  the  case  of 
Rossiter  v.  Miller,  above  quoted  from-  In 
that  case.  Lord  Chief  Justice  Coleridge  and 
Lord  Justices  James  and  Baggallay,  three  of 
England's  most  distingruished  judges,  were 
clear  that  there  was  no  contract,  for  want  of 
a  formal  draft  Lord  Chancellor  Cairns  and 
Lords  Hatherly,  Blackburn,  and  Gordon, 
equally  able  and  eminent  jurists,  were  confi- 
dent in  the  contrary  opinion. 

We  come  now  to  the  consideration  of  the 
circumstances  and  correspondence  in  this 
case. 

The  attempt  was  to  negotiate  a  contract 
for  the  use  of  space  on  ocean  steamers,  of 
which  the  shippers  were  to  have  contix)!  to 
some  extent,  and  in  which  they  were  to  set 
up  their  appliances,  and  load  and  care  for 
their  own  merchandise.  This  arrangement 
is  quite  different  from  the  ordinary  contract 
of  affreightment  It  is  like  a  charter  party, 
which  is  almost  universally  reduced  to  for- 
mal written  draft. 

The  negotiations  contemplated  not  simply 
a  contract  for  one  area  of  space  on  a  single 
steamer  for  a  single  trip.  The  contract  Mas 
to  be  for  a  year,  and  for  different  areas  of 
space  on  three  different  ships.  The  inter- 
ests of  the  contracting  parties  in  those  spaces 
were  so  various,  and,  if  not  conflicting,  yet 
In  such  close  contact  that  a  contract  would 
need  to  contain  many  stipulations  in  order 
to  sufficiently  define  the  rights  and  duties  of 
the    parties-     The    draft    prepared    by    the 


CONTRACTUAL  INTENTION. 


105 


steamship  company  would,  if  printed  in  this  1 
type,  occupy  over  three  pages  of  this  volume. 
It  contained  some  21  distinct  stipulations, 
many  of  them  nowhere  alluded  to  in  the  cor- 
respondence or  conversations,  and  yet  seem- 
ingly essential  to  be  agreed  upon  in  a  con- 
tract for  chai-teriug  space  on  ocean  steamers 
for  the  transportation  of  dressed  meats.  It 
had  annexed,  as  a  part  of  itself,  a  long,  print- 
ed, blank  biU  of  lading.  The  elder  Tori-ance 
testified  that  all  the  details  in  the  written 
draft  were  the  well-understood  custom  of  the 
trade,  and  understood  in  every  similar  con- 
tract He  also  testified  that  "the  contract 
was  carefully  drawn  up,"  and  that  when  he 
drew  it  he  had  before  him  several  other  con- 
tracts. So  far  as  the  case  shows,  the  draft 
was  entirely  In  manuscript  No  printed 
blanks  seem  to  have  been  in  existence,  as 
there  probably  would  have  been,  had  the  nu- 
merous details  become  crystaUzed  into  a  weU- 
understood  custom.  The  defendants  deny 
the  existence  of  any  such  custom  or  under- 
standing. 

The  claim  of  the  plaintiff  company  that  it 
would  have  made  nearly  $25,000  profits  by 
Buch  a  contract  shows  that  the  negotiations 
were  not  about  a  trifle. 

The  correspondence  seems  to  Indicate  that 
a  formal  draft  of  the  contract  was  in  the 
minds  of  the  parties,  or  at  least  in  the  mind 
of  the  defendants,  as  the  only  authoritative 
evidence  of  a  contract  In  the  first  letter,— 
that  of  November  19th,— Torrance  ct  Co.,  the 
plaintiff's  agents,  write  that  they  are  author- 
ized "to  make  a  contract  for  dressed  beef  on 
our  steamers  Samia  and  Oregon,  and  we 
hasten  to  advise  you  that  we  are  prepared 
to  discuss  the  matter  with  you."  In  the  sec- 
ond letter,  they  Invite  a  bid.  In  the  letter  of 
March  3,  1890,  they  name  terms,  and  then 
say,  "If  you  are  inclined  to  do  anytliing  on 


these  terms,  you  might  further  communicate 
with  us,  or  our  Portland  house."  In  the  let- 
ter of  March  24th,  from  Portland,  they  say, 
"We  would  not  be  prepared  to  enter  into  a 
contract  with  you  for  the  Vancouver,  Sarnia, 
and  Oregon,  unless  for  one  year,  from  Mon- 
treal during  the  summer,  and  PorUaud  in 
winter,  we  reserving  tlie  right  to  withdraw 
Vancouver  during  the  winter."  In  the  letter 
of  AprU  1st,  they  say,  "You  can  arrange  with 
our  Portland  house  in  reference  to  the  con- 
tract" July  8th  the  defendants  wired  toe  a 
copy  of  the  contract  to  be  sent  On  the  same 
day,  Torrance  &  Co.  write,  apologizing  for 
neglect  to  send  copy.  July  10th,  Torrance  & 
Co.  send  the  written  draft  which  has  been 
above  described,  and  write,  "We  now  inclose 
you  copy  of  our  proposed  contract,  which  we 
trust  may  be  found  in  accordance  with  the 
understanding  arrived  at  last  March." 

Neither  party,  during  all  the  correspond- 
ence, seems  to  have  made  any  change  in  his 
business  operations  by  reason  of  anything  in 
the  corresix)ndence.  No  dressed  meats  were 
shipped  by  the  defendants,  or  offered  for 
shipment  No  space  was  reserved  by  the 
plaintiff,  and  there  was  no  delay  or  hin- 
drance suffered  in  its  regular  business. 

The  case  is  by  no  means  free  from  doubt 
and  difficulty,  but  due  reflection  and  study 
of  the  evidence  have  at  the  last  brought  us 
to  the  conclusion  that  what  the  plaintiff 
claims  to  have  become  a  perfected  contract 
on  April  5,  1890,  by  the  defendants'  letter  of 
that  date,  was  at  the  most  only  the  accept- 
ance of  the  proposed  basis  of  a  contract 
which  was  yet  to  be  perfected  'as  to  details, 
and  put  in  writing,  and  that  the  defendants 
did  not  have,  nor  signify,  any  intention  to  be 
bound  until  the  written  draft  had  been  made 
and  signed. 

Judgment  for  defendants. 


106 


CONTRACTS  UNDER  SEAL. 


W 


MARTIN  T.  FLAHARTY  et  aL    ^ 
c(j  (32  Pac.  2S7,  13  Mont.  96.)       )^ 

Supreme  Court  of  Montana.    Feb.  6,  1893. 

Appeal  from  distilct  court,  Gallatin  county; 
Frank  K.  Armsti'ong,  Judge. 

Ejectment  by  J.  P.  Martin,  administrator, 
against  Martha  Flaharty  and  others.  Judg- 
ment for  defendants.  From  an  order  refus- 
ing a  new  trial,  plaiutifiE  appeals.    Affirmed. 

E.  P.  Cadwell  and  J.  L.  Staats,  for  appel- 
lant   Luce  Sc  Luce,  for  respondents. 

PEMBERTON,  C.  J.  This  is  a  suit  in  eject- 
ment instituted  in  the  court  below  by  appellant 
as  administiator  of  Rebecca  Githens,  deceased. 
The  complaint  is  such  a  one  as  is  ordinarily 
employed  in  such  actions.  The  answer  con- 
tains a  denial  of  all  of  the  material  allega- 
tions contained  in  the  complaiut,  and  alleges 
affijmatively  that  the  deceased  was  not  the 
owner  of  the  demanded  premises  at  the  time 
of  her  death,  but  was  the  tenant  of  the  re- 
spondents; that,  as  she  did  not  die  seised  of 
any  estate  in  the  premises,  her  administrator, 
the  appellant,  cannot  maintain  this  action. 
Both  parties  in  the  court  below  having  ex- 
pressly waived  a  jury,  the  case  was  tried  by 
the  court.  The  findings  and  judgment  of  the 
court  below  were  in  favor  of  the  respondents. 
The  appellant  filed  his  motion  for  a  new  trial, 
which  was  overruled,  and  from  the  order  of 
the  court,  overruling  his  motion  for  a  new 
trial,  this  appeal  is  taken. 

The  facts  of  the  case  are  substantially  as 
follows:  The  deceased,  Rebecca  Githens,  was 
the  mother  of  the  respondents.  On  the  2d 
day  of  January,  1888,  the  deceased,  who  was 
then  seised  in  fee  of  the  premises  in  dispute, 
executed  a  deed  to  the  demanded  premises  to 
the  respondents.  On  the  same  day  the  re- 
spondents executed  a  lease  to  the  same  prem- 
ises to  the  deceased  for  the  term  of  her 
nattu"al  life,  and  delivered  the  same  to  the  de- 
ceased. The  proof  is  not  positive  that  the 
deed  was  actually  then  delivered  by  the  gran- 
tor to  the  grantees;  that  is,  by  manual  de- 
livery. Some  months  after  the  execution  of 
the  said  deed  and  lease,  the  deceased,  in  com- 
pany with  Mrs.  Flaharty,  one  of  the  grantees, 
took  both  of  said  instruments  to  the  Gallatin 
Valley  Bank,  and  dehvered  them  to  the  as- 
sistant cashier.  This  inscription  was  written 
on  the  outside  of  said  paper:  "To  deliver  to 
Mrs.  Githens,  and,  in  case  of  her  death,  to 
Mrs.  Flaharty."  Mrs.  Githens  died  some 
months  after  the  delivery  of  these  papers  to 
the  bank,  without  even  calling  for  them,  and 
without  even  attempting  or  expressing  any 
desire  to  regain  the  possession  of  them.  After 
the  death  of  Mrs.  Githens  the  papers  were  de- 
livered to  Mrs.  Flaharty.  While  these  papers 
were  in  the  bank,  Mrs.  Githens  spoke  of  them 
to  witnesses,  saying  the  "gii'ls'  deed"  (meaning 
the  respondents)  was  in  the  bank.  The  evi- 
dence also  shows  that  the  deceased  occupied 
the  demanded  premises  under  said  lease  from 


its  execution  until  her  death.  After  the  death 
of  Mrs.  Githens  the  respondents  took  posses- 
sion of  the  demanded  premises,  and  have 
exercised  control  thereof  ever  since.  The  de 
ceased,  in  her  lifetime,  while  said  papers  were 
in  tlie  bank,  spoke  of  both  the  deed  and  lease 
bemg  in  the  bank,  and  of  the  deed  as  be- 
longing to  the  respondents.  Upon  this  show- 
ing of  facts  appellant  contends  there  was  no 
delivery  of  said  deed,  that  the  deceased  never 
lost  control  over  it  dm-ing  her  lifetime,  and 
that  the  deliveiy  thereof  was  void.  Coimsel 
for  the  appellant  concedes  that  if  the  deed 
was  delivered  he  has  no  case.  Respondents, 
of  course,  claim  that  the  deed  was  delivered. 
What,  then,  is  a  deliveiy?  And  how  can  the 
delivery  be  shown? 

In  5  American  and  English  Encyclopedia 
of  Law,  (page  447,)  we  find  this  doctrine 
asserted:  "The  intention  always  controls  the 
determination  of  what  constitutes  a  sutfi- 
cient  delivery;  and  it  may  be  manifested 
by  acts  or  by  words,  or  by  both,  in  the  most 
informal  manner.  But  either  acts  or  words 
manifesting  the  intention  must  be  present,  in 
order  to  constitute  a  good  deliverj'.  But  the 
deed  need  not  be  actually  delivered,  if  the 
grantor  intends  the  execution  to  have  the  ef- 
fect of  a  delivery,  and  the  parties  act  upon  this 
presumption.  Delivery  will  be  presumed  from 
the  fact  that  the  deed  was  executed  before 
the  witnesses,  and  declared  to  be  delivered 
in  their  presence."  And  see  cases  cited  in 
notes. 

In  Washburn  on  Real  Property  (volume  3, 
5th  Ed.,  p.  305,  par.  28)  the  author  says: 
"Thus,  a  deed  may  be  delivered  to  the  gran- 
tee himself,  or  it  may  be  delivered  to  a 
stranger  unknown  to  the  person  for  whose 
benefit  it  is  made,  if  so  intended  by  the  mak- 
er; and  this  may  be  an  effectual  delivery 
the  moment  it  is  assented  to  by  the  grantee, 
even  though  the  grantor  may  in  the  mean  time 
have  deceased."    See  authorities  cited  in  note. 

In  Devlin  on  Deeds  (volume  1,  §  202)  the  au- 
thor holds  the  doctrine  of  delivery  of  a  deed 
to  be  one  of  intention:  "As  no  particular  form 
of  delivery  is  reqiured,  the  question  whether 
there  was  a  delivery  of  a  deed  or  not,  so  as 
to  pass  title,  must  in  a  great  measm-e,  where 
It  is  not  clear  that  an  actual  delivery  has  been 
efl!ected,  depend  upon  the  peculiar  circumstan- 
ces of  each  particular  case.  The  question  of 
delivery  is  one  of  intention,  and  the  rule  is 
that  a  delivery  is  complete  when  there  is  an 
intention  manifested  on  the  part  of  the  grantor 
to  make  the  instrument  his  deed.  'The  doc- 
trine seems  to  be  settled  beyond  a  reasonable 
doubt,'  remarks  Justice  Atwater,  'that  where 
a  party  executes  and  acknowledges  a  deed, 
and  afterwards,  eitlier  by  acts  or  words,  ex- 
presses his  will  that  the  same  is  for  the  use 
of  the  grantee,  especially  where  the  assent 
of  the  grantee  appears  to  the  transaction,  it 
shall  be  stifficient  to  convey  the  estate,  though 
the  deed  remains  in  the  hands  of  the  grantor. 
*  *  *  The  main  thing  which  the  law  looks 
at  is  whether  the  grantor  indicates  his  will 


DELIVERY. 


107 


that  the  instrument  should  pass  into  the  pos- 
session of  the  grantee;  and,  if  that  will  is 
manifest,  then  the  convoj-ance  Inures  as  a 
valid  grant,  although,  as  above  stated,  the 
deed  never  comes  into  the  hands  of  the  gran- 
tee.' A  deed  does  not  become  operative  until 
It  is  delivered  with  the  intent  that  it  shall  be- 
come effective  as  a  convejance.  Whether 
such  intent  actually  existed  is  a  question  of 
fact  to  be  determined  by  the  circumstances  of 
the  case,  and  cannot,  in  the  majority  of  in- 
stances, be  declared  as  a  matter  of  law.  A 
deed  was  held  complete  and  valid  where  it 
had  been  prepared  for  execution,  read,  signed, 
and  aclinowledged  before  a  proper  officer,  not- 
withstanding tlie  testimony  of  the  witnesses 
present  at  its  execution  that  there  was  no 
formal  delivery,  and  the  fact  that  the  deed, 
after  the  grantor's  death,  was  found  among 
his  private  papers  in  his  desk." 

In  Doe  dem.  Garnons  v.  Knight,  11  E.  C. 
L.  032,  Bayley,  J.,  holds  that  "where  a  party 
to  an  instrument  seals  it,  and  declares,  in  the 
presence  of  a  witness,  that  he  delivers  it  as 
his  deed,  but  Icoi^'ps  it  in  liis  own  possession, 
and  there  is  nothing  to  qualify  that,  or  to 
show  that  the  executing  party  did  not  in- 
tend it  to  operate  immediately,  except  the 
keeping  of  the  deed  in  his  hands,  it  is  a  valid 
and  effectual  deed;  and  delivery  to  the  party 
who  is  to  take  by  the  deed,  or  to  any  per- 
son for  his  use,  is  not  essential;"  and  cites 
a  gi'oat  number  of  cases  in  support  of  this 
doctrine. 
^^  In  Wheelwright  v.  Wheelwright,  2  Mass. 
447,  in  a  case  very  similar  to  the  one  at  bar, 
Parsons,  C.  J.,  delivering  the  opinion  of  the 
court,  holds  that  "a  deed  signed,  sealed,  de- 
livered, and  acknowledged,  which  is  commit- 
ted to  a  third  person,  as  the  deed  of  the 
grantor,  to  be  delivered  over  to  the  grantee 
on  a  future  event,  is  the  deed  of  the  grantor 
presently;  and  the  third  person  is  a  trustee 
of  it  for  the  grantee." 

In  Woodward  v.  Camp,  22  Conn.  459,  460, 
Waite,  J.,  speaking  of  what  constitutes  a 
valid  delivery  of  a  deed,  says:  "And,  in  or- 
der to  constitute  a  valid  delivery,  it  is  not 
necessary  that  it  should  be  delivered  per- 
sonally to  the  grantee.  It  will  be  sufficient 
if  delivered  to  some  third  person  for  the  use 
of  the  grantee,  although  the  latter  was  not 
present  at  the  time,  had  no  knowledge  of  the 
existence  of  the  deed,  and  never  gave  any 
authority  to  the  person  receiving  it  to  act  in 
his  behalf.  Merrills  v.  Swift,  IS  Conn.  257. 
And  if  a  deed  be  delivered  to  a  third  person, 
to  be  by  him  kept,  during  the  life  of  the 
grantor,  subject  to  his  order,  and  at  his  death, 
if  not  previously  recalled,  to  be  delivered  over 
to  the  grantee,  and  the  grantor  die  without 
having  recalled  the  deed,  such  delivery  will 
become  effectual,  and  the  title  of  the  grantee 
consummated.  In  the  death  of  the  grantor. 
Belden  v.  Carter,  4  Day,  GG.  According  to 
these  authorities,  had  the  deed,  in  the  present 
case,  been  delivered  to  some  third  person,  to 
have  been  kept  during  the  life  of  Mi-s.  Camp, 


and  then  delivered  to  the  grantee,  such  deliv- 
ery, upon  her  death,  would  have  become  per- 
fected, and  the  title  would  have  vested  in 
him." 

In  Farrar  v.  Bridges,  5  Humph.  411,  the 
court  say:  "A  formal,  ceremonious  deliv- 
ery of  a  deed  Is  not  essential  to  its  validity. 
If  no  condition  be  annexed,  if  nothing  remains 
to  be  performed  in  order  to  give  effoct  to  the 
instrument,  its  signing,  sealing,  and  attesta- 
tion as  a  valid  instrument  between  the  par- 
ties will  make  it  complete  and  effectual,  al- 
though the  insti-ument  may  be  left  in  the 
possession  of  the  bargainor  or  grantor."  See 
authortties  cited. 

In  Thatcher  v.  St.  Andrew's  Church,  37 
Mich.  2G'J,  speaking  of  what  constitutes  the 
delivers'  of  a  deed,  the  court  say:  "The  act 
of  delivery  is  not,  neccs.sarily,  a  transfer  of 
the  possession  of  the  instrument  to  the  gran- 
tee, and  an  acceptance  by  him;  but  it  is  that 
act  of  the  grantor,  indicated  either  by  acts 
or  words,  or  both,  which  shows  an  intention 
on  his  part  to  perfect  the  transaction,  by  a 
surrender  of  the  instrument  to  the  grantee, 
or  to  some  third  person  for  his  use  and  bene- 
fit. The  whole  object  of  a  delivery  is  to  in- 
dicate an  intent  upon  the  part  of  the  grantor 
to  give  effect  to  the  instrument.  The  deed 
may  be  delivered  to  the  grantee,  or  to  a 
stranger  unknown  to  the  person  for  whose 
benefit  it  is  made;  and  it  has  been  held  that 
such  was  a  good  delivery,  when  assented  to 
by  the  grantee  after  the  death  of  the  gran- 
tor."    See  authorities  cited. 

In  McLure  v.  Colclough,  17  Ala.  9G,  the 
court  say,  speaking  of  what  constitutes  de- 
livery: "Then,  although  there  was  no  deliv- 
ery by  the  hand,  there  was  enough  to  con- 
stitute a  good  delivery  in  law.  This  may  be 
accomplished  by  mere  words,  or  by  such 
words  and  actions  as  indicate  a  clear  inten- 
tion that  the  deed  shall  be  considered  as  ex- 
ecuted, as  when  a  party  to  an  insfrumeni 
seals  it,  and  declares  in  presence  of  a  wit- 
ness that  he  delivers  it  as  his  deed,  but  keeps 
it  in  his  own  possession,  and  there  is  nothing 
to  qualify  that,  or  to  show  that  the  execut- 
ing party  did  not  intend  it  to  operate  imme- 
diately, except  the  keeping  of  the  deed  in  his 
hands,  it  is  a  vahd  and  effectual  deed;  and 
actual  delivery  to  the  party  who  is  to  take 
by  the  deed,  or  to  any  person  for  his  use,  is 
not  essential.  Doe  dem.  Garnons  v.  Knight, 
5  Barn.  &  C.  671." 

In  Belden  v.  Carter,  4  Day,  GG,  a  Connecti- 
cut case,  depending  on  this  statement  of  facts: 
"Delivery  of  deed.  When  takes  effect.  A 
grantor,  having  signed,  sealed,  and  acknowl- 
edged a  deed,  took  it  up,  in  the  absence  of 
the  grantee,  and  said  to  another:  'Take  this 
deed,  and  keep  it.  If  I  never  call  for  it,  de- 
liver it  to  B.  after  my  death.  If  I  call  for 
it,  deliver  it  to  me.'  The  party  then  took  the 
deed,  and  the  grantor  d>iug  soon  afterwards, 
and  never  having  called  for  it,  it  was  deliv- 
ered to  the  grantee."  Upon  these  facts  the 
court  say  and  hold:     "The  grantor  delivered 


108 


co:n'tracts  under  seal. 


the  deed  to  Wright  with  a  reservation  of  a 
power  to  countermand  it,  but  this  makes  no 
difiference;  for  it  was  in  the  nature  of  a  tes- 
tamentary disposition  of  real  estate,  and  was 
revocable  by  the  grantor  during  his  life,  with- 
out an  express  reservation  of  that  power. 
The  case,  then,  stands  upon  the  same  footing 
as  if  there  had  been  no  reservation  of  a  pow- 
er to  countermand  the  deed.  It  was  a  de- 
liveiT  of  a  writing  as  a  deed  to  the  use  of  the 
grantee,  to  take  effect  at  the  death  of  the 
grantor,  deposited  in  the  hands  of  a  third  per- 
son to  hold  till  that  event  happened,  and  then 
to  deliver  it  to  the  grantee.  The  legal  opera- 
tion of  this  delivery  is  that  it  became  the  deed 
of  the  grantor  presently;  that  Wright  held 
it  as  a  trustee  for  the  use  of  the  grantee; 
that  the  title  became  consummate  in  the 
grantee  by  the  death  of  the  grantor;  and 
that  the  deed  took  effect,  by  relation,  from 
the  time  of  the  first  delivery." 

In  Newton  v.  Bealer,  41  Iowa,  334,  in  a 
case  nearly  on  all  fours  with  the  case  at  bar, 
Day,  J.,  delivering  the  opinion  of  the  court, 
on  page  339,  says:  "Where  one  who  has  the 
mental  power  to  alter  his  intention,  and  the 
physical  power  to  destroy  a  deed  in  his  pos- 
session, dies  without  doing  either,  there  is, 
it  seems  to  us,  but  little  reason  for  saying 
that  his  deed  shall  be  inoperative,  simply  be- 
cause, during  life,  he  might  have  done  that 
which  he  did  not  do.  It  is  much  more  con- 
sonant with  reason  to  determine  the  effect  of 
the  deed  by  the  intention  existing  up  to  the 
time  of  death  than  to  refuse  to  give  it  that 
effect  because  the  intention  might  have  been 
changed.  Applying  this  doctrine  to  the  deed 
in  question,  there  can  be  no  doubt  that  it 
should  be  sustained.  The  deceased,  as  he 
frequently  declared,  had  made  all  the  provi- 
sions for  his  ocher  children  that  he  intended 
to  make.  When  within  a  veiy  few  days  of 
his  death,  and  evidently,  as  appears,  contem- 
plating approaching  dissolution,  he  says  that 
he  has  his  property  all  fixed,  and  points  to 
the  chest  in  which  the  deed  would  be  found, 
which,  as  he  supposed,  had  the  effect  to  fix 
his  property  so  that  there  would  be  no  'fuss- 
ing' about  it  when  he  was  gone.  He  thus 
manifested  an  unequivocal  intention,  within 
a  very  short  time  of  his  death,  to  have  this 
deed  operate  as  a  disposition  of  his  property; 
and  any  construction  of  tlie  law  which  ig- 
nores this  intention,  and  defeats  this  purpose, 
prefers  shadow  to  substance."  See  cases 
cited. 

In  Hathaway  v.  Payne,  34  N.  Y.  92,  a  case 
wherein  the  facts  are  as  nearly  like  the  facts 
in  the  case  at  bar  as  usually  happens,  the 
court  hold  that,  "where  a  deed  is  to  be  de- 
livered to  the  grantee  on  the  death  of  the 
grantor,  the  title,  by  relation,  passes  at  the 
time  the  deed  was  left  for  delivery."  Pot- 
ter, J.,  delivered  the  opinion  in  this  case,  and 
after  viewing  at  great  length  the  facts,  in 
stating  the  law  and  citing  the  authorities, 
says:  "Looking  to  the  language  of  the  agree- 
ment itself  for  the  purpose  and  intent  of  this 


conveyance,  it  left  no  condition  to  be  per- 
formed before  delivery.  It  required  nothing 
but  the  lapse  of  time,  to  wit,  the  death  of 
both  gi-antors,  when  Herrendeen,  the  agent, 
trustee,  or  depositary  of  the  deed,  (by  what- 
ever name  he  may  be  called,)  by  mutual  di- 
rection of  the  parties,  not  alone  that  of  the 
grantor,  who  alone  could  not  revoke  a  mu- 
tual agreement,  immediately  to  deliver  it,  as 
a  good  and  valid  convej-ance  of  all  the  lands 
therein  contained.  If  we  look  at  the  intent 
of  the  parties  to  the  deed,  as  manifested  by 
their  acts,  indopondeut  of  the  language  of 
their  agreement, — the  one  granting,  the  other 
accepting  the  grant  of,  this  part  of  the  same 
premises, — it  is  equally  apparent  that  the  par- 
ties intended  the  first  deed  as  a  present  con- 
veyance. In  Ruggles  v.  Lawson,  13  Johns. 
2S5,  A.  executed  a  deed  of  lands,  in  consid- 
t  eration  of  natural  love  and  affection,  to  his 
two  sons,  and  delivered  it  to  C,  to  be  deliv- 
ered to  his  sons  in  case  A.  should  die  with- 
out making  a  will;  and,  A.  having  died  with- 
out a  will,  C.  delivered  the  deed  to  the  sons. 
It  was  held  that  this  was  a  valid  deed,  and 
took  effect  from  the  first  delivery;  that  this 
was  not  an  escrow.  In  Tooley  v.  Dibble,  2 
Hill,  G41,  a  father  signed  and  scaled  a  deed 
purporting  to  convey  to  his  son  a  farm, 
placing  the  deed  in  the  hands  of  B.,  with  in- 
sti-uctions  to  deliver  it  after  the  father's 
death,  but  not  before,  imless  both  parties 
called  for  it;  and  after  the  father  died  B. 
delivered  the  deed  accordingly.  It  was  held 
that  the  title  of  the  son  took  effect,  by  rela- 
tion, from  the  time  the  deed  was  left  with  B., 
and  that  the  son's  quitclaim,  executed  inter- 
mediate the  leaving  the  deed  with  B.,  and  the 
father's  death,  though  importing  a  mere  con- 
veyance of  the  son's  'right  in  expectancy' 
in  the  land,  would  pass  his  title.  The  cases 
of  Goodell  V.  Pierce,  Id.  659,  and  Himter  v. 
Hunter,  17  Barb.  25,  are  but  confirmations  of 
this  view  of  the  title  taking  effect  from  the 
first  delivery  of  the  deed.  In  the  case  of 
Belden  v.  Carter,  reported  in  4  Day,  G6,  a  deed 
was  delivered  to  a  third  person  to  keep,  and, 
if  not  called  for,  to  deliver  it  after  the  death 
of  the  grantor.  It  was  held  that  by  legal 
operation  it  became  the  deed  of  the  grantor 
presently,  and  that  the  depositary  held  it  as 
a  trustee  for  the  use  of  the  grantee,  and  that 
the  title  becarne  consummate  in  the  grantee 
by  the  death  of  the  grantor,  and  the  deed 
took  effect,  by  relation,  from  the  time  of  the 
first  delivery.  In  the  case  of  Wheelwright 
V.  Wheelwright,  2  Mass.  447,  a  distinction  is 
made  which  I  regard  as  sound,  and  which 
I  think  has  not  been  questioned  since,  that 
applies  to  this  case.  It  was  held  that  a  deed, 
signed,  sealed,  delivered,  and  acknowledged, 
which  is  committed  to  a  third  person  as  the 
deed  of  the  grantor,  to  be  delivered  over  to 
the  grantee  on  a  future  event,  is  the  deed 
of  the  grantor  presently,  and  the  third  per- 
son is  a  trustee  of  it  for  the  grantee.  But  if 
it  be  delivered  to  the  third  person  as  the 
writing  or  escrow  of  the  grantor,  to  be  deliv- 


DELIVERY. 


orod  on  some  future  event,  it  is  not  the  g:i'an- 
tor's  deed  until  the  second  delivery.  That  is, 
its  being  a  pivseut  deed  depends  upon  the 
fact  whether  it  was  dclivored  as  an  escrow. 
The  cases  can  be  multiplied,  each  varying 
from  every  other  by  some  nice  shade  of  dif- 
ference, upon  the  que.'^tion  whether,  in  the 
present  case,  the  deed  was  an  escrow  in  the 
hands  of  the  depositary,  or  whether  the  de- 
positary was  made  the  trustee  of  the  grantor. 
In  the  former  case  a  second  delivery  is  gen- 
erally required  before  the  title  passes;  in  the 
latter,  the  title  passes  at  the  instant  of  deliv- 
ering the  deed  to  the  deijositai-y.  This,  I 
think,  is  the  true  distinction.  In  the  case  at 
bar  there  was  no  direction  by  the  grantors 
that  the  deed  was  left  as  an  escrow,  and  it 
presents  no  evidence  of  intent  on  the  part  of 
the  grantors  to  make  this  deed  an  escrow. 
There  is  no  condition  mentioned  in  the  agree- 
ment, to  be  performed  before  delivery,  which 
In  law  would  create  it  an  escrow;  and  pre- 
sumptions arising  from  the  language  of  the 
agreement,  being  taken  ni<jst  strongly  against 
the  grantor,  forbid  any  implication  of  its  be- 
uig  an  escrow.  I  think,  therefore,  that  if  the 
case  dopendt'd  upon  this  point,  raised  by  the 
plaintiff  on  tlie  assumption  that  there  was  no 
such  delivery  of  the  deed  of  1S39  as  to  pass 
the  title  to  the  defendant,  he  must  also  fail. 
There  is  another  reason,  which  exists  both 
at  common  law  and  by  the  statute,  (which 
adopted  the  common  law  in  this  respect,) 
which  is  controlling,— 'that,  in  the  construc- 
tion of  every  instrument  creating  or  convey- 
ing any  estate  or  interest  in  lands,  it  shall  be 
the  duty  of  courts  of  justice  to  cai-ry  into  ef- 
fect the  intent  of  the  parties,  so  far  as  such 
intent  can  be  collected  from  the  whole  instru- 
ment, and  is  consistent  with  the  rules  of 
law.'  "  And,  in  the  case  just  cited,  Denio,  C. 
J.,  dissents  from  part  of  the  opinion  of  the 
court,  but  agrees  with  the  court  as  to  the  law 
concerning  the  delivery  of  deeds  in  such 
cases,  and,  on  page  113  of  the  opinion  cited, 
says:  "They  do,  [referring  to  cases  cited  on 
the  question  as  to  what  is  a  sufficient  deliv- 
ery of  a  deed,]  however,  I  think,  prove  that 
a  deed  may  be  delivered  to  a  third  person,  as 
this  was,  with  instructions  to  be  finally  deliv- 
ered to  the  grantee  after  the  death  of  the 
grantor.  In  such  a  case  the  weight  of  au- 
thority is  that  no  title  passes  until  the  final* 
deliveiy,  and  that  then  and  thereafter  the 
title  is,  by  relation,  deemed  to  have  vested  as 
of  the  time  of  the  first  delivery  to  the  third 
pei'son.  If  it  were  an  original  question,  I 
should  suppose  that  such  a  transaction  was 
of  a  testamentary  character,  and  that  it 
would  be  inoperative,  for  want  of  the  attes- 
tation required  by  the  statute  of  wills.  But 
the  cases  establish  the  rule  as  I  have  stated, 


and  they  should  not  now  be  disturbed." 
authorities  he  cites  on  this  point.  ^ 

Authorities  might  be  cited  to  any  extent  in 
support  of  the  doctrine  that  a  manual  deliv- 
ery of  a  deed  is  not  an  absolutely  essential 
requisite  to  its  validity;  that  "the  question 
of  delivery  is  one  of  intention,  and  the  rule 
is  that  a  delivery  is  complete  when  there  is 
an  intention  manifested  on  the  part  of  the 
grantor  to  make  the  instrument  his  deed." 
In  this  ca.sc,  the  grantor  having  executed  the 
deed  to  the  grantees,  and  having  received 
back  froiu  them  at  the  same  time  a  lease  for 
the  term  of  her  natural  life,  for  the  same 
premises,  and  she  having  accepted  said  lease, 
depositing  it,  with  the  deed  to  the  demanded 
premises,  with  the  depositary,  with  instruc- 
tions to  deliver  the  deed  to  the  grantees  in 
the  event  of  her  death,  and  having  never 
recalled  the  deed,  or  made  any  attempt  or  ex- 
pressed any  desire  to  regain  control  thereof, 
but  in  the  mean  time  spoke  of  the  deed  as 
being  the  deed  of  the  grantees,  in  the  hands 
of  the  depositary,  and  occupied  the  premises 
as  the  tenants  of  respondents,  and  in  all  re- 
spects havmg  treated  the  deed  as  Ix'longing 
to  the  grantees,  and  both  parties  having  act- 
ed concurrently  upon  the  theory  that  the 
deed  was  complete,  as  well  as  the  delivery 
thereof,  the  opinion  seems  irresistible  that 
the  facts  show  a  valid  delivery  of  the  deed 
in  this  case.  Many  of  the  authorities  cited  in 
this  opinion  have  been  so  cited,  not  that  we 
deemed  it  necessary  to  a  determination  of 
the  case  at  bar,  but  more  for  the  purpose  of 
showing  the  trend  of  the  authorities,  and  the 
extent  to  which  they  go  in  support  of  the  doc- 
trine discussed  in  this  case.  Some  of  these 
authorities  go  further  than  perhaps  this  court 
would  go  under  like  circumstances;  but  they 
all  support  the  position  we  take,— that  in  the 
case  at  bar  there  was  a  valid  delivery  of  the 
deed.  The  acts,  words,  and  conduct  of  the 
parties,— especially  the  giving  of  the  lease  to 
the  demanded  premises  by  the  grantees  of  the 
deed  to  the  grantor  contemporaneously  with 
the  execution  of  the  deed,  and  her  occupying 
the  premises  under  said  lease  until  her  death, 
—establish  beyond  controversy  that  the  par- 
ties considered  the  deed  complete,  as  well  as 
the  delivery  thereof.  This  opinion  is  not  to 
be  Interpreted  as  establishing  any  new  rule 
in  relation  to  the  testamentary  disposition  of 
property,  or  as  expressing  any  opinion  as  to 
the  rights  of  creditors  in  cases  resting  upon 
like  facts  and  circimi.stances.  We  simply  de- 
cide that  in  this  case  there  was  a  delivery  of 
the  deed,  and  complete  consummation  there- 
of, before  the  death  of  the  grantor. 

Judgment  of  the  lower  ot)urt  is  affirmed. 

HARWOOD  and  D1-:  WITT,  .1.7.,  concur. 


See  _ 


no 


CONTRACTS  UXDER  SEAL 


r\J 


^ 


ALLER  V.  ALLER. 
(40  N.  J.  Law,  446.) 


yO 


I 

Court  of  Errors  and  Appeals  of  New  Jersey. 
Not.  Term,  1S78. 

The  action  was  brought  on  the  following 
instrument,  viz.:  "One  day  after  date,  I 
promise  to  pay  my  daughter,  Angeline  H. 
Aller,  the  sum  of  three  hundred  and  twelve 
dollars  and  cixty-one  cents,  for  value  receiv- 
ed, with  lawful  interest  from  date,  without 
defalcation  or  discount,  as  witness  my  hand 
and  seal  this  fourth  day  of  September,  one 
thousand  eight  hundred  and  seventy-three. 
$312.61.  This  note  is  given  in  lieu  of  one- 
half  of  the  balance  due  the  estate  of  Mary 
A.  Aller,  deceased,  for  a  note  given  for  one 
thousand  dollars  to  said  deceased  by  me. 
Peter  H.  Aller.  [L.  S.]  Witnesses  present: 
John  J.  Smith,  John  F.  Grandin." 

Both  subscribing  witnesses  were  examined 
at  the  trial,  and  it  appeared  that  there  was 
a  note  for  $1,000,  dated  May  1st,  1858,  given 
by  said  Peter  H.  Aller  to  Mary  Ann  Aller, 
upon  which  there  were  indorsements  of  pay- 
ments, April  1st,  1863,  $50;  April  1st,  1866, 
$46;  April  1st,  1867,  $278.78. 

Mary  Ann  Aller  the  wife,  died,  and  on  the 
day  after  her  burial,  Peter  H.  Aller  told  his 
daughter,  the  plaintiff,  to  get  the  note,  which 
he  said  was  among  her  mother's  papers.  She 
brought  it;  read  the  note.  He  said  there  was 
more  money  indorsed  on  it  than  he  thought; 
requested  the  witness  John  P.  Grandin  to 
add  up  the  indorsements  and  subtract  them 
from  the  principal,  to  divide  the  balance  by 
two,  and  draw  a  note  to  each  of  her  daugh- 
ters, Leonora  and  Angeline,  for  one-half.  Aft- 
er they  were  drawn  by  the  witness,  Peter  H. 
Aller  said,  "Now  here,  girls,  is  a  nice  pres- 
ent for  you,"  and  gave  them  the  notes.  An- 
gelina was  directed  to  put  the  old  note  back 
among  her  mothei-'s  papers.  Grandin  was 
afterwards  appointed  administrator  of  Mary 
A.  Aller,  and  as  such,  he  says,  he  destroyed 
the  old  note. 

The  letters  of  administration;  a  copy  of  the 
original  note  and  endorsements  thereon;  a 
deed  of  release  by  Peter  H.  Aller  to  Leonora 
Shai-p  and  Angeline  H.  Aller,  in  which,  for 
the  consideration  of  one  dollar,  and  of  nat- 
ural love  and  affection,  he  released  all  his 
right  and  Interest  "by  the  curtesy"  to  all  the 
real  and  personal  estate  of  said  Mary  A.  Al- 
ler, deceased,  w-hich  is  dated  September  8th, 
1873;  and  the  last  will  and  testament  of  Peter 
H.  Aller, — were  offered  in  evidence. 

The  action  was  brought  by  Angeline  H.  Al- 
ler, now  Angeline  H.  McPherson,  against 
Peter  H.  Aller,  in  his  lifetime,  and,  after  his 
death,  continued  against  his  executor,  Mich- 
ael Shurts. 

The   defendant,   Peter  H.   Aller,   was  aged 
and  feeble,  and  the  plea  was,  therefore,  filed 
in  his  lifetime,  by  consent,  without  affidavit. 
Argued  June  term,  1878,  before  BBASLEY, 


C.  J.,  and  DEPUE,  SCUDDER,  and  KNAPP, 
JJ. 

G.  A.  Allen  and  J.  R.  Emery,  for  plaintiff. 
J.  T.  Bird,  for  defendant. 

SCUDDER,  J.  Whether  the  note  for  $1,- 
000  could  have  been  enforced  in  equity  as 
evidence  of  an  indebtedness  by  the  husband 
to  the  wife  during  her  life  is  immaterial,  for 
after  her  death  he  was  entitled,  as  husband 
of  his  deceased  wife,  to  administer  on  her 
estate,  and  receive  any  balance  due  on  the 
note,  after  deducting  legal  charges,  under  the 
stiitute  of  distribution.  The  daughters  could 
have  no  legal  or  equitable  claim  on  this  note 
against  their  father  after  their  mother's  de- 
cease. The  giving  of  these  two  sealed  prom- 
ises in  writing  to  them  by  their  father  was 
therefore  a  voluntary  act  on  his  part  That 
it  was  just  and  meritorious  to  divide  the 
amount  represented  by  the  original  note  be- 
tween these  only  two  surviving  children  of 
the  wife,  if  it  was  her  separate  property,  and 
keep  it  from  going  into  the  general  distribu- 
tion of  the  husband's  estate  among  his- other 
children,  is  evident,  and  such  appears  to  have 
been  his  purpose. 

The  question  now  is  whether  that  intention 
was  legally  and  conclusively  manifested,  so 
that  it  cannot  now  be  resisted. 

This  depends  on  the  legal  construction  and 
effect  of  the  instrument  which  was  given  by 
the  father  to  his  daughter. 

It  has  been  treated  by  the  counsel  of  the  de- 
fendant in  his  argument,  as  a  promissory 
note,  and  the  payment  was  resisted  at  the 
trial  on  the  gi-ound  that  it  was  a  gift.  Being 
a  gift  inter  vivos,  and  without  any  legal  con- 
sideration, it  was  claimed  that  the  action 
could  not  be  maintained.  But  the  instrument 
is  not  a  promissory  note,  having  the  proper- 
ties of  negotiable  paper  by  the  law  merchant; 
nor  is  it  a  simple  contract,  with  all  the  lati- 
tude of  inquiry  into  the  consideration  allowa- 
ble in  such  a  case;  but  it  is  in  form  and  legal 
construction  a  deed  under  seal.  It  says  in 
the  body  of  the  writing,  "as  witness  my  hand 
and  seal,"  and  a  seal  is  added  to  the  name  of 
Peter  H.  Aller.  It  is  not  therefore  an  open 
promise  for  the  payment  of  money,  which  is 
said  to  be  the  primary  requisite  of  a  bill  oi' 
promissoiy  note,  but  it  is  closed  or  sealed, 
whereby  it  loses  its  character  as  a  commer- 
cial insti-ument,  and  becomes  a  specialty  gov- 
erned by  the  rules  affecting  common-law  se- 
curities.   1  Daniel,  Neg.  Inst.  §§  1,  31,  34. 

It  is  not  at  this  time  necessary  to  state  the 
distinction  between  this  writing  and  corpo- 
ration bonds  and  other  securities  which  have 
been  held  to  have  the  properties  of  negotiable 
paper  by  commercial  usage.  This  is  merely 
an  individual  promise  "to  pay  my  daughter, 
Angeline  H.  Aller,  the  sum  of  $312.61,  for 
value  received,"  etc.  It  is  not  even  transfer- 
able in  form,  and  there  is  no  intention  shown 
upon  its  face  to  make  it  other  than  it  is  clear- 
ly expressed  to  be,  a  sealed  promise  to  pay 


CON.SIDEItATlOX, 


111 


money  to  a  cert.iiu  person  or  a  debt  in  law 
under  seal.  How  then  will  it  be  affected  by 
the  evidence  wliich  was  offered  to  show  that 
It  was  a  mere  voluntary  promise,  without  le- 
gal consideration,  or,  as  It  was  claimed,  a 
gift  unexecuted? 

Our  statute  concerning  evidence  (Revision, 
p.  380,  §  IG)  which  enacts  that  in  any  action 
upon  an  instrument  in  writing,  under  seal, 
the  defendant  in  such  action  may  plead  and 
set  up  as  a  defense  therein  fraud  in  the  con- 
sideration, is  not  applicable,  for  here  there 
is  no  fraud  sho'mi. 

But  it  is  said  that  the  act  of  April  Gth,  1875 
(Revision,  p.  387,  §  52),  opens  it  to  the  defense 
of  want  of  sufficient  consideration,  as  if  it 
were  a  simple  contract,  and,  that  being 
shown,  the  contract  becomes  Inoperative. 

The  statute  reads:  "That  in  every  action 
upon  a  sealed  instrument,  or  where  a  set-off 
Is  founded  on  a  sealed  instrument,  the  seal 
thereof  shall  be  only  presumpU»a,^£vidence 
of  a  sufficient  consideration,  which  may  be 
rebutteo:,  as  if  such  instrument  was  not  seal- 
ed," etc 

Suppose  the  presumption  that  the  seal  car- 
ries with  It,  that  there  is  a  sufficient  consid- 
eration, is  rebutted,  and  overcome  by  evi- 
dence showing  there  was  no  such  considera- 
tion, the  question  still  remains  whether  an 
instrument  under  seal,  without  sufficient  con- 
sideration, is  not  a  good  promise,  and  enforce- 
able at  law.  It  is  manifest  that  here  the  par- 
ties intended  and  understood  that  there 
should  be  no  consideration.  The  old  man 
said,  "Now  here,  girls,  is  a  nice  present  for 
each  of  you,"  and  so  it  was  received  by  them, 
■^he  mischief  which  the  above-quoted  law  was 
designed  to  remedy  was  that  where  the  par- 
ties intended  there  should  be  a  consideration, 
they  were  prevented  by  the  common  law  from 
showing^ none,  if  the  confiact  was  nndeEIs£al._ 
Rut  itjjEP'ilfl  be  going  tflO-Jar  to  say  thnt  tbp 
.statutewas  intended  to  abrogate  alL  xsthvft^ 
tary  contracts,  and  to  abolish  alLdistisction 
Ukitween  specialties  angLaimple  Goutiacls— 

It  will  not  do  to  hold  that  every  convey- 
ance of  land  or  of  chattels  is  void  by  show- 
ing that  no  siifficient  consideration  passed 
when  creditors  are  not  affected.  Nor  can  it 
be  shown  by  authority  that  an  executory  con- 
tract, entered  into  intentionally  and  delib- 
erately, and  attested  in  solemn  form  by  a  seal, 
cannot  be  enforced.  Both  by  the  civil  and 
the  common  law,  persons  were  guai-ded 
against  haste  and  imprudence  in  entering  in- 
to voluntary  agreements.  The  distinction  be- 
tween "nudum  pactum"  and  "pactum  vesti- 
tum,"  by  the  civil  law,  was  in  the  formality 
of  execution,  and  not  in  the  fact  that  in  one 
case  there  was  a  consideration  and  in  the 
other  none,  though  the  former  term,  as  adopt- 
ed in  the  common  law,  has  the  signification 
of  a  contract  without  consideration.  The  lat- 
ter was  enforced  without  reference  to  the 
consideration,  because  of  the  formality  of  its 
ratification.    1  Tars.  Cont.  (Gth  Ed.)  427. 


The  opinion  of  Justice  "SVllmot  In  Pillans  v. 
Van  Mierop,  3  Buitows,  1G63,  is  Insuuctive 
on  this  point. 

The  early  case  of  Sharington  v.  Strotton, 
Plowd.  308,  gives  the  same  caase  for  the 
adoption  of  the  sealing  and  delivery  of  a 
deed.  It  says  among  other  things:  "Be<ause 
words  are  oftentimes  siwken  by  men  unad- 
visedly and  without  deliberation,  the  law 
has  provided  that  a  contract  by  words  shall 
not  bind  without  consideration.  And  the 
reason  is  because  it  is  by  wiirds  which  pass 
from  men  lightly  and  inconsiderately,  but 
where  the  agreement  is  by  deed  there  is 
more  time  for  deliberation,  etc.  So  that 
there  is  great  deliberation  used  in  the  mak- 
ing of  deeds,  for  which  reason  they  are  re- 
ceived as  a  lien  final  to  the  party,  and  are 
adjudged  to  bind  the  party  without  examin- 
ing uix)n  what  cause  or  consideration  they 
were  made.  And  therefore  in  the  case  put 
in  17  Edw.  IV.,  if  I  by  deed  promise  to  give 
you  £20  to  make  your  sale  de  novo,  here  you 
shall  have  an  action  of  debt  upon  the  deed, 
and  the  consideration  is  not  examinable,  for 
in  the  deed  there  is  sufficient  consideration, 
viz.  the  will  of  the  party  that  made  the 
deed."  It  would  seem  by  this  old  law  that 
in  case  of  a  deed  the  saying  might  be  ap- 
plied, "Stat  pro  ratione  voluntas.'' 

In  Smith  on  (Contracts,  the  learned  author, 
after  stating  the  strictness  of  the  rules  of 
law  that  there  must  be  a  consideration  to 
support  a  simple  contract  to  guard  persons 
against  the  consequences  of  their  own  im- 
prudence, says:  "The  law  does  not  absolute- 
ly prohibit  them  from  contracting  a  gratui- 
tous obligation,  for  they  may,  if  they  will, 
do  so  by  deed." 

This  subject  of  the  derivation  of  terms  and 
formalities  from  the  civil  law,  and  of  the 
nUe  adopted  in  the  common  law,  is  fully  de- 
scribed in  Fonb.  Eq.  335,  note  a.  The  au- 
thor concludes  by  saying:  "If,  however,  an 
agreement  be  evidenced,  by  bond  or  other  in- 
strument, under  seal,  it  would  certainly  be 
seriously  mischievous  to  allow  its  considera- 
tion to  be  disputed,  the  common  law  not  hav- 
ing pointed  out  any  otlier  means  by  which 
an  agreement  can  be  more  solemnly  authen- 
ticated. Every  deed,  therefore,  in  itself  im- 
ports a  consideration,  though  it  be  only  the 
will  of  the  maker,  and  therefore  shall  never 
be  said  to  be  nudum  pactum."  See,  also.  1 
Chit.  Cont  (11th  Ed.)  G;  Morly  v.  Boothby, 
3  Biug.  107;  Rajin  v.  Hughes,  7  Term  R.  350, 
note  a. 

These  statements  of  the  law  have  been  tlius 
particularly  given  in  the  words  of  others,  be- 
cause the  signiliaince  of  writings  under  seal, 
and  their  importance  in  our  common-law 
system,  seem  in  danger  of  being  overlooke^l 
in  some  of  our  later  legislation.  If  a  party 
has  fully  and  absolutely  expressed  his  inten- 
tion in  a  writing  sealed  and  delivered,  with 
the  most  solemn  sanction  known  to  our  law, 
what    should    prevent    its    execution    where 


112 


CONTKACTS  U:^DEK  SEAL. 


there  is  no  fraud  or  illegality?  But  because 
deeds  have  been  used  to  cover  fi-aud  and  ille- 
gality in  the  consideratioii,  and  just  defenses 
have  been  often  shut  out  by  the  conclusive 
character  of  the  fonnality  of  sealing,  we  liave 
enacted  in  ovir  state  the  two  recent  statutes 
above  quoted.  The  one  allows  fraud  Jn_the 
consideration  of  instruments  under  seal  to 
be  set  up  as  a  defence,  the  other  takes  away 
the  conclusive  evidence  of  a  sufficient  con- 
sideration heretofore  accorded  to  a  sealed 
writing,  and  makes  it  only  presumptive  evi- 
dence.  This  does  not  reach  the  case  of  a 
"vblTOtAry  agreement,__where__th££e— wn  a  qo_ 
consideration,  an< 


none  intended  by  the  pax^. 
re  "statute  establishes  a  new  rule  of 
evidence,  by  which  the  consideration  of  seal- 
ed instruments  may  be  shown,  but  does  not 
take  from  them  the  effect  of  establishing  a 
contract  expressing  the  intention  of  the  par- 
ties, made  with  the  most  solemn  authentica- 
tion, which  is  not  shown  to  be  fraudulent  or 
illegal.  It  could  not  have  been  in  the  mind 
of  the  legislature  to  make  it  impossible  for 
parties  to  enter  into  such  promises;  and 
without  a  clear  expression  of  the  legislative 
will,  not  only  as  to  the  admissibility,  but  the 
effect    of    such    evidence,  such    construction 


should  not  be  given  to  this  law.  Even  if  It 
should  be  held  that  a  considei-ation  is  requir- 
ed to  uphold  a  deed,  yet  it  might  still  be  im- 
plied where  its  piupose  is  not  within  the 
mischief  which  the  statute  was  intended  to 
remedy.  It  was  certainly  not  the  intention 
_jof  the  legislature  to  abolish  all  distinction 
between  simple  contracts  and  specialties, 
for  in  the  last  clause  of  the  section  they  say 
that  all  instruments  executed  with  a  scroll, 
or  other  device  by  way  of  scroU,  shall  be 
deemed  sealed  instruments.  It  is  evident 
that  they  were  to  be  continued  with  their 
former  legal  effect,  except  so  far  as  they 
might  be  controlled  by  evidence  affecting 
their  intended  consideration. 

K  the  statute  be  anything  more  than  a 
change  of  the  rules  of  evidence  which  exist- 
ed at  the  time  the  contract  was  made,  and 
in  effect  makes  a  valuable  consideration  nec- 
essary, where  such  requisite  to  its  validity 
did  not  exist  at  that  time,  then  the  law 
would  be  void  Ln  this  case,  because  it  would 
impair  the  obligation  of  a  prior  contract. 
This  cannot  be  done.  Oooley,  Const.  Lim. 
2S8,  and  notes. 

The  rule  for  a  new  trial  should  be  dis- 
charged. 


REVOC/VTION  OF  OFFER  UNDEll  SEAL. 


113 


^ 


11,  1SS5. 


^  McMillan  V.  AMES.         ^ 

'  (22  N.  W.  612,  33  Minn.  257. 

Supreme  Court  of  MinnesofJi.     March 

Appeal  from  an  order  of  the  district  court, 
Hennepin   county,   denying  new   trial. 

Scott  Longbrake  &  Van  Cleve  and  Arthur  J. 
Shores,  for  appellant,  James  McMillan.  Bab- 
cock  &  Davis,  for  respondent,  Eli  B.  Ames. 

VANDERBURGH,  J.  On  the  day  it  bears 
date  the  defendant  executed  and  delivered  to 
.Tames  McMillan  &  Co.  the  following  cove- 
nant or  agreement  under  seal,  which  was 
subsequently  assigned  to  the  plaintiff: 
"Exhibit  A. 

"I,  E.  B.  Ames,  of  Minneapolis,  Minnesota, 
for  the  consideration  hereinafter  mentioned, 
do  hereby  promise  and  agree  to  grant,  bar- 
gain, sell,  and  convey,  by  good  and  kiwful 
warranty  deed,  unto  .Tames  McMillan  «&  Co., 
their  heirs  and  assigns,  in  fee-simple,  free 
from  all  incumbrances,  at  any  time  bet«-een 
the  date  of  this  instniment  and  the  third  day 
of  August,  1&S4,  that  the  said  James  Mc- 
Millan &  Co.  may  elect,  that  certain  real 
estate  situate  in  the  county  of  Hennepin  and 
state  of  Minnesota,  and  described  as  follows, 
to-wit,  a  part  of  lots  nine  (9)  and  ten  (10),  in 
block  twenty  (20),  in  the  town  of  Minneap- 
olis, being  a  tract  of  land  twenty-seven  (27) 
feet  wide,  fronting  on  First  avenue  south, 
and  extending  back  ninety-nine  (90)  feet,  to- 
gether with  the  two-story  brick  and  stone 
building  standing  tliereou,  together  with  all 
the  appurtenances  thereunto  belonging. 

"The  consideration  above  mentioned  and 
referred  to  is  the  payment  to  me.  by  the  said 
James  Mc-NIillan  &  Co.,  of  the  sum  of  thirty- 
five  hundred  dollars,  and  the  further  pay- 
ment of  tlie  taxes  duly  assessed  upon  said 
real  estate  between  the  second  day  of  August, 
1S79,  and  the  date  of  the  execution  and  de- 
livery of  said  deed.  Said  payments  to  be 
made  at  the  time  of  the  execution  and  de- 
livery of  said  deed,  unless  otherwise  agi*eed  to 
by  said  James  McMillan  &  Co.  and  myself. 

"It  is  hereby  expressly  understood  and 
agreed  that  in  case  of  a  violation  of  the 
lease  under  which  the  said  James  McMillan 
&  Co.  now  hold  said  real  estate,  I  am  to  be 
released  from  any  and  all  promises  contained 
and  by  me  made  in  this  instrument 

"Witness  my  hand  this  sixth  day  of  Octo- 
ber, 1S79,  the  same  being  the  date  of  tliis  in- 
stniment. E.  B.  Ames.    [Seal.]" 

By  the  terms  of  this  instrument,  which  is 
admitted  to  have  been  sealed  by  defendant, 
he  covenanted  to  convey  the  premises  upon 
the  consideration  and  condition  of  the  pay- 
ment by  the  covenantees  of  the  sum  named, 
on  or  before  the  date  fixed  in  the  writing. 
Before  performance  on  their  part,  the  defend- 
ant notified  them  of  his  withdrawal  and  re- 
scission of  the  promise  and  obligation  em- 
braced in  such  written  instrument,  and  there- 
after refused  the  tender  of  payment  and  offer 

HOPK.  SEl..  CAS.  C02«  T.  — 8 


of  performance  by  the  plaintiff  In  conformity 
therewith,  as  alleged  in  the  complaint,  and 
within  the  time  limited.  On  the  trial,  it 
appearing  that  such  notice  of  rescission  had 
been  given,  the  court  rejected  plaintiff's  offer 
to  introduce  the  writing  in  evidence,  and  dis- 
missed the  action. 

The  only  question  presented  on  this  appeal 
Is  whether  plaintiff's  promise  or  obligatioa 
was  nudum  pactum  and  presumptively  in- 
valid for  want  of  a  consideration,  or  whether, 
being  in  the  nature  of  a  covenant,  the  de- 
fendant was  bound  tliereby,  subject  to  tlie 
performance  of  the  conditions  by  the  cove- 
nantees. Apart;  from  the  effect  of  the  seal 
as  evidencing  a  consideration  binding  the  de- 
fendant to  hold  open  his  proposition,  or  rather 
validating  his  promise  subject  to  the  condi- 
tions expressed  in  the  writing,  it  is  clear  that 
such  promise,  made  for  a  consideration  there- 
after to  be  performed  by  the  plaintiff  at  his 
election,  would  take  effect  as  an  offer  or  prop- 
osition merely,  but  would  become  binding  as 
a  promise  as  soon  as  accepted  by  the  perform- 
ance of  the  consideration,  unless  previously 
revoked  or  it  had  otherwise  ceased  to  exist. 
Langd.  Cent.  §  70;  Railroad  v.  Bartlett,  3 
Cush.  227,  22S.  In  the  case  cited  there  was 
a  proposition  to  sell  land  by  writing  not  under 
seal.  The  court  L'  .J  the  party  at  Uberty  to 
withdraw  his  offer  at  any  time  before  ac- 
ceptance, but  not  after,  within  the  appointed 
time,  because  until  acceptance  it  was  a  mere 
offer,  without  a  consideration  or  a  correspond- 
ing promise  to  support  it,  and  the  court  say: 
"Whether  wisely  or  not,  the  common  law  un- 
yieldingly insists  upon  a  consideration,  or  a 
piiper  with  a  seal  attached."  If,  however,  his 
promise  is  bin. ling  upon  the  defendant,  be- 
cause contained  in  an  instniment  under  seal, 
then  it  is  not  a  mere  offer,  but  a  valid  prom- 
ise to  convey  the  land  upon  the  condition  of 
payment  All  that  remained  was  perform- 
ance by  plaintiff  within  the  time  specified  to 
entitle  him  to  a  fulfillment  of  the  covenant 
to  convey.  Langd.  Smnmary,  §§  17S,  179, 
(vol.  2,  Cases  on  Contract)  As  respects  the 
validity  or  obligation  of  such  unilateral  con- 
tracts, the  distinction  between  coven.nnts  and 
simple  contracts  is  well  defined  and  estab- 
lished. Anson,  Cont  12;  Chit  Cout.  *5; 
Leake,  Cont  146;  1  Smith,  Lead.  Cas.  (7th 
Ed.)  69S;  Wing  v.  Chase,  35  Me.  2G0;  Wil- 
lard  V.  Tayloe,  8  Wall.  504. 

In  Pitman  v.  Woodbury.  3  Exch.  11,  Parke, 
B.,  says:  "The  cases  establish  that  a  cove- 
nnntee  in  an  ordinary  indenture,  who  is  a 
party  to  it,  may  sue  the  covenantor,  who  ex- 
ecuted it  though  he  himself  never  did;  for 
he  is  a  party,  though  he  did  not  execute,  and 
it  makes  no  difference  that  the  covenants  of 
the  defendant  tlierein  are  stated  to  be  in  con- 
sideration of  those  of  the  covenantee.  Of 
this  there  is  no  doubt,  nor  that  a  covenant 
binds  without  consideration."  Morgan  v. 
Pike,  14  C.  B.  4S4;  Leake,  (>)nt  14L  The 
covenantee  in  such  cases  may  have  the  ben- 
efit of  the  contract  but  subject  to  the  condi- 


114 


CONTRACTS  UNDER  SEi^L. 


tions  and  provisos  in  the  deed.  These  obliga- 
tions frequently  take  the  form  of  bonds, 
which  is  only  another  method  of  forming  a 
contract,  in  which  a  party  binds  himself  as  if 
he  had  made  a  contract  to  perform;  a  consid- 
eration being  necessai-ily  implied  from  the 
solemnity  of  the  kistniment.  The  considera- 
tion of  a  sealed  instrument  may  be  inquired 
into;  it  may  be  shown  not  to  have  been 
paid,  (Bo wen  v.  Bell,  20  Johns.  338,)  or  to 
be  different  from  that  expressed, — Jordan  v. 
White,  20  Minn.  99,  (Gil.  77;)  McCrea  v.  Fur- 
mort,  16  Wend.  460.— or  as  to  a  mortgage 
that  there  is  no  doubt  to  secure,  (Wearse  v. 
Peirce,  24  Pick.  144,)  etc.;  but,  except  for 
fraud  or  Illegality,  the  consideration  impUod 
from  the  seal  cannot  be  impeached  for  the 
pui-pose  of  invalidating  the  instrument  or  de- 
stroying its  character  as  a  specialty.  It  is 
true  that  equity  will  not  lend  its  auxiliary 
remedies  to  aid  in  the  enforcement  of  a  con- 
tract which  is  inequitable,  or  is  not  supported 
by  a  substantial  consideration,  but  at  the 
same  time  it  will  not  on  such  grounds  inter- 
fere to  set  it  aside.  But  no  reason  appears 
why  equity  might  not  have  decreed  specific 
performance  in  this  case,  (had  the  land  not 
been  sold,)  because  the  substantial  and  mer- 
itorious consideration  required  by  the  court 
In  such  cases  would  consist  in  that  stipulated 
in  the  instrument  as  the  condition  of  a  con- 
veyance, performance  of  which  by  the  plain- 
tiff would  have  been  exacted  as  a  prerequisite 
to  relief,  so  as  to  secure  to  defendant  mu- 
tuality in  the  remedy,  and  all  his  rights  under 
the  contract.  The  inquiry  would  not,  in  such 
case,  be  directed  to  the  constructive  consid- 
eration evidenced  by  the  seal,  for  a  mere 
nominal  consideration  would  have  supported 
defendant's  offer  or  promise  upon  the  pre- 
scribed conditions.  Leake,  Gont  17,  18;  Rail- 
road V.  Babcock,  6  Mete.  (Mass.)  353;  Yard 
V.  Patton,  13  Pa.  St  285;  Candor's  Appeal, 
27  Pa.  St.  119. 
If,  then,  defendant's  promise  was  irrevoca- 


ble within  the  time  limited,  plaintiff  might 
certainly  seek  his  remedy  for  damages,  upon 
the  facts  alleged  in  the  pleadings,  upon  show- 
ing performance  or  tender  thereof  on  his 
part.  There  is  a  growing  tendency  to  abro- 
gate the  distinction  between  sealed  and  un- 
s€?alod  instruments;  in  some  states  by  legis- 
lation, in  others  to  a  limited  extent  by  usage 
or  judicial  recognition.  State  v.  Young,  23 
Minn.  557;  1  Pars.  Cont.  *429.  But  tlie  sig- 
nificance of  the  seal  as  importing  a  considera- 
tion is  everywhere  still  recognized,  except  as 
affected  by  legislation  on  the  subject.  It  has 
certainly  never  been  questioned  by  this  court 

In  Pennsylvania  the  courts  allow  a  party, 
as  an  equitable  defense  in  actions  upon  seal- 
ed instruments,  to  show  a  failure  to  receive 
the  consideration  contracted  for,  where  an 
actual  valuable  consideration  was  intended 
to  pass,  and  furnished  the  motive  for  enter- 
ing into  the  contract.  Candor's  Appeal,  27 
Pa.  St.  119;  Yard  v.  Patton,  supra.  But 
whatever  the  rule  as  to  equitable  defenses 
and  counter-claims  under  our  system  of  prac- 
tice may  be  held  to  be  in  the  case  of  sealed 
instruments,  it  has  no  application,  we  think, 
to  a  case  like  this,  where  fuU  effect  must  be 
given  to  the  seal.  Under  the  civil  law  the 
rule  is  that  a  party  making  an  offer,  and 
granting  time  to  another  in  which  to  accept 
it,  is  not  at  liberty  to  withdraw  it  within 
the  appointed  time,  it  being  deemed  inequita- 
ble to  disappoint  expectations  raised  by  such 
offer,  and  leave  the  party  without  remedy. 
Xhe  common  law,  as  we  have^seen^  though 
requiring  a  consideration,  issatisfi^d  with_the 
v^dencg  thereof  s'ignmea  Dyrirsftair~Railroad 
V.  BarGett,  supra.  The  same  principle  applies 
to  a  release  under  seal,  which  is  conclusive 
though  disclosing  on  its  face  a  consideration 
otherwise  insufficient  Staples  v.  Welling- 
ton, 62  Me.  9;  Wing  v.  Chase,  35  Me.  260. 

These  considerations  are  decisive  of  the 
case,  and  the  order  denying  a  new  trial  must 
be  reversed. 


STATUTE  OF  FRAUDS. 


116 


THOMPSON  V.  BLANCHARD.i 

(3  N.  Y.  335.) 
Court  of  Appeals  of  New  York.    April,  1850. 
N.  HiU,  Jr.,  for  appellant     S.  Stevens,  for 
respondent. 

GAllDINER,  J.  The  undertaking  of  the 
appt'llaut  in  this  case  was  drawn  with  refer- 
ence to,  and  is  In  precise  conformity  witti, 
the  requirements  of  section  335  of  the  Code. 
In  this  we  all  agree.  It  is  a  necessary  im- 
plication from  the  statute,  that  an  undertak- 
ing thus  executed  shall  be  effectual  to  svis- 
tain  an  appeal  and  an  action  in  beliulf  of  the 
appellee,  if  the  judgment  appealed  should  be 
alhrmed  in  whole  or  in  part.  The  legisla- 
ture, however,  have  not  left  the  matter  to 
implication.  They  have  enacted  that  "when 
an  appeal  shall  be  perfected  as  provided  by 
the  335tli  section,  it  shall  stay  all  proceed- 
ings in  the  court  below  upon  the  judgment 
appealed  from,  or  the  matter  embraced  there- 
in."    Section  339. 

It  is  objected,  notwithstanding,  that  the  in- 
strument is  nudum  pactum,  not  because  there 
is  no  consideration  in  fact,  but  because  none 
is  expressed  in  the  writing.  The  answer  is, 
that  the  statute  required  an  undertaking  in 
writing  with  certain  prescribed  stipulations, 
and  nothing  else.  An  undertaking  is  a  prom- 
ise. Bouv.  Law  Diet  It  may  be  made 
with  or  without  consideration.  If  the  prom- 
ise was  in  writing,  the  consideration  need 
not  be  expressed,  it  might  be  proved  in  all 
cases  by  parol.  The  common  law  was  sat- 
isfied if  there  was  a  consideration  in  fact  to 
sustain  the  undertaking.  Neither  before  nor 
since  the  statute  of  frauds,  has  it  ever  been 
hold  that  an  undertalcing,  or  promise,  ex  vi 
termini,  imports  a  consideration.  In  Wain 
V.  Wariters,  5  East  10,  luider  the  English 
statute  of  frauds,  it  was  for  the  first  time 
decided  that  the  word  agreement  implied  a 
consideration.  But  that  case  proceeded  upon 
the  dLstinction  between  an  agreement  and  an 
luidortaking.  Lord  Ellenborough  stated  the 
question  to  be,  whether  "agreement,  in  the 
statute,  was  synonymous  with  promise  or  un- 
dertaking, or  signified  a  mutual  contract  up- 
on consideration."  And  all  the  judges  con- 
curred in  saying,  that  had  the  statute  re- 
quired only  that  the  promise  should  be  in 
writing,  instead  of  the  agreement  in  respect 
to  which  the  promise  was  made,  their  opin- 
ion would  have  been  different. 

The  legislature,  in  the  section  referred  to, 
have  said  that  an  undertaking,  to  the  effect 
proscribed,  shall  be  effectual.  We  have  no 
authority  to  add  other  conditions.  If  It  be 
said  that  such  an  instrument  would  not  be 
obligatory  by  the  statute  of  frauds,  the  very 
obvious  answer  is,    that   the   legislature   of 


1  Dissenting  opinion  of  Bronson,  C.  J.,  omit- 
ted. 


1848  had  the  same  power  to  restore  the  com- 
mon law,  as  to  this  class  of  securities,  that 
their  predecessors  had  to  abolish  it  2d. 
The  imdertaking  prescribed  by  the  335th  sec- 
tion is  a  statute  security  and  not  a  common- 
law  agreement  Agreements  which  derive 
their  obligation  from  the  common  law,  and 
no  others,  are  enumerated  in  our  statute,  and 
required  to  be  made  in  writing,  expressing 
a  consideration.  2  Rev.  St.  13G.  The  oli- 
jection  I  am  considering  assumes  that  the 
undertaking  in  question  falls  within  one  of 
the  classes  of  agreements  there  specified.  It 
has,  however,  been  genei-ally  supposed  that 
the  assent  of  more  than  one  party  was  es- 
sential to  the  validity  of  an  agi-eoment  at 
common  law.  Lord  Ellenborough  calls  it  a 
mutual  contract  upon  consideration.  The 
consideration  being  one  element  of  the  agree- 
ment, must,  of  course,  be  the  subject  of  ar- 
rangement between  the  parties  before  it  can 
be  expressed  in  writing.  Accordingly  where 
a  contract  has  been  executed  by  both  par- 
ties, evidence  is  required,  in  addition,  of  de- 
livery and  acceptance,  or  something  equiva- 
lent, in  order  to  show  their  assent  to  It  as  a 
perfected  instrument,  mutually  obligatory  up- 
on them.  The  necessity  for  this,  when  it  is 
executed  by  one  of  the  parties  only.  Ls  app.ar- 
ent.  Now  the  undertaking  Ln  question  was 
properly  prepared,  executed,  and  filed  with 
the  clerk  by  the  appellant,without  any  com- 
munication or  arrangement  with  the  appel- 
lee. Sections  343,340.  The  assent  of  the  lat- 
ter was  not  necessaiy  to  the  creation  of  the 
obligation,  nor  would  his  dissent  defeat  or  in 
the  slightest  degree  modify  its  effect  upon 
his  own,  or  the  rights  of  the  otlier  party. 
And  so  we  have  In  effect  decided,  in  a  case 
between  these  parties.  2  N.  Y.  562.  The 
only  consideration  that  can  be  imagined,  for 
the  imdertaking  of  the  defendant  and  his 
sureties,  is  the  stay  of  proceedings  upon,  and 
the  right  to  review  the  judgment  obtained 
by  the  plaintiff.  But  this  delay  and  privi- 
lege is  the  act  of  the  law,  against  the  wish- 
es and  in  spite  of  the  opposition  of  the  re- 
spondent What  possible  application,  there- 
fore, has  the  statute  designed  to  prevent 
frauds  and  perjunes  in  reference  to  common- 
law  contracts,  to  an  undertaking,  the  con- 
tents and  legal  effect  of  which  are  written 
on  the  face  of  the  statute?  What  fraud  is  to 
be  suppn^ssed,  or  perjury  avoided,  by  making 
this  appolhint  certify,  under  his  signature,  to 
a  consideration  which,  if  it  exist  at  all,  did 
not  arise  from  the  agreement  of  parties,  but 
from  a  law  which  this  court  and  all  others, 
ai-e  bound  judicially  to  notice?  At  most  it 
would  be  but  cumulative  evidence  of  the  pro- 
visions of  a  stxitiite. 

We  think,  for  the  reasons  assigned,  the  un- 
dertaking sufficient  and  the  appeal  well 
brought. 


116 


STATUTE  OF  FRAUDS. 


i;^V 


STONE  T.  DENNISON.i         / 
(13  Pick.  1.)  (p 


Lj-    Supreme  Judicial    Court  of   Massachusetts. 
Sept  Term,  1S32. 

At  the  trial,  before  Wilde,  J.,  the  plaintiff 
proved  that  he  had  been  in  the  service  of  the 
defendant  from  October,  ISIS,  to  October, 
1S2S,  when  he  became  twenty-one  years  of 
age;  and  he  introduced  evidence  tending  to 
show  that  his  services  were  worth  more  tlian 
the  support  and  education  f\imished  him  by 
the  defendant.  Evidence  was  offered  by  the 
defendant  tending  to  show  the  contrary,  and 
that  the  agreement  was  a  reasonable  one. 

The  defendant  contended  that  he  was  not 
liable,  because  at  the  time  when  the  plaintiff 
was  fourteen  years  of  age,  his  father  being 
dead,  George  Eels  was  duly  appointed  his 
guardian,  and  it  was  agreed  between  the 
plaintiff,  the  defendant  and  the  guardian  that 
the  plaintiff  should  continue  in  the  service  of 
the  defendant,  until  he  should  arrive  at  the 
age  of  twenty-one,  for  his  board,  clothing  and 
education,  and  the  defendant  had  performed 
the  contract  on  his  part 

The  plaintiff  objected  to  the  admission  of 
evidence  to  prove  these  allegations: 

(1)  Because  the  supposed  contract  was  void 
by  the  statute  of  frauds,  it  not  being  in  writ- 
ing. 

(2)  Because,  the  plaintiff  having  no  prop- 
erty and  his  mother  being  living  at  the  time, 
the  appointment  of  the  guardian  was  void; 
or,  at  least,  if  valid,  it  gave  the  guardian  no 
power  to  bind  the  plaintiff  by  the  contract 
stated;  and  the  plaintiff  could  not  be  bound 
by  any  assent  given  by  himself  to  the  agree- 
ment, during  his  infancy. 

But  the  judge  admitted  the  evidence,  and 
instructed  the  jury  that  if  the  plaintiff  en- 
tered into  thir  agreement  as  contended  for  by 
the  defendant,  and  entered  into  the  service  of 
the  defendant  in  pursuance  of  the  same,  and 
continued  in  it  during  all  the  time  agreed 
upon,  he  could  not  waive  the  contract  and  go 
upon  a  quantum  meruit,  unless  the  contract 
was  obtained  by  unfair  means,  and  so  was 
fraudulent  on  the  part  of  the  defendant;  and 
that,  if  the  con.Ti^ct  was  so  unreasonable  as 
to  show  that  the  plaintiff  was  overreached, 
that  would  be  evidence  of  fraud  and  would 
I'endcr  the  contract  null  and  void. 

The  jury  found  a  verdict  for  the  defend- 
ant, and  the  plaintiff  moved  for  a  new  trial. 
If  the  foregoing  opinions  and  instructions 
were  erroneous,  a  new  trial  was  to  be  grant- 
ed; otherwise  judgment  was  to  be  rendered 
on  the  verdict. 

Mr.  Wells,  for  plaintiff.  Bates  &  Dewey, 
for  defendant. 

SHAW,  C.  J.  Several  points  were  left  to 
the  jury  in  the  present  case,  which  may  be 
considered  as  settled  by  their  verdict. 


1  Irrelevant  parts  omitted. 


By  the  report  it  appoars  that  after  the 
plaintiff  aiTived  at  the  age  of  fourteen  years, 
having  then  lived  several  years  with  the  de- 
fendant, it  was  agreed  between  the  plaintiff 
and  his  guardian  on  the  one  side,  and  the  de- 
fendant on  the  other,  that  the  plaintiff  should 
continue  in  the  sei-vice  of  the  defendant  urftil 
he  should  arrive  at  the  age  of  twenty-one,  for 
his  board,  clothing  and  education.  By  the 
finding  of  the  ju'y,  under  the  instructions  giv- 
en to  them  by  the  court,  it  must  be  taken  to 
have  been  settled,  that  the  contract  was  not 
obtained  by  any  unfair  means,  or  fraudulent, 
on  the  part  of  the  defendant,  and  that  it  was 
not  unequal,  so  as  to  show  that  the  plaintiff 
was  overreached. 

The  case  then  is  one  of  a  minor  over  four- 
teen years  of  age,  entering  into  an  agreement 
with  a  person,  for  labor  and  service  to  be  fur- 
nished on  one  side,  and  subsistence,  clothing 
and  education  on  the  other,  an  agreement  in 
which  the  minor  was  not  overreached,  which 
was  not  so  unreasonable  as  to  raise  any  sus- 
picion of  fi-aud,  and  which  was  assented  to 
and  sanctioned  by  the  guardian  of  the  minor. 
This  agreement  is  fully  executed  on  both 
sides.  The  labor  and  services  are  performed 
by  the  minor,  and  the  stipulated  compensa- 
tion is  furnished  by  his  employer.  And  the- 
question  is,  whether  the  plaintiff,  notwith- 
standing such  agreement,  can  maintain  a 
quantum  meruit  for  his  services,  merely  by 
showing  that  in  the  event  which  has  happen- 
ed his  services  were  worth  more  than  the 
amount  of  the  stipulated  compensation;  and 
we  think  he  cannot. 

The  first  point  taken  by  the  plaintiff  is  that 
the  evidence  of  the  agreement  ought  not  to 
have  been  admitted,  because  the  agreement, 
not  being  to  be  performed  within  a  year,  and 
not  being  in  writing,  was  void  by  the  stat- 
ute of  fi-auds.    St  17SS,  c.  16,  §  1. 

But  we  think  this  objection  is  answered  by 
the  consideration  that  here  the  contract  has 
been  com^jletely  performed  on  both  sides. 
The  defendant  is  not  seeking  to  enforce  this 
agreement  as  an  executory  contract,  but  sim- 
ply to  show  that  the  plaintiff  is  not  entitled  to 
recover  upon  a  quantum  meiniit  as  upon  an 
implied  promise.  But  the  statute  does  not 
make  such  a  contract  void.  The  provision"  is, 
tfiaf"  no" 'action  stall  be  brought,  whereby  to 
charge  any  person  upon  any  agreement,  which 
is  not  to  be  performed  within  the  space  of 
one  year,  unless  the  agreement  shall  be  in 
writing.  The  statute  prescribes  the  species 
of  evidence  necessary  to  enforce  the  execu- 
tion of  such  a  contract.  But  where  the  con- 
tract has  been  in  fact  performed,  the  rights, 
duties,  and  obligations  of  the  parties  result- 
ing from  such  performance  stand  unaffected 
by  the  statute. 

In  the  case  of  Boydell  v.  Drummond,  11 
East,  142,  a  case  was  put  in  the  argument  of 
goods  sold  and  delivered  at  a  certain  price,  by 
parol,  upon  a  credit  of  thirteen  months. 
There,  as  a  part  of  the  contract  was  the  pay 
ment  of  the  price,  which  was  not  to  be  per- 


EXECUTED  CONTRACTS. 


117 


formed  within  the  year,  a  quustion  is  made, 
whether  by  force  of  the  statute  the  purchaser 
is  exempted  from  the  obligation  of  the  agree- 
ment as  to  the  stipulated  price,  so  as  to  leave 
it  open  to  the  jury  to  give  the  value  of  the 
goods  only,  as  upon  an  implied  contract.  "In 
that  case,"  said  Lord  EUenborough,  "the  de- 
livery of  the  goods,  which  is  supposed  to  be 
made  within  the  year,  would  be  a  complete 
execution  of  the  contract  on  the  one  part;  and 
the  question  of  consideration  only  would  be 
reserved  to  a  future  period." 

If  a  performance  upon  one  side  would  avoid 
the  operation  of  the  statute,  a  fortiori  would 
the  entire  and  complete  performance  on  both 
sides  have  that  effect.  Take  the  common  case 
of  a  laborer  entering  into  a  contract  with  his 
employer  towards  the  close  of  a  year,  for  an- 
other year's  service,  upon  certain  stipulated 
terms.  Should  either  party. refuse  to  perfonn, 
the  statute  would  prevent  either  party  from 
bringing   any   action   whereby   to  charge   the 


other  upon  such  contract.  But  It  would  be  a 
very  different  question  were  the  contract  ful- 
filled upon  both  sides,  by  the  performance  of 
the  services  on  the  one  part  and  the  payment 
of  money  on  account,  from  time  to  time,  on 
the  other,  equal  to  the  amount  of  the  stipu- 
lat-^d  wages.  In  case  of  the  rise  of  wages 
within  the  year,  and  *he  consequent  increased 
value  of  the  sen- ices,  could  the  laborer  bring 
a  quantum  meruit,  and  recover  more;  or  in 
case  of  the  fall  of  labor  and  the  diminished 
value  of  the  services,  could  the  employer 
bring  money  had  and  received  and  recover 
back  part  of  the  money  advanced,  on  the 
ground  that  by  the  statute  of  frauds  the  orig- 
iiial  contract  could  not  liave  been  enforced? 
Such,  we  think,  is  not  the  true  corustructioa  j-t 
the  statute.  ^Ve  are  of  the  opinion  that  it  has 
no  application  to  executed  contracts,  and  that 
the  evidence  of  this  contracr  was  rigTitly  ad- 
mitted- 


118 


STATUTE  or  FRAUDS. 


.< 


[s 


'   Oct., 


BELLOWS  V.  SOWLES. 
(57  Vt.  164.) 
Supreme  Court  of  Vermont.     Montpelier. 
1SS4. 

Assumpsit.  Heard  on  demurrer  to  the 
declaration,  September  Term,lSS3,  Frank- 
lin County,  RoYCE,  Ch.  J.,  presiding.  De- 
murrer overniled.  The  declaration  alleged 
in  substance:  That  the  plaintiff  was  a 
relative  and  heir-at-law  of  Hiram 
Bellows,  deceased  ;  *that  by  the  terms  "IGo 
of  said  Bellows'  will,  presented  to 
the  Probate  Court  for  allowance,  no  pro- 
vision was  made  for  the  plaintiff;  that 
the  plaintiff  "claimed  and  insisted  tliat  he 
was  left  out  of  said  will,  and  that  no  pro- 
vision ♦  ♦  ♦  was  made  for  the  plaintiff 
thrt'Ugh  undue  influence  had  and  used 
jpon  said  Bellows  by  said  defendant  and 
nis  wife,  Maggie  Sowles,  and  that  said  will 
was  void,  and  should  not  be  approved; 
that  he  had  employed  counsel  to  test  the 
validity  of  said  will  before  the  Probate 
Court;  that  similar  claims  were  made  by 
other  heirs";  "and  whereas  the  said  de- 
fendant being  then  and  there  the  executor 
named  in  said  will,  and  being  largely  in- 
terested pecuniarily  in  said  estate  as  leg- 
atee and  the  husband  of  the  princijial  leg- 
atee under  said  will,  and  well  knowing  the 
claim  of  the  plaintiff,  and  that  he  had 
employed  counsel  as  aforesaid,  and  that 
otlier  heirs  were  then  and  there  making 
similar  claims,  and  being  anxious  to  have 
said  will  sustained,  had  also  employed 
counsel  for  that  purpose;  and  it  was  theu 
and  there  expected  by  the  parties  that  a 
contest  would  be  had  upon  the  approval 
of  said  will,  which  would  involve  the  ex- 
penditure of  a  large  amount  of  money, 
and  hinder  and  delay  the  settlement  of 
said  Bellows' estate,  and  the  receipt  by  the 
said  defendant  and  his  said  wife  of  their 
said  legacies";  that  the  plaintiff  met  the 
defendant  by  appointment  at  defendant's 
house,  and  that  the  matters  relating  to 
the  will  were  talked  over;  that"the  plain- 
tiff, at  the  special  instance  and  request  of 
the  said  defendant,  would  see  one  Char- 
lotte Law,  who  was  one  of  the  heirs  of 
said  Bellows,  and  who  was  then  and 
there  intending  to  contest  the  validity  of 
said  will,  and  use  his  influence  to  have  her 
allow  said  will  to  be  approved,  and  that 
the  plaintiff  forbear  to  contest  the  ap- 
proval of  Faid  will  of  said  Bellows,  and 
allow  the  same  to  be  approved  by  the 
Probate  Court  aforesaid,  and  would  not 
appeal  from  the  decision  of  said  court,  he, 
th2  said  defendant,  undertook,  and  then 
and  there  faithfully  promised  to  pay  the 
plaintiff  the  sum  of  $5,000,  whenever,  after 
twenty  days  had  elapsed  from  the  date  of 
the  approval  of  said  will  by  said  Probate 
Court,  he  should  be  thereunto  requested." 
•  *  *  "And the  plaintiff  avers, that, con- 
fiding in  the  promise  and  undertaking  of 
the  said  defendant  so  made  as  aforesaid, 
afterwards,  to  wit,  on  the  day  and  year 
aforesaid,  he  did  see  said  Charlotte  Law, 
and  did  use  his  influence  with  her  to 
*166  allow  said  will  to  be  ap*proved,  and 
did  forbear  to  contest  the  approval 
of  said  will  of  said  Bellows,  and  did  al- 
low the  same  to  be  approved  by  said  Pro- 
bate Court,  and   did  not  appeal  from  said 


approval";  •  •  •  thatsaid  will  was  duly 
approved  on  the  7th  day  of  December, 
INTO;  that  no  appeal  was  taken;  that  the 
twenty  days  has  ela[)sed;  and  that  de- 
fendant, though  requested,  has  wholly 
neglected  and  refused  to  pay  the  said 
$5,000,  &c.  There  was  a  second  count,  sub- 
stantially like  the  first,  alleging,  that  the 
plaintiff  was  heir-at-law  of  said  Bellows; 
that  he  received  nothing  under  the  will ; 
that  the  will  was  made  as  it  was,  and 
plaintiff  left  out, "through  undue  influence 
and  by  procurement  of  the  said  defendant 
and  his  said  wife,  and  that  said  will  was 
void";  that  he  had  arranged  to  contest 
the  validity  of  the  will;  that  this  was 
known  to  the  defendant;  that  it  was  "ex- 
pected by  the  parties  that  long  and  ex- 
pensive  litigation  would  ensue,  which 
would  delay  the  settlement  of  said  Bel- 
lows' estate,  and  prevent  the  said  defend- 
ant and  his  said  wife  from  receiving  the 
large  sums  of  money  which  they  expected 
from  said  estate,  as  they  otherwise 
would";  that  the  defendant  "being  pe- 
cuniarily interested  in  said  estate  to  a 
large  amount  as  legatee,  as  husband  of 
the  largest  legatee  under  the  will,"&c. ; 
that  defendant  promised  to  pay  plaintiff 
the  sum  of  $5,000  if  he  would  forbear  to 
contest  the  will;  that  he  did  forbear,  in 
consideration  of  the  promise,  &c.,  &c. 
The  common  counts  followed. 

Geo.  A.  Ballard,  Fartlngton  &  Post,  Wil- 
son &  Hall,  and  Noble  &  Smith,  for  plain- 
tiff. Defendant  pro  se  ( with  him  H,  S. 
Royce  and  L.  P.  Poland). 

POWERS,  J.  Counsel  for  the  defendant 
have  demurred  to  the  declaration  in  this 
case  upon  two  grounds;  first,  that  the 
consideration  alleged  is  insufficient;  sec- 
ondly, that  the  promise  not  being  in  writ- 
ing comes  within,  and  is  therefore  not  en- 
forceable under,  the  Statute  of  Frauds. 

It  has  been  so  often  held  that  forbear- 
ance of  a  legal  right  affords  a  sufficient 
consideration  upon  which  to  found  a  valid 
contract,  and  that  the  consideration  re- 
quired by  the  Statute  of  Frauds  does  not 
differ  from  that  required  by  the  common 
law,  it  does  not  appear  to  us  to  be  neces- 
sary to  review  the  authorities,  or  discuss 
the  principle.  As  to  the  second  point 
urged  in  behalf  of  the  defendant,  this  case 
pre.sents  greater  difficulties.  Although 
the  Statute  of  Frauds  was  enacted  two 
centuries  ago,  and  even  then  was  little 
more  than  a  re-enactment  of  the  pre-exist- 
ing common  law,  and  though  cases  have 
continually  arisen  under  it,  both  in  Eng- 
land and  America,  yet  so  confusing  and 
at  times  inconsistent  are  the  decisions, 
that  its  considei-ation  is  always  attended 
with  difficulty  and  embarrassment. 

The  best  understanding  of  the  statute 
is  derived  from  the  language  itself,  viewed 
in  the  light  of  the  authorities  which  seem 
to  us  to  interpret  its  meaning  as  best  to 
attain  its  object.  That  clause  of  the  stat- 
ute under  which  this  case  falls,  reads: 
"No  action  at  law  or  in  ecjuity  shall  be 
brought  *  *  *  upon  a  special  promise 
of  an  executor  or  administrator  to  answer 
damages  out  of  his  own  estate." 

This  special   promise  referred   to  is,  in 


PROMISE  BY  EXECUTOR  OR  ADMINISTRATOR. 


119 


short,  any  actual  promiso  made  by  an  ex- 
ecutor or  administrator,  in  distinction 
from  promiHes  implied  bj'  law,  which  are 
hold  not  within  tli«' statute. 

Tlie  promiHe  must  be  "  to  answer  dam- 
ages out  of  ills  o  wn  estate.  "  Tl)is  pJirtise- 
olo^y  clearly  implies  an  obligation,  duty, 
or  liability  on  the  part  of  the  testator's 
estate,  for  which  the  executor  promises  to 
pay  damages  out  of  his  own  estate.  The 
statute,  then,  was  enacted  to  pre- 
vent executors  *or  administrators  *170 
from  beinj;-  fraudulently  held  for  the 
debts  or  liabilities  of  the  estates  upon 
which  they  were  called  to  administer.  In 
this  view  of  the  case,  this  clause  of  the 
Btatnte  is  closely  allied,  if  not  identical  in 
principle,  with  the  followinp:  clauKe.  name- 
ly :  "No  action,  etc.,  upon  a  special  prom- 
ise to  answer  for  the  debt,  default  or  mis- 
doinj^s  of  another."  And  so  Jud^^eUoYCK, 
in  delivering  the  opinion  of  the  court  in 
Harrington  v.  Rich,  6  Vt.  GGG.  dtH.'lares 
tlu'se  two  classes  of  uudertaUings  to  bo 
"very  nearly  allied,"  and  considers  them 
together.  This  seems  to  as  to  be  the  true 
idea  of  this  clause  of  the  statute:— that 
the  undertaking  contemplated  by  it,  like 
that  contemplated  by  the  next  clause,  is 
in  the  nature  of  a  guaranty;  and  that 
reasoning  ap|)licable  to  the  latteris  equal- 
b'  applicable  to  the  former. 

We  believe  this  view  to  be  well  support- 
ed by  the  authorities.  Browne,  in  his 
work  on  the  Statute  of  Frauds,  p.  loO, 
says:  "In  the  ft)nrth  section  of  the  Statute 
of  Frauds,  special  promises  of  executors 
and  administrator  to  answer  damages 
out  of  their  own  estates  appear  to  be 
spoken  of  as  on«  class  of  that  large  body 
of  contracts  known  as  guaranties.  "  And 
soon  page  184,  he  interprets  "to  answer 
damages"  as  equivalent  to  pay  debts  of 
the  decedent.  This  seems  to  be  the  con- 
struction given  to  the  statute  by  Chief 
Justice  Redfikli),  in  his  work  on  Wills. 
Vol.  II.  p.  290,  et  seq. 

The  Revised  Statutes  of  New  York,  Vol. 
II.  p.  113,  have  improved  upon  the  phrase- 
ology of  the  old  statute  as  we  have  adopt- 
ed it.  by  adding,  or  to  pay  the  debts  of 
the  testator  or  intestate  out  of  his  own 
estate. 

If  we  are  correct  in  this  view  of  the  re- 
lation between  these  twoclauscs, the  solu- 
tion of  the  question  presented  by  this  case 
is  comparatively  easy. 

It  has  been  held  in  this  State,  that  when 
the  contract  is  founded  upon  a  new  and 
distinct  consideration  moving  between 
the  parties,  the  undertaking  is  original 
and  independent,  and  not  within  the 
statute.  Templeton  v.  Bascom, 
*33  Vt.  132;  Cross  v.  Richardson.  30  nTl 
Vt.  G41;  Lampson  v.  Hobart.  28  Vt. 
097.  Whether  or  not  it  would  be  safe  to 
announce  this  as  a  general  rule  of  uni- 
versal application,  it  is  a  principle  of  law 
well  fortified  by  authority,  that  where 
the  principal   or  immediate  object  of   the 


promisor  is  not  to  pay  the  debt  of  an- 
other, but  to  subserve  some  jturpose  ot 
his  own,  the  promise  is  original  and  inde- 
pendent, and  not  within  the  statute. 
Branilt  Sur.  72;  3  Par.  Cont.  24;  Rob.  Fr. 
232;  Fmerson  V.  Slater,  22  How.  28.  And 
this  seems  to  be  the  real  ground  of  the  de- 
cisions above  cited  in  the  28th  and  30th 
Vt.,  in  which  the  c(jurt  seems  to  blend  the 
two  rules  just  laid  down. 

PiKuroiNT,  J.,  in  delivrring  the  opinion 
of  the  court  in  Cross  v.  Richardson,  sujn-a, 
says:  "The  consideration  must  l)e  not 
only  suflicient  to  supjtort  the  promise,  but 
of  such  a  nature  as  to  take  the  promise 
out  of  the  statute;  and  that  requisite,  we 
think,  is  to  be  found  in  the  fact  that  it 
ojicrates  to  theadvantageof  the  promisor, 
and  places  him  under  a  pecuniary  obliga- 
ticjn  to  the  promisee,  entirely  independent 
of  the  original  debt." 

Ai)ply  this   rule  to  this  case.     Here  the 
main  pur|)(jsej)f  Jiiiis  promise  wasTllOtJTg^ 
aiiisweT'~naTiTages"7JL)r  the"  tesUTlTOTrVouT  of 

-trlS"TJWir^STUTerT5Trr^\^as^ 

-eerrc — Eome    pill  i)0.>e~of  Jur^clefeiulant. 

~Ttre  conBidc'rarrrm    did  Iapt__aiEL(rL  the  es- 
t^te,  bjTf^vas'a  matter  purel^^_x^ersonaJI£Q- 

^t  h  e  jCjeitTTTl  an  t  TTeTT^TncMv^vvasnoTTabi  1  i- 
ty  or  obligaTton  on  the  part  of  the  estate 
to  be  answered  for  in  damages.  It  could 
make  no  difference  to  the  executor  of  that 
estate  whether  it  was  to  be  divided  ac- 
cording to  the  will,  or  by  the  law  of  de- 
scent. If  the  subject  matter  of  this  con- 
tract had  been  something  entirely  foreign 
to  this  estate,  no  one  would  maintain  that 
the  defendant  Avas  not  bound  by  it,  because 
he  happened  to  be  named  executor  in  this 
will,  ilere  the  subject  matter  of  the  con- 
tract was  connected  with  the  estate,  but 
in  such  a  way  that  it  was  practically  im- 
material to  the  estate  which  way  the 
question  was  decided.  There  exists, 
•172  therefore,  in  *this  case,  no  sufficient, 
actual,  primary  liabilitj'  to  which  this 
promise  could  be  collateral.  This  seems 
to  us  to  be  the  fairest  interpretation  of 
the  law.  The  statute  was  passed  for  the 
benelit  of  executors  and  administrators; 
but  it  might  be  said  of  it,  as  has  been  said 
of  the  protection  afforded  to  an  infant  by 
the  law  of  contracts,  that  "it  is  a  shield 
to  protect,  not  a  sword  to  destroy."  If 
this  class  of  contracts  was  allowed  to  be 
avoided  under  it,  instead  of  being  a  pre- 
vention of  frauds,  it  would  become  a  pow- 
erful instrument  for  fraud.  As  in  this  case, 
the  plaintiff  would  be  deprived  of  his  legal 
right  to  contest  the  will,  by  a  party  who 
has  reaped  all  the  l>enefit  of  the  transac- 
tion, and  is  shielded  from  resi)onsibility 
by  a  technicality.  We  do  not  believe  this 
was  the  result  contemplated  by  the  stat- 
ute. 

The  judgment  of  the  Connty  Court  over- 
ruling the  demurrer  and  adjudging  the 
declaration  suflieient  is  aflirmed,  and  case 
remanded  with  leave  to  the  defendant  to 
replead  on  the  usual  terms. 


120 


A 


LARSON  V.  JENSEN. 

(19  N.  W.  130,  53  Mich.  427.) 

Supreme  Court  of   Michigan.      April  23, 

Error  to  Manistee. 

L.  W.  Fowler,  for  plaintiff.    L.  G.  Ruther- 
ford, for  defendant  and  appellant 


/ 
ISSi. 


CHAMPLIN,  J.  The  plaintiff  claimed  that 
he  entered  into  an  agreement  with  defendant 
by  which  he  was  to  furnish  and  deliver  to  one 
John  Labonta  an  unlimited  amount  of  mer- 
chandise, as  he,  Labont:!,  might  call  for,  or 
order  by  mail,  or  otherwise;  and  defendant 
was  to  pay  plaintiff  for  all  the  goods  so  or- 
dered or  called  for  by  Labonta;  that  in  pur- 
suance of  that  agreement  plaintiff  dehver- 
ed  goods  to  Labonta,  from  time  to  time,  at 
the  request  of  defendant,  and,  at  the  time 
this  action  was  brought,  plaintiff  claimed  a 
balajice  due  him  of  about  $400.  On  the  trial 
the  plaintiff  gave  evidence  tending  to  prove 
the  contract  as  alleged  in  the  declaration.  The 
plaintiff  was  the  only  witness  who  testified 
to  the  contract,  and  his  statement  of  it  was 
denied  by  the  defendant,  who  testified  that  he 
told  plaintiff  that  Labonta,  his  son-in-law,  was 
intending  to  engage  in  trade  in  a  small  way; 
that  he  had  a  little  money  and  that  he  would 
help  him  a  little;  and  asked  plaintiff  if  he 
could  not  let  Labonta  have  some  goods,  and 
he  said  he  would. 

The  defendant  contends  that  the  contract, 
as  set  out  in  the  plaintiff's  declaration,  is  void 
as  being  against  the  statute  of  frauds,  for  the 
reason  that  the  promise  of  defeudant  is  col- 
lateral, and  is  only  to  pay  the  debt  or  de- 
fault of  Labonta.  This  is  a  mistake.  The 
promise  and  undertaking  of  defendant,  as  al- 
leged in  the  declaration,  is  an  original  promise, 
and  rests  upon  a  sufficient  consideration.  The 
goods  were  to  be  furnished  to  Labonta,  it  is 
ti-ue,  but  upon  the  express  agreement  that 
defendant  should  pay  for  them.  Under  the 
declaration,  the  entire  credit  was  originally 
given  to  defendant. 

The  defendant  also  insists  that,  under  the 
evidence,  which  is  all  returned  in  the  record, 
it  was  the  duty  of  the  trial  judge  to  have 
taken  the  case  from  the  jury,  and  decide  the 
case  as  matter  of  law  in  favor  of  defendant. 
But  this  the  trial  judge  could  not  do,  if  there 
was  any  evidence  tending  to  prove  the  plain- 
tiff's claim.  The  testimony  of  the  plaintiff, 
however  inconsistent  with  itself,  tended,  "in 
some  parts  thereof,  to  sustain  the  declaration, 
and  the  effect  and  weight  to  be  given  to  it 
was  solely  a  question  for  the  jury,  and  it 
would  have  been  error  in  the  court  to  have 
taken  the  case  from  them. 

The  court  instructed  the  jury  that  the  bur- 
den of  proof  was  upon  the  plaintiff  to  show 
by  a  fair  preponderance  of  evidence  of  the  ex- 
istence of  the  contract,  and  that  in  pursuance 
of  such  contract  he  delivered  the  goods,  rely- 
ing entirely  upon  the  promise  of  Jensen  to  pay 
the  debt    And  if  the  jury  was  satisfied  by  a 


STATUTE  OF  FRAUDS. 

jr/  fair  preponderance  of  evidence  that  the  bar- 
gain was  made  as  plaintiff  claimed,  and  that 
he  relied  entirely  upon  it  and  never  looked 
to  Labonta  for  his  pay,  then  he  was  entitled 
to  recover;  otherwise  he  was  not  entitled  to 
recover.  But  if  the  jury  believed  the  theory 
0^  defendant  that  no  contract  of  this  kind 
■was  ever  made,  and  that  he  never  agreed  to 
pay  any  sum  whatever  absolutely,  he  is  not 
liable  and  they  should  find  no  cause  of  action. 
The  circuit  judge  placed  the  case  very  fully 
and  fairly  before  the  jury,  and  at  the  conclu- 
sion instructed  them  as  follows:  "The  only 
question  for  you  to  determine  is,  'Was  this 
bargain  made  between  the  plaintiff  and  de- 
fendant, whereby  goods  were  to  be  delivered 
to  Labonta  upon  the  credit  of  the  defendant, 
and  did  the  plaintiff,  reljing  upon  it,  deliver 
the  goods  solely  upon  the  credit  of  this  man 
Jensen,  and  looking  to  no  one  else  at  all  for  his 
pay?'  That  is  the  question.  If  you  solve  that 
question  in  favor  of  the  plaintiff,  then  he  is 
entitled  to  a  verdict;  if  you  solve  it  against 
him,  then  he  is  not  entitled  to  a  verdict.  The 
plaintiff  must  have  looked  to  the  defendant 
Jensen,  from  the  beginning  to  the  end  of  the 
transaction."  There  is  no  error  in  the  charge 
of  the  court  We  do  not  think  it  is  open  to  the 
criticism  that  "the  charge,  as  given,  assumed 
that  the  evidence  made  out  an  absolute  prom- 
ise to  pay."  On  the  contrary,  it  was  the  very 
question  he  submitted  to  the  jury,  to  be  de- 
termined by  them  from  all  the  evidence  in  the 
case. 

The  plaintiff  testified:  "Last  August  Mr. 
Jensen  came  up  to  me,  in  Manistee,  and  made 
aiTangements  to  furnish  his  son-in-law  goods 
when  he  called  for  them.  The  object  that  Mr. 
Jensen  wanted  goods  for  his  son-in-law  was  be- 
cause he  was  a  roving  character,  and  he  would 
see  them  paid  for.  I  should  deliver  the  goods 
to  John  Labonta,  and  he  would  see  them  paid. 
He  stated  the  object  in  wanting  the  goods: 
His  son-in-law  was  a  sailor  by  profession,  and 
he  wanted  to  settle  him  down.  He  wanted 
his  daughter  to  run  the  store,  and  his  son- 
in-law  to  work  around  the  mills,  if  the  store 
didn't  require  his  services.  And  I  agreed  to 
do  so." 

K  this  testimony  of  the  plaintiff  was  foimd 
by  the  jury  to  be  true,  the  agreement  was  not 
within  the  statute  of  frauds.  The  statute  does 
not  prevent  a  person  from  buying  goods  on 
his  own  credit,  to  be  delivered  to  another,  un- 
less in  writing.  In  such  case  the  important 
question  is,  to  whom  was  the  credit  given? 
And  this  question  the  court  fairly  submitted 
to  the  jury.  And  the  fact  that  the  goods  ai-e 
charged  on  the  books  of  the  seller  to  the 
person  to  whom  they  were  delivered  is  not 
conclusive  that  they  were  sold  upon  his  credit 
Foster  v.  Persch,  68  N.  Y.  400;  Huzen  v. 
Bearden,  4  Sneed,  48;  Walker  v.  Richard-s, 
41  N.  H.  388;  Swift  v.  Pierce,  13  AUen,  136; 
BaiTett  V.  McHugh,  128  Mass.  165;  Champion 
V.  Doty,  31  Wis.  190;  Ruggles  v.  Gatton,  50 
111.  412.  The  plaintiff  charged  the  goods  de- 
livered as  follows:    "John  Labonta,  by  order 


piiOMisE  TO  a:^swer  foe  debt  of  another. 


121 


of  Charles  Jensen."  The  plaintiff  testified 
that  he  gave  credit  to  the  defendant  when  he 
let  the  goods  go,  and,  Ln  response  to  a  ques- 
tion put  to  him  on  cross-examination  by  de- 
fendant's attorney,  "Who  did  you  look  to  for 
pay  for  those  goods?"  replied:  "Jensen;"  and 
that  he  did  not  look  to  Labunta  for  it.  The 
court  Instructed  the  jury  that  "tlie  way  the 
goods  are  charged  upon  the  books  does  not 
exclude  the  parties  from  showing  the  exact 
fact  to  whom  the  credit  waa  given."    While 


there  was  no  error  in  this  portion  of  the 
charge,  we  think  the  charge  made  upon  the 
books  is  quite  as  consistent  with  the  view  that 
credit  was  originally  given  to  defendant  as  to 
Labonta;  and  the  testimony  received  upon  the 
subject  as  to  whom  credit  was  given  was  un- 
exceptionable. 

There  are  no  errors  In  the  record  that  call 
for  a  reversal  of  the  judgment,  and  therefore 
it  is  affirmed. 

The  other  justices  concurred 


STATUTE  OF  FIJAUDS. 


CRANE  V.  WHEELER. 

"y      (51)  N.  W.  1033.  48  :Minn.  207.) 

Supreme   Court   of   Minnesota.    Jan.    25,   1S92. 

Appeal  from  district  court,  Mower  coun- 
ty ;  Faumrr.  Judg:e. 

'  Petition  of  Henry  Wheeler  for  allowance 
of  a  claim  ap:ainst  insolvents,  of  whom 
F.  I.  Crane  was  assiojnee.  Judgment  for 
petitioner.  The  assignee  appeals.  Re- 
versed. 

Kina:sley  &  Shepherd,  for  appellant. 
French  &  Wright,  for  respondent. 

GILFILLAN.C.  J.  In  the  insolvency  pro- 
ceedings Wheeler  filed  his  petition,  verified 
bj'  his  attorney,  setting  forth  his  claim 
against  the  insolvents.  The  assignee  dis- 
allowed the  claim,  and  the  claimant  ap- 
pealed to  the  district  court.  Upon  such 
appeal  the  claim  is  to  be  tried  as  other 
civil  actions.  Laws  1881,  c.  148.  §  8.  When 
the  appeal  came  on  for  trial  the  assignee 
objected  to  evidence  being  offered  to  prove 
the  claim  on  about  this  proposition,  as 
near  as  we  can  tell  from  the  statement  of 
the  objection  in  the  settled  case  and  from 
the  brief:  That  the  court  is  to  hear  the 
appeal  only  upon  such  proof  of  the  claim 
as  was  offered  before  the  assignee,  and,  if 
none  was  offered  before  him,  then  none 
can  be  received  by  the  court.  There  is 
nothing  in  the  statute  to  suggest  such  an 
idea.  No  trial  except  upon  an  appeal  is 
contemplated.  The  claim  was  based  upon 
the  insolvent's  guaranty  of  a  promissory 
note.  The  facts  found  by  the  court  and 
the  evidence  fully  sustained  the  findings. 
Stating  such  facts  briefly,  they  are:  That 
in  June,  1882,  Wheeler  left  with.Wilkins  & 
Smith,  to  loan  for  him,  a  sum  of  money, 
with  instructions  to  make  no  loan  except 
upon  security  of  first-class  real  estate, 
and  paper  indorsed  by  good  indorsers. 
That,  contrary  to  such  instructions,  they, 
in  said  June,  loaned  of  said  money  $1,500 
to  one  Gregson,  taking  his  note  therefor, 
payable  to  said  Wheeler  in  one  year.  Aft- 
erwards, when  informed  they  had  made 
Bald  loan  to  Gregson,  Wheeler  stated  to 
them  that  he  should  look  to  them  for  the 
money  they  had  loaned  contrary  to  his 
instructions,  and  they  agreed  to  be  re- 
Bponsible  for  the  same,  as  though  they 
had  borrowed  the  money,  and  to  pay  the 
note  in  case  Gregson  made  default  in  pay- 
ment; and  they  thereupon  wrote  and 
signed  this  guaranty  on  the  note:  "We 
hereby  guaranty  the  collection  of  the 
within  note.  June  2,  1885."  The  note 
seems,  up  to  that  time,  to  have  been  in 
the  possession  of  Wilkins  and  Smith.  The 
question  mainly  argned  in  the  case  is, 
doe.s  the  guaranty  come  within  the  stat- 
ute'of  frauds,  so  as  to  be  void  because  it 
does  not  express  the  consideration?  In 
form,  at  least,  it  is  a  promise  to  answer 
for  the  debt  or  default  of  another.  The 
form,  however,  is  not  decisive;  for  where 


vne  leading  purpose  of  the  promise  is,  noli 
to  become  surety  for  another,  not  for  the 
benefit  in  any  way  of  such  other,  but  to 
promote  the  interest,  to  effect  some  pur- 
pose, of  the  promisor,  as  independent  of 
the  debt  or  contract  guarantied,  as  where 
it  is  to  enable  the  guarantor  to  transfer 
the  debt  or  contract,  (Nichols  v.  Allen,  22 
Minn.  283;  Wilson  y.  Hentgcs,  29  Minn. 
102,  12  N.  W.  Kep.  1.51,)  or  to  satisfy  or 
discharge  an  obligation  resting  on  him- 
self, (Sheldon  v.  Butler,  24  Minn.  .51:^,)  it  is. 
notwithstanding  its  form,  and  altliough 
it  incidentally  guaranties  the  debt  of  an- 
other, regarded  as  an  original,  and  not  a 
collateral,  undertaking,  and  so  not  with- 
in the  statute  of  frauds.  This  case  cannot 
be  distinguished  from  Sheldon  v.  But- 
ter. The  insolvents  had  misappropriate'? 
Wheeler's  money,  and  they  were  liable  to 
him  for  it.  If  he  could  be  induced  to  ac- 
cept the  Gregson  note,  and  thus  ratify 
what  they  had  done,  it  would  discharge 
their  liability.  To  induce  him  to  do  it 
they  guarantied  the  note.  Under  the  cir- 
cumstances, the  guaranty,  while  in  form 
a  promise  to  answer  for  the  default  of  an- 
other, was  in  fact  and  in  substance  a 
promise  to  pay  and  discharge  their  own 
liability  if  Wheeler  could  not  collect  it 
from  Gregson.  The  claimant  must  stand 
on  the  terms  and  nature  of  the  guaranty. 
It  is  a  guaranty  of  collection,—/,  p.,  that 
the  note  is  collectible.  The  condition  of 
the  guarantor's  liability  is  that  the  cred- 
itor shall  be  unable  to  collect  the  debt,  he 
using  due  diligence.  Ordinarily,  in  such 
cases,  due  diligence  requires  of  the  creditor 
to  promptly  bring  suit,  and  diligently  pros- 
ecute it  to  the  return  of  an  execution. 
There  may  be  circumstances  that  will  ex- 
cuse omission  to  bring  suit, — as,  if  the  prin- 
cipal debtor  be  insolvent,  so  that  a  suit 
against  him  would  be  fruitless;  or  if  the 
guarantor  should  waive  the  use  of  dili- 
gence. The  only  effort  which  the  court 
finds  the  claimant  made  to  collect  the 
debt  fromGregs()n  was  that  September  20, 
1886,  he  brought  an  action  against  him, 
in  due  time  recovered  judgment  and  issued 
execution,  which  was  returned  unsatis- 
fied. The  note  was  past  due  when  the 
guaranty  was  made,  so  that  there  was  a 
delay  of  nearly  15  months  before  suit  was 
brought.  No  fact  is  found  to  excuse  this 
delay.  The  court  found  that  since  Octo- 
ber 8,  188G,  Gregson  has  been  insolvent, 
but  that,  of  course,  would  not  excuse  the 
prior  delay.  Whether  the  qijestion  of  due 
diligence  in  such  cases  be  one  of  law  or  of 
fact,  or  a  mixed  question  of  law  and  fact, 
an  unexplained  delay  of  nearly  15  months 
in  bringing  suit  makes  a  case  of  omission 
to  use  due  diligence.  Moaklev  v.Riggs,  19 
Johns.  69;  Kies  v.  Tifft,  1  Cow.  98;  Penni- 
man  v.  Hudson,  14  Barb.  579;  Craig  v. 
Parkiss,  40  N.  Y.  181.  For  failure  of  claim- 
ant to  show^  due  diligence  to  collect  from 
Gregson,  or  to  show  any  excuse  for  omit- 
ting it,  there  must  be  a  new  trial.  Order 
reversed. 


PROMISE  TO  ANSWER  FOR  DEBT  OF  ANOTHER. 


123 


/         WAIT  V.  WAIT'S  EX'R. 

/  (28  Vt.  350.) 

Supreme    Court    of    Vermont.      Rutland.     Feb. 
Term.  1856. 

Appeal  from  the  decision  and  report  of  com- 
missioners, disallowing  a  part  of  the  appellant's 
claim  against  the  estate  of  Joseph  H.  Wait,  de- 
ceased. The  nature  of  the  claim,  and  the  facts 
in  relation  thereto,  sufliciently  appear  in  the 
opinion  of  the  court.  The  county  court,  Sep- 
tember Term,  18m,— PiKRPOiNT,  J.,  presiding, 
—rendered  judgment  in  favor  of  the  appellant 
for  the  amount  of  his  claim.     Excei)tions  by 

the  appellee. 
*351        *U.  A'.  Xicholson  and  C.  L.  Williams  for 
the  appellant. 

B.  Fristne.  and  hJ.  Edrjerion  for  the  appellee. 

The  opinion  of  the  court  was  delivered  by 

ISilAM,  J.  This  is  an  appeal  from  the  decis- 
ion of  the  probate  court,  disallowing  the  plain- 
tiff's claim  against  the  estate  of  Joseph  II.  ^VaiL 
The  plaintiff  claims  the  sum  of  .^140,00  for  his 
expenses  in  erecting  a  barn  on  premises  then 
owned  by  Joseph  Wait.  The  barn  was  erected 
at  the  request  of  Joseph  Wait,  under  his  assur- 
ance that  by  some  arrangement  the  premises 
should  be  conveyed  to  the  plaintiff,  so  that  he 
should  have  the  benefit  of  his  labor  and  ex- 
penses; 01  if  the  premises  were  conveyed  to  an- 
other, that  person  should  pay  the  amount  e.x- 
pended  in  erecting  the  building.  In  1847,  Jo- 
seph Wait  conveyed  these  premises  and  this 
barn  to  Joseph  H.  Wait,  and  they  now  consti- 
tute a  part  of  his  estate.  The  fact  is  found  by 
the  auditor,  that  soon  after  that  conveyance, 
Joseph  H.  Wait  informed  the  plaintiff  that  there 
was  an  understanding  between  him  and  Joseph 
Wait,  that  he  was  to  pay  him  for  building  the 
barn,  and  that  he  would  do  it  as  soon  as  he 
could.  This  promise  the  auditor  finds  was  re- 
peated on  several  occasions  down  to  1851.  and 
that  intheirlast  conversation,  the  deceased  rec- 
ognized the  debt  as  due  from  him,  and  prom- 
ised to  pay  it.  It  is  now  insisted  that  this  prom- 
ise to  pay  the  plaintiff  his  claim  is  void  under 
the  statute  of  frauds,  it  not  being  in  writing, 
and  being  a  promise  to  pay  the  debt  of  another. 
The  payment  of  this  claim  due  the  plaintiff  was 
a  part  "of  the  consideration  for  which  those 
premises  were  conveyed  to  the  deceased,  and 
was  made  at  the  request  of  Joseph  Wait,  in  ful- 
filment of  those  assurances  which  had  been 
given  to  the  plaintiff.  That  is  plainly  the  find- 
ing of  the  auditor,  and  the  only  reasonable  con- 
struction that  can  be  given  to  his  language 
throughout  his  report.  Under  those  circum- 
stances, we  think,  the  authorities  are  clear  that 
this  promise  is  founded  upon  a  sufficient  con- 
sideration, and  that  it  is  to  be  regarded  as  an 
original  and  binding  contract.  There  is  no 
doubt  that  a  premise  to  pay  the  debt  of  another, 
though  made  at  the  same  time  the  credit  was 
given  to  the  principal  debtor,  will  be  void,  un- 
der the  statute,  if  not  in  writing.  The  same  re- 
sult follows,  where  such  a  promise  is  subse- 
quently made,  if  the  consideration  of  that 
promise  is  the  subsis*ting  liability  of  the  *352 
original  debtor.  The  promise  in  those 
cases  is  collateral,  and  therefore  void;  and  the 
promise  will  be  deemed  collateral,  so  long  as 
the  liability  of  the  original  debtor  continues. 
The  cases  of  Fish  v.  Hutchinson.  2  Wils.  94; 
Chater  v.  Beckett,  7  Term  11.  201,  and  Wain  v. 
Warlters,  5  East  10,  are  illustrations  of  that 
principle.  But  that  principle  has  no  applica- 
tion to  cases  where  the  original  debtor  places 
property  of  any  kind  in  the  hands  of  a  third 
person. "and  that  person  promises  to  pay  the 
claim  of  a  particular  creditor  of  the  debtor. 


The  promise  in  such  case  is  an  original  prom- 
ise, and  the  property  placed  in  his  hands  is  its 
consideration.  In  this  class  of  cases,  it  is  im- 
material whether  the  liability  of  the  original 
debtor  continues  or  not.  In  the  case  of  Farley 
V  Cleveland,  4  Cowen  432,  Savagk,  Cn.  J.  ob- 
served that  "when  there  is  a  new  and  original 
consideration  of  benefit  to  the  defendant,  or 
harm  to  the  plaintiff,  moving  to  the  party  mak- 
int;  the  promise,  the  subsisting  liability  of  the 
original  debtor,  is  no  objection  to  the  recov- 
ery "  In  1  Smith's  Lead,  cases  32'J.  this  subject 
is  examined  by  the  American  editor,  and  from 
a  review  of  the  authorities  on  this  question,  he 
observes  that  "a  promise  to  paj'  an  antecedent 
debt,  in  consideration  of  property  placed  in  the 
haniis  of  the  promisor  by  the  debtor,  has  been 
held  not  to  require  a  writing  to  give  it  validity, 
and  that  it  seems  reasonably  well  settled,  that 
a  verbal  promise  to  be  answerable  for  the  ante- 
cedent debt  of  another  will  be  valid,  where  it  is 
made  upon  a  new  and  independent  considera- 
tion, although  the  debt  itself  still  remain  in  full 
force;  but  that  where  the  consideration  grows 
out  of  the  original  contract,  the  promise  will 
be  within  the  statute."  The  cases  there  re- 
ferred to  on  this  subject  are  numerous,  and 
fully  sustain  this  principle.  The  case  under 
consideration  clearly  falls  within  the  applica- 
tion of  that  doctrine.  The  promise  by  the  de- 
fendant to  pay  this  debt  of  the  plaintiff  is  fully 
found  by  the  auditor;  its  consideration  was  not 
the  subsisting  liability  of  Joseph  Wait,  neither 
did  it  arise  out  of  the  original  contract,  but 
from  property  placed  in  the  defendant's  hands 
for  that  purpose  by  the  original  debtor.  We 
are  satisfied  that  the  promise  of  the  defendant 
in  this  case,  is  to  be  regarded  as  an  original 
promise  founded  upon  a  new  consideration,  and 
legally  binding  upon  him. 

On  the  trial  of  this  case  it  was  insisted 
*353  that  parol  evidence  was  *inadmissible  to 
show  that  the  jjaymentof  this  debt  was  a 
part  of  the  consideration  for  which  the  premises 
were  conveyed  by  Joseph  Wait  to  the  deceased, 
as  it  contradicted  the  deed  and  bond  which  is 
made  part  of  this  case.  The  consideration  of  the 
deed  is  expressed  to  be  for  the  sum  of  three 
thousand  doll-ars.  The  bond  was  given  to  sup- 
port the  grantor  and  his  wife  during  their  lives, 
and  to  pay  specified  sums  in  money  to  his  three 
daughters,  amounting  to  the  sum  of  five  hun- 
dred dollars.  As  between  Joseph  Wait  and  the 
deceased,  it  is  possible  the  bond  would  be 
evidence  of  the  extent  of  his  claim.  The  object 
of  the  bond  was  to  secure  the  support  of  the 
grantor  and  his  wife,  and  the  payment  of  certain 
sums  as  a  family  settlement  of  his  estate.  It  was 
not  intended  to  cover  all  the  obligations  as- 
sumed by  the  grantee.  The  plaintiff  is  not  a 
party  to  the  deed  or  bond.  The  object  of  the 
testimony  is  not  to  show  a  different  obligation 
from  that  expressed  in  the  bond,  nor  to  vary  or 
affect  the  leiral  operation  of  the  deed,  but  to 
show  that  the  payment  of  this  debt  was  a  part  of 
the  three  thousand  dollars  which  is  expressed  to 
be  the  consideration  of  the  deed.  The  execution 
of  the  bond  was  reducing  to  writing  only  a  part 
of  the  consideration  of  the  deed,  and  that  part 
onh',  which  was  to  be  rendered  to  the  grantor. 
In  such  case,  it  is  competent  to  prove  an  addi- 
tional and  suppletory  agreement  by  parol,  as 
that  the  remaining  part  of  the  consideration 
was  to  be  paid  to  the  plaintiff:  Bowen  v.  Bell 
20  John.  341;  Greenl.  Evid.  §  284.  a.  i$  304;  Jef- 
fery  v  Walton.  1  Starkie  267;  Rockwood's  case, 
1  Cro.  Eliz.  164.  We  think  the  testimony  was 
admissible,  and  that  the  plaintiff  is  entitled  to 
recover  the  amount  of  his  claim. 

The  judgment  of  the  county  court  isaflirmed, 
and  the  case  is  to  be  certified  to  the  probate 
court. 


124 


STATUTE  OF  FRAUDS. 


'b 


^ 


^ 


MALLORT  V.  GILLETT.     l^\ 
(21  N.  Y.  412.)  \    \  * 


■Court  of  Appeals  of   New  York. 


June,   ISGO. 
Henry 


George  T.  Spencer,  for  appellant 
M.  Hj-de,  for  respondent 


COMSTOCK,  C.  J.  This  case  ought  to  be 
one  of  first  impression.  By  the  statute  of 
frauds,  all  promises  to  answer  for  the  debt 
of  a  third  person  are  void  tmless  reduced  to 
writing.  One  Haines  owed  the  plaintiff  a 
debt  for  repairs  on  a  boat,  for  which  the  lat- 
ter had  a  lien  on  the  chattel.  In  considera- 
tion of  the  relinquishment  of  that  lien,  and 
of  forbearance  to  sue  the  original  debtor,  the 
defendant  promised  the  plaintiffs  without 
writing,  to  pay  the  debt  at  a  certain  future 
time.  There  is  no  pretense  that  the  defend- 
ant's promise  was  given  or  accepted  as  a 
substitute  for  the  original  demand,  or  that 
such  demand  was  in  any  manner  extinguish- 
ed. The  promise  was,  therefore,  to  answer 
for  the  existing  and  continuing  debt  of  an- 
other, or,  in  the  language  of  the  books,  it  was 
a  collateral  promise.  The  consideration  was 
perfect,  but  as  there  was  no  writing,  the 
case  seems  to  fall  within  the  very  terms  of 
the  statute.  Authorities  need  not  be  cited 
to  prove  that  the  sufficiency  of  the  considera- 
tion never  takes  a  case  out  of  the  statute. 
Indeed,  there  can  be  no  question  imder  the 
statute  of  frauds  in  any  case,  tmtil  it  is  as- 
certained that  there  is  a  consideration  to 
sustain  the  promise.  Without  that  element 
the  agreement  is  void  before  we  come  to  the 
statute.  A  naked  promise  is  void  on  general 
principles  of  law,  although  it  be  in  writing. 
The  mere  existence  of  a  past  debt  of  a  third 
person  will  not  sustain  an  agreement  to  pay 
it,  unless  there  be  forbearance  to  sue,  or 
some  other  new  consideiution.  In  such  a 
case,  when  we  find  there  is  a  new  considera- 
tion, we  then,  and  not  till  then,  reach  the 
inquiry  whether  the  agreement  must  be  in 
writing.  Such  is  this  case.  It  is  nothing 
to  say  that  here  was  a  new  consideration. 
If  such  was  not  the  fact,  there  would  be  no 
question  in  the  case. 

There  is  sometimes  danger  of  error  creep- 
ing into  the  law  through  a  mere  misunder- 
standing or  misuse  of  terms.  The  words 
"original"  and  "collateral"  are  not  in  the 
statute  of  frauds,  but  they  were  used  at  an 
early  day — the  one  to  mark  the  obligation  of 
a  principal  debtor,  the  other  that  of  the  per- 
son who  xmdertook  to  answer  for  such  debt. 
This  was,  no  doubt,  an  accurate  use  of 
language;  but  it  has  sometimes  happened 
that,  by  losing  sight  of  the  exact  ideas  rep- 
resented in  these  terms,  the  word  "original" 
has  been  used  to  characterize  any  new  prom- 
ise to  pay  an  antecedent  debt  of  another 
person.  Such  promises  have  been  called 
original,  because  they  are  new;  and  then  as 
original  undertakings  are  agreed  not  to  be 
within  the  statute  of  frauds,  so  these  new 


promises,  it  is  often  argued,  are  not  within 
it  If  the  terms  of  the  statute  wei-e  adhered 
to,  or  a  more  discnminating  use  were  made 
of  words  not  contained  in  it,  there  would  be 
no  danger  of  falling  into  errors  of  this  de- 
scription. 

What  is  a  promise  to  answer  for  the 
"deot  or  default"  of  another  person?  Un- 
der this  language,  perplexing  questions  may 
arise,  and  many  have  arisen,  in  the  courts. 
But  some  propositions  are  extremely  plain; 
and  one  of  them  is,  that  the  statute  points 
to  no  distinction  between  a  debt  created  at 
the  time  when  the  collateral  engagement  is 
made,  and  one  having  a  previous  existence. 
The  requirement  is,  that  promises  to  answer 
for  the  debt  etc.,  of  a  third  person,  be  in 
writing.  The  original  and  collateral  obliga- 
tions may  come  into  existence  at  the  same 
time,  and  both  be  the  foundation  of  the  cred- 
it, or  the  one  may  exist  and  the  other  be 
created  afterward.  In  either  case,  and  equal- 
ly in  both,  the  inquiry  under  that  statute  is, 
whether  there  be  a  debtor  and  a  surety,  and 
not  when  the  relation  was  created.  The  lan- 
guage of  the  enactment  is  so  plain  that  there 
is  no  room  for  interpretation;  and  its  policy 
is  equally  cleai'.  If  A.  say  to  B.:  "If  you 
will  suffer  C.  to  incut  a  debt  for  goods  which 
you  will  now  or  hereafter  sell  and  deliver  to 
him,  I  will  see  you  paid,"  the  promise  is  with- 
in the  statute.  This  no  one  ever  doubted. 
But  if  A.  say  to  B.:  "If  you  will  forbear  to 
sue  C.  for  six  months  on  a  debt  heretofore 
incurred  by  him  for  goods  sold  and  delivered 
to  him,  I  will  see  you  paid"— is  not  the  case 
equally  plain?  So,  if,  in  such  a  case,  instead 
of  forbeai"ance,  there  is  some  other  sufficient 
consideration,  for  example,  forgiving  a  part 
of  the  debt  or  relinquishing  some  security 
for  it,  the  difference  is  still  one  of  circiuu- 
stance,  but  not  of  principle.  In  the  case 
first  put,  „the  consideration  of  the  guaranty 
is  the  original  sale  of  the  goods  on  the  faith 
of  it;  in  the  other,  it  may  be  forbearance  or 
the  relinquishment  of  some  advantage,  the 
original  debt  still  remaining.  Looking  at 
the  comparative  merit  of  these  considera- 
tions, it  would  seem  to  be"  the  highest  in  the 
first  case,  for  the  whole  debt  owes  its  origin 
to  the  collateral  promise,  while  in  the  other 
the  debt  remains  as  before,  and  only  some 
collateral  advantage  is  lost.  But  the  appli- 
cation of  the  statute  depends  on  no  such 
test.  These  considerations  are,  all  of  them, 
sufficient,  and  simply  sufficient,  to  sustain 
the  auxiliary  undertaking.  But  if  they  also 
dispense  with  a  wi-iting,  then,  so  far  as  1 
can  see,  there  are  no  cases  to  which  this 
branch  of  the  statute  of  frauds  can  be  ap- 
plied. 

Such  an  extreme  position  has  not  been  tak- 
en; but  it  is  said  that  the  promise  now  in 
question  need  not  be  in  writing,  because  it 
was  new  and  original,  and  was  founded  on 
the  relinquishment  to  the  debtor  of  a  secu- 
rity which  the  creditor  held.  To  say  that  it 
was  new  and  original  expresses  no  idea  of 


PROMISE  TO  ANSWER  FOR  DEBT  OF  AXOTHER. 


125 


any  Importance.  Every  promise  Is  new  and 
original  that  was  never  made  before.  An 
undertaliiug  to  answer  for  an  old  debt  of  a 
third  porson  certainly  has  no  more  of  orig- 
inality than  one  to  answer  for  a  debt  now 
contracted.  As  to  the  relinquishment  of  the 
lien  or  security,  this,  althougli  a  meritorious 
consideration,  is,  in  judgment  of  law,  no 
more  so  than  any  other  which  is  sufticient 
to  sustain  a  contract  Forbearance  to  sue 
has  the  same  legal  merit,  and  so  has  the  re- 
lease of  a  part  of  the  debt. 

There  is  nothing  so  remarkable  or  pecvdiar 
about  this  case  that  it  may  not  be  included 
in  some  general  proposition  which  involves 
a  principle  of  law.  Now,  one  of  these  two 
propositions  must,  I  think,  be  true:  1.  The 
statute  of  frauds  never  applies  to  a  promise, 
the  subject  of  which  is  an  antecedent  debt  of 
a  third  person  to  whom  it  is  collateral;  or, 
2.  It  applies  to  all  such  promises  where  the 
consideration  moves  solely  between  the  cred- 
itor and  original  debtor  and  the  debt  still 
remains.  If  the  first  is  true,  then  the  prom- 
ise in  question  is  valid  without  a  writing, 
and  so  would  any  such  promise  be,  without 
regai-d  to  the  particular  nature  of  the  consid- 
ei-ation;  it  being  necessary,  of  course,  that 
there  should  be  some  sufficient  consideration. 
If  the  first  be  not  true,  and  the  second  is, 
then  the  promise  in  this  ease  is  void,  because 
it  falls  directly  within  it  The  first  proposi- 
tion cannot  be  tme,  upon  the  plain  terms  and 
evident  policy  of  the  statute;  and  no  such 
doctrine  was  ever  asserted.  The  universal 
tnith  of  the  second  one  necessarily  follows, 
unless  the  law  will  discriminate  between  dif- 
ferc-ut  promises  according  as  the  considera- 
tion may  diffier  in  the  particular  nature  or 
kind.  But  is  such  a  discrimination  possible,  so 
long  as,  in  anygiven  case,the  consideration  is 
sufficient  in  the  eye  of  the  law,  and  moves 
solely  between  the  original  parties?  No  one, 
it  seems  to  me,  can  hesitate  to  answer  such 
a  question  in  the  negative.  Yet  we  are  told, 
without  reason  or  principle,  that  when  a 
creditor  releases  a  security  to  the  debtor,  al- 
though without  releasing  the  debt  a  promise 
of  another  person,  foimded  on  that  peculiar 
consideration,  is  not  within  the  statute.  The 
inevitable  logic  of  such  a  proposition  will  in- 
clude a  like  promise  founded  on  any  other 
consideration  equally  sufficient  to  sustain  a 
contract;  and,  therefore,  we  are  carried  back 
to  the  first  general  proposition  above  stated, 
which  is  admitted  to  be  false.  It  has  al- 
ready been  observed,  that,  without  a  consid- 
eration, no  question  on  the  statute  of  frauds 
can  arise. 

In  this  elementary  view  of  the  question,  I 
do  not  understiiud  that  much  difference  of 
opinion  exists.  It  is  claimed,  however,  tliat 
the  course  of  adjudication  has  been  such, 
that  we  cannot  determine  the  case  before  us 
according  to  a  consistent  inile  of  law.  This 
argument  is  foundeid  in  a  misapprehension  of 
the  authorities,  some  reference  to  which  will 
be  necessary. 


In  this  state,  an  early  case,  and  one  of  vei7 
high  authority,  is  that  of  Leonard  v.  Vreden- 
burgh,  8  .lohns.  29,  in  which  Chief  Justice 
Kent  divided  the  c-ases  on  this  branch  of  the 
statute  of  frauds  into  three  classes,  as  fol- 
lows: (1)  Where  the  promise  is  collateral 
to  the  i)rincipal  contract,  but  is  made  at  the 
same  time,  and  becomes  an  essential  ground 
of  the  original  credit.  (2)  "Cases  in  wliich  v 
the  collateral  undertaking  is  subsequent  to 
the  creation  of  the  debt,  and  was  not  the  ( 
inducement  to  it,  though  the  subsisting  lia-  , 
bility  is  the  ground  of  the  promise."  "Hfre," 
the  chief  justice  observed,  "there  must  be 
some  further  [or  new]  consideration  shown, 
having  an  immediate  respcKit  to  such  liabil- 
ity; for  the  consideration  of  the  original  dibt 
will  not  attach  to  this  subsequent  promise. 
(3)  Cases  where  the  promise  to  pay  the  debt 
of  another  arises  out  of  some  new  and  orig- 
inal cousidei-ation  of  benefit  or  harm  moving 
between  the  newly  contracting  parties." 
"The  two  fii"st  classes,"  he  further  obsen'cd, 
"are  within  the  statute  of  frauds,  but  the 
last  is  not"  I  suppose,  in  the  light  of  later 
decisions,  that  the  opinion  of  that  great 
jurist,  delivered  in  the  case  cited,  may  con- 
tain some  inaccurate  remarks  respecting  the 
right  to  prove  a  consideration  for  a  collateral 
agreement  where  none  appeared  in  the  writ- 
ing. It  would  be  so  considered,  especially 
since  the  change  we  have  made  in  the  lan- 
guage of  the  statute  of  frauds,  requiring  the 
consideration  to  be  expressed  in  the  collat- 
eral insti-ument  But  the  above  classifica- 
tion of  the  cases,  and  the  connected  remarks 
respecting  each  class,  are  strictly  correct,  and 
they  have  been  a  landmark  of  the  law  for 
forty  years.  Does  the  present  case  belong 
to  the  second  class,  which  is  within  the  stat- 
ute, or  to  the  third,  which  is  not?  Manifest- 
ly it  belongs  to  the  second,  because  that  is  a 
class  where  the  undertaking  is  subsequent  to 
the  creation  of  the  debt.  It  does  not  fall 
without  that  class  in  consequence  of  the 
newness  of  the  consideration,  because,  the 
learned  chief  justice  said,  "here  must  be 
some  further  [new]  consideration  having  an 
immediate  respect  to  such  liability."  It  can- 
not fall  within  the  third  class,  because  if  we 
arrange  it  there,  we  necessarily  compress  the 
two  classes  into  one,  or.  more  properly 
speaking,  we  merge  the  second  wholly  into 
the  third.  In  such  a  disposition  of  the  pres- 
ent question  no  second  class  is  left  of  collat- 
eral undertakings  subsequent  to  the  creation 
of  the  original  debt,  founded,  as  they  must 
be,  on  some  new  or  "further  consideration." 

The  classification  referred  to.  on  a  casual 
reading,  is  perhaps  open  to  some  misappre- 
hension, and  I  think  it  has  been  occasionally 
misapprehended.  What  then,  is  the  tme 
distinction  between  the  second  and  third 
classes?  They  are  both  of  them  promises, 
in  form  at  least  to  pay  the  antecedent  debt 
of  a  third  person,  and  in  that  respect  they 
are  alike.  The  distinction,  therefore,  is  in 
the  consideration  of  the  promises  which  be- 


126 


STATUTE  or  FEAUDS. 


long  to  the  two  classes;  not  in  respect  to  its 
particular  nature  or  kind,  but  in  respect  to 
the  parties  between  whom  it  moves.  In  the 
one  class,  the  consideration  is  characterized 
as  a  "further  one,  having  immediate  respect 
to  the  [original]  liability"  of  the  debtor;  in 
the  other,  as  "new  and  original  moving  be- 
tween the  newly  contracting  parties."  In 
the  second  class,  the  new  or  "further"  con- 
sideration moves  to  the  primary  debtor.  It 
may  consist  of  forbear-ance  to  sue  him,  of  a 
release  to  him  of  some  security,  or  of  any 
sufficient  bejiefit  to  him  or  harm  to  the  cred- 
j  itor,  but  in  which  the  collateral  promisor  has 
'  no  interest  or  concern.  In  the  third  class,> 
the  consideration,  whatever  its  nature,  moves 
I  to  the  person  making  the  promise,  and  that 
i  also,  as  in  all  other  cases  of  contract,  may| 
I  consist  of  benefit  to  him  or  harm  to  the  party! 
with  whom  he  is  dealing.  This  distinction'^ 
is  also  extremely  well  expressed  by  Chief 
Justice  Shaw  of  the  supreme  court  of  Massa- 
chusetts. One  class  of  cases  (within  the 
statute),  he  says,  is  "where  the  direct  and 
leading  object  of  the  promise  is  to  become 
the  surety  or  guarantor  of  another's  debt;" 
the  other  class  (not  within  the  statute)  is 
"where,  although  the  effect  of  the  promise 
is  to  pay  the  debt  of  another,  yet  the  lead- 
ing object  of  the  undertaker  Ja^o  subserve 
..O.r  promote  some  interestjor_imnHase]]o|Jiis_ 
.  own."  Nelson  vT^^nton,  3  Mete.  (Mass.) 
390-^5150.  Chief  Justice  Savage,  in  this  state 
(Farley  v.  Cleveland,  4  Cow.  432,  439),  made 
the  same  classification.  "In  all  these  eases," 
he  observed,  referring  to  those  which  fall 
within  tlie  third  class,  "founded  on  a  new 
and  original  consideration  of  benefit  to  the 
defendant  or  harm  to  the  plaintiff,  moving  to 
the  party  making  the  promise,  either  from 
the  plaintiff  or  original  debtor,  the  subsisting 
liability  of  the  original  debtor  is  no  objection 
to  a  recovery."  In  one  respect,  this  lan- 
guage of  Chiel  Justice  Savage,  has  greater 
precision  than  that  of  Chief  Justice  Kent. 
The  latter  speaks  of  the  consideration  as 
"moving  between  the  newly  contracting  par- 
ties." The  former  characterizes  it  as  mov- 
ing to  the  party  making  the  promise.  This 
description  is  more  exact,  as  well  as  more 
comprehensive,  because  it  includes  a  variety 
of  cases  found  in  the  books,  where  the  new 
consideration  springs  from  the  original  debt- 
or and  not  the  creditor,  as,  for  example, 
where  the  debtor,  by  conveyance  of  property 
or  otherwise,  places  a  fund  in  the  hands  of 
a  third  person,  the  latter  promising,  in  con- 
sideration thereof,  to  pay  the  debt.  But  the 
difCerence  is  not  one  of  principle,  because 
there  is  a  sense  in  which,  even  in  such  cases, 
the  new  consideration  moves  from  the  cred- 
itor through  the  debtor  to  the  person  making 
the  promise,  and  on  that  ground  many  cases 
hold  that  the  creditor  may  himself  sue  on  the 
promise,  although  it  was  made  to  the  debtor. 
Lawrence  v.  Fox,  20  N.  Y.  268,  and  the  cases 
cited.  Where  the  promise  in  this  particular 
description  of  cases  has  been  made  directly 


to  the  creditor,  the  only  question  has  been 
on  the  statute  of  fi-auds;  and  the  rule  is  very 
properly  settled  that  they  are  not  within  the 
statute.  The  cases  of  Farley  v.  Cleveland, 
supra,  Gold  v.  Phillips,  10  Johns.  412,  and 
Olnistead  v.  Greenly,  18  Johns.  12,  belong  to 
this  class. 

Omitting,  then,  the  first  class  of  collateral 
undertakings — I  mean  those  made  at  the 
same  time  with  the  creation  of  the  debt — as 
having  nothing  to  do  with  the  present  ques- 
tion, there  are  two  kinds  of  promises  of  ex- 
tensive use  in  the  dealings  of  community, 
which,  in  form  and  effect,  very  much  re- 
semble each  other;  each  being  to  answer  for 
or  pay  a  debt  already  due  or  owing  from  a 
third  person,  yet  wholly  different  in  respect 
to  the  motive  and  consideration.  In  the  one 
class  the  promisor  has  no  personal  interest 
or  concern,  and  his  undertaking  is  made  sole- 
ly upon  some  fresh  consideration  passing 
between  the  creditor  and  his  debtor.  This 
class  is  within  the  statute.  In  the  other, 
the  promise  may  be  in  the  same  form,  and, 
when  performed,  may  have  the  same  effect, 
but  it  is  made  as  the  incident  of  some  new 
dealing  in  which  the  promisor  is  himself  con- 
cerned, and  upon  a  consideration  passing  be- 
tween the  creditor  or  the  debtor  and  himself. 
This  class,  which  may  include  a  great  varie- 
ty of  particvilar  examples,  is  not  within  the 
statute.  The  distinction  is  broad  and  in- 
telligible, although  the  formal  resemblance 
in  such  transactions  may  have  occasionally 
led  to  inaccuracy  of  expression  or  decision. 
The  great  body  of  the  cases,  however,  will 
be  found  to  illustrate  this  distinction,  and  to 
establish  it  fiiTQly  as  a  guide  in  this  branch 
of  the  law.  If  such  a  distinction  were  a 
questionable  one,  the  tendency  of  the  doubt 
woidd  necessarily  be  in  the  direction  of  hold- 
ing both  classes  of  oases  to  be  within  the 
statute,  but  never  in  the  direction  of  placing 
without  the  statute  any  one  of  the  cases  be- 
longing to  the  first  of  these  classes. 

With  this  classification  before  us,  it  wiU 
be  proper  to  notice  more  in  detail  the  cases 
cited  on  the  argument,  and  others  not  cited. 
In  Skelton  v.  Brewster,  8  Johns.  376,  the 
promise  was  held  not  within  the  statute,  be- 
cause the  delator  had  delivered  goods  to  tlie 
defendant  as  the  consideration  of  the  under- 
taking, and  the  plaintiff,  the  creditor,  had 
discharged  the  debt.  For  two  reasons,  there- 
fore, the  promise  by  parol  was  good:  First, 
it  was  founded  on  a  new  consideration  re- 
ceived by  the  promisor;  and,  second,  it  was 
accepted  as  a  substitute  for  the  original  debt; 
it  could  not  be  collateral. 

In  Gold  V.  Phillips.  10  Johns.  412,  one  Wood 
owed  the  plaintiffs.  He  conveyed  land  to 
the  defendants,  who,  upon  that  considera- 
tion, bound  themselves  to  him  to  pay  that 
and  other  debts.  Being  thus  bound,  they  so 
informed  the  plaintiffs,  and  agreed  to  pay 
them.  The  case,  therefore,  very  distinctly 
falls  within  the  third  class,  according  to  the 
distinctions  above  set  forth.     Bailey  v.  Free- 


PROMISE  TO  ANSWER  FOR  DEBT  OF  ANOTHER. 


12? 


man,  11  Johns.  221,  was  on  a  written  guax- 
anty  made  at  the  same  time  with  the  prin- 
cipal   contract,    and    it    has    nothing    to    do 
with  the  present  question.    Nelson  v.  Dubois, 
13  Johns.  175,  is  equally  foreign  to  the  in- 
quiry.    The   plaintiff    sold    a    horse   to    one 
Bnmdige,  taking  tlierefor  the  note  of  Bruu- 
dige,  payable  to  hiinsolf  or  beai-er,  and   in- 
dorsed by  the  defendant.     The  lejjral  propo- 
sition in  the  case  was,  that  a  guaranty  might 
be  written  over  the  defendant's  name,  it  be- 
ing a  condition  of  the  sale  that  he  should  be- 
come  securitj'  for  the  price.     In    Myers   v. 
Morse,  15  Johns.  425,  the  plaintiffs  were  lia- 
ble as  indorsers  of  a  note  of  one  H-  Morse, 
and  they  held  a  note  of  the  same  person  in- 
dorsed by  the  defendant     The  declaration 
set  forth  that  the  plaintifSs  had  agreed  not 
to  hold  the  defendant  liable  on  his  indorse- 
ment, in  consideration  of  which,  the  defend- 
ant agreed  to  indemnify  them  ag^iinst  one- 
third  of  any  loss  they  might  sustain  on  their 
own  indorsement  of  the  same  person's  note. 
A  plea  of  the  statute   of  frauds   was   held 
bad.     This  was  plainly  a  case  where  the  con- 
sideration moved  to  the  defendant  himself, 
and,  therefore,  it  was  held  to  fall  within  the 
third  class  of  cases,  according  to  the  distinc- 
tion which  has  been  explained.     The  defini- 
tion of  Chief  Justice  Kent,   in  Leonard   v. 
Vredenburgh,  was  expressly  adopted  and  ap- 
plied to  the  facts.     In  Olmstead  v.  Greenly, 
18  Johns.   12,   the  plaintiff   was  an   accom- 
modation indorser  on  the  note  of  B.,  and  B. 
also  owed  him  a  sum  of  money;    B.  there- 
upon  placed    money    and    property    in    the 
hands  of  the  defendant  to  provide  for  pay- 
ing the  note  and  the  debt,  and  upon  that  con- 
sideration the  defendant  promised  the  plain- 
tiffs to  make  such  payment.     The  coui't  said 
this   was  an   original  contract  on   an   inde- 
pendent  consideration   received   by   the   de- 
fendant    Farley  v.  Cleveland,  4  Cow.  432, 
and  same  case  in  error,  9  Id.  G39,  already 
mentioned,  was  entirely  similar.     The  plain- 
tiff held  the  note  of  one  Moon,  which  the  de- 
fendant promised  to  pay  in  consideration  of 
fifteen  tons  of  hay  sold  to  him  by  Moon.   The 
promise  was  hold  to  be  not  within  the  stat- 
ute.    The  reporter's  note  truly  expresses  the 
principle  of  the  decision.     It  is  as  follows: 
"Where  a  promise  to  pay  the  debt  of  a  third  I 
f    person  arises  out  of  some  new  consideration! 
of  benefit  to  the  promisor  or  harm   to  the^ 
j     pi'omisee,    moving    to    the    promisor,    either i 
'     from   the  promisee   or   the   original   debtor,) 
'     such  promise   is  not   within    the   statute   of 
frauds,  although  the  original  debt  still  sub- 
'    sists  and  remains  entirely  unaffected  by  the 
-t  new   agreement"     In   Chapin   v.   Merrill,   4 
Wend.  657,  the  promise  was  not  within  the 
statute,  because  it  was  not  collateral  to  any 
debt  or  liability   of   a  third   person   to   the 
promisee.    The  third  person  proposed  to  con- 
tract a  debt   with   fourth   parties,    and   the 
plaintiff  agreed  to  guarantee , that  debt,  the 
defendant  at  the  same  time  agreeing  to  in- 
demnify   him    for    so    doing.     The  plaintiff 


might  have  invoked  the  statute.  If  his  guar- 
anty had  not  been  in  writing.  But  the  de- 
fendant was  his  indemnitor  merely.  It  was 
a  contingent  liability,  of  necessity  original," 
because  there  was  nothing  to  which  It  could 
be  collateral.  There  \vas  no  debt  of  the 
third  person  to  the  plaintiff.  The  case  there- 
fore, had  not  even  the  formal  resemblance 
to  the  present  one,  which,  existing  in  other 
cases,  has  misled  the  plaintiff's  counsel.  The 
eases  of  Gardiner  v.  Hopkins,  5  Wend.  23; 
Ell  wood  V.  Monk,  Id.  235;  King  v.  Despard, 
Id.  277;  and  Meech  v.  Smith,  7  Wend.  315,— 
are,  all  of  them,  in  principle,  with  differences 
of  detail,  like  Parley  v.  Cleveland,  supra.  In 
each  of  them  the  consideration  of  the  new 
promise  moved  to  the  defendant  proceeding 
either  from  the  original  debtor  or  the  cred- 
itor, and  the  decisions  were  placed  distinctly 
on  that  ground. 

It  cannot  faU  to  be  seen,  that  nearly  all 
the  cases  which  have  been  mentioned;  in 
fact,  all  of  them  which  exhibit  a  promise  to 
pay  or  answer  for  the  debt  of  another  per- 
son, are  essentially  of  one  type.  With  great 
variety  in  the  circumstances,  one  controlling 
characteristic  pei-vades  them  all.  In__every 
instance  the  consideration  of  Jhe  promise,  was. 
beneHcTaTliJTEe  person  promising.  This  was 
the'  fSTture  whicinmparted  to  the  promise 
the  character  of  originality,  as  that  term  is 
used  with  reference  to  the  statute  of  frauds. 
In  not  one  of  them  is  it  true  that  the  under- 
taking was  entered  Into  upon  a  consideration 
merely  beneficial  to  the  debtor,  but  of  no  con- 
cern to  the  promisor;  and  I  can  confidently 
say  that  not  one  of  those  cases  contains  even 
a  dictum,  which,  being  understood,  coxuite- 
nances  the  doctrine  contended  for  on  the  part 
of  the  plaintiff  in  this  case.  The  principle 
involved  is  tlie  same  which  loms  through  oth- 
er cases  that  have  not  been  cited.  For  ex- 
ample, A.,  holding  the  note  of  B.,  transfers 
it  to  C.  upon  a  consideration  moving  from  C 
to  him,  and  with  a  parol  guaranty  of  the 
payment  This,  in  a  merely  formal  sense,  is 
a  promise  to  answer  for  the  debt  of  the  mak- 
er of  the  note,  and  it  has  been  strenuously 
contended  that  such  a  promise  is  within  the 
statute.  But  the  rule  is  otherwise;  it  be- 
ing considered  tliat  such  transactions,  how- 
ever close  to  the  letter,  are  not  within  the 
intent  of  the  statute;  because  they  have 
their  root  in  a  new  dealing  which  concerns 
the  promisor,  and  in  a  new  consideration 
which  moves  to  him.  Brown  v.  Curtiss,  2 
N.  Y.  225,  was  such  a  case,  in  which  Judge 
Bronson  remarked:  "This  belongs  to  the 
third  class  of  cases  mentioned  by  Kexit,  C. 
J.,  in  Leonard  v.  Vredenburgh;  there  was  a 
new  and  distinct  consideration  independent 
of  the  debt  of  the  maker,  and  one  moving 
between  the  parties  to  the  new  promise." 
Such  are  also  the  cases  of  Johnson  v.  Gil- 
bert, 4  Hill,  178,  and  the  very  recent  one  in 
this  court  of  Cardell  v.  McNiel  (decided  at 
the  last  term)  21  N.  Y.  336. 
I  have  not  yet  referred  to  the  case  of  Slin- 


128 


STATUTE  or  FRAUDS. 


gerland  v.  Moi"se,  7  Johns.  463,  which  seems 
to  be  much  relied  on;  but  it  does  not  pi'e- 
isent  the  question  now  before  us.  The  pLiin- 
tiff  had  distrained  the  goods  of  his  tenant 
for  rent,  but  did  not  remove  them.  There- 
upon the  defendants  signed  a  writing  in 
these  words:  "We  do  hereby  promise  to  de- 
liver to  Peter  Slingerland  all  the  goods  and 
cliattels  contained  in  the  within  inventory  in 
six  days  after  demand,  or  pay  the  said  Peter 
51450."  Looking  at  the  face  of  that  writing, 
it  is  only  siirprising  that  any  one  could  ever 
thinli^  it  was  within  the  statute  of  frauds. 
In  its  very  terms  it  was  original,  and  not  col- 
latei-al.  It  discloses  no  debt  of  any  one  else 
than  the  defendant  who  signed  it  Looliing 
outside  of  it,  we  leara  there  was  at  least  a 
claim  made  for  rent  due  from  another  per- 
son, but  it  is  quite  obvious  that,  as  a  substi- 
tute for  that  claim,  the  creditor  accepted  the 
original  promise  of  the  defendant  to  deliver 
the  goods  or  pay  a  sum  of  money.  This  is 
the  evident  import  of  the  agreement  itseK, 
for  it  recognizes  no  continuing  debt  or  lia- 
bility of  the  tenant,  nor  does  it  undertalie  to 
pay  his  debt  or  answer  for  him  in  any  way. 
The  goods  were  the  fund.  The  defendant 
took  them  under  his  own  control  (a  fact 
which  the  agreement  assumes),  and  upon  that 
consideration  made  himself  the  primary  debt- 
or, and  not  the  guarantor  or  surety.  I  think 
the  case  was  weU  decided,  although  it  is 
veiy  obscurely  and  scantily   reported. 

So  far,  then,  we  find  no  cases  or  dicta  in 
point.  Yet  it  would  not  be  true  to  say  that 
the  plaintiff's  position  is  wholly  unsupported 
by  any  authority  in  the  coui^ts  of  this  state. 
In  Mercein  v.  Andrus,  10  Wend.  461,  Savage, 
C.  J.,  made  this  remark  on  a  motion  for  a 
new  trial:  "The  judge  correctly  stated  to  the 
jury  tliat  where  the  promise  of  one  person 
to  pay  the  debt  of  another  was  founded  upon 
the  consideration  of  surrendering  up  proj)- 
erty  levied  on  by  an  execution,  the  promise 
was  an  original  undertaking,  and  need  not 
be  in  writing  to  be  valid."  Of  course,  no 
such  point  wa.s  decided,  because  the  decision 
granted  a  new  trial  upon  another  question 
not  material  to  the  present  inquiry.  The 
chief  justice  cited  no  authority.  If  he  meant 
to  lay  down  the  doctrine,  that  a  new  consid- 
eration, moving  from  the  creditor  to  the  debt- 
or, the  debt  still  remaining,  would  sustain 
the  unwritten  promise  of  another  person  to 
pay  the  debt,  there  was  no  authority  to  be 
cited,  for  no  such  proposition  had  ever  been 
advanced  in  this  state.  If,  however,  the 
charge  at  the  trial  and  the  obsei-vation  of 
the  chief  justice  assumed,  as  the  law  was, 
that  the  levy  of  an  execution  extinguished 
the  debt,  and  that  the  release  of  the  levy  re- 
mitted the  creditor  to  the  new  promise  as 
his  only  remedy,  then  the  remark  was  strict- 
ly correct,  but  it  has  no  application  to  this 
case.-  Such  is  probably  the  true  explana- 
tion; and  we  shall  presently  see  there  are 
English  cas<^  under  the  statute  standing  on 
that  ground.    The  plaintiff's  counsel  has  been 


able,  however,  to  cite  one  case  which  is  en- 
tirely to  his  purpose.  In  Fay  v.  Bell,  La- 
lor's  Supp.  251,  the  plaintiff  had  a  lien  on  a 
pair  of  boots  which  he  had  mended,  and  in 
consideration  of  releasing  that  lien  and  giv- 
ing up  the  boots,  the  defendant  promised  ta 
pay  his  demand,  which  amoimted  to  fifty 
cents.  So  far  as  appears,  the  debt  still  re- 
mained. The  case  went  up  from  a  justice's 
court,  through  the  common  pleas,  to  the  su- 
preme court,  where  the  question  was  dis- 
posed of  with  the  single  observation  that  the 
promise  was  "a  new  undertaking,  founded  on 
a  new  and  distinct  consideration,  the  relin- 
quishment by  the  plaintiff  of  his  lien  on  the 
boots,  and  which  was  sufficient  to  uphold  the 
promise  made."  The  remark,  as  made,  is 
strictly  true.  The  consideration  was  dearly 
sufficient  to  uphold  the  promise,  but  the  stat- 
ute of  fi-auds  requires  not  only  a  considera- 
tion but  a  writing.  The  case  was  of  very 
slight  importance,  and  the  principles  of  the 
question  were  not  examined.  In  the  same 
book  is  another  case,  precisely  the  other  way> 
the  opinion  being  given  by  another  judge. 
In  Van  Slyck  v.  Pulver,  Lalor's  Supp.  47,  the 
promise  was  made  in  consideration  that  the 
plaintiff  would  suspend  proceedings  on  an 
execution  against  his  debtor.  This  forbear- 
ance was  admitted  to  be  a  sufficient  consid- 
eration, and  it  was  certainly  a  new  one;  but 
the  promise  was  held  void  within  the  statute. 
In  all  the  judicial  history  of  this  state, 
then,  there  is  but  one  adjudged  case  which 
sustains  the  doctrine  contended  for,  and  that 
is  one  entitled  to  no  great  consideration.  I 
wUl  now  refer  to  several  of  a  very  decisive 
character,  which  furnish  a  true  exposition 
of  the  statute,  and  show  that  the  rule  is  the 
other  way.  One  case  I  have  just  mentioned, 
which  is  directly  in  point,  and  is  of  a  date 
comparatively  recent  Going  back  to  an  ear- 
ly day,  in  Simpson  v.  Patten,  4  Johns.  422, 
the  plaintiff  forebore  to  sue  his  debtor,  and 
upon  that  consideration  the  defendant  prom- 
ised to  pay  the  debt  as  soon  as  he  could  sell 
a  piece  of  land  which  belonged  to  the  debtor. 
The  promise  was  held  void  within  the  stat- 
ute of  frauds,  the  court  observing:  "A  prom- 
ise to  pay  the  debt  of  a  third  person  must 
be  in  writing,  notwithstanding  it  is  made 
on  a  sufficient  consideration."  I  have  some 
hesitation  in  citing  Jackson  v.  Rayner,  12 
Johns.  291,  because  it  seems  to  me  to  have 
gone  too  far.  The  defendant  had  received 
an  assignment  of  the  debtor's  property,  and 
upon  that  consideration,  as  well  as  forbear- 
ance, the  defendant  promised  to  pay  the  de- 
mand. The  court  regarded  the  uncondition- 
al promise  as  evidence  that  the  fund  was 
adequate.  Upon  the  discrimination  made  in 
the  later  cases  (heretofore  cited),  the  convey- 
ance of  the  property  to  the  defendant  was  a 
new  considei-ation,  moving  to  him  from  the 
debtor,  and  made  the  promise  an  original 
one.  Nevertheless,  on  the  ground  that  the 
original  debt  still  remained,  the  promise  was 
held   void   under  the   statute.     In   Smith   v 


PROMISE  TO  ANSWER  FOR  DEBT  OF  ANOTHER. 


129 


Ives,  15  Wend.  182,  the  declaration  was  on 
a  written  guaranty  of  a  note,  the  considera- 
tion alleged  being  forbearance  to  sue  the 
maker.  Plea,  that  no  consideration  was  ex- 
pressed in  the  writing.  The  plea  was  held 
good,  the  cc^urt  saying:  "Forbearance  has 
never  been  considered  a  new  consideration 
passing  between  the  newly  contracting  par- 
ties, so  as  to  take  the  case  out  of  the  stat- 
ute." In  Packer  v.  Willson,  15  Wend.  343,  a 
guaranty  of  the  same  nature,  and  upon  the 
same  consideration,  was  again  held  to  be 
void.  In  Watson  v.  Randall,  20  Wend.  201, 
these  propositions  were  expressly  aihriued: 
(1)  An  agreement  to  forbear  to  sue  a  debtor 
is  a  good  consideration  for  the  promise  of  a 
third  pei-son  to  pay  the  debt,  but,  to  render 
the  promise  obligatoi-y,  it  must  be  in  writ- 
ing. (2)  While  the  debt  remains  a  subsist- 
ing demand  against  the  original  debtor  the 
promise  of  a  third  person  is  collateral,  and 
must  be  in  writing.  In  Barker  v.  Bucklin, 
2  Denio,  45,  a  new  ti'ial  was  ordered  upon  a 
point  not  now  material;  but  the  present 
question  was  quite  fully  examined  by  Mr. 
Justice  Jewett  According  to  his  views,  the 
promise  in  tliis  case  is  clearly  void.  If  I 
were  to  criticise  his  opinion,  I  should  say  he 
goes  somewhat  too  far,  by  reason  of  not  dis- 
criminating so  as  to  uphold  promises  where 
(the  original  debt  still  remaining)  the  new 
consideration  moves  from  the  creditor  to  the 
promisor  as  well  as  from  the  primary  debt- 
or. In  Kiugsley  v.  Balcome,  4  Barb.  131,  the 
principal  cases  were  reviewed  by  Mr.  Jiistice 
Sill,  and  his  conclusion  is  thus  stated:  "The 
true  rule  is,  that  the  new  original  considera- 
tion spoken  of  must  be  such  as  to  shift  the 
actual  indebtedness  to  the  new  pi-omisor,  so 
that,  as  between  him  and  tlie  original  debtor, 
he  must  be  bound  to  pay  the  debt  as  his  own, 
the  latter  standing  to  him  in  tlie  relation  of 
surety."  I  do  not  tliink  this  a  perfect  defi- 
nition of  an  original  promise  to  pay  a  sum 
for  which  another  was  previously  bound  as 
the  primary  debtor,  because,  as  I  have  shown, 
there  are  many  cases  which  such  a  defini- 
tion does  not  include.  The  more  we  exam- 
ine the  original  classification  of  Chief  Justice 
Kent  in  Leonard  v.  Vredenburgh,  the  more 
we  shall  find  it  the  result  of  a  profound  and 
masterly  view  of  the  subject;  it  being  ucc- 
essaiy,  however,  to  the  completeness  of  his 
definition,  that  the  new  or  original  consid- 
eration may  move  to  the  promisor  as  well 
from  the  debtor  as  the  creditor,  the  funda- 
mental requisite  being  that  such  considera- 
tion must  not  be  one  wholly  existing  or 
moving  between  the  debtor  and  the  creditor. 
These  numerous  authorities  are  decisive. 
They  all  present  examples  where  tlie  collat- 
eral undertaking  was  founded  on  a  consid- 
eration sufficient  to  sustain  the  promise,  but 
of  no  personal  concern  to  the  promisor;  yet 
the  promises  were  void,  because  they  fell 
within  the  precise  terms  and  the  undoubted 
policy  of  the  statute  of  frauds.  Certainly 
that  statute  was  not  enacted  for  cases  where 

nOPK.SEL.CAS.CONT. — 9 


the  promise  woidd  be  void  at  the  common 
law  for  want  of  a  consideration  to  sioistain 
it  If  it  was  not  I'uacted  for  the  very  eases 
where  a  new  consideration  arises,  additional 
to  the  original  debt,  that  being  insufficient 
according  to  aU  authority,  then  why  was  it 
ever  passed?  Indeed,  the  struggle  in  the 
courts  has  been  to  withdraw  from  its  inUu- 
ence.  not  such  cases  as  these,  but  otliers 
having  a  close  formal  resemblance,  yet  dis- 
tinguishable, not  because  there  is  a  consid- 
eration, but  because  it  moves  to  the  promis- 
or, and  so  gives  to  his  undertaking  an  origi- 
nal character.  A  perM»n  who  receives  a  con- 
sideration may  be  bound  by  any  hiwful  prom- 
ise founded  upon  it,  and  that  promise  may 
as  well  lie  to  pay  another  man's  debt  as  to 
do  any  other  act.  The  success  of  this  stinig- 
gle,  in  a  variety  of  instances  not  within  the 
intent  of  the  statute,  shoidd  not  overthrow 
the  very  object  for  which  it  was  enacted. 

This  discussion  would  be  incomplete  with- 
out referring  to  the  rule  elsewhere  than  in 
this  state.  I  have  already  mentioned  the 
case  of  Nelson  v.  Boynton,  3  Mete.  (Mass.) 
39G,  which  may  be  regarded  as  settling  the 
question  in  Massachusetts.  The  creditor  in 
that  case  sued  his  debtor,  and  seized  his 
property  under  an  attachment.  The  defend- 
ant promised  to  pay  the  debt  in  considera- 
tion of  a  discontinuance  of  the  suit.  The 
suit  was  discontinued  accordingly,  and  the 
lien  of  the  attachment  was  thereby  lost,  but 
the  debt  remained  against  the  original  debt- 
or. It  was  held,  upon  the  fullest  considera- 
tion, Chief  Justice  Shaw  giving  the  opiuiou, 
that  the  promise  was  void  because  it  was 
not  in  writing.  I  regard  the  decision  as  of 
great  value,  because  the  cases  were  exam- 
ined, and  the  discrimination  between  the  dif- 
ferent classes  was  made  with  entire  accu- 
racy. 

Upon  the  argument  of  the  present  case  a 
passage  from  an  English  text-book  was  read 
(Add.  ConL  38),  to  the  effect  that,  if  the 
creditor  has  a  lien  or  security  which  he  is 
Induced  to  part  with  on  the  faith  of  a  promise 
of  another  person  to  pay  the  debt,  the  prom- 
ise so  made  is  notwithin  the  mischief  intend- 
ed to  be  provided  against  by  the  statute  of 
frauds,  and  may  be  good  by  parol.  This  ex- 
tract, according  to  its  apparent  meaning, 
seemed  to  indicate  that  in  England  the  stat- 
ute of  frauds  was  essentially  disregarded. 
The  authorities  referred  to  by  the  writer  to 
sustain  the  proposition  are:  Barker  v.  Birt, 
10  Mees.  &  W.  Gl;  Haigh  v.  Brooks,  10  AdoL 
&  E.  309-335;  Barrell  v.  Tnisscll,  4  Taunt 
117;  :Meredith  v.  Short,  1  Salk.  2.".;  Castling 
V.  Aubert,  2  East,  325;  and  Walker  v.  Tay- 
lor, 6  Car.  &  P.  752  I  have  looked  at  these 
cases,  and  find  that  none  of  them  have 
the  slightest  connection  with  such  a  propo- 
sition, except  the  two  last,  which  are  alike, 
and  do  not  sustain  It  In  the  last  case,  the 
creditor  had  the  possession  and  a  lien  upon 
certain  licenses  as  a  security  for  his  demand, 
and  he  gave  them  up  to  the  defendant,  who 


130 


STATUTE  OF  FRAUDS. 


promised  tx>  pay  the  debt  The  case  was  at 
nisi  prius.  Tindal,  C.  J.,  said:  "It  is  a  new 
contract,  under  a  new  state  of  circumstaji- 
ces.  It  is  not,  'I  will  pay,  if  the  debtor  can- 
not;' but  it  is,  'in  consideration  of  that  which 
is  an  advantage  to  me,  I  will  pay  you  this 
money.'  "  "There  is  a  whole  class  of  cases 
in  which  the  matter  is  excepted  from  the 
statute  on  account  of  a  consideration  arising 
immediately  between  the  parties."  Here  is 
the  very  distinction  so  well  established  in 
our  own  cases.  It  should  be  added,  that  the 
text-wi-iter  referred  to  could  not  have  in- 
tended what  his  lajiguage  apparently  means; 
for  hp  add5,  in  the  same  connection.  "In 
these  cases,  the  plaintiff  must  so  shape  his 
case  as  not  to  show  or  admit  that  there  is 
a  princiijal  debtor  liable,  and  that  the  prom- 
Vie  of  the  defendant  is  a  promise  to  pay  that 
6ebt" 

The  early  case  in  England,  of  Williams  v. 
Leper,  3  Bm-rows,  1886,  2  Wils.  308,  is  cited 
anc  relie»j  on  to  sustain  the  plaintiff's  posi- 
tion; anJ  it  is,  perhaps,  the  only  one  in  the 
EiiiJjsh  courts  capable  of  a  misinterpretation. 
But  the  case  does  not,  in  fact,  sustain  any 
such  do<±iiDe,  and  it  has  never  been  so  un- 
derstood in  the  courts  of  that  ctyontry.  One 
Taylor  owed  the  plaintif  £45  for  rent.  He 
conveyed  all  his  effects  for  the  benefit  of 
his  creditors,  who  employed  Leper,  the  de- 
fetdant,  to  sell  them;  aiid  he  advertised 
them  ftr  sale  ac-coidingly.  The  plaintiff  then 
came  to  distrain,  and  the  defendant  proui- 
ised  tc  piiy  the  rent  if  he  would  not  dis- 
trahi:  and  be  desisted  accordingly.  Lord 
Mansfieid  saia  the  defendant  was  a  trustee 
for  ai  tbj  creaitors,  and  was  obliged  to  pay 
the  lar;dioi*d,  whv  had  the  prior  lien.  Jus- 
tice Wilmot  said  the  defendant  became  the 
bailiff  ol  the  landlord,  and,  when  he  had 
sold  thd  goods,  the  money  ws.'^  the  landlord's 
in  his  ovrn  bailiff  s  hands.  Therefore,  he 
said,  an  action  would  have  lain  against  the 
defendant  for  money  had  and  received  to  the 
plaintiff's  use.  Justice  Yates  said,  it  was  an 
original  consideration  to  the  defendant.  Jus- 
tice Aston  thought  tte  goods  were  a  fund  be- 
tween both,  "and  on  that  foot  he  concurred." 
From  the  reasoning  of  these  judges,  it  seems 
to  me  perfectly  evident  that,  if  the  tenant 
had  not  assigned  his  goods,  and  the  defend- 
ant had  no  connection  with  them  as  trustee 
or  otherwise,  but  the  plaintiff  had  simply  re- 
leased his  distress,  or  right  to  distrain,  for 
the  benefit  of  the  debtor  alone,  the  promise 
to  pay  the  debt  on  that  consideration  would 
have  been  held  within  the  statute.  But  as 
the  facts  were,  the  law  would  imply  an  ob- 
ligation on  the  defendant's  part  to  pay  over 
the  money  to  the  plaintiff  after  selling  the 
goods;  and  where  the  law  will  imply  a  debt 
or  duty  against  any  man,  his  express  prom- 
ise to  pay  the  same  debt,  or  perform  the 
same  duty,  must,  in  its  nature,  be  original. 
The  distinguishing  feature  of  the  case  was, 
that  the  creditor  relinquished  his  distress. 
not  to  the  debtor,  but  to  other  creditors  of 


the  same  debtor  who  beneficially  owned  the 
goods,  and  the  defendant  was  the  represent- 
ative of  those  creditors,  having  the  fund  in 
his  possession.  K  this  early  case  had  not 
been  sometimes  misapprehended,  it  is  prob- 
able that  no  doubt  would  ever  have  arisen 
in  questions  like  the  one  before  us. 

The  cases  also  cited  of  Houlditch  v.  Milne, 
3  Esp.  86;  Casthng  v.  Aubert,  2  East,  325; 
Edwards  v.  Kelly,  6  Maule  &  S.  204;  Bird 
v.  Gammon,  3  Bing.  N.  C.  883;  Bampton  v. 
Paulin,  4  Bing.  204;  Walker  v.  Taylor,  6 
Car.  &  P.  752;  and  Stephens  v.  Pell,  2  Cromp. 
&,  M.  710, — differing  only  in  immaterial  cir- 
cumstances, all  involved  the  same  general 
principles  as  Williams  v.  Leper.  In  each  of 
them  the  creditor  relinquished  some  lien  or 
advantage  incident  to  his  debt;  but  in  each 
of  them  whatsoever  he  relinquished  was  ac- 
quired by  the  defendant — either  as  a  matter 
of  personal  interest  and  concera  to  himself 
or  to  other  parties  whom  he  represented— 
and  on  that  considei-ation  he  promised  to 
pay.  In  none  of  them  was  any  such  doc- 
trine asserted  as  the  plaintiff  contends  for 
in  this  case.  In  all  of  them  the  engagement 
was  deemed  original,  either  because  the  pri- 
mary debt  was  gone  or  because  the  consider- 
ation moved  to  the  promisor;  and  in  some 
of  them  the  decision  was  put  on  both  these 
grounds.  These  cases  not  only  elucidate 
more  perfectly  the  principle  of  Williams  v. 
Leper,  but  they  are  in  themselves  illustra- 
tions of  the  distinction  which,  as  we  have 
seen,  is  recognized  in  our  own  courts.  Re- 
ferring now  to  Read  v.  Nash,  1  Wils.  305, 
it  was  the  case  of  a  promise  to  pay  the  plain- 
tiff a  certain  sum  if  the  latter  would  with- 
draw his  record  in  an  action  of  assault  and 
battery  against  anotl:ier  person,  and  would 
not  proceed  to  trial.  This  pixamise  was  held 
not  to  be  within  the  statute  of  frauds;  the 
decision  being  placed  on  the  ground  that  the 
person  sued  for  the  assault  was  not  a  debtor 
at  all  within  the  meaning  of  the  statute,  and 
could  not  be  so  considered  until  after  ver- 
dict against  him.  "For  aught  we  can  tell," 
the  court  said,  "the  verdict  might  have  been 
in  his  favor."  The  pi-omise,  therefore,  stood 
as  at  the  common  law.  In  Goodman  v. 
Chase,  a  debtor,  taken  on  a  ca.  sa.  at  the  suit 
of  the  plaintiff,  was  discharged  with  the 
plaintiff's  consent  on  the  defendant's  prom- 
ise to  pay  the  debt.  This  was  held  an  origi- 
nal promise,  because  the  debt  itself  was  ex- 
tinct and  satisfied  by  the  ca.  sa.  and  its  dis- 
charge; and  the  principle  of  the  decision  is 
a  veiy  plain  one. 

I  have  now  referred  to  all  the  decisions  in 
the  English  courts  which  can  be  supposed  to 
favor  in  any  degree  the  doctrine  on  whicli 
the  plaintiff  in  this  case  relies;  and  I  think 
it  may  be  safely  affirmed,  that  no  case  has 
ever  been  determined  in  those  courts  tend- 
ing to  the  proposition  that  a  parol  promise 
to  pay  the  debt  of  another  person  is  valid 
where  the  consideration  is  beneficial  only  to 
tJie  debtor,  and  where  there  is  a  debt  which 


PKOMISE  TO  ANSWER  FOR  DEBT  OF  ANOTHER, 


131 


still  remains  against  him.  I  will  now  men- 
lion  a  I'ew  cases,  among  many  oLliei'S,  which 
show  what  the  hiw  in  England  is  upon  the 
precise  question  now  to  be  decided. 

In  Fish  V.  Hutchinson,  2  Wils.  i)4,  the  pliiin- 
tiff  had  commenced  a  suit  against  his  debt- 
or, and  the  defendant,  in  cousidei-ation  that 
he  would  stay  that  suit,  promised  by  parol 
to  pay  the  debt  The  whole  court  of  king's 
bench  were  of  opinion  that  tJie  undertaking 
was  void  by  the  statute  of  frauds;  observ- 
ing that  there  was  a  debt  still  subsisting 
against  another  person  and  a  promise  to  pay 
it  The  consideration  was  manifestly  good, 
but  that,  moving  as  it  did  to  the  debtor  only, 
did  not  sustain  the  promise  without  a  writ- 
ing. This  case  was  decided  just  one  hun- 
dred years  ago,  and  the  principle  of  it  was 
never  departed  fix)m  in  succeeding  times. 
Coming  down  to  a  recent  period,  in  Chmcy 
V.  Piggott,  2  Adol.  &  E.  473,  one  Moore  was 
indebted  to  the  plaintiff,  for  which  tlie  lat- 
ter held  his  goods  in  pledge.  In  considei-a- 
tion  of  surrendering  the  pledge  to  the  debtor, 
the  defendant  promised,  by  a  writing  which 
did  not  express  the  considei-ation,  to  pay  tlie 
plaintiff  his  debt  Williams  v.  Leper,  and 
the  other  cases  above  referred  to,  belonging 
to  that  class,  were  cited  to  sustain  the  un- 
dertaking; but  the  court  held  it  within  the 
statute  and  void.  Williams  v.  Leper,  and 
the  kindi-cd  decisions,  were  not  overniled,  or 
even  questioned,  and  the  case,  therefore, 
shows  how  those  decisions  are  understood  in 
England.  In  Tomlmson  v.  Gell,  6  Adol.  & 
E.  564,  the  plaintiff's  client  was  indebted  to 
him  for  costs  in  a  pending  chancery  suit,  and 
in  consideration  of  a  discontinuance  of  that 
suit,  the  defendant  promised  to  pay  those 
costs  to  the  plaintiff.  Held  void  within  the 
statute.  Patterson,  J.,  observed:  "It  is  said 
that  a  new  ccnsideration  arose  from  the  dis- 
continuance of  the  suit  But  I  do  not  think 
it  is  a  new  one.  The  eases  on  tliat  point  are 
where  sometlimg  has  been  given  up  by  the 
plaintiff,  and  acquired  by  the  partj-  making 
the  promise,  as  a  secoirity  of  goods  for  a 
debt." 

Without  pursuing  this  discussion  fuilher, 
the  general  riile  is,  tliat  all  promises  to  an- 
swer for  the  debt  or  default  of  a  third  per- 
son must  be  in  writing,  whether  Uie  prom- 
ise be  made  before,  at  the  time,  or  after  the 
debt  or  liability  is  created.  Such  is  the  rule, 
because  so  is  the  statute  of  frauils.  The 
stitute  makes  no  exception  of  any  promise 
which  is  of  that  character.  The  courts  have 
made  no  exceptions;  as  clearly  tlioy  should 
not.  But  a  considerable  variety  of  uudertiik- 
ings,  having  points  of  resemblance  and  an- 
alogy to  such  promises,  have  been  held  not 
to  be  witliin  the  statute.  These  may  be 
chiefly,  if  not  wholly,  arranged  in  the  fol- 
lowing classes:  (1)  Whore  there  was  no  orig- 
in.T.1  debt  to  which  the  auxiliary  promise 
could  be  collateral;  for  example  where  the 
promisee  was  a  mere  guarantor  for  the  tiiird 
pei-son  to  some  one  else,   and   the  promisor 


agrees  to  indemnify  him,  or  where  his  de- 
mand was  founded  in  a  pure  tort  (2)  Where 
the  origimil  debt  becomes  extinguished,  and 
the  creditor  has  only  the  new  promise  to 
rely  upon;  for  example  where  such  new  un- 
dertaking is  accepted  as  a  substitute  for  the 
original  demand,  or  where  the  original  de- 
mand Ls  deemed  satislied  by  the  arrest  of  the 
debtor's  body  or  a  levy  on  his  goods,  the 
arrest  or  levy  being  discharged  by  the  cred- 
itor's consent  (3)  Where,  although  the  debt 
remains,  the  promise  is  founded  on  a  new 
consideration  which  moves  to  the  promisor. 
This  consideration  may  come  from  the  debt- 
or, as  where  he  puts  a  fund  in  the  hands 
of  the  promisee,  either  by  absolute  transfer 
or  upon  a  trust,  to  pay  the  debt,  or  it  may 
be  in  his  hands  charged  with  the  debt  as  a 
prior  lien,  as  in  the  case  of  Williams  v.  Le- 
per, and  many  others.  So  the  cjnsideration 
may  originate  in  a  new  and  Independent 
dealing  between  the  promisor  and  the  cred- 
itor, tlie  undertaking  to  answer  for  the  deljt 
of  another  being  one  of  the  incidents  of  that 
dealing.  Thus,  A.,  for  any  compensation 
agreed  on  between  him  and  B.,  may  under- 
take that  C.  shall  pay  his  debt  to  B.  So  A.. 
himself  being  the  creditor  of  C,  may  trans- 
fer the  obligation  to  B.  upon  any  sufficient 
consideration,  and  guarantee  it  by  parol.  If 
we  go  beyond  these  exceptional  and  peculiar 
cases,  and  withdraw  from  the  statute  all 
promises  of  this  nature,  where  the  debtor 
alone  is  benefited  by  the  consideration  of  the 
new  undertaking,  and  the  debt  still  subsists, 
then  we  leave  absolutely  nothing  for  the 
statute  to  operate  upon. 
The  judgment  should  be  affirmed.  t 

BACON,  J.  (dissenting).  This  case  preset  ts  "^^^ 
a  single  question,  and  a  proposition  apparent- 
ly so  simple  that  the  first  emotion  is,  perhaps, 
one  of  surprise  that  there  could  be  any  ques- 
tion in  regard  to  it,  since,  in  the  multitude  of 
decisions  with  which  the  books  are  filled 
touching  the  construction  of  the  statute  of 
frauds,  it  would  seem  that  the  rule  applicable 
to  a  case  which,  in  its  essential  features, 
must  so  often  have  arisen,  must  be  settled  by 
authority.  My  own  conviction  is,  that  the 
nde  which  governs  this  case  has  been  long 
and  well  established  in  opposition  to  the  con- 
clusion of  the  referee  and  the  judgment  of 
the  supreme  court;  but,  at  the  same  time,  it 
may  readily  be  admitted  that  reservations 
and  doubts  have  been  suggested,  and  dis- 
criminations attempted,  from  time  to  time, 
that  if  they  have  ser^-ed  no  other  purpose, 
have  at  least  involved  the  matter  in  some  ob- 
scurity. 

"Every  special  promise  to  answer  for  the 
debt,  default  or  miscarriage  of  another  per- 
son," the  statute  declares,  "shall  be  void,  un- 
less such  agreement,  or  some  note  or  mem- 
orandum thereof,  expressing  the  considera- 
tion, be  in  writing  and  subscribed  by  the 
party  to  be  charged  therewith,"  2  Rev.  St 
135,  §  2.     This  statute,  as  is  well  known.  Is 


132 


STATUTE  OF  FliAUDS. 


an  almost  literal  transcript  of  the  English 
statute  of  frauds  (29  Car.  II.  c.  3);  the  only 
noticeable  change  being,  that  in  our  statute 
the  consideration  is  required  to  be  expressed 
iu  the  writing.  This,  however,  so  far  as  the 
construction  of  the  two  statutes  is  concerned, 
is  of  no  special  moment,  inasmuch  as  the 
courts,  both  in  England  and  in  this  state,  had 
held,  before  the  words  were  inserted  in  the 
section  as  it  now  stands,  that  it  was  neces- 
sary to  a  valid  agreement  that  the  considera- 
tion should,  in  some  terms,  be  incorporated 
therein.  Whatever,  then,  has,  by  the  course 
of  adjudication  in  England  upon  this  clause  of 
the  statute,  been  deemed  or  acquiesced  in  as 
the  settled  law,  must  be  accepted  with  us  as 
controlling  authority,  unless,  upon  due  consid- 
eration, and  by  the  solemn  judgment  of  some 
court  whose  decisions  are  recognized,  any  pe- 
culiar and  special  construction  has  been  ques- 
tioned or  repudiated. 

It  would  probably  have  been  better  if  there 
had  been  less  of  what  may,  perhaps,  without 
irreverence,  be  called  legal,  and  even  judicial 
tampering  with  the  words  of  the  statute,  to 
force,  at  times,  a  constraetion  seemingly  at 
war  with  its  natural  and  more  obvious  Import. 
But  all  regrets  on  this  subject  are  vain,  since 
the  business  of  construction  began  with  the 
infancy  of  the  law,  and  has  not  yet  ceased, 
and  will  doubtless  attend  it  even  down  to  old 
age.  One  of  the  earliest  attempts  to  create 
and  define  a  distinction  by  which  agreements 
were  to  be  held  withm  or  without  the  scope 
of  the  statute  was  to  express  them  by  the 
terms  "original"  and  "collateral."  It  is  true 
that  neither  of  these  words  is  to  be  found  m 
the  statute,  but  they  have  been  so  long  em- 
ployed in  connection  with  it  as  to  have  attach- 
ed to  them  an  established  and  recognized 
meaning;  and  the  struggle  always  is,  in  de- 
termining the  validity  of  such  an  agreement 
as  seems  to  fall  within  the  general  purview 
of  the  law,  to  ascertain  whether  it  is  collat- 
eral and  ancillary  to  the  principal  contract, 
having  no  aliment  whatever  independently  of 
that,  or  whether  it  can  be  sustained  and  en- 
forced as  an  independent,  original  undertak- 
ing altogether  outside  of,  and,  therefore,  not 
needing  to  be  evidenced  by  the  written  agree- 
ment required  by  the  statute. 

An  attempt  was  made  as  early  as  1811  by 
Chancellor  Kent,  then  chief  justice  of  the  su- 
preme court,  in  the  well-knov\Ti  case  of  Leon- 
ard V.  Vredenburgh,  8  Johns.  29,  to  arrange 
into  three  classes  the  cases  where  a  promise, 
to  be  answerable  for  the  debt  of  another,  was 
within  or  without  the  statute.  They  are  fa- 
miliar to  the  profession,  and  for  a  long  time 
stood  their  ground  as  a  just  exposition  of  the 
law.  The  third  class,  in  which  he  held  that  a 
promise  to  pay  the  debt  of  another  was  not 
within  the  statute  "when  it  arose  out  of  some 
new  and  original  consideration  of  benefit  or 
barm  moving  between  the  newly  contracting 
parties," has  been  subjected  to  much  criticism; 
and  it  may  be  fairly  admitted  that  it  is  not 
now,  in  the  naked  and  unqualified  terms  m 


which  it  is  expr-issed,  to  be  received  as  the 
true  construction  of  the  statute.  And  yet  this 
rule  did  obtain,  and  was  followed  in  several 
well-considered  cases  in  our  own  courts. 
Thus,  in  Farley  v  Cleveland,  4  Cow.  432,  the 
classification  of  Kent  was  stated  and  reafiirm- 
ed,  and  the  case  then  on  argument  held  to 
fall  within  his  third  class;  and  the  court  lay 
down  the  broad  proposition,  that,  where  a 
promise  to  pay  the  debt  of  a  third  person 
arises  out  of  some  new  consideration  of  bene- 
fit to  the  promisor,  or  harm  to  the  promisee, 
moving  to  the  promisor  either  from  the  prom- 
isee or  the  original  debtor,  such  promise  is 
not  within  the  statute.  And  it  is  added, 
that  this  is  so,  although  the  original  debt  still 
subsists,  and  is  entirely  unaffected  by  the  new 
agreement.  This  case  was  carried  up  to  the 
court  of  errors,  and  was  there  aflinned.  9 
Cow.  639.  The  doctrine  of  the  supreme  court 
Is  reiterated  in  the  precise  language  of  the 
marginal  note  in  4  Cow.,  and  by  an  entirely 
undivided  court;  the  report  merely  stating 
that  Jones,  Ch.,  examined  the  question,  and 
was  of  opinion  that  the  judgment  should  be 
aflirmed;  "whereupon,  per  totam  curiam,  the 
judgment  was  affirmed." 

In  Meech  v.  Smith,  7  Wend.  315,  the  same 
rule  is  again  repeated  and  the  court  say  that 
it  has  long  been  settled,  that,  although  the 
promise  be  by  parol,  yet,  if  it  arises  out  of 
some  new  and  original  consideration  of  bene- 
fit or  harm  moving  between  the  newly  con- 
tracting parties,  the  case  is  not  within  the 
statute.  Alluding  to  Leonard  v.  Vredenburgh. 
and  the  above  cited  case  of  Farley  v.  Cleve- 
land, the  court  say:  "This  rule  has  been  rec- 
ognized by  all  writers  upon  contracts,  and  by 
the  highest  court  In  the  state,  and  is,  there- 
fore, as  much  the  law  of  the  land  as  the  stat- 
ute itself."  The  authority  of  Leonard  v.  Vre- 
denburgh. and  especially  the  third  class  of 
Chancellor  Kent,  has  been  cited  approvingly 
and  followed  in  the  courts  of  several  of  our 
sister  states;  and  in  the  case  of  De  Wolf  v. 
Rabaud,  1  Pet.  47G,  the  judgment  of  the  su- 
preme court  of  the  United  States  proceeded 
substantially  upon  an  aflirmance  of  the  au- 
thority of  Leonard  v.  Vredenburgh,  as  a  just 
construction  of  the  statute  of  this  state. 

If  these  cases  are  to  be  received  as  approv- 
ed law  at  the  present  day,  tliey  decide  more 
than  enough  to  reverse  the  judgment  now  be- 
fore us;  and  there  need  be  no  further  exam- 
ination of  authorities  upon  the  discussion 
which  this  case  has  opened.  But  it  is  impor- 
tant to  a  just  appreciation  of  the  ground  upon 
which,  as  I  suppose,  the  agreement  in  this 
case,  and  the  consequent  right  of  the  plain- 
tiff to  recover,  is  to  be  upheld,  to  notice  the 
several  cases  in  which  the  dLscrimination  be- 
tween original  and  collateral  promises  has 
been  established,  or  affirmed,  by  the  courts. 
This  discrimiuation  will  be  found  to  exist,  I 
think,  and  the  requirements  of  the  statute  not 
to  apply,  under  four  conditions,  within  some 
one  of  which  most  of  the  authorities  upon  this 
particular  section  of  the  statute,  and  which,. 


PEOMISE  TO  ANSWER  FOR  DEBT  OF  ANOTHER. 


133 


In  some  respects,  have  been  thought  to  con- 
flict with  each  other,  may  be  arranged. 

1.  Where  tlie  primary  afjreement  has  been 
in  effect  extinguished,  and  the  promise  super- 
seded, bj  the  new  agreement  and  promise 
which  have  talien  their  place,  and  the  credit 
is  given  wholly  to  the  new  promisor. 

2.  Where  a  fund  has  been  provided,  or  prop- 
erty has  been  placed  in  the  hands  of  the  new- 
ly contracting  p;irty,  from  which  the  means 
are  to  be  procured  to  pay,  or  the  promisor 
derives  an  equivalent  or  advantage  therefrom. 

3.  Where  the  purport  and  intent  of  the 
agreement  Is  to  accomplish  the  payment  of 
the  promisor's  own  debt,  although  the  effect 
is  to  pay  the  debt  of  another,  and  where  that 
debt  is  used  to  measure  the  extent  of  the  lia- 
bility, as  where  A.  owes  B.,  and  C.  is  indebt- 
ed to  A.,  and  in  consideration  of  that  liability 
promises,  at  A.'s  request,  to  pay  B.  the  debt 
A.  is  owing  him. 

4.  Where  the  creditor,  in  consideration  of 
the  promise,  surrenders  some  pledge,  or  re- 
linquishes some  lien  actually  held  by  him  and 
capable  of  enforcement,  and  by  means  of 
which  the  original  debt  was  rendered  secure. 

In  all  these  classes,  excepting  the  first,  it 
does  not  affect  the  liability  of  the  newly  con- 
tracting party  that  the  original  debt  subsists 
and  the  liability  of  the  debtor  remains  in  full 
force,  "Wherever  the  conditions  exist  which 
I  have  arranged  under  these  four  heads,  there 
is  not  only  a  sufficient  consideration  for  the 
promise  to  pay  another's  debt,  but  the  prom- 
ise is  good  although  by  parol. 

Numerous  illustrations  might  be  gathered 
from  the  authorities  under  these  several 
heads;  and  although  it  must  be  admitted  that 
the  current  of  decisions  is  not  uniform,  and 
some  apparently  irreconcilable  cases  may  be 
found,  I  am  persuaded  that  a  careful  sifting 
of  the  facts,  and  an  attention  to  the  proper 
discrimination  which  should  be  made,  would 
reconcile  many  which  stand  seemingly  in  con- 
flict, and  in  the  result  make  this  branch  of  the 
law  more  homogeneous  and  reliable.  At  pres- 
ent, however,  it  only  concerns  us  to  trace  the 
course  of  decisions  which  have  established 
the  distinction  expressed  under  the  fourth 
head  of  exceptions  to  the  operation  of  the  stat- 
ute; and  if  it  shall  be  found,  as  I  think  it 
will,  a  distinction  fully  recognized  and  up- 
held by  a  long  and  almost  unbroken  series  of 
decisions,  the  right  of  the  plaintiff  to  recover 
upon  the  facts  of  this  case  will  be  put  beyond 
question. 

And,  first,  as  to  the  condition  of  the  English 
law  upon  this  subject  One  of  the  earliest 
cases  to  be  found  in  the  books  is  Tomlinson 
v.  Gill  (decided  by  Lord  Ilardwicke,  in  17.")»i) 
Amb.  330.  That  case  was  briefly  this:  Gill, 
the  defendant,  promised  the  widow  and  ad- 
ministratrix of  tlie  intestate  that,  if  she  would 
permit  him  to  be  joined  with  her  in  the  letters 
of  administration,  he  would  make  good  any 
deficiency  of  assets  to  discharge  the  debts  of 
the  intestate;  and  the  action  was  brouglit  by 
a  creditor  to  enforce  that  agreement    The  de- 


fendant Insisted  that  the  promise  was  void 
by  the  statute  of  frauds.  It  was  holden  to  be 
not  within  the  statute.  Here  was  the  reliu- 
quishirtent  by  the  widow  of  a  part  of  her  ex- 
clusive lien  upon  and  interest  in  the  goods 
and  effects  of  her  husband,  and  which  were  a 
fund  in  her  hands  for  the  payment  of  the 
debts  of  the  estate,  and  the  defendant  by  the 
agreement,  acquired  that  interest  Lord 
Hardwicke  goes  even  further  than  tnls  in  his 
decision,  wherein  he  says  it  is  not  witliin  the 
statute,  "for  there  is,"  he  adds,  "a  distinction 
between  a  promise  to  pay  the  original  debt 
and  on  the  foot  of  the  original  contract,  and 
where  it  is  on  a  new  consideration.  Here  is 
quite  a  new  consideration." 

There  is  a  short  case  reported  in  Salkeld, 
standing  apparently  upon  the  .same  ground. 
It  was  to  this  effect:  The  sheriff  took  goods 
upon  an  execution,  and  a  stranger  promised 
the  officer  to  pay  the  debt  in  consideration 
that  he  would  restore  them.  The  action  was 
brought  upon  that  promise,  and  on  demurrer 
it  was  held  to  be  a  good  consideration.  No 
benefit  so  far  as  the  case  discloses,  accrued 
to  the  promisor,  the  goods  being  restored  to 
the  debtor;  but  the  consideration  which  up- 
held the  promise,  and  which  was  good  as  an 
original  undertaking,  was  the  relinquishment 
of  the  lien  which  the  sheriff  had  upon  the 
property  by  virtue  of  the  levy  under  his  exe- 
cution. Love's  Case,  1  Salk.  2S.  It  is  true 
that  the  statute  of  frauds  is  not  called  in 
question  in  this  decision,  but  the  case  clearly 
presented  that  objection,  which  would,  be- 
yond doubt,  have  been  urged  if  either  the 
counsel  or  the  court  had  deemed  it  tenable. 

The  next  case,  and  the  one,  perhaps,  most 
frequently  cited  and  commented  on  in  con- 
nection with  the  particular  question  we  are 
considering,  is  Williams  v.  Leper,  3  Burrows, 
1S8G,  and  reported  also  more  briefly  in  2 
Wils.  308.  The  case  was  tried  before  Lord 
Mansfield,  at  Guildhall,  and  a  verdict  taken 
for  the  plaintiff  upon  the  following  state  of 
facts:  One  Taylor  was  indebted  to  the  plain- 
tiff in  the  sum  of  £45  for  rent  of  premises  he 
held  of  him  as  his  landlord.  Taylor,  becom- 
ing insolvent,  conveyed  his  property  to  the 
defendant  Leper,  for  the  benefit  of  his  cred- 
itors. Leper  took  possession,  when  the  plain- 
tiff came  as  landlord,  to  distrain  for  the  rent 
due  him;  whereupon  Leper  promised  that,  if 
he  would  desist  from  distraining,  he  would 
pay  the  debt.  The  plaintiff,  accordingly,  in 
consideration  of  this  promise,  refrained  from 
enforcing  his  distress,  and  the  action  was 
brought  upon  that  agreement.  In  the  court 
of  king's  bench,  all  the  judges  gave  brief 
opinions.  Lord  Mansfield  said,  emphatically: 
"The  case  has  nothing  to  do  with  the  statute 
of  frauds.  The  landlord  had  a  legal  pledge. 
He  enters  to  distrain,  and  has  the  pledge  in 
his  custody.  The  defendant  agrees  that  the 
goods  shall  be  sold,  and  the  plaintiff  be  paid 
in  the  first  place.  The  goods  are  the  fund. 
Leper  was  obliged  to  pay  the  landlord,  who 
had  the  prior  lien."     The  other  judges  con- 


131 


STATUTE  OF  PKAUDS. 


cxirred  in  the  result;  but  Justice  Astou  was 
inclined  to  put  it  upon  the  fooring  that  the 
goods  were  a  fund  and  Leper  the  bailiff  of 
the  landlord,  and  when  he  had  sold  the 'goods 
the  money  was  in  his  hands  substantially  as 
the  landlord's  agent.  The  case  may,  perhaps, 
be  safely  maintained  upon  that  special 
groimd,  and  is  thus  an  authority  within  what 
I  have  ventured  to  designate  as  the  second 
class  of  promises  not  within  the  statute;  but 
I  think  the  language  of  Lord  Mansfield  pre- 
sents very  clearly  the  ground  of  the  distinc- 
tion to  be,  that  the  plaintiff  had,  in  conse- 
quence of  the  promise  of  defendant,  relin- 
quished a  lien  operative  and  efficient  to  pro- 
duce satisfaction  of  the  debt,  and  that  it  is  a 
very  ample  authority  to  support  the  validity 
of  such  a  promise  upon  that  consideration. 

The  case  of  Houlditch  v.  Milne,  3  Esp.  86, 
presents  the  point  more  clearly,  and  is  a  very 
decisive  authority  on  the  proposition  we  are 
discussing.  The  plaintiff  had  repaired  car- 
riages for  one  Cofey,  and  charged  the  ac- 
count to  him.  The  defendant  sent  an  order 
to  have  them  packed  and  sent  on  board  a  ship, 
and  promised  to  pay  the  bill.  On  the  trial  the 
defendant's  counsel  asked  that  the  plaintiff  be 
nonsuited,  on  the  ground  that  the  promise  be- 
ing to  pay  a  debt  of  Cofey,  who  was  himself 
liable,  and  not  being  in  writing,  it  was  void 
by  the  statute.  But  Lord  Eldon  refused  to 
nonsuit  the  plaintiff,  and  held  that  it  was  an 
original  undertaking.  He  cited  the  case  of 
Williams  v.  Leper,  saying  that  it  appeared 
to  apply  precisely  to  the  case  then  before  him. 
'•The  plaintiff,"  he  adds,  "had,  to  a  certain 
extent,  a  lien  upon  the  carnages,  which  he 
parted  with  on  the  defendant's  promise  to 
pay.  This  took  the  case  out  of  the  statute, 
and  made  the  defendant  liable." 

Castling  v.  Aubert,  2  East,  325,  presented 
the  following  facts:  The  plaintiff  was  a 
broker,  aud  had  in  his  hands  policies  of  in- 
surance upon  which  he  had  a  lien  for  certain 
acceptances  he  had  given  for  one  Grayson. 
The  defendant,  upon  the  plaintiff  delivering 
him  the  policies  that  he  might  collect  them, 
promiscHi  that  he  would  provide  for  the  ac- 
ceptances as  they  became  due.  The  plaintiff, 
being  prosecuted  on  one  of  his  acceptances, 
brought  this  suit  to  recover  of  the  defendant 
upon  his  promise.  It  appeared  that  the  de- 
fendant had  collected  the  policies.  Tliis  was 
held  to  be  an  original  undertaking,  and  not 
within  the  statute.  It  is  true  that  it  pre- 
sented another  ground  upon  which  the  recov- 
ery could  be  sustained,  to-wit,  that  the  de- 
fendant had  possessed  himself  of  the  fund 
created  for  the  express  purpose  of  meeting 
the  debt,  and  this  would  sustain  a  count  for 
money  had  and  received.  Lord  Ellenborough 
puts  it  in  both  aspects,  and  says,  at  the  close 
of  his  opinion,  citing  Williams  v.  Leper,  that 
he  agrees  with  that  decision  to  the  full  extent 
of  it.  "I  agree,"  he  says,  "with  those  of  the 
judges  who  thought  the  c-ase  not  within  the 
statute  at  all,  and  I  aLso  agree  with  the 
ground  on  which  Mr.  Justice  Aston  proceed- 


ed, that  the  evidence  sustains  the  count  for 
money  had  and  received." 

A  distinction  had  crept  into  the  books  found- 
ed upon  a  remark  of  Buller  in  Matson  v. 
Wharam,  2  Term  R.  80,  to  the  effect  that  if 
the  person  to  whose  use  goods  are  furnished 
or  property  delivered  is  liable  at  all,  any  other 
promise  by  a  third  person  to  pay  that  debt 
must  be  in  writing,  otherwise  it  is  void  by  the 
statute  of  frauds;  and  upon  this  distinction 
the  case  of  Croft  v.  Smallwood,  1  Esp.  121, 
was  decided.  But  this  distinction  was  repu- 
diated in  the  cases  already  cited,  in  all  which 
it  is  manifest  that  the  original  debt  was  still 
subsisting  and  remained  unaffected  by  the 
new  undertaking;  and  in  this  state  that  pre- 
cise poLat  has  been  expressly  adjudged  in  the 
case  of  Farley  v.  Cleveland,  heretofore  refer- 
red to,  and  in  Rogers  v.  Kneeland,  13  Wend. 
114. 

The  principle  of  the  cases  I  have  thus  cited 
has  been  affirmed,  and  the  doctrine  fully  rec- 
ognized in  two  or  three  modem  English  cases, 
among  which  are  Edwards  v.  Kelly,  6  Maule 
&  S.  204;  Bird  v.  Gammon,  3  Bing.  N.  C.  8S3; 
and  Wiilker  v.  Taylor,  6  Car.  &  P.  752  (which 
is,  pyerhaps,  the  most  recent  one),  aud  is  to 
the  following  effect:  The  widow  of  a  pub- 
lican employed  an  undertaker  to  conduct  the 
funeral  of  her  deceased  husband,  and  deposit- 
ed with  him  the  licenses  of  the  house  as  a 
security  for  the  payment  of  his  bill.  A.,  one 
of  a  firm  who  supplied  the  house  with  liquors, 
took  out  letters  of  administration  on  the  es- 
tate, and  B.,  the  other  partner,  promised  the 
undertaker  that,  if  he  would  give  up  the  li- 
censes to  him,  he  would  pay  the  funeral  ex- 
penses. It  was  held  that  the  undertaker,  hav- 
ing surrendered  the  licenses,  might  recover 
his  bill  against  R,  although  the  widow  was 
his  employer  and  he  had  charged  the  admin- 
istrator as  his  debtor.  Tindal,  C.  J.,  said  on 
the  trial:  "Here  is  a  new  contract,  under  a 
new  state  of  circumstances.  It  has  nothing 
whatever  to  do  with  the  statute  of  frauds." 

In  view  of  these  authorities,  I  think  it  may 
be  safely  atlirmed  that  the  rule  in  England  is 
too  well  settled  to  admit  of  question  that  the 
promise  in  this  case  is  not  within  the  statute 
of  frauds.  No  case  that  fairly  holds  the  con- 
trary has  been  produced,  or  even  referred  to, 
on  the  argument;  and  so  well  established 
does  this  doctrine  seem  to  be,  that  the  elemen- 
tary writers  substantially  concur  in  the  prin- 
ciple derived  from  them.  Thus  Chitty  says: 
"Although  the  debt  of  another  form  the  sub- 
ject-matter of  the  defendant's  undertaking, 
still,  if  he  promised  to  pay  the  debt  upon 
some  new  consideration  raised  by  himself^ 
and  the  consideration  be  the  resignation  of  a 
charge  or  lien  which  afforded  a  remedy,  or 
fund,  to  enforce  the  payment,  the  case  does 
not  fall  within  the  statute."  Chit.  Cont. 
(Springfield   Ed.   1851)   p.  446. 

Thus,  also,  Burge,  Surety.  26,  expresses  in 
substance  the  same  proposition:  "Though  the 
debt  of  another  may  have  been  the  original 
cause  of  the  promise,  yet,   if   the  person   to 


PROMISE  TO  ANSWEIl  FOR  DEBT  OF  AXOTIIEU. 


135 


whom  it  is  made  rcliuiiimhes  some  right  or 
advantiige  which  lie  possessed,  and  which 
might  have  enabled  him  to  obtain  satisfaction 
of  his  debt,  the  promise  by  a  third  party  to 
pay  tlie  debt  in  consideration  of  ^uch  relin- 
quishment is  an  original  promise,  and  not 
witliin  the  statute."  See,  also,  Fell,  Guar,  c 
2,  §§  7,  S,  to  the  same  effect. 

Tlie  rule  is,  perhaps,  still  more  clearly  and 
strongly  stated  by  Addison,  In  his  recent 
treatise  on  Contracts,  who,  on  a  collation  of 
the  authorities,  both  ancient  and  modern, 
states  his  conclusion  in  the  following  terms: 
"A  contract  or  promise,  although  made  con- 
cerning the  debt  or  default  of  a  third  party, 
may  yet  be  an  original  promise,  not  within 
the  statute.  If  the  plaintiff  has  a  lien  upon 
the  property  of  his  debtor  in  his  possession, 
or  holds  securities  for  the  payment  of  his 
debt,  and  is  induced  to  give  up  the  lien,  or 
part  with  his  securities,  upon  the  faith  of  the 
defendant's  promise  to  pay  the  debt,  the 
promise  so  made  is  not  within  the  mischiefs 
provided  against  by  the  statute,  although  the 
amount  promised  to  be  paid,  on  the  surrender 
of  the  securities,  may  be  the  subsisting  debt 
of  the  third  party  due  to  the  plaintiff,  and  the 
possession  of  the  promise  may  have  the  ef- 
fect of  discharging  the  debt"  Add.  Cont  3S, 
39. 

To  the  English  cases  above  cited  and  com- 
mented on,  I  add  that  of  B.arrell  v.  Trussell, 
4  TaunL  117,  where  the  same  point  is  ad- 
judged. It  was  a  case  where  the  plaintiff 
was  about  to  sell  the  property  of  one  Abbott, 
under  a  bill  of  sale  executed  to  him  by  Ab- 
bott. Having  taken  the  property,  the  de- 
fendant, in  consideration  that  the  plaintiff 
would  relinquish  the  possession  to  Abbott, 
promised  verbally  to  pay  the  plaintiff  £122, 
being  the  debt  of  Abbott  due  to  the  plaintiff, 
and  to  collect  which  the  plaintiff  was  about 
to  make  the  sale.  The  plaintiff  obtained  a 
verdict,  but,  on  a  rule  to  show  cause,  the  de- 
fendant insisted  that  tlie  plaintiff  was  not  en- 
titled to  recover  because  this  was  an  agree- 
ment to  answer  for  the  debt  of  another,  and 
there  was  no  signature  of  the  party  sought  to 
be  charged.  The  counsel  for  the  defendant, 
on  the  argument,  insisted  that  here  was  no 
benefit  derived  to  the  defendant,  as  there  was 
no  delivery  of  the  goods  to  the  defendant; 
but  Heath,  J.,  said:  "There  was  a  detriment 
moving  to  the  plaintiff,  which  is  a  good  con- 
sideration; for  in  consequence  of  his  forbear- 
ance, the  goods  were  afterward  taken  aud 
sold  on  an  execution  against  Abbott."  At  a 
subsequent  day  the  rule  was  discliaigcHl, 
Mansfield,  C.  J.,  saying:  "Wliat  is  this  but 
the  case  of  a  man,  who,  having  the  absolute 
power  of  selling  goods,  refrains  upon  the  re- 
quest of  another?  It  is  not  a  promise  to  pay 
another's  debt" 

The  cases  decided  in  this  state,  with  per- 
haps an  occasional  exception,  affirm  the  same 
rule,  even  if  they  do  not  carry  the  doctrine 
somewhat  further.  It  will  be  sufficient  for 
our  present  purpose,  however,  if  they  shaU  be 


found  to  be  substantially  in  accordance  with 
the  English  cases.  I  will  examine  them  very 
briefly: 

Sliiigerland  v.  Morse,  8  Johns.  474,  is  the 
earliest  reported  case  whore  this  question  was 
presented.  The  plaintiff  in  that  case  had  dis- 
trained the  goods  of  his  tenant  for  rent  The 
defendant  agreed  that  hu  would  deliver  the 
goods  in  six  days,  or  pay  the  amount  of  the 
rent,  and  thereupon  the  distre.ss  was  aban- 
doned and  the  goods  left  with  the  tenant 
This  was  held  to  be  an  original,  and  not  a 
collateral  undeilaking,  and  that  no  writing 
was,  therefore,  necessary.  It  was  decided, 
substantially,  upon  the  authority  of  Williams 
V.  Leper.  It  has  been  said  in  regard  to  this 
case,  that  it  may  perhaps  be  sustained  on  the 
ground  that  the  goods  were  a  fund  in  the 
hands  of  the  defendant,  from  the  possession 
of  which  his  liability  resulted.  But  in  an- 
swer to  this  it  is  only  necessary  to  say,  that 
no  such  reason  is  given  for  the  decision,  and 
in  the  case  it  is  expressly  stated  that  the 
goods  were  left  with  the  tenant 

The  cases  of  Skelton  v.  Brewster,  8  .Tolins. 
37G,  and  Gold  v.  Phillips,  10  Johns.  412,  I  do 
not  cite  in  this  connection;  for,  although  they 
both  recognize  the  doctrine  of  Chancellor  Kent 
in  Leonard  v.  Vredenburgh,  and  hold  the 
promise  good  because  it  was  founded  upon  a 
distinct  consideration  arising  between  the 
newly  contracting  parties,  yet,  as  in  both 
cases  property  had  been  delivered  to  the  de- 
fendant to  enable  him  to  discharge  the  debt, 
they  do  not  fall  within  that  precise  class  to 
which  this  case  belongs. 

The  case  of  Chapui  v.  Merrill,  4  Wend.  0.17, 
was  an  agreement  to  indemnify  another  for 
becoming  the  guarantor  of  a  third;  and  it 
was  held  not  to  be  within  the  statute,  and  is 
in  point  to  show  that  it  is  not  necessary  that 
tlie  defendant  should  receive  any  benefit  from 
what  w^as  done  by  the  plaintiff,  the  consid- 
eration in  that  case  being  purely  harm  to  the 
plaintiff. 

Jackson  v.  Rayner,  12  Jolms.  291,  is  some- 
times cited  as  conflicting  with  the  prior  cases 
of  Skelton  v.  Brewster  and  Gold  v.  Phillips, 
and  with  the  distinction  I  am  seeking  to  il- 
lustrate. It  clearly  does  not  with  the  latter, 
for  no  lien  was  surrendered  or  benefit  waived 
by  the  plaintiff.  The  case  came  fairly  within 
that  class  where  tlie  agreement  is  valid  by 
reason  of  property  being  placed  in  the  hands 
of  the  promisor  to  pay  the  debt,  in  consid- 
eration of  which  he  agrees  to  discharge  it. 
The  court  put  the  decision,  however,  upon  the 
express  ground  that  the  original  debt  was 
still  subsisting;  a  distinction  which  is  no 
longer  recognized.  There  cannot  be  a  doubt 
that  on  the  precise  state  of  facts  disclosed  in 
tbat  case,  the  decision  would  now  be  the  oth- 
er way. 

In  the  case  of  Gardiner  v.  Hopkins,  5  Wend. 
23,  the  plaintiff  had  a  lien  upon  the  sheets  of 
a  law-book  he  was  printing  for  one  Wiley, 
and  the  defendant  promised  that,  if  he  would 
deliver  the  sheets,  he  would  pay  the  balance 


136 


STATUTE  or  FRAUDS. 


of  his  account— tlie  claim  against  Wiley  still 
remaining  in  force.  The  case,  as  stated, 
leaves  it  a  little  uncertain  whether  the  de- 
livery was  made  to  Wiley,  or  to  the  defend- 
ant, who  was  his  assignee.  The  decision  pro- 
ceeded upon  ihe  ground  that  the  plaintiff 
gave  up  what  was  claimed  to  be  a  valid  lien, 
and  the  defendant  derived  a  benefit  from  the 
surrender  by  obtaining  the  property.  It  Is  not 
a  case  proceeding  upon  the  simple  ground  of 
a  lien  surrendered;  although,  if  that  had 
been  the  only  feature  presented,  I  think  it 
clear  the  verdict  would  have  been  sustained. 

The  case  of  Mercein  v.  Andrus,  10  Wend. 
461,  presented  the  precise  point.  The  plain- 
tiff had  a  levy  by  virtue  of  an  execution  upon 
the  property  of  one  Reed;  and  one  of  the  de- 
fendants agreed  that,  in  consideration  of  the 
release  of  the  levy,  the  defendants  would  pay 
the  plaintiff  $150  at  the  expiration  of  some 
eighty  days,  or  give  their  note  for  that 
amount.  The  judge  at  the  trial  ruled  that  a 
promise  founded  upon  the  consideration  of 
surrendering  up  property  levied  on  by  execu- 
tion is  an  original  undertaking  and  need  not 
be  in  writing;  and  on  the  other  ground,  of 
the  partnership  liability,  he  left  it  to  the  jury 
to  say,  upon  the  evidence,  whether  the  firm 
was  bound  by  what  had  been  shown  upon 
that  point  A  new  trial  was  granted  for  a 
misdirection  of  the  court  upon  this  branch  of 
the  case;  but  upon  the  other.  Chief  Justice 
Savage  stated  that  the  ruling  was  right,  and 
that  a  promise  made  upon  such  a  considera- 
tion as  appeared  in  the  case  was  not  within 
the  statute  of  frauds.  In  reference  to  this 
case,  it  is  said,  in  the  able  opinion  of  the  su- 
preme court  given  in  the  present  case  at  the 
general  term,  that  what  was  said  by  Judge 
Savage  in  his  decision  on  tliis  point  was  en- 
tirely obiter,  and  that  he  cited  no  authority  to 
support  his  conclusion.  I  cannot  agree  with 
the  learned  justice  who  gave  the  opinion,  on 
this  point  So  far  from  the  remark  being 
obiter,  the  precise  question  was  presented.  Lf 
the  ruling  at  the  circuit  had  been  wrong,  that 
would  have  been  an  end  of  the  case,  and  a 
new  trial  would  have  been,  perhaps,  unneces- 
sary on  the  other  ground.  If,  however,  it 
was  to  be  sent  back,  it  was  equally  necessary 
to  determine  the  other  question,  which  was 
vital  to  the  maintenance  of  the  action  itself; 
and  as  to  the  remark  that  no  authority  was 
cited,  the  chief  justice  probably  deemed  that 
the  doctrine  had  been  so  often  and  well  set- 
tled as  to  have  become  almost  elementary, 
and  requiring  no  array  of  cases  to  sustain  it. 

Indeed,  so  well  had  the  rule  been  establish- 
ed, that  in  the  case  of  Smith  v.  Weed,  20 
Wend.  184,  the  point  was  not  even  raised  by 
the  counsel  on  the  argument  It  presented 
the  case  of  a  naked  parol  promise  of  a  third 
person  to  pay  the  debt  to  the  plaintiff,  in  con- 
sideration of  the  release  of  an  attachment 
which  the  plaintiff  had  levied  on  the  property 
of  his  debtor;  and  the  court  held,  without  any 
hesitation,  that  the  lien  was  valid,  and  the  re- 
lease thereof  constituted  a  sufficient  considera- 


tion for  the  undertaking  of  the  defendant  to 
pay  the  debt.  Being  an  original  promise,  it 
was,  of  course,  not  within  the  statute. 

The  last  case  which  has  arisen  in  our  courts 
where  this  precise  question  has  been  present- 
etl  is  Fay  v.  Bell,  Lalor,  Supp.  251.  The  deci- 
sion is  brief,  but  emphatic,  and  is  given  by  an 
able  and  eminent  judge,  who,  until  his  recent 
lamented  decease,  continued,  with  intellectual 
vigor  unimpaired,  and  "natural  force"  almost 
unabated,  by  his  large  learning  and  ripened 
experience,  to  enlighten  the  tribimal  over 
which  he  once  presided.  The  facts  were 
briefly  these:  One  Daharch  had  employed  the 
plaintiff  to  mend  a  pair  of  boots.  The  work 
had  been  done,  and  the  boots  remained  in  the 
possession  of  the  plaintiff,  and  he  had,  of 
course,  a  lien  for  the  amount  of  his  charge. 
Upon  the  promise  of  the  defendant  to  pay  the 
demand,  the  boots  were  delivered  to  Daharclu 
There  was  a  recovery,  and  on  appeal  it  was 
Insisted  that  the  promise  was  within  the  stat- 
ute of  frauds;  but  the  coui't  held  otherwise. 
Beardsley,  J.,  who  gave  the  decision,  enters 
upon  no  argument  to  vindicate  it  He  simply 
says:  "It  was  a  new  imdertaking,  founded 
on  a  new  and  distinct  consideration,  to-wit, 
the  relinquishment  by  the  plaintiff  of  his  lien 
on  the  boots,  and  which  was  sufficient  to  up- 
hold the  promise  made.  It  was  not  within 
the  statute  of  frauds."  He  then  adds  the  au- 
thorities, some  ten  or  twelve  in  number, 
among  which  are  several  we  have  particular- 
ly considered.  Here,  then,  is  an  opinion  not 
obiter— not  unsustained,  but  fortified  by  au- 
thority, and  presenting  a  state  of  facts  abso- 
lutely identical  with  the  case  now  before  us. 
The  decision  has  never  been  questioned  or 
doubted  by  any  succeeding  case;  and  I  pro- 
pose to  abide  by  it,  as  a  clearly  expressed, 
well-considered  and  authoritative  exposition 
of  the  law,  and  which  determines  the  present 
case  in  favor  of  the  plaintiff.  Whatever  we 
might  be  disposed  to  say  of  this  as  an  orig- 
inal question— (and,  were  I  at  liberty  to  view 
it  as  such,  I  confess  I  should  find  diificulty  in 
so  construing  the  language  of  the  statute  as 
to  exempt  these  cases  from  its  operation) — I 
think  the  current  of  authority  has  too  long 
and  steadily  set  in  one  direction  to  be  now 
turned  aside,  and  that  the  rule  stands  too 
firmly,  not  only  "super  antiquas,"  but  "super 
novas  vias,"  to  be  disturbed. 

I  need  scarcely  add  that  the  cases  of  Barker 
V.  Bucklin,  2  Denio,  45,  and  Brewster  v.  Si- 
lence, 8  N.  Y.  207,  to  which  we  have  been 
referred  by  the  defendant's  counsel,  hold  no 
doctrine  whatever  inconsistent  with  the  great 
"cloud  of  witnesses"  that  have  been  summon- 
ed to  the  stand.  The  former  case  was  where 
property  had  been  sold  to  the  defendant,  in 
consideration  of  which  he  promised  to  pay  the 
debt  of  the  party  delivering  the  property  to 
the  plaintiff.  It  was  not  a  promise  to  pay  the 
debt  of  a  third  party  merely,  but  was,  in  ef- 
fect, an  agreement  to  pay  the  defendant's 
own  debt.  The  case  was  rightly  decided  upon 
all  the  authoritifcs,  and  it  was  unnecessary  to 


PKOMISE  TO  ANSWER  FOR  DEBT  OF  ANOTHER. 


137 


go  beyond  this  simple  and  plain  proposition  to 
upliold  the  recovery.  Tbe  case  of  Brewster 
V.  Silence  Is  purely  that  of  a  naked  written 
guaranty  to  pay  another's  debt,  expressing  no 
consideration.  The  court  hold  that  the  con- 
sideration could  not  be  supplied  by  parol 
proof.  There  was  no  preten.se  that,  in  con- 
sideration of  the  uudiTtaliiug,  any  lien  was 
Burrendered  or  right  relinquished  which  the 
plaintiCE  held,  and  which  was  operative  in  his 
hands.  Some  evidence  was  attempted  to  be 
given  on  the  trial  ttiat  the  property  was 
placed  In  the  hands  of  the  defendant,  on 
which  fact  his  undertaking  was  founded;  but 
the  court  of  appeals  held  that  this  was  not 
only  outside  of  the  issue,  but  that  the  evi- 
dence given  did  not  conduce  to  prove  the  point 
Bought  to  be  establis'.ied.  Tliis  case  also  fl- 
Dally   settled    the   doctrine    whicJ}    had    been 


floating  loosely  through  the  reports,  tlxat  a 
guaranty  could  not  be  changed  into  a  prom- 
issory note  so  as  to  charge  the  party  by  some 
other  contract  than  the  one  he  had  in  fact 
entered  into;  but  beyond  Uiis,  and  the  other 
proposition  that  a  guaranty  which  does  not 
express  the  consideration  is  void  under  the 
statute  of  frauds,  the  case  Is  not  to  be  in- 
voked as  authority  The  deci-slon  Is  not, 
tlierefore,  in  contlict  with  the  rule  which  is 
to  be  applied  to  this  case,  which  is  controlling 
upon  the  question  before  us. 

My  opinion  Is,  tliat  the  judgment  should  be 
reversed,  and  a  new  trial  granted,  with  costs 
to  abide  the  event 

DA  VIES  and  WRIGHT,  Ji^  also  dissented. 

Judgment  affirmed. 


138 


STATUTE  OF  FRAUDS. 


[o 


^ 


t\      MALLORY'S   ADM'K   v.    MALLORY'S^I/^ 


ADM'K  et  aL  i  " 

(17  S.   W.   737,  92  Ky.   316.) 
Court  of  Appeals  of  Kentucky.    Dec,  3,  1891. 

Appeal     from    circuit   court,   Todd   county. 

"To  be  officially  reported." 

Action  by  C.  L.  Mallory's  administrator 
against  A.  W.  Mallory's  administrator  and 
others  to  recover  personal  property.  Judg- 
ment for  defendants.  Plaintiff  appeals.  Re- 
versed. 

E.  W.  Hines  and  Ben  T.  Perkins,  Jr.,  for 
appellant.  BL  G.  Petrie  and  W.  B.  Rives,  for 
appellees. 

BENNETT,  J.  A.  W.  Mallory,  the  appel- 
lee's intestate,  was  a  widower  with  children, 
and  C.  I..  Mallory,  the  appellant's  intestate, 
was  a  widow  with  one  child,  a  son.  Both  of 
these  persons  owned  property,  and  married 
each  other.  The  husband,  the  appellee's  in- 
testate, died,  and  in  a  few  days  thereafter, 
and  before  the  personal  property  that  the 
statute  gives  to  the  widow,  and  which  is  to 
be  set  apart  to  her,  was  set  apart,  C.  L.  Mal- 
lory, wife  of  A  W.  Mallory,  and  the  appel- 
lant's intestate,  died.  This  suit  was  insti- 
tuted by  appellant's  administrator  to  recover 
of  the  appellee,  as  administrator,  the  value  of 
the  said  personal  property,  the  same  not  hav- 
ing been  set  apart,  and  was,  or  some  of  it,  on 
hand  at  the  death  of  A.  W.  Mallory,  but  dis- 
posed of  by  the  appellee.  The  contention  of 
appellee  is  that,  as  there  was  an  antenuptial 
contract  between  C.  L.  and  A.  W.  Mallory, 
that  entitled  each  to  retain  the  title  of  his 
and  her  property,  and  dispose  of  the  same  as 
though  no  marriage  had  taken  place,  C.  L. 
Mallory  was  not  entitled  to  the  property  that 
the  statute  directs  to  be  set  apart  to  the 
widow  upon  the  death  of  her  husband.  It  is 
not  alleged  that  the  antenuptial  contract  was 
in  writing;  and  as  chapter  22,  §  1,  requires 
contracts  in  consideration  of  marriage  to  be 
in  writing,  if  the  contract  relied  upon  comes 
within  said  provision.  It  was  necessary  to  al- 
lege that  the  contract  was  In  writing;  and  the 
answer,  because  of  not  alleging  that  fact,  is 
not  sufiic  ent.  Besides,  the  proof  fails  to 
show  that  the  contract  was  in  writing.  Does 
the  alleged  contract  come  within  said  provi- 
sion? It  seems  that  the  question  has  been 
settled  and  put  beyond  dispute  by  this  court 
in  the  case  of  Potts  v.  Merritt,  14  B.  Mon. 
406.  That  case,  like  this,  was  a  case  of  verbal 
and  antenuptial  contract,  and  the  Revised 
Statutes,  then  in  force,  had  the  same  provi- 
sion, as  to  requiring  the  antenuptial  contract 
to  be  in  \\Titing,  as  the  General  Statutes,  su- 
pra; and  this  court  held  that  the  contract  was 


not  enforceable,  in  law  or  in  equity,  unless 
it  was  in  writing.  An  antenuptial  contract 
is  one  by  which  the  parties  agree  to  antici- 
pate the  general  law  controlling  the  maritiil 
relation,  and  make  a  law  in  that  regard  to 
suit  themselves;  and  consideration  for  the 
contract  is  the  agreement  to  marry  each  other, 
which  must  be  consummated,  else  the  con- 
sideration fails.  So  the  contract  clearly 
comes  within  the  provision,  supra,  requiring 
contracts  in  consideration  of  marriage  to  be 
in  writing.  If  they  are  not  in  writing,  no  ac- 
tion can  be  maintained  on  them,  and,  in  a 
case  like  this,  such  contract  is  no  defense  to 
an  action  by  the  widow  or  her  representative 
to  enforce  her  marital  rights.  It  is  a  mistake 
to  say  that  the  property  that  chapter  31,  S 
11,  Gen.  St.,  directs  to  be  set  apart  to  the 
widow,  only  vests  in  the  widow  upon  the  set- 
ting the  same  apart  to  her.  By  said  statute 
the  right  to  a  certain  kind  of  property,  if  on 
hand,  if  not,  its  value,  etc.,  vests  eo  instanti, 
by  operation  of  law,  in  the  widow  upon  the 
death  of  her  husband.  The  setting  apart  of 
said  property  is  merely  for  the  purpose  of 
designating  the  individual  pieces  of  property, 
and  valuing  them,  and  supplying  their  places 
with  other  property  when  required.  Said 
property  vests  in  the  widow,  and  must  be  set 
apart  to  her  whether  or  not  she  has  any  in- 
fant children;  the  only  difference  being  that, 
if  there  are  no  infant  children  residing  in  the 
family,  there  shall  be  nothing  set  apart  for 
their  support.  The  case  of  Southerland  v. 
Southerland's  Adm'r,  5  Bush,  591,  is  relied  on 
as  establishing  the  fact  that  a  verbal  ante- 
nuptial agreement  is  valid  between  the  con- 
ti-acting  parties  and  volunteers.  The  leadin.i,' 
facts  of  that  case  are  that  the  husband  before 
marriage  verbally  agreed  that  his  intended 
v/ife  should  retain  her  slaves,  etc.,  after  mar- 
riage, as  her  separate  estate;  and  after  mar- 
riage, and  until  her  death,  he  uniformly  ad- 
hered to  that  agreement,  and  recognized  said 
property  as  her  separate  estate,  and  she  al- 
ways claimed  it  and  controlled  it,  as  such; 
and,  after  the  husband's  death,  the  court  said 
that,  as  between  volunteers  claiming  the  prop- 
erty by  virtue  of  the  husband's  marital  rights 
and  the  wife,  equity  would  uphold  that  agree- 
ment as  consistent  with  the  husband's  pow- 
er, he  being  sui  juris  all  the  time,  to  let  the 
wife  retain  her  property  as  her  separate  es- 
tate; but  the  wife  has  no  power  to  relinquish 
her  marital  rights  unless  she  pursues  the  law 
in  that  regard.  The  fact  that  the  agreement 
was  called  antenuptial  simply  had  reference 
to  the  fact  In  that  case  that  it  was  made  be- 
fore marriage.  The  judgment  is  reversed, 
and  cause  remanded  for  further  proceedings 
consistent  with  this  opinion. 


",1 


AGREEMENTS  RELATING  TO  LAND. 


133 


/>r 


May 


riAVILAND  V.  SAMMIS  et  aL 

(25  Atl.  394,  G2  Conn.  44.) 

Supreme  Court  of  Errors  of  Connecticut. 
28.   1892. 

Case  reserved  from  court  of  common  pleas, 
Fairfield  county. 

Action  by  Annie  C.  Haviland  against  Wil- 
liam A.  Samrais  and  others  to  recover  money 
paid  by  plaintiff  to  defendants  under  a  mis- 
apprehension, Ha  part  of  the  purchase  price 
of  land,  and  which  defendants  had  promised 
orally  to  repay.  Case  reserved  for  advice 
of  this  court  on  demurrer  to  the  complaint. 
Advice   that   the  demurrer  be   overruled. 

R.  Frost,  for  plaintiff.  M.  W.  Seymour  and 
H.   H.   Knapp.  for  defendants. 

ANDREWS,  C.  J.  The  complaint  alleges,  in 
substance,  that  on  the  2Gth  day  of  June, 
1SS8,  the  defendants  were  the  owners  of  a 
tract  of  land  on  West  avenue,  in  the  city 
of  Norwalk,  which  they  represented  to  the 
plaintiff  to  be  110  feet  wide;  that  the  plain- 
tiff, relying  on  their  representation,  agreed 
to  buy  the  land,  and  made  on  that  day  a 
part  payment  of  the  ^purchase  money,  and 
on  the  29th  day  of  the  same  month  paid 
the  balance  of  the  purchase  price  to  the  de- 
fendants; that  thereafter  the  defendants 
tendered  to  the  plaintiff  a  deed,  which  de- 
scribed the  land  to"  be  110  feet,  more  or  less, 
wide  on  West  avfcnue,  and  89  feet  wide  in 
the  rear.  Apparently  the  plaintiff  refused 
to  accept  the  deed,  for  the  complaint  avers 
"that  the  said  defendants,  by  their  said 
agent,  agreed  by  parol  with  the  plaintiff, 
through  her  said  agent,  that  if  she  would 
accept  said  deed  they  would  pay  her  the 
difference  between  the  value  of  the  tract 
described  in  the  deed  and  the  value  of  the 
tract  as  represented  by  them,  and  that  the 
plaintiff,  under  this  agreement,  accepted 
said  deed."  The  complaint  alleges  the  dif- 
ference in  the  value  to  be  .?7.50,  and  that 
the  defendants  have  refused  to  pay  it.  The 
plaintiff  claims  damages  to  the  amoimt  of 
$800.  The  defendants  demur  to  the  com- 
plaint, "because  it  appears  from  the  allega- 
tions thereof  that  the  agreement  upon  which 
the  plaintiff  seeks  to  maintain  her  action, 
if  any  such  was  made,  was  for  the  sale 
of  real  estate,  or  an  interest  in  or  concern- 
ing it,  and  was  bj*  parol,  and  not  in  writing, 
as  required  by  the  statute  of  frauds."  The 
proposition  of  law  maintained  by  the  de- 
fendants, "that  when  an  entire  and  indivis- 
ible contract  is  partially  within  the  statute 
of  fraiids,  the  whole  is  avoided  by  the  stat- 
ute if  that  part  is  by  parol,"  is  undoubtedly 
correct.  But  this  case  is  not  affected  by 
that  proposition.  The  defendants  had  con- 
tracted to  convey  to  the  plaintiff  a  certain 
piece  of  land,  for  which  she  had  paid  them. 


They  propo.sed  to  convey  a  smaller  piece. 
She  refused  to  accept  it.  They  then  say  to 
her:  "If  you  will  accept  the  deed  of  the 
smaller  piece,  we  will  return  to  you  the 
difference  in  value  between  the  piece  of  land 
we  agreed  to  convey  to  you  and  the  piece  of 
land  which  in  fact  we  do  convey  to  you." 
The  promise  to  return  the  excess  of  money 
is  not  affected  by  any  sale  of  land. 

Analj'ze  the  transaction  between  these 
parties  more  minutely,  and  this  becomes 
clear.  The  defendants  had  had  negotia- 
tions with  the  plaintiff  by  which  they  had 
contracted  to  convey  to  her  a  certain  piece 
of  land,  for  which  she  had  paid  them. 
They  tender  her  a  deed  of  a  smaller  piece, 
which  she  refuses  to  accept.  At  that  mo- 
menj  all  contract  for  the  sale  of  th:it  piece 
'fi?~lnnjj  js^nt  nn  end"  "ThTTrtlle'parties  be- 
gin to  negotiate  for  the  sale  by  the  defend- 
ants to  the  plaintiff  of  a  different  piece  of 
land,— a  smaller  piece.  The  plaintiff  con- 
sents to  take  a  smaller  piece  at  a  smaller 
price.  This  is  a  new  contract.  A  deed  is 
given  and  accepted.  The  price  had  been 
paid.  All  contracts  respecting  land  or  any 
interest  in  or  concerning  land  between  these 
parties  were  then  concluded, — executed  on 
both  sides.  But  the  money  representing  the 
difference  in  price  between  the  piece  of  land 
agreed  by  the  first  negotiation  to  be  con- 
veyed and  the  price  of  the  land  actually 
conveyed  remained  in  the  hands  of  the  de- 
fendants. They  had  promised  to  return  it 
to  the  plaintiff.  They  have  not  done  so. 
This  action  is  brought  to  recover  it.  "The 
statute  of  frauds  does  not  apply  to  such  an 
action,  whether  brought  on  an  implied  or 
upon  an  express  agreement.  The  obligation 
to  repay  the  money  advanced  by  the  plam- 
Tnr  is  indepeudenT  of  the  character  of__the 
consideration  upon  which  the  advance_was 
made.-  And  if  an  express  promise  to  that 
effect  be  separable  from  the  principal  agree- 
ment to  which  it  is  an  Incident,  it  may  be 
enforced,  although  the  principal  agreement 
might  be  avoided.  The  fact  that  a  certain 
stipulation  is  made  at  the  same  time,  and 
forms  a  part  of  an  arrangement  for  the  sale 
of  an  interest  in  land,  does  not  prevent  an 
action  from  being  maintained  upon  it:  pro- 
vided—First, that  the  action  does  not  tend 
to  enforce  the  sale  or  purchase  of  the  in- 
terest in  land;  and,  second,  that  in  other 
respects  the  stipulation  is  susceptible  of  be- 
ing separately  enforced  by  action.  Such 
stipulations,  collateral  to  the  sale,  but  con- 
tained in  the  same  contract,  have  been  re- 
peatedly enforced."  Wetherbee  v.  Potter, 
99  Mass.  354.  3G1;  Wilkinson  v.  Scott,  17 
Mass.  258;  Hall  v.  Solomon.  Gl  Conn.  47G. 
23  Atl.  S7G.  The  court  of  common  pleas  is 
advised  to  overrule  the  demurrer.  The  other 
judges  concurred. 


STATUTE  OF  FRAUDS. 


MUMFORD  T.  WHITNi.j..i 
(15  Wend.  oSO.) 


Supreme  Ccurt  of  New   York.    May,  1836. 


This  was  an  action  on  tlie  case  tried  at  the 
Monroe  circuit,  in  April,  1S32,  before  the  Hon. 
Addison  Gardiner,  one  of  the  circuit  judges. 

The  suit  was  brought  for  the  recovery  of 
damages  for  the  flowing  of  lands,  by  the  erec- 
tion of  a  dam  by  the  defendant,  in  the  Genesee 
river.  The  plaintiff  showed  title  to  the  prem- 
ises, and  proved  the  injury  alleged  Ln  his  dec- 
laration. The  dam  complained  of  was  erected 
in  1S26,  abutting  upon  the  land  of  the  plain- 
tiff and  partly  placed  upon  it.  The  defendant 
proved  a  parol  licence  from  the  plaintiff  for 
the  erection  of  the  dam,  and  also  insisted  that 
the  plaintiff  had  recognized  its  existence  in 
deeds  executed  by  him,  conveyiag  mill-sites 
suppUed  with  water  for  hydraulic  purposes  by 
means  of  such  dam.  To  support  this  groimd 
of  defence  the  defendant  gave  in   evidence: 

(1)  A  deed  from  the  plaintiff  to  one  Sylvester 
Felt,  bearing  date  1st  December,  1825,  convey- 
ing a  mill-site,  on  a  canal  situate  on  the  west- 
erly side  of  the  river,  which  was  supplied  with 
water  from  the  westerly  channel  of  the  Gen- 
esee river,  formed  by  an  island  near  Rochester 
owned  by  the  plaintiff;  together  with  the 
privilege  of  taking  such  proportion  of  the 
water  as  the  w-idth  of  the  lot  conveyed,  bore 
to  the  whole  length  of  the  line  of  the  canal; 
to  be  held  and  enjoyed  in  common  with  the 
other  proprietors  upon  the  canal,  and  subject 
to  a  proportion  of  the  expense  of  repairs,  t&c. 

(2)  A  contract  dated  2d  December,  1825, 
whereby  the  plaintiff  agreed  to  convey  unto 
one  Silas  Ball  a  lot  upon  the  same  canal,  with 
the  same  rights  as  to  the  use  of  water,  and 
subject  to  the  same  limitations  and  restrictions 
as  c-ontaincd  in  the  plaintiff's  deed  to  Sylves- 
ter Felt  And  (3)  a  deed  from  the  plaintiff  to 
Sidney  S.  Allcott,  dated  7th  April,  1828,  con- 
veying another  lot  on  the  canal,  with  the  like 
privilege  of  water  and  with  the  like  condi- 
tions as  contained  in  the  deed  to  Felt  and  in 
the  contract  with  Ball;  and  then  proved  that 
those  several  lots  were  supplied  with  water 
for  hydraulic  purposes  by  means  of  the  dam 
erected  by  the  defendant.  To  rebut  this  evi- 
dence, it  was  shown  on  the  part  of  the  plain- 
tiff, that  previous  to  182G  the  canal  mentioned 
in  the  plaintiff's  deeds  was  supplied  with  wa- 
ter by  means  of  a  dam  erected  across  the  Gen- 
esee river  in  1812,  at  the  upper  or  southerly 
end  of  the  island  owned  by  the  plaintiff,  the 
half  of  which  dam  was  cut  away  in  1824,  by 
one  Solomon  Cleveland,  an  owner  of  property 
on  the  east  side  of  the  river,  who  then  erected 
a  dam  near  the  lower  or  northerly  end  of  the 
island,  which,  after  being  carried  off  by  a 
freshet,  rebuilt,  and  again  swept  away,  was 
replaced  in  1826  by  the  dam  in  question.  The 
plaintiff  also  proved  that  the  deed  from  him 
to  Allcott  was  executed  pursuant  to  the  terms 

1  Irrelevant  parts  omitted. 


of  a  contract  entered  into  between  him  and 
Allcott  in  October,  1825,  and  that  the  descrip- 
tion of  the  lot  with  the  water  privileges  con- 
nected therewith,  as  expressed  in  the  deed, 
had  been  taken  verbatim  from  the  contract. 

Several  minor  questions  arose  on  the  triaL 
The  plaintiff  had  examined  a  witness  as  to 
declarations  made  by  the  defendant  at  and 
about  the  time  of  the  erection  of  the  dam  Ln 
1826,  and  of  and  concerning  such  erection. 
The  defendant's  counsel,  on  the  cross-exam- 
ination of  the  same  witness,  asked  him  wheth- 
er, in  the  same  conversation,  the  defendant 
had  said  that  the  plaintiff  had  given  his  con- 
sent to  the  erection  of  the  dam.  The  plain- 
tiff's counsel  objected  to  proof  of  the  defend- 
ant's declarations,  except  for  the  purpose  of 
explaining  the  declarations  called  for  by  the 
plaintiff,  and  insisted  that  the  defendant  was 
not  entitled  to  give  proof  of  his  own  declara- 
tions upon  a  distinct  subject,  although  made  in 
the  course  of  the  same  conversation.  The 
judge  overruled  the  objection,  and  the  witness 
testified  that  the  defendant  did  at  that  time 
say  that  the  plaintiff  had  consented  to  the 
erection  of  the  dam.  Another  question  arose 
as  follows:  it  was  proved,  on  the  part  of  the 
plaintiff,  that  in  1824  an  agreement  took  place 
between  him  and  Cleveland,  who  cut  away 
the  old  dam  in  1824,  in  respect  to  the  build- 
ing of  a  dam  on  the  site  of  the  dam  subse- 
quently erected,  in  1826;  that  the  agreement 
was  reduced  to  writing,  but  not  executed; 
that  Cleveland  took  a  copy  of  it  to  show  to 
others  interested  in  the  mattei",  and  that  short- 
ly afterwards  he  commenced  the  erection  of 
the  dam.  After  showing  these  facts,  the 
plaintiff  offered  the  agreement  thus  reduced 
to  writing  in  evidence;  but  the  judge  refused 
to  receive  it.  The  witness  who  had  given  this 
account  of  the  written  agreement,  also  testi- 
fied that  Cleveland,  at  the  time,  agreed  to  con- 
struct a  stone  wall  along  the  east  line  of  the 
island,  to  protect  it  from  injui-y;  and  after 
giving  such  testimony,  the  plaintiff's  counsel 
enquired  of  the  witness  whether  it  was  under- 
stood between  the  plaintiff  and  Cleveland, 
that  Cleveland  should  not  build  the  dam,  im- 
less  he  built  a  wall  to  secure  the  island.  To 
this  enquiry  the  defendant's  counsel  objected, 
and  was  sustained  by  the  judge. 

The  judge  charged  the  jury,  as  to  the  ground 
of  defence  assumed  by  the  counsel  for  the  de- 
fendant, that  by  virtue  of  the  plaintiff's  con- 
tract and  deed,  executed  previous  to  the  year 
1826,  the  grantee  acquired  the  right  to  locate 
the  dam  in  question  where  it  had  been  placed, 
or  to  maintain  it,  that  those  instruments  were 
to  be  construed  in  reference  to  the  actual  state 
of  things  and  the  nature  of  the  plaintiff's 
rights,  and  could  have  no  application  to  the 
dam  erected  in  1826;  and  also  that  those  in- 
struments could  not  be  used  by  the  defendant 
as  constituting  an  estoppel  to  the  plaintiff's 
right  of  action  against  the  defendant,  because 
the  defendant  was  not  a  party  to  them;  but 
he  charged  them  that  a  licence,  by  the  plain- 
tiff to  the  defendant  and  others,  to  construct 


AGREEMENTS  RELATING  TO  LAND. 


141 


the  dam  in  question,  would  constitute  a  valid 
defence  to  the  action,  because  the  plaintiff 
would  thus  be  a  party  to  the  nuisance,  and 
he  could  not  recover  for  any  injury  it  produ- 
ced, and  submitted  the  evidence  on  the  sub- 
ject of  the  licence  to  the  consideration  of  the 
jury.  The  judge  also  charged  the  jury  that 
the  conveyance  by  the  plaintiff  to  Allcott  of 
mill  privileges  and  the  right  of  using  water 
on  the  canal,  referred  to  and  adopted  the 
means  of  furnishing  water  to  the  canal  as 
they  existed  at  the  date  of  the  deed,  and  as 
the  present  dam  was  then  erected  the  deed 
was  a  full  confirmation  and  recognition  of  it, 

and    that   such    confirmation    and    recognition 

» 
applied  to  the  effects  of  the  dam   upon   the 

property  of  the  plaintiff.  He  told  the  jury 
that  it  had  been  fully  proved  that  the  plaintiff 
had  sustained  some  Injury,  and  that  as  to  the 
measure  of  damages,  they  were  the  exclusive 
judges.  The  jury  found  a  verdict  for  the  de- 
fendant. The  plaintiff's  counsel  having  ex- 
cepted to  the  charge  of  the  judge  and  to  va- 
rious decisions  in  the  progress  of  the  trial, 
now  moved  to  set  aside  the  verdict. 
The  cause  was  argued  by 

J.  C.  Spencer,  for  plaintiff.  F.  M.  Haight 
and  D.  D.  Barnard,  for  defendant 

SAVAGE,  C.  J.  The  questions  are:  (1) 
Whether  the  defendant  was  entitled  to  prove 
his  own  decLirations,  made  in  the  same  con- 
versation about  which  the  plaintiff  had  ex- 
amined the  witness;  (2)  whether  the  copy  of 
the  agreement  reduced  to  writing,  but  not  ex- 
ecuted, should  have  been  received  in  evidence; 
(3)  whether  the  witness  should  have  been  per- 
mitted to  testify  as  to  the  licence  being  con- 
ditional; (4)  whether  a  parol  licence  in  this 
case  is  valid;  (5)  whether  the  deed  to  Allcott 
was  a  recognition  of  the  dam  erected  by  the 
defendant 

4.  Suppose,  however,  the  licence  to  have 
been  properly  and  fully  proved,  was  It  valid 
and  available  as  a  defence  to  this  action? 
Did  it  purport  to  convey  an  interest  in  or  con- 
cerning the  lands  of  the  plaintiff,  which  re- 
quired an  agreement  in  writing?  The  9th  sec- 
tion of  the  statute  of  frauds  of  1S13  (1  R.  L. 
78,  §  9)  declares  that  all  leases,  estates,  in- 
terest of  freeholds  or  terms  of  years,  or  any 
uncertain  interests  of,  in,  to  or  out  of  any 
lands,  made  by  parol  and  not  in  writing,  shall 
have  tlie  effect  of  estates  at  will  only.  This 
clause  excepts  leases  for  three  years.  The 
10th  section  declnr<?s  that  no  such  interest 
shall  be  assigned,  granted  or  surrendered,  un- 
less in  writing.  The  11th  section  declares 
that  no  action  shall  be  brought  upon  any 
contract  for  sale  of  lands,  or  any  interest  in 
or  concerning  them,  unless  the  agreement  be 
In  writing.  It  must  be  conceded  that  the  de- 
cisions on  the  question,  what  is  an  interest  in 
lands  within  the  meaning  of  the  statute,  are 
not  easily  reconcilable  with  the  statute  or 
with  each  other.     In  an  old  case,  before  the 


passing  of  the  29  Car  I  (Webb  v.  Paternoster, 
Palm.  71),  a  licence  was  given  to  a  party  to 
erect  a  stack  of  hay  till  he  might  conven- 
iently sell  it;  it  stood  two  years,  and  then 
a  lease  of  the  land  was  granted  to  a  stran- 
ger, who  gave  notice  to  remove  it,  and  half  a 
year  after  turned  his  beasts  into  the  field, 
who  ate  the  hay;  yet  because  of  the  c<ju- 
venient  time  to  remove,  the  judgment  was 
for  the  defendant  Vmer,  Abr.  tit  "Licence," 
F,  pi.  2.  Upon  the  authority  of  this  case, 
It  is  said  by  Mr.  Sugden  (Sugd.  Vend.  M), 
the  case  of  Wood  v.  Lake,  Sayer,  3,  was  de- 
termined. There  was  a  parol  agreement  to 
stack  coals  on  part  of  a  close  for  seven  yeai-s, 
with  the  use  of  that  part  of  the  close.  The 
court  held  the  agreement  good.  They  said 
the  agreement  was  only  for  an  easement,  and 
not  for  an  interest  in  the  land;  It  did  not 
amount  to  a  lease,  and  it  was  held  good  for 
seven  years.  It  has  been  held  that  timber 
growing  may  be  sold  by  parol  (1  Ld.  Kaym. 
182);  but  grass  growing  cannot  because  such 
a  contract  is  a  sale  of  an  interest  in,  or  at 
least  an  interest  concerning  lands  (Crosby  v. 
Wadsworth,  6  East  Gil).  So,  also,  that  a 
sale  of  turnips  growing  must  be  in  writing 
(2  Taunt.  38);  but  in  the  case  of  Parker  v. 
Stainland,  11  East  3G2,  a  parol  sale  of  pota- 
toes in  the  ground  was  held  valid,  and  not 
witliin  the  statute.  The  difference  between 
this  case  and  Crosby  v.  Wadsworth,  as  stated 
by  Lord  Ellenborough,  is  this:  that  in  that 
case  the  contract  for  the  grass  was  made 
while  growing,  but  the  contract  was  for  the 
potatoes  in  a  matured  state.  The  grass  was 
to  ^ow  before  cut,  but  the  potatoes  were  to 
be  removed  immediately.  In  this  court,  how- 
ever. It  has  been  expressly  adjudged  that 
wheat  or  com  growing  is  a  chattel,  and  may 
be  levied  on  and  sold  as  such  by  virtue  of 
an  execution.  2  Johns.  418,  421;  9  Johns. 
112;  9  Cow.  42.  The  case  of  Crosby  v.  Wads- 
worth. was  doubted  by  Spencer,  J.,  in  Frear 
V.  Hardenbergh,  5  Johns.  27G,  where  he  re- 
marks that  the  statute  could  have  in  view, 
to  avoid  such  agreements  in  relation  to  lauds 
as  rested  in  parol,  only  where  some  interest 
was  to  be  acquired  in  the  land  itself,  and  not 
such  as  were  collateral,  and  Dy  which  no  kind 
of  interest  was  to  be  gained  by  the  agree- 
ment, in  the  land.  A  licence  to  enter  upon 
land  does  not  purport  to  convey  an  Interest 
In  the  land;  it  is  sxibstantially  a  promise, 
without  anf  consideration  to  support  it  and 
while  it  remains  executory,  may  be  revoked 
at  pleasure;  but  when  executed,  it  in  general 
can  only  be  revoked  by  placing  the  other 
party  in  the  same  situation,  in  which  he 
stood  before  he  entered  on  its  execution.  So 
a  promise  to  give  may  be  rescinded  before 
execution,  but  not  after.  It  is  said,  however, 
that  if  a  rule  of  law  would  be  transgressed 
b.v  holding  an  executed  licence  irrevocable,  it 
cannot  be  done;  tlie  law  must  stand  and  the 
licence  be  revoked.  Hammond.  N.  P.  207. 
In  the  case  of  Winter  v.  Brockwoll,  8  East, 
308,  the  plaintiff  complained  that  the  defend- 


142 


STATUTE  OF  FRAUDS. 


aut  had  placed  a  sky  light  over  an  opening 
area  above  the  plaintifif's  window,  by  means 
of  which  light  and  air  were  prevented  from 
entering.  The  defence  was,  that  the  area 
belonged  to  the  defendant's  house,  and  the 
sky  light  was  put  over  it  by  the  express 
consent  and  appi-obation  of  the  plaintiff  be- 
fore the  enclosure,  who,  after  it  was  done, 
gave  notice  to  have  it  removed.  Lord  Ellen- 
borough,  before  whom  the  cause  was  tried, 
was  of  opinion  that  the  licence  of  the  plain- 
tiff having  been  acted  upon  and  expense  in- 
curred, it  could  not  be  recalled  without  offer- 
ing to  pay  aU  expenses  incurred  under  it. 
The  defendant  had  a  verdict,  and  a  new- 
trial  was  denied.  On  the  trial,  the  question 
was  raised,  whether  a  parol  licence,  as  this 
was,  was  good  by  the  statute  of  frauds,  but 
it  was  overruled.  In  Taylor  v.  Waters,  7 
Taunt.  374,  it  was  held  that  a  beneficial  li- 
cence to  be  exercised  upon  land  may  be  grant- 
ed without  deed  and  without  writing.  The 
plaintiff  was  the  bearer  of  an  opera  ticket 
which  gave  him  admission  to  the  opera  house 
for  twenty-one  years,  and  was  denied  admis- 
sion by  the  defendant,  for  which  an  action 
was  brought.  One  ground  of  defence  was, 
that  this  was  an  interest  in  land,  and  could 
not  pass  without  a  writing.  To  this  it  was 
answered  that  it  was  not  an  interest  in  land, 
but  a  licence  irrevocable  to  permit  the  plain- 
tiff to  enjoy  certain  privileges  thereon,  and 
therefore  need  not  be  in  writing;  and  of  this 
opinion  was  the  court.  Gibbs,  C.  J.,  cited  the 
cases  of  Webb  v.  Paternoster,  Winter  v. 
Brockwell,  and  Wood  v.  Lake,  and  remarks: 
"These  cases  abundantly  prove  that  a  licence 
to  enjoy  a  beneficial  privilege  on  Land  may  be 
granted  without  deed,  and  notwithstanding 
the  statute  of  frauds  without  writing." 

These  cases  relate  to  some  privilege  to  be 
exercised  upon  the  land.  The  case  of  Fent- 
iman  v.  Smith,  4  East  108,  decides  that  a 
parol  licence  to  make  a  tunnel  through  the 
defendant's  land,  to  cairy  water  to  the  plain- 
tiff's mill,  was  revocable  at  any  time.  The 
defendant  had  agreed  for  the  consideration  of 
a  guinea,  to  be  paid  by  the  plaintiff,  to  let 
the  plaintiff  lay  a  ttmnel  through  his  land  for 
can-j'ing  the  water;  and  even  assisted  in 
making  it;  but  there  was  no  conveyance.  The 
guinea  was  afterward  tendered,  but  the  de- 
fendant refused  to  receive  it,  and  cut  a  chan- 
nel, by  which  the  water  was  diverted.  Lord 
Ellenborough  says,  the  title  to  have  the  wa- 
ter flowing  in  the  tunnel  over  the  defendant's 
land  could  not  pass  by  parol  licence,  without 
deed;  and  if  by  licence,  it  was  revocable  at  any 
time.  A  case  in  some  respects  resembling 
the  last  is  found  in  14  Serg.  &  R.  2G7.  Kern 
sued  Rurick  in  a  court  of  common  pleas,  for 
diverting  a  watercourse,  in  consequence  of 
which  he  lost  the  use  of  his  saw-mill.  It 
appeared  that  before  he  built  his  mill  he  ap- 
plied to  Rurick  for  permission  to  turn  the 
water  from  what  was  called  the  right  hand 
stream  into  the  left  hand  stream,  which,  with- 
out the  water  of  the  former,  would  have  been 


wholly  insufficient;  permission  was  given  to 
turn  the  stream  through  R.'s  land,  but  no 
deed  was  given,  nor  any  consideration  paid; 
a  mill  was  built  on  the  left  hand  stream, 
which  would  not  have  been  done  but  for  the 
permission  to  turn  the  water.  Subsequently 
R.,  the  defendant  below,  turned  away  the 
water  of  the  right  hand  stream.  The  coiu"t 
below  decided,  in  substance,  that  the  licence 
might  have  been  revoked  before  Kern  had 
incurred  the  expense  of  building  his  mill,  on 
the  faith  of  Rurick's  promise;  or  he  might 
have  revoked  it,  if  it  had  been  given  after  the 
mill  had  been  built,  but  not  after  he  had  in- 
duced Kern  to  be  at  the  expense  of  btiilding 
his  mifl.  Upon  a  writ  of  error  brought  into 
the  supreme  court  the  plaintiff's  counsel  re- 
lied upon  the  above  case  of  Fentiman  v.  Smith, 
and  Dexter  v.  Hazen,  10  Johns.  240,  where 
the  defendant,  having  given  permission  to 
the  plaintiff  to  pass  over  liis  land  with  teams, 
revoked  it;  and  the  court  said  that  it  was 
a  mere  licence,  gratuitously  given,  and  rev- 
ocable at  pleasure,  being  still  executory. 
On  the  other  side  it  was  contended  that  the 
licence  was  irrevocable,  after  expense  had 
been  incurred  upon  the  faith  of  such  licence; 
and  it  was  compared  to  a  parol  gift  of  land, 
accompanied  with  possession,  and  also  that 
it  was  a  fraud  for  Rurick  to  witness  the  ex- 
penditure of  money  upon  his  land,  and  after- 
wards revoke  his  licence.  Gibson,  J.,  gave 
the  opinion  of  the  court,  and  held  that  a  li- 
cence may  become  an  agreement  on  valuable 
consideration,  as  when  the  grantee  has  made 
improvements  or  invested  capital  in  conse- 
quence of  it,  he  has  become  a  purchaser  for  a 
valuable  consideration.  He  held  that  equity 
would  decree  the  specific  performance  of  such 
an  agreement.  That  a  right,  under  a  licence, 
when  not  specially  restricted,  is  commensu- 
ate  with  the  thing  of  which  the  licence  is 
accessory;  that  relating  to  a  permanent  evic- 
tion, it  was  of  unlimited  duration.  It  had 
been  previously  decided  in  that  court,  in  the 
case  of  Le  Fevre  v.  Le  Fevre,  4  Serg.  &  R. 
241,  that  after  the  execution  of  a  deed,  con- 
veying a  right  to  lay  down  pipes  to  conduct 
water  through  the  granted  land  by  courses 
and  distances,  the  route  might  be  altered  by 
parol,  and  be  valid,  after  it  was  carried  into 
effect. 

This  subject  has  been  viewed  very  differ- 
ently by  the  supreme  court  of  Massachusetts, 
in  Cook  V.  Steams,  11  Mass.  53G.  That  was 
an  action  of  trespass,  for  entering  upon  the 
plaintiff's  close,  and  digging  up  his  soil.  The 
defendant  pleaded  that  he  was  the  owner 
of  a  mill  and  dam,  near  the  plaintiff's  close; 
part  of  the  dam  being  made  upon  tlie  plain- 
tiff's close,  by  the  consent  of  the  then  owners; 
and  that  it  was  necessary  to  repair  the  same, 
and  the  defendant  entered  for  the  purpose  of 
repairing.  The  plaintiff  demurred,  assigning 
for  cause,  that  there  was  no  conveyance.  For 
the  defendant  it  was,  among  other  things, 
contended  that  there  was  a  licence,  which 
being  once  executed  was  not  revocable.    Par- 


AGREEMENTS  RELATING  TO  LAND. 


143 


ker,  C.  J.,  gave  the  opinion  of  the  court,  and 
states  the  defendant's  claim  a  permanent  in- 
terest In  the  plaintiff's  close;  a  right  to  main- 
tain the  dam  and  canal,  which  was  formerly 
placed  there  by  consent;  and  to  enter  at  any 
time,  to  make  repairs.  This,  he  says,  is  an 
interest  in  lands  which  cannot  pass  without 
deed  or  writing.  The  coun.sol  for  the  defend- 
ant had  contended  that  such  a  licence  might 
be  by  parol,  and  that  it  could  not  be  counter- 
manded. The  learned  judge  says:  "This  ar- 
gument had  some  plausiliility  In  it,  when  first 
stated;  but  upon  more  mature  consideration 
It  seems  to  have  no  foundation  in  principles 
of  law.  A  licence,  he  says,  is  technically  an 
authority  given  to  do  some  one  act,  or  series 
of  acts,  on  the  land  of  another,  without  pass- 
ing any  estate  in  the  land:  as  to  hunt,  to  cut 
down  trees;  these  are,  when  executory,  rev- 
ocable, but  not  when  executed;  but  licences 
which,  in  their  nature,  amoimt  to  the  grant- 
ing of  an  estate,  for  ever  so  short  a  time,  are 
not  good,  without  deed,  and  are  considered  as 
leases,  and  must  be  pleaded  as  such."  He 
adds:  "The  distinction  Is  obvious.  Licences 
to  do  a  particular  act  do  not,  in  any  degree, 
trench  upon  the  policy  of  the  law,  which  re- 
quires that  bargains  respecting  the  title  or 
interest  in  real  estate  shall  be  by  deed,  or  in 
writing.  They  amount  to  nothing  more  than 
an  excuse  for  the  act,  which  would  otherwise 
be  a  trespass;  but  a  permanent  right  to  hold 
another's  Land  for  a  particular  purpose,  aud 
to  enter  upon  it  at  all  times,  without  his  con- 
sent, is  an  important  interest,  which  ought 
not  to  pass  without  writing,  and  is  the  very 
object  provided  for  by  our  statute."  He  con- 
cedes that  the  licence  authorized  the  partic- 
ular act,  but  not  a  repetition  of  it;  and  says, 
that  the  transfer  of  the  land  to  another  was 
.1  countermand  of  the  licence.  The  court  held 
the  plea  bad,  not  showing  such  a  licence  as 
may  be  pleaded,  and  the  interest  claimed 
being  not  in  the  nature  of  a  licence  but  of 
an  estate,  or  at  least  an  easement  in  the 
land,  which  cannot  be  acquired  without  writ- 
ing or  prescription,  or  such  a  possession  as 
furnishes  a  presumption  of  a  grant.  If  the 
plea  were  held  to  be  a  bar  to  the  action,  all 
the  mischiefs  and  uncertainties  which  the 
legislature  intended  to  avoid,  by  requiring 
such  bargains  to  be  put  in  writing,  would  be 
revived;  and  purchasers  of  estates  would  be 
without  the  means  of  knowing  whether  in- 
cumbrances existed  or  not  on  the  land  which 
they  purchase. 

In  Ex  parte  Coburn,  1  Cow.  570,  this  court 
said,  that  a  right  of  way  is  a  real  or  chattel 
interest,  according  to  the  term  of  its  duration, 
and  the  former  is  well  known  as  an  incor- 
poreal hereditament;  not  so  of  a  licence  to 
enter  upon  anothei''s  land,  without  considera- 
tion. This  is  not  an  interest,  it  Is  a  mere 
authority,  revocable  at  any  moment;  not  In 
Its  nature  assignable,  but  limited  to  the  per- 
son of  the  grantee.  Giving  permission  to 
walk  over  one's  land  is  but  an  excuse  for  a 
trespass.     The  case  of  Thompson  v.  Gregory, 


4  Johns.  81,  has  been  much  relied  on  by  the 
plaintiff's  counsel,  as  containing  the  princi- 
ple for  which  he  contends.  Thompson  sued 
Gregory,  for  damages  for  overflowing  his 
land,  by  means  of  a  dam  on  Gregory's  own 
land.  The  defence  set  up  was  that  S.  Van 
Rensselaer  had  leased  both  plaintiff's  and 
defendant's  land,  and  reserved  to  himself  and 
his  assigns  the  privilege  of  building  dams  and 
flowing  lands,  and  that  this  right  had  been  as- 
signed by  parol  to  the  defendant  The  court 
say  the  right  in  question  could  not  pass  by 
parol;  the  right  reserved  to  the  grantor  was 
an  incorporeal  here<litament.  It  was  not  the 
land  Itself,  but  a  right  annexed  to  it,  and  it 
could  only  pass  by  grant.  No  such  interest 
could  be  assigned  or  granted  without  writ- 
ing, according  to  the  express  provision  of  the 
statute  of  frauds.  And  in  Jackson  v.  Buel, 
9  Johns.  298,  it  was  held  that  ejectment  would 
lie  by  the  grantor  for  such  a  reservation. 
Chancellor  Kent,  in  his  Commentaries, 3  Kent, 
Comm.  452,  says,  that  the  modern  cases  dis- 
tinguish between  an  easement  and  a  license. 
A  claim  for  an  easement  must  be  founded 
upon  grant,  by  deed  or  writing,  or  upon  pre- 
scription which  presupposes  one,  for  it  Is  a 
permanent  interest  In  another's  land,  with  a 
right,  at  all  times,  to  enter  and  enjoy  it;  but 
a  license  is  an  authority  to  do  a  particular 
act,  or  a  series  of  acts  upon  another's  land, 
without  possessing  any  estate  therein.  It  is 
founded  In  personal  confidence,  and  Is  not 
assignable.  This  distinction  between  a  priv- 
ilege or  easement  carrying  an  interest  in  land, 
and  requiring  a  writing  within  the  statute 
of  frauds  to  support  it,  and  a  license  which 
may  be  by  parol,  is  quite  subtle,  and  it  be- 
comes diflicult,  in  some  of  the  ca.ses,  to  di.s- 
cem  a  substantial  difference  between  them. 

I  shall  not  undertake  to  reconcile  these  vari- 
ous cases.  It  Is  evident  the  subject  has 
been  understood  very  differently  by  different 
judges.  But  in  this  all  agree,  that  according 
to  the  statute  of  frauds,  any  permanent  in- 
terest In  the  land  itself,  cannot  be  trans- 
ferred, except  by  writing.  Much  of  the  dis- 
crepancy may  have  arisen  from  the  different 
ideas  attached  to  the  word  license.  If  we 
understand  it  as  Chancellor  Kent  defines  It. 
it  seems  to  me  there  can  be  no  difficulty.  It 
Ls  an  authority  to  do  a  particular  act  upon 
another's  land;  Is  founded  In  personal  con- 
fidence, and  is  not  assignable.    For  example. 

A.  agrees  with  B.  that  B.  may  hunt  or  fish 
on  his.  A.'s  land;  A.  thereby  gives  B.  a  li- 
cence for  that  purpose.  This  gives  B.  no  In- 
terest in  the  land;  he  cannot  authorize  an.\ 
other  person  to  go  upon  the  land;  it  is  a  per- 
sonal privilege  granted  to  B.  alone.  If,  aft- 
er A.  has  given  his  consent,  and  before  B. 
has  entered  upon  his  land  A.  changes  his 
mind,  he  has  a  right  to  do  so,  and  forbid  B. 
from  entering  upon  his  land  for  the  specified 
purpose.  The  licence  is  thus  far  executory, 
and  may  be  revoked  at  pleasure;  if  B.  after- 
wards enters,  he  is  a  trespasser.    If.  however, 

B.  enters  before  any  revocation  of  licence,  the 


144 


STATUTE  OF  FRAUDS. 


licence  is  then  executed;  and  it  is  not  com-  ; 
petent  for  A.  to  revoke  it,  and  make  B.  a 
trespasser.  This  doctrine  is  applicable  only 
to  tlie  temporary  occupation  of  land,  and  con- 
fers no  right  nor  interest  in  the  land.  If 
A.  agrees  wit±i  B.  that  he  may  enter  upon  his 
land,  and  occupy  it  for  a  year,  that  is  not 
properly  speaking,  a  licence  merely;  it  is 
more— it  Is  a  lease,  and  if  no  term  be  speci- 
fied in  the  agreement,  it  is  an  estate  at  will. 
If  the  period  of  occupation  expressed  or  im- 
plied previous  to  1S30  was  more  than  three 
years,  it  required  an  agreement  in  writing  to 
support  it.  If  there  was  no  written  agree- 
ment, the  right  of  occupancy  could  certainly 
uot  extend  beyond  three  years.  Where  an 
Interest  greater  than  a  temporary  occupation 
was  to  be  created,  it  might  be  an  easement, 
as  a  right  of  way;  such  an  easement  is,  or 
may  be,  a  permanent  interest  in  the  land 
over  which  the  right  of  way  exists,  and  must 
be  founded  upon  grant  or  prescription,  which 
supposes  a  grant  Such  an  interest  is  not 
properly  a  licence;  it  may  be  assigned,  and 
cannot  be  revoked.     If  A.  agree  with  B.  that 


B.  may  build  a  dam  upon  the  land  of  A., 
or  across  an  island,  as  in  the  present  case,  if 
It  is  to  be  permanent,  or  any  thing  more 
than  a  mere  temporary  erection,  such  an 
agreement  is  not  technically  a  licence.  The  ob- 
ject of  A.  is  to  grant,  and  of  B.  to  acquire 
an  interest  which  shall  be  permanent;  a  right 
not  to  occupy  for  a  short  time,  but  as  long 
as  there  shall  be  employment  for  the  water 
power  to  be  thus  created;  can  such  an  inter- 
est, such  a  right  be  created  by  parol?  As 
Mr.  Sugden  says  of  the  case  of  Wood  v. 
Lake,  "It  appears  to  be  in  the  very  teeth  of 
the  statute  which  extends  generally  to  all 
leases,  estates  or  interests."  It  declares  that 
all  leases,  estates,  interest  of  freehold,  or 
terms  of  years,  or  any  uncertain  interests,  of. 
in,  to  or  out  of  any  lands,  made  by  parol, 
and  not  in  writing,  shall  have  the  effect  of 
estates  at  will  only.  To  decide  that  a  right 
to  a  permanent  occupation  of  the  plaintiff's 
land  may  be  acquired  by  parol,  and  by  call- 
ing the  agreement  a  licence,  would  be  Id 
efiCect  to  repeal  the  statute. 


AGREEMENTS  RELAX rXG  TO  LAND. 


145 


A 


GREEN    v.    ARMSTRONG.!         / 

(1  Denio.  550.)  ^/ 

Snpr«mt   Court  of  New   York.    Oct.,   1845, 

O.  S.  Williams,  for  plaintiff  in  error.  John 
Dean,  for  defendant  in  error. 

BEARDSLEY,  J.  A  verbal  contract  was 
made  between  these  parties,  by  which  the  de- 
feudiint  agreed  to  sell  certain  trees  then 
standing  and  growing  on  his  land,  to  the  plain- 
tiff, with  liberty  to  cut  and  remove  the  same 
at  any  time  within  twenty  years  from  the 
maldng  of  the  contract  A  part  of  the  trees 
were  cut  and  removed  under  this  agreement, 
but  the  defendant  then  refused  to  permit  any 
more  to  be  taken,  and  for  this  the  plaintiff 
brought  his  action  In  the  justice's  court,  where 
a  judgment  was  rendered  in  his  favor.  On 
the  trial  of  the  cause  the  defendant  objected 
to  proof  of  such  parol  contract,  but  the  ob- 
jection was  overruled.  The  judgment  was 
removed  by  certiorari  to  the  court  of  common 
pleas  of  Oneida  county,  and  was  reversed  by 
that  court,  on  the  ground,  as  the  record  states, 
that  the  contract,  not  being  in  writing,  was 
void  by  the  statute  of  frauds. 


The  Revised  Statutes  declare  that  no  "in- 
terest in  lands"  shall  be  created,  unless  by 
deed  or  conveyance  In  writing;  and  that 
every  contract  for  the  sale  of  "any  interest 
in  lands"  shall  be  void  unless  in  writing. 
2  Rev.  St  134,  §§  6,  8.  Certain  exceptions 
and  qualifications  to  these  enactments  are 
contained  in  the  sections  referred  to,  but 
none  which  touch  the  question  now  before 
the  court:  and  so  far  as  respects  this  ques- 
tion the  former  statute  of  New-York,  and  the 
English  statute  of  29  Car.  II.  c  3,  contain 
similar  provisions.  1  R.  L.  1813,  p.  78;  Chit 
Cent.  299. 

The  precise  question  in  this  ease  is,  wheth- 
er an  agreement  for  the  sale  of  growing 
trees,  with  a  right  to  enter  on  the  land  at 
a  future  time  and  remove  them,  is  a  con- 
tract for  the  sale  of  an  interest  in  land.  If 
it  is,  it  must  foUow  that  the  one  declared  on 
in  this  case,  not  being  In  writing,  was  in- 
valid, and  the  judgment  of  the  common 
pleas,  reversing  that  of  the  justice,  was  cor- 
rect and  must  be  affirmed. 

And  In  the  outset  I  must  observe,  that  this 
question  has  not,  to  my  knowledge,  been  de- 
cided in  this  state.  It  has,  however,  arisen  in 
the  English  courts,  and  in  some  of  those  of 
our  sister  states;  but  their  decisions  are 
contradictory,  and  the  views  of  individual 
judges  wholly  irreconcilable  with  each  other. 
Greenl.  Ev.  (2d  Ed.)  §  271,  and  notes;  Chit 
Cont  299-302;  4  Kent,  Comm.  (5th  Ed.) 
450,  451.  We  are,  therefore,  as  it  seems  to 
me.  at  fuU  liberty  to  adopt  a  broad  prin- 
ciple, if  one  can  be  found,  which  will  de- 
termine this  precise  question  in  a  manner 
which  our  judgments  shall  approve,  and  es- 


1  Irrelevant  parts  omitted. 

HOPK.  SEL.  CAS.  CONT. — 10 


pocially  if  It  be  equally  applicable  to  other 
and  analogous  cases. 

By  the  statute,  a  contract  for  the  sale  of 
"any  interest  in  lands"  is  void  unless  in  writ- 
ing. The  word  land  is  comprehensive  in 
its  Import,  and  includes  many  things  be- 
sides the  earth  we  tread  on,  as  waters, 
grass,  stones,  bulldlng.-i,  fences,  trees  and 
the  like;  for  all  tliese  may  be  conveyed  by 
the  general  designation  of  land.  1  Shep. 
Touch,  (by  Preston),  91;  1  Inst.  4;  1  Pres- 
ton, Est  8;  2  Bl.  Comm.  17,  18;  1  Rev.  St 
387,  §  2;  2  Rev.  St  137,  §  G.  Standing  trees 
are  therefore  part  and  parcel  of  the  land  in 
which  they  are  rooted,  and  as  such  are  real 
property.  They  pass  to  the  heir  by  descent 
as  part  of  the  inheritance,  and  not  as  per- 
sonal chattels  do,  to  the  executor  or  ad- 
ministrator. Toller,  Ex'rs,  193-195;  2  Bl. 
Comm.  (by  Chitty)  122,  note;  Rob.  Frauds, 
3a5,  SCO;  Liford's  Case,  11  Coke,  40;  Com. 
Dig.  "Biens,"  (H)-  And  being  strictly  real 
property,  they  cannot  be  sold  on  an  execution 
against  chattels  only.  Scorell  v.  Boxall,  1 
Younge  &  J.  39G;  Evans  v.  Roberts,  5  Barn. 
&  C.  829. 

It  is  otherwise  with  growing  crops,  as 
wheat  and  corn,  the  annual  produce  of  labor 
and  cultivation  of  the  earth;  for  these  are 
personal  chattels,  and  pass  to  those  entitled 
to  the  personal  estate,  and  not  to  the  heir. 
ToUer,  150,  194;  2  Bl.  Comm.  404.  They 
may  also  be  sold  on  execution  like  other  per- 
sonal chattels.  Whipple  v.  Foot  2  Johns. 
418;  Jones  v.  Flint,  10  Adol.  &  E.  753; 
Peacock  v.  Purvis,  2  Brod.  &  B.  302;  Hart- 
well   V.   Bissell,    17  Johns.    128. 

These  principles  suggest  the  proper  dis- 
tinction An  interest  in  personal  chattels 
may  be  created  without  a  deed  or  convey- 
ance in  writing,  and  a  contract  for  their 
sale  may  be  valid  although  by  parol.  But 
an  interest  in  that  which  is  land,  can  only 
be  created  by  deed  or  written  conveyance: 
and  no  contract  for  the  sale  of  such  an  in- 
terest is  valid  unless  in  writing.  It  is  not 
material  and  does  not  affect  the  principle, 
that  the  subject  of  the  sale  will  be  personal 
property  when  transferred  to  the  purchaser. 
K,  when  sold,  it  is,  in  the  hands  of  the 
seller,  a  part  of  the  land  itself,  the  contract 
is  within  the  statute.  These  trees  were  part 
of  the  defendant's  land  and  not  his  personal 
chattels.  The  contract  for  their  sale  and 
transfer,  being  by  parol,  was  therefore  void. 
The  opinion  of  the  court  In  the  case  of 
Dunne  v.  Ferguson,  1  Hayes,  542,  contains 
one  of  the  best  illustrations  of  this  question. 
That  case  is  thus  •  stated  in  Steph.  N.  P. 
1971:  "The  facts  of  the  case  were,  that  in 
October,  1830,  the  defeudant  sold  to  the 
plaintiff  a  crop  of  turuipo,  which  he  had 
sown  a  short  time  previously,  for  a  sum  less 
tliau  ten  pounds.  In  Februaiy,  1831,  and 
previously,  while  the  turnips  were  still  in 
the  groimd,  the  defendant  severed  and  car- 
ried away  considerable  quantities  of  them, 
which  he  converted  to  his  own  use.    No  note 


146 


STATUTE  OF  FRAUDS. 


In  writing  was  made  of  ttie  bargain.    It  was 
contended  for  the  defendant,  tliat  the  action 
of  trover  did  not  lie  for  tilings  annexed  to 
the  freehold,  and  that  the  contract  was  of 
no  validity  for  want  of  a  note  or  memoran- 
dum in  writing  pursuant  to  the  statute  of 
frauds.      Upon    the    foregoing    facts    Chief 
Baron  Joy  observed  (Barons  Smith,  Fenne- 
feather  and   Foster,   concurring):    'The  gen- 
eral  question  for   our   decision  is,   whether 
there   has   been  a   contract   for  an   interest 
concerning  lands,  within  the  second  section 
of  the  statute  of  frauds?  or  whether  it  mere- 
ly concerned  goods  and  chattels?    And  that 
question  resolves  itself  into  another,  whether 
or  not  a  growing  crop  is  goods  and  chattels? 
In  one  case  it  has  been  held,  that  a  contract 
for  potatoes  did  not  require  a  note  in  writ- 
ing, because  the  potatoes  were  ripe:  and  in 
another   case,    the    distinction   turned   upon 
the  hand  that  was  to  dig  them,  so  that  if 
dug  by  A.  B.  they  were  potatoes,  and  if  by 
C.  D.  they  were  an  interest  in  lands.     Such 
a  course  always  involves  the  judge  in  per- 
plexity, and  the  case  in  obscurity.    Another 
criterion    must,    therefore,    be    had    recourse 
to;    and,  fortunately,   the  later  cases   have 
rested  the   matter  on  a  more  rational  and 
solid  foundation.     At  common  law,  growing 
crops  were  imiformly  held  to  be  goods;  and 
they  were  subject  to  all  the  leading  conse- 
quences of  being  goods,  as  seizure  in  exe- 
cution,   &C.     The    statute    of    frauds    takes 
things  a.-:*   it  find?   them,   and    provides   for 
lands  and  goods  according  as  they  were  so 
esteemed  before  its  enactment    In  this  way 
the  questit^n  may  be  satisfactorily  decided. 
If,   before  tJie   statute,   a  growing  crop  has 
been    held    to    be   a:a    interest    in   lands,    it 
woxOd  come  witbin  the  second  section  of  the 
act,  but  if  it  were  only  goods  and  chattels, 
then  it  esjoae  within  the  thirteenth  section. 
On  t>i/>,  the  only  rational  ground,  the  cases 


of  Evans  v.  Roberts^  5  Bam.  &  C.  S29; 
Smith  V.  Surman,  9  Barn.  &  C.  561;  and. 
Scored  V.  Boxall,  1  Younge  &  J.  396,— have 
been  decided.  And  as  we  think  that  grow- 
ing crops  have  all  the  consequences  of  chat- 
tels, and  are  like  them,  liable  to  be  taken  in 
execution,  we  must  rule  the  points  saved  for 
the  plaintiff.'  " 

Various  other  decisions  have  proceeded  on 
the  same  principle,  although  it  has  no  where 
been  stated  and  illustrated  with  the  same 
clearness  and  force  as  m  the  opinion  of 
Chief  Baron  Joy. 

The  following  cases  may  be  cited  to  show 
that  growing  crops  of  grain  and  vegetables, 
fructus  industriales,  being  goods  and  chat- 
tels, and  not  real  estate,  may  be  conveyed 
by  a  verbal  contract,  as  they  may  also  be 
sold  on  execution  as  personal  chattels.  Car- 
rington  v.  Roots,  2  Mees.  &  W.  248;  Sams- 
bury  V.  Matthews,  4  Mees.  &  W,  343;  Ran- 
dall V.  Ramer,  2  Johns.  421,  note;  Mumford 
V.  Whitney,  15  Wend.  387;  Austin  v.  Sawyer, 
9  Cow.  39;  Jones  v.  Flint,  10  Adol.  &  E. 
753;  Warwick  v.  Bruce,  2  Maule  &  S.  205; 
Graves  v.  Weld,  5  Barn.   &  Adol.  105. 

But  where  the  subject  matter  of  a  contract 
of  sale,  is  growing  trees,  fruit  or  grass,  the 
natural  produce  of  the  earth,  and  not  annual 
productions  raised  by  manurance  and  the 
industry  of  man,  as  they  are  parcel  of  the 
land  itself,  and  not  chattels,  the  contract, 
in  order  to  be  valid  must  be  In  writing. 
Teal  V.  Auty,  2  Brod.  &  B.  99;  Putney  v. 
Day,  6  N.  H.  430,  Olmstead  v.  NUes,  7  N.  H. 
522;  Crosby  v.  Wads  worth,  6  East,  602; 
Rodwell  V.  PhUlips.  9  Mees.  &r.  W.  501;  Jones. 
V.  Flint,  10  Adol.  &  K  753. 

The  contract  in  this  case  was  within  the 
statute,  and  being  by  parol  was  void.    The 
judgment,  of  the  common  pleas  must  be  af- 
firmed. 
Judgment  affirmed. 


.^ 


AGREEMENTS  RELATING  TO  LAND. 


147 


V 


/>  0>  I  HIRTH   V.   GRAHAM.1 

[7  (33  N.  E.  90,  50  Ohio  St.  57.) 

SuprenjL'   Court  of   Ohio.    Jan.   24,   1893. 

Error  to  circuit  court,  Morrow  couuty. 

Action  for  breach  of  contract  by  one  Hirth 
against  one  Graham.  PlaiutifC  recovered  a 
judj;uieut  before  a  justice  of  the  peace  of 
Morrow  couuty,  which,  upon  error  being 
brouj4ht  to  the  court  of  common  pleas,  was 
alhrmed.  The  case  was  then  talien  on  error 
to  the  circuit  court,  where  the  judgments  of 
the  court  of  common  pleas  and  of  the  justice 
were  both  reverscnl,  and  plaintiff  brings  er- 
ror.   AfUrmed. 

James  H.  Beebe,  for  plaintiff  in  error.  An- 
drews &  Simms,  for  defendant  in  error. 

BRADBURY,  J.  The  plaintiff  in  error 
brought  an  action  before  a  justice  of  the 
peace  to  recover  of  tbe  defendant  in  error 
damages  alleged  to  have  been  sustained  on 
account  of  the  refusal  of  the  latter  to  per- 
form a  contract  by  which  he  had  sold  to  the 
plaintiff  in  error  certain  growing  timber. 
The  defendant  attempted  to  secure  the  dis- 
missal of  the  action,  on  the  ground  that  the 
justice  had  no  jurisdiction  of  an  action  for 
the  breach  of  such  a  contract.  Failing  in 
this,  and  the  action  being  tried  to  a  jury,  he 
requested  the  justice  to  instruct  the  jury 
"that  if  they  find  from  the  evidence  that  the 
trees  at>out  which  this  action  is  brought  were 
at  the  time  of  said  alleged  contract  then  grow- 
ing upon  the  land  of  defendant,  and  that  no 
note  or  contract  or  memorandum  was  made 
of  the  contract  of  sale  was  at  the  time  made 
in  writing,  the  plaintiff  cannot  maintain  this 
action,  and  your  verdict  should  be  for  tbe  de- 
fondant,"  which  instruction  the  justice  re- 
fused to  give,  but  on  the  contrary  gave  to 
them  the  following  instructions  on  the  sub- 
ject: "This  is  an  action  for  damage,  not  on 
the  contract,  nor  to  enforce  the  same;  and  if 
you  find  that  a  contract  was  made  verbal  or 
otherwise  and  the  defendant  refused  or  fail- 
ed to  comply  with  its  terms,  the  plaintiff  is 
entitled  to  any  damage  you  may  find  him  to 
liave  sustained  by  way  of  such  noncompli- 
ance." The  defendant  in  error,  who  was  also 
the  defendant  in  the  justice's  court,  excepted, 
both  to  the  charge  as  given  and  to  the  re- 
fusal to  charge  as  requested;  the  verdict  and 
judgment  being  against  him,  he  embodied 
tlie  cliargo  as  given,  as  well  as  that  refused, 
in  separate  bills  of  exceptions,  and  brought 
the  cause  to  the  court  of  common  pleas  on 
error,  where  the  judgment  of  the  justice  of 
the  peace  was  attirmed.  He  thereupon 
brought  error  to  the  circuit  court,  where  the 
judgments  of  the  court  of  common  pleas  and 
tliat  of  the  jtistice  were  both  reversed,  and 
it  is  to  reverse  this  judgment  of  the  circuit 
court,  and  reinstate  and  affirm  those  of  the 
court  of  common  pleas  and  justice  of  the 
peace,  that  this  proceeding  is  pending. 


1  Irrelevant  parts  omitted. 


Ckiun.sel  for  plaintiff  in  error  contends  that 
the  record  contains  nothing  to  show  that  the 
trees  which  were  the  subject  of  the  contract 
were  standing  or  growing,  and  that  there- 
fore it  does  not  appear  that  the  defendant 
was  injured  by  the  In.structions  given  and  re- 
fused. The  record  does  not  support  this  con- 
tention. During  the  trial  three  separate  bills 
of  exceptions  were  taken,  and,  when  all  of 
them  are  considered  together.  It  clearly  ap- 
pears that  evidence  was  given  tending  to 
prove  .that  the  trees,  the  subject  of  the  con- 
tract, were  growing  on  the  land  at  the  time 
it  was  made,  and  that  the  contract  was  not 
evidenced  by  any  note  or  memorandum  in 
writing.  The  instruction  refused  was,  there- 
fore, pertinent,  and  if  It  contained  a  sound 
legal  proposition  the  refusal  to  give  it  in 
charge  to  the  jury  was  prejudicial  to  the  de- 
fendant. The  court,  however,  not  only  re- 
fused to  give  the  instructions  requested  by  the 
defendant,  but  told  the  jury  in  substance  that 
no  written  memorandum  was  necessary. 

Whether  a  sale  of  growing  trees  Is  the  sale 
of  an  interest  in  or  concerning  land  has  long 
been  a  much  controverted  subject  In  the 
courts  of  England,  as  well  as  in  the  courts 
of  the  several  states  of  the  Union.  The  ques- 
tion has  been  differently  decided  in  different 
jurisdictions,  and  by  different  courts,  or  at 
different  times  by  the  same  court  within  the 
same  jurisdiction.  The  courts  of  England, 
liarticularly,  have  varied  widely  in  their  lioUl- 
ings  on  the  subject.  Lord  Mansfield  held  that 
the  sale  of  a  crop  of  growing  turnips  was 
within  this  clause  of  the  statute.  Emmereon 
V.  Heelis,  2  Taunt.  3S,  following  the  case  of 
Waddington  v.  Bristow,  2  Bos.  &  P.  452, 
where  the  sale  of  a  crop  of  growing  hops  was 
adjudged  not  to  have  been  a  sale  of  goods 
and  chattels  merely.  And  in  Crosby  v.  Wads- 
worth,  6  East,  602,  the  sale  of  growing  grass 
was  held  to  be  a  contract  for  the  sale  of  an 
interest  in  or  concerning  land.  Ivord  Ellen- 
borough  saying:  "  Upon  the  first  of  these 
questions,"  (whether  this  purchase  of  the 
growing  crop  be  a  contract  or  sale  of  lands, 
tenements,  or  hereditximents,  or  any  interest 
in  or  concerning  them,)  "I  think  that  the 
agreement  stated,  conferring,  as  it  professes 
to  do,  an  exclusive  right  to  the  vesture  of  the 
land  during  a  limited  time  and  for  given  pur- 
poses, is  a  contract  or  sale  of  an  interest  in, 
or  at  least  an  interest  conceniing.  lands."  Id. 
010.  Afterwards,  in  Teal  v.  Auty,  2  Brod.  & 
B.  99,  the  erv.rt  of  common  pleas  held  a  con- 
tract for  the  sale  of  growing  poles  was  a  sale 
of  an  interest  in  or  concerning  lands.  Many 
decisions  have  been  announced  by  the  Eng- 
lish courts  since  the  cases  above  noted  were 
decided,  tlie  tendency  of  which  have  been  to 
greatly  narrow  the  application  of  the  fourth 
section  of  the  statute  of  frauds  to  crops,  or 
timber,  growing  upon  land.  Crops  planted 
and  raised  annually  by  the  hand  of  man  are 
practically  withdrawn  from  its  operation, 
while  t-he  sale  of  other  crops,  and  in  some  in- 


148 


STATUTE  or  FRAUDS. 


stances  growing  timber,  also,  are  withdrawn 
from  the  statute,  where,  in  the  contemplation 
of  the  contracting  parties,  the  subject  of  the 
contract  is  to  be  treated  as  a  chattel.  The 
latest  declaration  of  the  English  courts  upon 
this  question  is  that  of  the  common  pleas  di- 
vision of  the  high  court  of  justice,  in  Mar- 
shall V.  Green,  1  C.  P.  Div.  35,  decided  in 
1S75.  The  syllabus  reads:  "A  sale  of  grow- 
ing timber  to  be  taken  away  as  soon  as  pos- 
sible by  the  purchaser  is  not  a  contract  or 
sale  of  land,  or  any  interest  therein,  within 
the  fourth  section  of  the  statute  of  frauds." 
This  decision  was  rendered  by  the  three  jus- 
tices who  constituted  the  common  pleas  divi- 
sion of  the  high  court  of  justice,  Coleridge, 
C.  J.,  Brett  and  Grove,  JJ.,  whose  characters 
and  attainments  entitle  it  to  great  weight; 
yet,  in  view  of  the  prior  long  period  of  un- 
settled professional  and  judicial  opinion  in 
England  upon  the  question,  that  the  court 
was  not  one  of  final  resort,  and  that  the  de- 
cision has  encountered  adverse  criticism  from 
high  authority  (Benj.  Sales  [Ed.  1892]  §  126), 
it  cannot  be  considered  as  finally  settling  the 
law  of  England  on  this  subject.  The  con- 
flict among  the  American  cases  on  the  sub- 
ject cannot  be  wholly  reconciled.  In  Mas- 
sachusetts, Maine,  Maryland,  Kentucky,  and 
Connecticut  sales  of  growing  trees,  to  be  pres- 
ently cut  and  removed  by  the  vendee,  are 
held  not  to  be  within  the  operation  of  the 
fourth  section  of  the  statute  of  frauds.  Claf- 
lin  V.  Carpenter,  4  Mete.  (Mass.)  580;  Nettle- 
ton  V.  Sikes,  8  Mete.  (Mass.)  34;  Bostwick  v. 
Leach,  3  Day,  476;  Erskine  v.  Plummer,  7 
Me.  447;  Cutler  v.  Pope,  13  Me.  377;  Cain  v. 
McGuire,  13  B.  Mon.  340;  Byassee  v.  Reese,  4 
Mete.  (Ky.)  372;  Smith  v.  Bryan,  5  Md.  141. 
In  none  of  these  cases,  except  4  Mete.  (Ky.) 
373,  and  in  13  B.  Mon.  340,  had  the  vendor 
attempted  to  repudiate  the  contract  before 
the  vendee  had  entered  upon  its  execution, 
and  the  statement  of  facts  in  those  two  cases 
do  not  speak  clearly  upon  this  point.  In  the 
leading  English  case  before  cited,  (Marshall 
v.  Green,  1  C.  P.  Div.  35,)  the  vendee  had  also 
entered  upon  the  work  of  felling  the  trees, 
and  had  sold  some  of  their  tops  before  the 
vendor  countermanded  the  sale.  These  cases, 
therefore,  cannot  be  regarded  as  directly  hold- 
ing that  a  vendee,  by  parol,  of  growing  tim- 
ber to  be  presently  felled  and  removed,  may 
not  repudiate  the  contract  before  anything  is 
done  under  it;  and  this  was  the  situation  in 
which  the  parties  to  the  case  now  under  con- 
sideration stood  when  the  contract  was  re- 
pudiated. Indeed,  a  late  case  In  Massa- 
chusetts, (Giles  V.  Simonds,  15  Gray,  441), 
holds  that  "the  owner  of  land,  who  has  made 
a  verbal  contract   for  the   sale   of   standing 


wood  to  be  cut  and  severed  from  the  free- 
hold by  the  purchaser,  may  at  any  time  re- 
voke the  license  which  he  thereby  gives  to 
the  purchaser  to  enter  his  land  to  cut  and  car- 
ry away  the  wood,  so  far  as  it  relates  to  any 
wood  not  cut  at  the  time  of  the  revocation." 
The  courts  of  most  of  the  American  states, 
however,  that  have  considered  the  question, 
hold  expressly  that  a  sale  of  growing  or 
standing  timber  is  a  contract  concerning  an 
interest  in  lands,  and  within  the  fourth  sec- 
tion of  the  statute  of  frauds.  Green  v.  Arm- 
strong, 1  Deuio,  550;  Bishop  v.  Bishop,  11  N. 
Y.  123;  Westbrook  v.  Eager,  16  N.  J.  Law, 
81;  Buck  V.  PickweU,  27  Vt  157;  Cool  v.  Lum- 
ber Co.,  87  Ind.  531;  Terrell  v.  Frazier,  79 
Ind.  473;  Owens  v.  Lewis,  46  Ind.  488;  Ann- 
strong  V.  Lawson,  73  Ind.  498;  Jackson  v. 
Evans,  44  Mich.  510,  7  N.  W.  79;  Lyle  v.  Shin- 
nebarger,  17  Mo.App.66;  Howe  v.  Batchelder, 
49  N.  H.  204;  Putney  v.  Day,  6  N.  H,  430; 
Bowers  v.  Bowers,  95  Pa.  St.  477;  Daniels  v. 
Bailey,  43  Wis.  506;  Lillie  v.  Dunbar,  62  Wis. 
198,  22  N.  W.  467;  Knox  v.  Haralson,  2  Tenn. 
Ch.  232.  The  question  is  now,  for  the  first 
time,  before  this  court  for  determination; 
and  we  are  at  liberty  to  adopt  that  rule  on 
the  subject  most  conformable  to  sound  rea- 
son. In  all  its  other  relations  to  the  affairs 
of  men,  growing  timber  is  regarded  as  an  « 
I  Integral  part  of  the  land  upon  which  it  stands;  / 
'it  is  not  subject  to  levy  and  sale  upon  execu-, 
tion  as  chattel  property;  it  descends  with  the 
land  to  the  heir,  and  passes  to  the  vendor 
with  the  soil.  Jones  v.  Timmons,  21  Ohio  Sti 
1596.  Coal,  petroleum,  building  stone,  and] 
many  other  substances  constituting  integral 
parts  of  the  land,  have  become  articles  of 
commerce,  and  easily  detached  and  removed, 
and,  when  detached  and  removed,  become 
personal  property,  as  well  as  fallen  timber; 
but  no  case  is  foimd  in  which  it  Is  suggested 
that  sales  of  such  substances,  with  a  'view  to 
their  immediate  removal,  would  not  be  with- 
in the  statute.  Sales  of  growing  timber  are 
as  likely  to  become  the  subjects  of  fraud  and 
perjury  as  are  the  other  integral  parts  of  the 
land,  and  the  question  whether  such  sale  is  a 
sale  of  an  Interest  in  or  concerning  lands 
should  depend  not  upon  the  intention  of  the 
parties,  but  upon  the  legal  character  of  the 
subject  of  the  contract,  which,  in  the  case  of 
growing  timber,  is  that  of  realty.  This  rule 
has  the  additional  merit  of  being  clear,  sim- 
ple, and  of  easy  application, — qualities  en- 
titled to  substantial  weight  In  choosing  be- 
tween conflicting  principles.  Whether  cir- 
cumstances of  part  performance  might  re- 
quire a  modification  of  this  rule  is  not  be- 
fore the  court,  and  has  not  been  considered. 
Judgment  aflirmed. 


0,1 


AGREEMENTS  NOT  TO  BE  PERPOliMED   WITHIN  A  YEAR 


149 


7 


BLAKE  V.  COLE.i 

17  (-22  Pick.  97.) 

Supreme   Judicial    Court    of   Massachusetts. 
Mii-ch  Term,  1839. 

This  was  an  action  brought  by  the  plaintiff 
as  administrator  of  the  estate  of  Jabez  Hatcii 
senior,  deceased,  to  recover  the  sum  of  $2UO0 
paid  by  the  plaintiff  as  such  administrator  to 
the  use  of  the  defendant 

At  the  trial,  before  Sluiw,  C.  J.,  it  appeared, 
that  on  the  11th  of  August,  1834,  the  plain- 
tiff's intestate  and  the  defendant  became  sure- 
ties on  a  bond  at  the  probate  otiice,  given  by 
Jabez  Hatch  junior  (son  of  the  intestate)  as 
principal,  on  his  appointment  as  the  adminis- 
ti'ator  of  one  Gallagher;  tliat  the  principal 
made  default,  and  he  and  his  sureties  be- 
came liable  to  tlie  amount  of  $400<J;  and  that 
the  plaintiff,  as  administrator  of  Hatch  senior, 
was  duly  called  upon  to  pay,  and  out  of  the 
assets  of  his  intestate  did  pay  that  sum,  as 
surety.  And  he  brought  this  suit  against  the 
defendant  as  his  co-suretj*,  for  a  conlributiou. 

The  defence  was,  that  the  defendant  was  in- 
duced to  sign  the  bond  by  the  express  request 
of  Hatch  senior,  and  upon  his  verbal  promise 
to  indemnify  the  defendant  and  save  him 
harmless  from  any  responsibility  he  might  in- 
cur by  reason  of  his  so  becoming  surety. 

This  defence  was  placed  upon  two  grounds 
in  law:  (1)  That  a  parol  promise  to  indemnify 
againsta  responsibility  undertaken  upon  request, 
is  a  good  and  valid  contract,  and  not  within 
the  statute  of  frauds;  and  if  the  defendant 
had  been  called  upon  as  surety,  he  might 
have  maintained  an  action  against  the  intes- 
tate, and  after  liis  decease,  against  the  plain- 
tiff, for  the  whole  amount  thus  paid;  and  (2) 
that  even  if  an  action  could  not  have  been 
maintained  in  such  case,  yet  when  the  party 
at  whose  express  request  the  bond  was  ex- 
ecuted by  one  surety,  has  been  obliged  to  pay 
money  in  consequence  of  such  sm-etyship,  he 
has  no  legal  claim  for  contribution  against 
the  surety  who  executed  it  at  his  request 
Both  of  these  groimds  were  contested  by  the 
plaintiff. 

Mr.  Blake,  pro  se.  W.  Phillips  and  Robbins, 
for  defendant 

PUTNAM,  J.,  delivered  the  opinion  of  the 
court  No  question  can  be  made  of  the  gen- 
eral rule,  that  if  one  surety  pays  the  whole 
debt  or  more  than  his  part,  he  has  a  right 
to  recover  at  law  a  contribution  against  his 
co-surety.  Batchelder  v.  Fiske,  17  Mass.  4GS. 
The  defendant  then  must  be  charged,  unless 
he  can  show  some  defence  exempting  him 
from  the  operation  of  the  general  rule.  And 
for  this  purpose  he  relies  upon  the  fact,  that 
he  became  siu-ety  at  the  request  of  the  plain- 
tiff's intestate,  upon  his  verbal  promise  to  in- 
demnify him. 

It  is  contended  for  the  plaintiff,  that  the 
verbal  promise  was  void  by  St  17S8.  c.  1(5, 
§  1,  commonly  called  the  statute  of  frauds,  as 
it  was  a  special  promise  to  answer   for  tbe 

1  Irrelevant  parts  omitted. 


debt,  default  or  misdoing  of  another  person, 
upon  an  agreement  that  was  not  to  be  per- 
formed within  the  space  of  one  year  from  the 
making  thereof.  And  the  plaintiff  says,  that 
by  no  possibility  could  the  bond  be  performed 
within  the  year.  The  plaintiff  relies  much 
upon  the  case  of  Boydeil  v.  Drummond,  11 
East,  155,  relating  to  the  publication  of  prints 
from  the  scenes  in  Shakspeare's  plays;  where 
It  was  held,  that  it  must  be  a  complete  per- 
formance within  the  year,  to  take  the  case  out 
of  the  statute.  And  the  court  said,  that  the 
whole  work  could  not  have  been  obtruded 
upon  the  subscribers  at  once,  so  as  to  have  en- 
titled the  publishers  to  demand  payment  of 
the  whole  within  a  year. 

But  the  bm  il  in  the'  case  at  bar  might  be 
forfeited  for  breaches  within  the  year;  and 
such  forfeiture  would  have  rendered  the  sure- 
ties liable  to  a  judgment  for  the  penalty. 

The  administrator,  for  example,  was  liable 
to  claims  of  creditors  within  the  year,  which 
were  not  affected  by  the  insolvency  of  the 
estate,  and  it  might  be  that  these  debts  would 
absorb  all  the  property,  and  so  the  estate 
would  be  settled  within  the  year,  and  the  con- 
tract would  thus  be  completelyperformed  with- 
in the  year.  It  might  be,  that  a  forfeiture 
would  be  incurred  for  not  returning  an  in- 
ventory within  three  months,  or  that  the  prin- 
cipal in  the  bond  might  have  rendered  himself 
liable  for  waste,  within  the  year;  and  other 
causes  of  forfeiture  might  have  happened 
within  the  year,  which  would  have  subjected 
the  sureties  to  judgment  for  the  whole  penalty 
of  the  bond. 

Comyn,  Gont  (3d  Am.  Ed.)  232.  The  stat- ^ 
I  ute  does  not  embrace  cases  which  may  be  per-  I 
formed  in  a  year,  or  which  depend  on  a  con-  j 
Itingency.  It  must  be  an  express  and  specitic  ( 
ngreement  not  to  be  performed  in  one  year, 
to  come  within  the  act.  If  it  may  be  perform- 
ed within  the  year,  it  does  not  come  within  it 
Moore  v.  Fox,  10  Johns.  244.  Thus,  where 
the  promise  was  to  pay  so  many  guineas  on 
the  day  of  the  plaintiff's  marriage,  it  was 
held  not  within  the  statute.  Where  the  prom- 
ise was  upon  a  contingency,  and  it  did  not 
appear  that  it  was  to  be  performed  after  the 
year,  there  a  note  in  writing  was  held  not 
necessary,  for  the  contingency  might  happen 
within  the  year.  Peter  v.  Compton,  Skin.  353. 
So,  where  it  was  to  pay  so  much  money  on 
the  return  of  such  a  ship,  which  ship  happen- 
ed not  to  return  in  two  years,  it  was  held  by 
all  the  judges  that  it  was  not  within  the  stat- 
ute, for  by  possibility  the  ship  might  have 
returned  within  the  year.  It  applies  to  a 
promise  where  by  the  express  appointment 
of  the  party  it  is  not  to  be  performed  in  a 
year.  Anon.,  1  Salk.  280.  So  in  Fenton  v. 
Emblers,  3  Burrows,  127S;  the  statute  applies 
to  promises  expressly  and  specifically  agreed 
not  to  be  performed  within  the  year;  nor  is 
any  case  upon  a  contingency  within  it  Smith 
V.  Westall.  1  Ld.  Raym.  316;  Gilbert  v.  Sykes, 
16  East  150. 

Plaintiff  nommit 


150 


STATUTE  OF  FRAUDS. 


DIXON.i       d 


^1,^ 


sacnus 


DOYLE 

(97  Mass.  208.) 

Supreme  Judicial  Court  of  Massachusetts. 
Hampden.      Sept.  Term,  1S67. 

Action  by  John  Doyle  against  John  Dixon 
for  breach  of  a  contract  by  which  the  defend- 
ant, on  selling  his  stock  of  groceries  and  good 
will  to  the  plaintiff,  agreed  not  to  go  i.atn  the 
grocery  business  in  Chico^ee  .for.  a  periodof 
five  years.  The  defendant  contended  that  the 
"agreement  was  within  the  statute  of  frauds 
as  an  agreement  not  to  be  performed  within 
a  year,  and  that,  as  it  was  not  in  writing, 
the  plaintiff  could  not  recover;  but  the  judge 
ruled  the  contrary.  There  was  a  verdict  for 
thf   plaintiff,    and  the  defendant  excepted. 

G.  :M.  Stearns,  for  plaintiff.  A.  L.  Soule,  for 
fit-fondant. 

GRAY,  J  It  is  well  settled  that  an  oral 
ajrretment  which  according  to  the  expression 
raid  contemplation  of  the  parties  may  or  may 
not  be  fully  performed  within  a  year  is  not 
Tv-ifhin  that  clause  of  the  statute  of  frauds, 
Tv'iich  requires  any  "agreement  not  to  be  per- 
formed wichiE  one  year  from  the  making 
thereor"  to  be  iu  writing  in  order  to  maintain 
an  action.  An__a£reement  therefore  which 
.■^iU  be  completely  performed  according  to  its 
terms  and'ihtention  if  either  party  should  die 
within  the  year  is  not  within  the  statute. 
Thus  vn  Peteis  v.  Westborough,  19  Pick.  364,  it 
was  hela  thsj.  ai:  agreement  to  support  a  child 
until  r,  certaLa  age  at  which  the  child  would 
not  anivc  for  several  years  was  not  within 
the  statntfi.  because  it  depended  upon  the  con- 
tingenc7  of  the  child's  life,  and,  if  the  child 
should  die  withio  one  year,  would  be  fully 
performed.  On  the  other  hand,  if  the  agree- 
ment <2annot  be  completely  pei-formed  with- 
in a  year,  the  fact  that  it  may  be  terminated, 
or  further  performance  excused  or  rendered 
impossible,  by  the  death  of  the  promisee  or  of 
another  person  within  a  year,  is  not  sufB- 
cient  to  take  it  out  of  the  statute.     It  v^as 

1  L,-relevant  parts  omitted 


therefore  held  iu  Ilill  v.  Ilnoper,  1  Gray,  lol, 
that  an  agreement  to  employ  a  boy  for  five 
years  and  to  pay  his  father  certain  sums  at 
stated  periods  during  that  time  was  within 
the  statute;  for  although  by  the  death  of  the 
boy  the  services  which  were  the  considera- 
tion of  the  promise  would  cease,  and  the  prom- 
ise therefore  be  determined,  it  would  cer- 
tainly not  be  completely  performed.  So  if 
the  death  of  the  promisor  within  the  year 
would  merely  prevent  full  performance  of  the 
agi'eement,  it  is  within  the  statute;  but  if  his 
death  would  leave  the  agreement  completely 
performed  and  its  puipose  fully  carried  out, 
it  is  not.  It  has  accordingly  been  repeatedly 
held  by  this  court  that  an  agreement  not 
hereafter  to  carry  on  a  certain  business  at  a 
particular  place  was  not  within  the  statute, 
.because,  being  only  a  personal  engagement 
I  to  forbear  doing  certain  acts,  not  stipulating 
!for  anything  beyond  the  promisor's  life,  and 
(imposing  no  duties  upon  his  legal  representa- 
I  fives,  it  would  be  fully  performed  if  he  died 
[  within  the  year.  Lyon  v.  King,  11  Mete. 
(Mass.)  411;  Worthy  v.  Jones,  11  Gray,  16S. 
An  agreement  not  to  engage  in  a  certain 
kind  of  business  at  a  particular  place  for  a 
specified  number  of  years  is  within  the  same 
principle;  for  whether  a  man  agrees  not  to  do 
a  thing  for  his  life,  or  never  to  do  it,  or  only 
not  to  do  it  for  a  certain  number  of  years,  it 
is  in  either  form  an  agreement  by  which  ho 
does  not  promise  that  anything  shall  be  done 
after  his  death,  and  the  performance  of  which 
is  therefore  completed  with  his  life.  An 
agreement  to  do  a  thing  for  a  certain  time 
may  perhaps  bind  the  promisor's  representa- 
tives, and  at  any  rate  is  not  performed  if  he 
dies  within  that  time.  But  a  mere  agreement 
that  he  will  himself  refrain  from  doing  a  cer- 
tain thing  is  fully  performed  if  he  keeps  it  so 
long  as  he  is  capable  of  doing  or  refraining. 
The  agreement  of  the  defendant  not  to  go  in- 
to business  again  at  Chicopee  for  five  years 
was  therefore  not  within  the  statute  of 
frauds. 

Exceptions  overruled- 


SALE  OF  GOODS. 


151 


BALDWIN   V.    WILLIAMS. 

(3  Mete.  3G5.) 

Supreme  Judicial   Court  of   Massachusetts. 
Nov.   Term,   1841. 

This  case  was  tried  before  Wilde,  J.,  who 
made   the   followinj,'   report   of   it:— 

This  was  an  action  of  assumpsit,  and  the 
declaration  set  forth  an  agreement  of  the 
plaintiff  that  he  would  bargain,  sell,  assign, 
transfer,  and  set  over  to  the  defendant,  and 
Indorse  without  recourse  to  him,  the  plain- 
tiff, in  any  event,  two  notes  of  hand  by  him 
held,  signed  by  S.  J.  Gardner;  one  dated 
April  24th,  1835,  for  the  payment  of  $1,500; 
the  other  dated  May  5th,  IS^iO,  for  the  pay- 
ment of  $500;  and  both  payable  to  the  plain- 
tiff or  order  on  the  3d  of  April,  1839,  with 
interest  from  their  dates.  The  declaration 
set  forth  an  agreement  by  the  defendant,  in 
consideration  of  the  plaintiff's  agreement 
aforesaid,  and  in  payment  for  said  Gard- 
ner's said  notes,  to  pay  the  plaintiff  $1,000 
in  cash,  and  to  give  the  plaintiff  a  post  note, 
made  by  the  Lafayette  Bank,  for  $1,000,  and 
also  a  note  signed  by  J.  B.  Russell  &  Co.  and 
indorsed  by  D.  W.  Williams  for  $1,000. 

The  plaintiff  at  the  trial  proved  an  oral 
agreement  with  the  defendant  as  set  forth 
in  the  declaration,  and  an  offer  by  the  plain- 
tiff to  comply  with  his  part  of  said  agree- 
ment, and  a  tender  of  said  Gardner's  said 
notes,  indorsed  by  the  plaintiff  without  re- 
course to  him  in  any  event,  and  a  demand 
upon  the  defendant  to  fulfil  his  part  of  said 
agreement,  and  the  refusal  of  the  defendant 
to  do  so.  But  the  plaintiff  introduced  no 
evidence  tending  to  show  that  any  thing 
passed  between  the  parties  at  the  time  of 
making  the  said  agreement,  or  was  given  in 
earnest  to   bind   the   bargain. 

The  judge  advised  a  nonsuit  upon  this  ev- 
idence, because  the  contract  was  not  in 
writing  nor  proved  by  any  note  or  memo- 
randum in  writing  signed  by  the  defend- 
ant or  his  agent,  and  nothing  was  received 
by  the  purchaser,  nor  given  In  earnest  to 
bind  the  bargain.  A  nonsuit  was  accord- 
ingly entered,  which  is  to  stand  if  in  the 
opinion  of  the  whole  court  the  agreement 
set  forth  in  the  declaration  falls  within  the 
statute  of  frauds  (Rev.  St.  c.  74,  §  4);  oth- 
erwise, the  nonsuit  to  be  taken  off,  and  a 
new  trial  granted. 

Mr,  Clarke,  for  plaintiff.  S.  D.  Parker,  for 
defendant. 


WILDE,  J.  This  action  Is  founded  on  an 
oral  contract,  and  the  question  Is,  whether 
It  is  a  contract  of  sale  within  the  statute 
of  frauds. 

The  plaintiff's  counsel  contends  in  the  first 
place  that  the  contract  is  not  a  contract 
for  the  sale  of  the  notes  mentioned  in  the 
declaration,  but  a  mere  agreement  for  the 
exchange  of  them;   and  in  the  second  place 


that  if  the  agreement  is  to  be  considered  as 
a  contract  of  sale,  yet  it  is  not  a  contract 
within  that  statute. 

As  to  the  first  point,  the  defendant's  coun- 
sel contends  that  an  agreement  to  exchange 
notes  is  a  mutual  contract  of  sale.  But  It 
is  not  necessary  to  decide  this  question,  for 
the  agreement  of  the  defendant,  as  alleged 
in  the  declaration,  was  to  pay  for  the  plain- 
tiff's two  notes  $2,000  in  cash,  in  addition 
to  two  other  notes;  and  that  this  was  a 
contract  of  sale  is,  we  think,  very  clear. 

The  other  question  Is  more  doubtful.  But 
the  better  opinion  seems  to  us  to  be,  that 
this  is  a  contract  within  the  true  meaning 
of  the  statute  of  frauds.  It  is  certainly 
within  the  mischief  thereby  intended  to  be- 
prevented;  and  the  words  of  the  statute, 
"goods"  and  "merchandise,"  are  sufficiently 
comprehensive  to  include  promissory  notes 
of  hand.  The  word  "goods"  is  a  word  of 
large  signification;  and  so  Is  the  word 
"merchandise."  "Merx  est  quicquid  vend! 
potest." 

In  Tisdale  v.  Harris,  20  Pick.  9,  it  was  de- 
cided that  a  contract  for  the  sale  of  shares 
in  a  manufacturing  corporation  is  a  contract 
for  the  sale  of  goods  or  merchandise  with- 
in the  statute;  and  the  reasons  on  which 
that  decision  was  founded  seem  fully  to  au- 
thorize a  similar  decision  as  to  promissory 
notes  of  hand.  A  different  decision  has  re- 
cently been  made  in  England  in  Humble  v. 
Mitchell,  3  Perry  &  D.  141,  11  Adol.  &  E. 
207.  In  that  case  It  was  decided  that  a 
contract  for  the  sale  of  shares  in  a  joint- 
stock  banking  company  was  not  within  the 
statute  of  frauds.  But  it  seems  to  us  that 
the  reasoning  in  the  case  of  Tisdale  v.  Har- 
ris Is  very  cogent  and  satisfactory;  and  it 
Is  supported  by  several  other  cases.  In 
Mills  V.  Gore,  20  Pick.  28.  it  was  decided 
that  a  bill  in  equity  might  be  maintained  to 
compel  the  redelivery  of  a  deed  and  a  prom- 
issory note  of  hand,  on  the  provision  in  the 
Rev.  St.  c.  81,  §  8,  which  gives  the  court 
jurisdiction  in  all  suits  to  compel  the  rede- 
livery of  any  goods  or  chattels  whatsoever, 
taken  and  detained  from  the  owner  thereof, 
and  secreted  or  withheld,  so  that  the  same 
cannot  be  replevied.  And  the  same  point 
was  decided  in  Clapp  v.  Shephard.  23  Pick. 
228.  In  a  former  statute  (St.  1S23.  c.  140), 
there  was  a  similar  provision  which  extend- 
ed expressly  to  "any  goods  or  chattels,  deed, 
bond,  note,  bill,  specialty,  writing,  or  other 
personal  property."  And  the  learned  com- 
missioners. In  a  note  on  the  Rev.  St  c.  81, 
§  8,  say  that  the  words  "  'goods  or  chattels' 
are  supposed  to  comprehend  the  several  par- 
ticulars immediately  following  them  In  St. 
1823,  c.  140,  as  well  as  many  others  that 
are  not  mentioned." 

The  word  "chattels"  is  not  contained  in 
the  provision  of  the  statute  of  frauds;  but 
personal  chattels  are  movable  goods,  and  sa 
far  as  these  words  may  relate  to  the  ques- 
tion under  consideration  they  seem  to  have 


15: 


STATUTE  OF  FRAUDS. 


the  same  meaning.  But  however  this  may 
be,  we  think  the  present  case  cannot  be 
distinguished  in  principle  from  Tisdale  v. 
Harris;  and  upon  the  authority  of  that  caso. 
taking  into  consideration  again  the  reasons 


and  principles  on  which  It  was  decided,  we 
are  of  opinion  that  the  contract  in  question 
is  within  the  statute  of  frauds,  and  conse- 
quently that  the  motion  to  set  aside  the 
nonsuit  must  be  overruled. 


SALE  OF  GOODS. 


153 


GODDARD  V.  BINNEY. 


(115  Mass.  450.) 

Supreme  Judicial  Court  of  Massachusetts.    Suf- 
folk.   Sept.  4,  1874. 

Contract  to  rocover  the  price  of  a  buj?f?y 
built  by  plaintiff  for  defendant.  Plaintiff 
agreed  to  build  a  buuj,'}'  for  defendant,  and 
to  deliver  it  at  a  certain  time.  Defendant 
^ave  special  directions  as  to  style  and  finish. 
The  buyyy  was  built  according  to  directions. 
Before  it  was  finished,  defendant  called  to 
see  it,  and  in  answer  to  plaintiff,  who  asked 
him  if  he  would  sell  it,  said  no;  that  he 
would  keep  it.  When  the  buggy  was  fin- 
ished, plaintiff  sent  a  bill  for  it,  which  de- 
fendant retained,  promising  to  see  plaintiff 
in  re^^ard  to  it.  The  buggy  was  afterwards 
burned  in  plaintiff's  i)ossession.  The  case 
was  reported  to  the  supreme  judicial  court. 

O.  A.  Welch,  for  plaintiff.  G.  Putnam, 
Jr.,  for  defendant 

AMES,  J.  Whether  an  agreement  like  that 
described  in  this  report  should  be  considered 
as  a  contract  for  the  sale  of  goods,  within 
the  meaning  of  the  statute  of  frauds,  or  a 
contract  for  labor,  services  and  materials, 
and  therefore  not  within  that  statute,  is  a 
question  upon  which  there  is  a  conflict  of  au- 
thority. According  to  a  long  course  of  de- 
cisions in  New  York,  and  in  some  other  states 
of  the  Union,  an  agreement  for  the  sale  of 
any  commodity  not  in  existence  at  the  time, 
but  which  the  vendor  is  to  manufacture  or 
put  in  a  condition  to  be  delivered  (such  as 
flour  from  wheat  not  yet  ground,  or  nails  to 
be  made  from  iron  in  the  vendor's  hands), 
is  not  a  contract  of  sale  within  the  meaning 
of  the  statute.  Crookshank  v.  Burrell,  18 
Johns.  58;  Sewall  v.  Fitch,  8  Cow.  215;  Rob- 
ertson V.  Vaughn,  5  Sandf.  1;  Downs  v.  Ross, 
23  Wend.  270;  Eichelberger  v.  M'Cauley,  5 
Har.  &  J.  213.  In  England,  on  the  other 
hand,  the  tendency  of  the  recent  decisions 
is  to  treat  all  contracts  of  such  a  kind  in- 
tended to  result  in  a  sale,  as  substantially 
contracts  for  the  sale  of  chattels;  and  the 
decision  In  Lee  v.  Griffin,  1  B.  &  S.  272,  goes 
so  far  as  to  hold  that  a  contract  to  make 
and  fit  a  set  of  artificial  teeth  for  a  patient 
is  essentially  a  contract  for  the  sale  of  goods, 
and  therefore  is  subject  to  the  provisions  of 
the  statute.  See  Maberley  v.  Sheppard,  10 
Bing.  99;  Howe  v.  Palmer,  3  B.  &  Aid.  321; 
Baldey  v.  Parker,  2  B.  «&  C.  37;  Atkinson  v. 
Bell.  8  B.  &  C.  277. 

In  this  commonwealth,  a  rule  avoiding 
both  of  these  extremes  was  established  in 
Mixer  V.  Howarth,  21  Pick.  205,  and  has  been 
recognized  and  affirmed  in  repeated  decisions 
of  more  recent  date.  The  effect  of  these 
decisions  we  understand  to  be  this,  namely, 
that  a  contract  for  the  sale  of  articles  then 
existing  or  such  as  the  vendor  in  the  ordinary 
course  of  his  business  manufactures  or  pro- 
''Jires  for  the  genei'al  market,  whether  on 
hand  at  the  time  or  not,  is  a  contract  for  the 


sale  of  goods,  to  which  the  statute  applies. 
But  on  the  other  hand,  if  the  goods  are  to  be 
manufactured  especially  for  the  purchaser, 
and  upon  his  special  order,  and  not  for  the 
general  market,  the  case  Is  not  within  the 
statute.  Spencer  v.  Cone,  1  Met  283.  "The 
distinction,"  says  Chief  Justice  Shaw,  in 
Lamb  v.  Crafts,  12  Met.  353,  "we  believe  is 
now  well  understood.  When  a  person  stip 
ulatos  for  the  future  sale  of  articles,  which 
he  is  habitually  making,  and  which,  at  the 
time,  are  not  made  or  finished.  It  Is  essential- 
ly a  contract  of  sale,  and  not  a  contract  for 
labor;  otherwise,  when  the  article  is  made 
pursuant  to  the  agreement"  In  Gardner  v. 
Joy,  9  Met.  177,  a  contract  to  buy  a  certain 
number  of  boxes  of  candles  at  a  fixed  rate 
per  pound,  which  the  vendor  said  he  would 
manufacture  and  deliver  in  about  three 
months,  was  held  to  be  a  contract  of  sale 
and  within  the  statute.  To  the  same  general 
effect  are  Waterman  v.  Meigs,  4  Cush.  497, 
and  Clark  v.  Nichols,  107  Mass.  547.  It  Is 
true  that  in  "the  infinitely  various  shades  of 
different  conti'acts,"  there  is  some  practical 
difficulty  in  disposing  of  the  questions  that 
arise  under  that  section  of  the  statute.  Gen. 
St.  c.  105,  §  5.  But  we  see  no  ground  for 
holding  that  there  is  any  uncertainty  in  the 
rule  itself.  On  the  contrary,  its  correctness 
and  justice  are  clearly  implied  or  expressly 
affirmed  in  all  of  our  decisions  upon  the  sub- 
ject matter.  It  is  proper  to  say  also  that 
the  present  case  is  a  much  stronger  one  than 
Mixer  v.  Howarth.  In  this  case,  the  car- 
riage was  not  only  built  for  the  defendant, 
but  in  conformity  in  some  respects  with  his 
directions,  and  at  his  request  was  marked 
with  his  initials.  It  was  neither  intended 
nor  adapted  for  the  general  market.  As  we 
are  by  no  means  prepared  to  overrule  the 
decision  in  that  case,  we  must  therefore  hold 
that  the  statute  of  frauds  does  not  apply  tc 
the  contract  which  tlie  plaintiff  is  seeking 
to  enforce  in  this  action. 

Independently  of  that  statute,  and  in  cases 
to  which  it  does  not  apply,  it  Is  well  settled 
that  as  between  the  immediate  parties,  prop- 
erty in  personal  chattels  may  pass  by  bargain 
and  sale  without  actual  delivery.  If  the  par- 
ties have  agreed  upon  the  specific  thing  that 
is  sold  and  the  price  that  the  buyer  is  to  pay 
for  it,  and  nothing  remains  to  be  done  but 
that  the  buyer  should  pay  the  price  and  take 
the  same  thing,  the  property  passes  to  the 
buyer,  and  with  It  the  risk  of  loss  by  fire  or 
any  other  accident  The  appropriation  of  the 
chattel  to  the  buyer  Is  equivalent,  for  that 
purpose,  to  delivery  by  the  seller.  The  as- 
sent of  the  buyer  to  take  the  specific  chattel 
is  equivalent  for  the  same  pui-pose  to  his 
acceptance  of  possession.  Dixon  v.  Yates, 
5  B.  &  Ad.  313,  340.  The  property  may  well 
be  in  the  buyer,  though  the  right  of  pos- 
session, or  lien  for  the  price,  is  in  the  seller. 
There  could  in  fact  be  no  such  lien  without 
a  change  of  ownership.  No  man  can  be 
said  to  have  a  lien,  in  the  proper  sense  of  the 


154 


STATUTE  or  FRAUDS. 


term,  upon  his  own  property,  and  the  seller's 
lien  can  only  be  upon  the  buyer's  property. 
It  has  often  been  decided  that  assumpsit  for 
the  price  of  goods  bargained  and  sold  can  be 
maintained  where  the  goods  have  been  se- 
lected by  the  buyer,  and  set  apart  for  him  by 
the  seller,  though  not  actually  delivered  to 
him.  and  where  notliing  remains  to  be  done 
except  that  the  buyer  should  ixiy  the  agreed 
price.  In  such  a  state  of  things  the  property 
vests  in  him,  and  with  it  the  risk  of  any  ac- 
cident that  may  happen  to  the  goods  in  the 
meantime.  Noy's  Maxims,  89;  2  Kent,  Com. 
ri2th  Ed.)  492;  Bloxam  v.  Sanders,  4  B.  & 
C.  941;  Tarling  v.  Baxter,  6  B.  &  C.  360; 
Hinde  v.  Whitehouse,  7  East,  571;  Macom- 
ber  V.  Parker,  13  Pick.  175,  1S3;  Morse  v. 
Sherman,  lOG  Mass.  430. 

In  the  present  case,  nothing  remained  to 
be  done  on  the  part  of  the  plaintiff.  The 
price  had  been  agreed  upon;  the  specific 
chattel  had  been  finished  according  to  order, 
set  apart  and  appropriated  for  the  defend- 


ant, and  marked  with  his  Initials.  The  plain- 
tiff had  not  undertaken  to  deliver  it  else- 
where than  on  his  own  premises.  He  gave 
notice  that  it  was  finished,  and  presented 
his  bill  to  the  defendant,  who  promised  to 
pay  it  soon.  He  had  previously  requested 
that  the  carriage  should  not  be  sold,  a  re- 
quest which  substantially  is  equivalent  to 
asking  the  plaintiff  to  keep  it  for  him  when 
finished.  Without  contending  that  these  cii'- 
cumstances  amount  to  a  delivery  and  accept- 
ance within  the  statute  of  frauds,  the  plain- 
tiff may  well  claim  that  enough  has  been 
done,  in  a  case  not  within  that  statute,  to 
vest  the  general  ownership  in  the  defend- 
ant, and  to  cast  upon  him  the  risk  of  loss 
by  fire,  while  the  chattel  remained  in  the 
plaintiff's  possession. 

According  to  the  terms  of  the  reservation, . 
the  verdict  must  be  set  aside,  and  judgment 
entered  for  the  plaintiff. 

COLT  and  ENDICOTT,  JJ.,  absent 


SALE  OF  GOODS. 


155 


COOKE  et  al.  v.  MILLARD  et  aL 

(G5  N.   i.  352.) 

Commission  of  Appeals  of  New  York.    1875. 

Action  to  recover  the  price  of  certain  lum- 
ber sold  aud  delivered.  The  referee  found 
that  ijhiiuUlfs  were  copartners  and  whole- 
sale lumber  merchants,  aud  proprietors  of 
a  plauing  mill,  at  Whitehall,  N.  Y.,  and  de- 
fendants were  partners  and  lumber  mer- 
chauts,  at  New  Hambur;,'h,  on  the  Hudson. 
The  course  of  busiuess  is,  that  the  lumber 
is  shipped  from  Whitehall  by  canal  to  Troy, 
and  thence  to  New  llamburyh  by  the  Hud- 
son river.  On  the  5th  day  of  Sept.,  1SG5, 
the  defendants  desiring  to  purchase  certain 
kinds  of  lumber,  were  shown  by  tin-  plain- 
tiffs the  lumber  then  in  their  yard  at  White- 
hall. This  was  of  the  desired  iiuality,  but 
needed  to  be  dressed  and  cut  into  the  dif- 
ferent sizes  which  they  wished.  There  was 
much  more  lumber  in  the  yard  shown  to  the 
defendants  than  was  re(iuisite  for  their  pur- 
poses. The  defendants  thereupon  orally 
gave  to  the  plaintiffs  an  order  for  certain 
quantities  and  sizes  of  lumber,  at  specified 
prices,  amounting  in  the  whole  to  $918.22. 
A  memorandum  of  the  order  so  agreed  to 
was  made  b^-  the  plaintiffs,  but  was  not  sub- 
scribed by  any  one.  No  particular  lumber 
was  selected  or  set  apart  to  fill  the  order, 
nor  was  any  part  of  it  then  in  condition  to  be 
accepted  or  delivered.  The  defendants  told 
the  plaintiffs  that  I'ercival,  a  forwarder  at 
Whitehall,  would  send  a  boat  to  take  the 
lumber,  when  notified  tliat  it  was  ready  to 
be  delivered.  Percival,  during  the  same  sea- 
son, and  prior  to  Sept.  5,  had  taken  up  a 
boat  for  the  defendants,  and  sliipped  a  part 
of  a  load  of  lumber  from  the  plaintiffs'  dock, 
making  up  the  residue  from  his  own  yard. 
He  had  frequently  shipped  lumber  for  the 
defendants.  By  the  course  of  trade,  a  boat 
could  not  be  obtained  to  carry  a  part  of  a 
load  of  lumber  from  Whitehall  to  New  Ham- 
burgh, except  for  the  price  of  a  full  load. 
To  avoid  paying  such  full  price,  arrange- 
ments had  to  be  made  to  fill  out  the  load. 
The  defendants  knew  of  this  when  they 
made  the  order  of  Sept.  5.  The  order  only 
amounted  to  one-half  a  boat-load.  Percival 
then  had  a  pile  of  lumber  (seventeen  thou- 
sand six  hundred  and  seventj'-one  feet  of 
culls)  to  ship  to  the  defendants,  which  was 
no  part  of  the  lumber  to  be  dressed  by 
plaintiffs.  The  lumber  ordered  on  Sept.  5 
was  to  be  talcen  from  the  lots  examined  by 
the  defendants,  and  the  lumber  dressed  and 
piled  on  the  plaintiffs'  dock,  was  all  taken 
from  the  lumber  shown.  After  the  oral  or- 
der defendants  went  into  the  lumber  yard 
with  the  plaintiECs'  foreman,  Martin,  and 
pointed  out  to  him  some  of  the  piles  from 
which  they  desired  the  lumber  to  be  manu- 
factured, and  directed  plaintilfs  to  put  the 
lumber,  when  ready,  on  plaintiffs'  dock  and 
to  notify  Percival;    and  told  plaintiffs  that 


when  this  was  done,  Percival,  who  was  also 
a  lumber  dealer,  would  take  up  a  boat  and 
ship  the  lumber,  and  make  out  the  load  from 
his  yard.  Subsequently,  the  15th  of  Sept., 
the  lumber  having  been  prepared  and  dress- 
ed, according  to  the  oral  agreement,  it  was 
piled  upon  the  dock  of  the  plaintiffs  at 
^Vhitehall,  along  the  front  of  the  planiug- 
mill,  and  was,  on  the  10th  of  that  mouth, 
measured  by  plaintiffs,  and  was  in  all  re- 
spects ready  for  delivery  by  them,  accord- 
ing to  the  oral  agreement. 

The  plaintiffs,  on  the  same  day,  gave  no- 
tice to  I'ercival  that  the  lumber  was  ready 
for  delivery,  and  requested  him  to  send  a 
boat  and  take  it  away.  Percival  had  not 
been  notified  that  he  was  to  ship  the  lum- 
ber, and  paid  no  attention  to  the  notice  giv- 
en him  by  plaintiffs.  On  the  other  hand, 
the  plaintiffs  did  not  ascertain  that  Percival 
did  not  know  of  the  arrangement,  which  the 
defendants  had  told  them  they  would  make 
with  Percival  as  to  shipping  the  lumber,  un- 
til after  the  fire  hereinafter  mentioned.  On 
the  next  day,  Sunday,  the  lumber  being  still 
on  the  dock,  as  it  was  at  the  time  Percival 
was  notified,  was  consumed  by  an  accidental 
fire,  with  the  planing-mill  and  much  other 
property.     Judgment  for  defendants. 

^lartin  W.  Cooke,  for  appellants.  Thomp- 
son &  Weeks,  for  respondents. 

DWIGHT,  C.  No  exceptions  were  taken 
in  this  cause,  except  to  the  conclusions  of 
law  derived  by  the  referee  from  the  facts  as 
found  in  the  report.  There  are  but  two 
questions  to  be  considered:  One  is,  whether 
the  contract  is  within  the  statute  of  frauds; 
the  other  is,  if  it  be  held  that  it  is  within  the 
statute,  were  the  acts,  done  by  the  parties, 
sufiicient  to  comply  with  its  terms,  so  as  to 
make  the  contract  enforceable  in  a  court  of 
justice? 

In  order  to  determine  whether  the  con- 
tract is  within  the  statute,  it  is  important 
briefly  to  state  the  exact  acts  which  the 
plaintiffs  were  to  perform. 

The  contract  was  plainly  executory  in  its 
nature.  There  were  no  specific  articles  up- 
on which  the  minds  of  the  buyer  and  seller 
met,  so  that  it  could  be  affirmed  that  a 
title  passed  at  the  time  of  the  contract.  The 
seller  was  to  select  from  the  mass  of  lumber 
in  his  j'ard,  certain  portions  that  would  com- 
ply with  the  buyer's  order.  The  purposes 
of  the  parties  could  not  even  be  accomplish- 
ed by  the  process  of  selection.  The  lumber 
must  be  put  in  a  condition  to  answer  the  or- 
der. It  must  be  dressed  and  cut  into  requir- 
ed sizes.  The  contract  called  for  distinct 
parcels  of  surface  pine  boards,  clapboards 
and  matched  ceiling.  Part  of  the  lumber 
was  surfaced,  and  a  portion  of  it  still  in  the 
rough.  The  clapboards  were  manufactured 
from  stuff  one  and  a  quarter-inch  thick.  It 
had  to  be  split,  surfaced  and  rabbeted.  The 
order  for  the  various  items  was  a  single  one, 


156 


STATUTE  OF  FRAUDS. 


there  beiug  tifteeu  thousand  four  hundred 
and  forty-one  feet  of  the  surface  pine,  ten 
thousand'  one  hundred  and  forty-four  feet 
of  clapboards,  and  eight  thousand  feet  of 
matched  ceiling.  The  surface  boards  and 
the  ceiling  were  in  existence,  and  only  need- 
*d  dressing  to  comply  with  the  order. 
Whether  the  clapboards  can  be  deemed  to 
have  been  in  existence  may  be  more  doubt- 
fuL  If  a  part  of  the  order  is  within  the 
statute  of  frauds,  and  a  portion  of  it  without 
it,  the  whole  transaction  must  be  deemed  to 
be  within  it,  as  au  entire  contract  cannot,  in 
this  case,  be  divided  or  apportioned.  Cooke 
V.  Tombs,  2  Anst.  -120;  Chater  v.  Beckett,  7 
T.  R.  201;  Mechelen  v.  Wallace,  7  A.  &  E. 
49;  Thomas  v.  Williams,  10  B.  &  C.  664; 
Loomis  V.  Newhall,  15  Pick.  159.  I  think  it 
clear  that  the  contract  was  in  its  nature  en- 
tire. It  was  in  evidence  that  the  intention 
was  to  buy  enough,  in  connection  with  what 
■percival  had  on  hand,  to  make  up  a  boat- 
load. This  could  only  be  accomplished  by 
using  the  entire  amount  of  the  order.  Ac- 
cordingly even  if  the  contract  for  the  clap- 
boards was  not  a  sale,  it  cannot  be  separated 
from  the  rest  of  the  order,  and  the  cases 
above  cited  are  applicable. 

The  question  is  thus  reduced  to  the  follow- 
ing proposition:  Is  a  contract  which  is,  in 
form,  one  of  sale  of  lumber  then  in  exist- 
ence for  a  fixed  price,  where  the  seller  agrees 
to  put  it  into  a  state  of  fitness  to  fill  the  or- 
der of  the  purchaser,  his  work  beiug  includ- 
ed in  the  price,  in  fact  a  contract  for  work 
and  labor  and  not  one  of  sale,  and  accord- 
ingly not  within  the  statute  of  frauds? 

The  New  York  statute  is  made  applicable 
to  the  "sale  of  any  goods,  chattels  or  things 
in  action,"  for  the  price  of  $50  or  more.  The 
words  "goods  and  chattels"  are,  literally 
taken,  probably  more  comprehensive  than 
the  expressions  in  the  English  statute 
"goods,  wares  and  merchandise."  It  will 
be  assumed  however  in  this  discussion,  that 
they  are  equivalent. 

There  are  at  least  three  distinct  views  as 
to  the  meaning  of  the  words  in  the  statute. 
These  may  be  called,  for  the  sake  of  conven- 
ience, the  English,  the  Massachusetts  and 
the  New  York  rules,  as  representing  the  de- 
cisions in  the  respective  courts. 

The  English  rule  lays  especial  stress  upon 
the  point,  whether  the  articles  bargained  for 
can  be  regarded  as  goods  capable  of  sale  by 
the  professed  seller  at  the  time  of  delivery, 
without  any  reference  to  the  inquiry  wheth- 
er they  were  in  existence  at  the  time  of  th  > 
contract  or  not  If  a  manufacturer  is  to 
produce  an  article  which  at  the  time  of  the 
delivery  could  be  the  subject  of  sale  by  him, 
the  case  is  within  the  statute  of  frauds.  The 
rule  excludes  all  cases  where  work  is  done 
upon  the  goods  of  another,  or  even  mate- 
rials supplied  or  added  to  the  goods  of  an- 
other. Thus  if  a  carriage-maker  should  re- 
pair my  carriage,  both  furnishing  labor  and 
supplying  materials,  it  would  be  a  contract 


for  work  and  labor,  as  the  whole  result  of 
his  efforts  would  not  produce  a  chattel  which 
could  be  the  subject  of  sale  by  him.  If  on 
the  other  hand,  by  the  contract  he  lays  out 
work  or  materials,  or  both,  so  as  to  produce 
a  chattel  which  he  could  sell  to  me,  the  con- 
tract is  within  the  statute.  This  conclusion 
has  been  reached  only  after  great  discussion 
and  much  fluctuation  of  opinion,  but  must 
now  be  regarded  as  settled.  The  leading 
case  upon  this  point  is  Lee  v.  Griffin,  1  Best 
&,  S.  272;  Benj.  Sales,  77.  The  action  was 
there  brought  by  a  dentist  to  recover  £21 
sterling  for  two  sets  of  artificial  teeth,  made 
for  a  deceased  lady  of  whose  estate  the  de- 
fendant was  executor.  The  court  held  thia 
to  be  the  sale  of  a  chattel  within  the  stat- 
ute of  frauds.  Blackburn,  J.,  stated  the 
principle  of  the  decision  in  a  clear  manner: 
"If  the  contract  be  such  that  it  will  result  in 
the  sale  of  a  chattel,  then  it  constitutes  a 
sale,  but  if  the  work  and  labor  be  bestowed 
in  such  a  manner  as  that  the  result  would 
not  be  any  thing  which  could  properly  be  said 
to  be  the  subject  of  sale,  the  action  is  for 
work  and  labor." 

The  Massachusetts  rule,  as  applicable  to 
goods  manufactured  or  modified  after  the 
bargain  for  them  is  made,  mainly  regards 
the  point  whether  the  products  can,  at  the 
time  stipulated  for  delivery,  be  regarded  as 
"goods,  wares  and  merchandise,"  in  the 
sense  of  being  generally  marketable  com- 
modities made  by  the  manufacturer.  In  that 
respect  it  agrees  with  the  English  rule.  The 
test  is  not  the  non-existence  of  the  commod- 
ity at  the  time  of  the  bargain.  It  is  rather 
whether  the  manufacturer  produces  the  arti- 
cle in  the  general  course  of  his  business  or  as 
the  result  of  a  special  order.  Goddard  v. 
Binney,  115  Mass.  450,  15  Am.  Rep.  112.  In 
this  very  recent  case,  the  result  of  their  de- 
cisions is  stated  in  the  following  terms:  "A 
contract  for  the  sale  of  articles  then  exist- 
ing, or  such  as  the  vendor  in  the  ordinary 
course  of  his  business  manufactures  or  pro- 
cures for  the  general  market,  whether  on 
hand  at  the  time  or  not,  is  a  contract  for 
the  sale  of  goods  to  which  the  statute  ap- 
plies. But  on  the  other  hand,  if  the  goods 
are  to  be  manufactured  especially  for  the 
purchaser  and  upon  his  special  order,  and 
not  for  the  general  market,  the  case  is  not 
within  the  statute."  Under  this  rule  it  was 
held  in  Gardner  v.  Joy,  9  Jletc.  177,  that  a 
conti-uct  to  buy  a  certain  number  of  boxes  of 
candles  at  a  fixed  price  per  pound,  which  the 
vendor  said  he  would  manufacture  and  de- 
liver in  about  three  months,  was  held  to  be 
a  contract  of  sale.  On  the  other  hand  in 
Goddard  v.  Binney,  supra,  the  contract  with 
a  carriage  manufacturer  was  that  he  should 
make  a  buggy  for  the  person  ordering  it, 
that  the  color  of  the  lining  should  be  drab, 
and  the  outside  seat  of  cane,  and  have  on  it 
the  monogram  and  initials  of  the  party  for 
whom  it  was  made.  This  was  held  not  to 
be  a   contract  of   sale    within   the    statute. 


SALE  OF  GOODS. 


157 


See,  also,  Mixer  v.  Howarth,  21  Tick.  205,  32 
Am.  Dec.  2l)G;  Lamb  v.  Cral'ts,  12  Mete.  353; 
Speucer  v.  Cone,  1  Mete.  283. 

The  New  York  rule  is  still  different.  It 
is  held  here  by  a  long  course  of  decisions 
that  an  agreement  for  the  sale  of  any  com- 
modity not  in  existence  at  the  time,  but 
which  the  vendor  is  to  manufacture  or  put 
in  a  condition  to  be  delivered,  such  as  flour 
from  wheat  not  yet  ground,  or  nails  to  be 
made  from  iron  belonging  to  the  manufac- 
turer, is  not  a  contract  of  sale.  The  New 
York  rule  lays  stress  on  the  word  "sale." 
There  must  be  a  sale  at  the  time  the  con- 
tract is  made.  The  latest  and  most  authori- 
tative expression  of  the  rule  is  found  in  a 
recent  case  in  this  court.  Parsons  v.  Loucks, 
48  N.  Y.  17,  10,  8  Am.  Rep.  517.  The  contrast 
between  Parsons  v.  Loucks,  in  this  state,  on 
the  one  hand,  and  Lee  v.  Griffin,  supra,  in 
England,  on  the  other,  is  that  in  the  former 
case  the  word  sale  refers  to  the  time  of  en- 
tering into  the  contract,  while  in  the  latter, 
reference  is  had  to  the  time  of  deliver^-,  as 
contemplated  by  the  parties.  If  at  that  time 
it  is  a  chattel  it  is  enough,  according  to  the 
English  rule.  Other  cases  in  this  state 
agreeing  with  Parsons  v.  Loucks  are  Crook- 
shank  V.  Burrell,  18  Johns.  58;  Sewall  v. 
Fitch,  8  Cow.  215;  Robertson  v.  Vaughn,  5 
Sandf.  1;  Parker  v.  Schenck,  28  Barb.  38. 
These  cases  are  based  on  certain  old  deci- 
sions in  England,  such  as  Towers  v.  Os- 
borne, 1  Strange,  50G,  and  Clayton  v.  An- 
drews, 4  Burrows,  2101,  which  have  been 
wholly  discarded  in  that  country. 

The  case  at  bar  does  not  fall  within  the 
rule  in  Parsons  v.  Loucks.  The  facts  of 
that  case  were  that  a  manufacturer  agreed 
to  make  for  the  other  party  to  the  contract, 
two  tons  of  book  paper.  The  paper  was  not 
in  existence,  and  so  far  as  appears,  not  even 
the  rags,  "except  so  far  as  such  existence 
may  be  argued  from  the  fact  that  matter  is 
indestructible."  So  in  Sewall  v.  Fitch,  su- 
pra, the  nails  which  were  the  subject  of  the 
contract  were  not  then  wrought  out,  but 
were  to  be  made  and  delivered  at  a  future 
day. 

Nothing  of  this  kind  is  found  in  the  pres- 
ent case.  The  lumber,  with  the  possible  ex- 
ception of  the  clapboards,  was  nil  in  exist- 
ence when  the  contract  was  made.  It  only 
needed  to  be  prepared  for  the  purchaser- 
dressed  and  put  in  a  condition  to  fill  his  or- 
der. The  court  accordingly  is  not  hampered 
in  the  disposition  of  this  cause  by  autliority, 
but  may  proceed  upon  principle. 

Were  this  subject  now  open  to  full  discus- 
sion upon  principle,  no  more  convenient  and 
easily  understood  rule  could  be  adopted  than 
that  enunciated  in  Lee  v.  Griffin.  It  is  at 
once  so  philosophical  and  so  readily  compre- 
hensible, that  it  is  a  matter  of  surprise  that 
it  should  have  been  first  announced  at  so 
late  a  stage  in  the  discussion  of  the  stat- 
ute. It  is  too  late  to  adopt  it  in  full  in  this 
state.    So  far  as  authoritative  decisions  have 


gone,  they  must  be  respected,  even  at  the 
expense  of  sound  principle.  The  court  liow- 
ever  in  view  of  tlie  present  state  of  the  law, 
should  plant  itself,  so  far  as  it  is  not  pre- 
cluded from  doing  so  by  authority,  up<»n 
some  clearly  intelligible  ground,  and  intro- 
duce no  more  nice  and  perplexing  distinc- 
tions. I  think  that  the  true  rule  to  be  ap- 
plied in  this  state,  is  that  when  the  chattel 
is  in  existence,  so  as  not  to  be  governed  by 
Parsons  v.  Loucks,  supra,  the  contract 
should  be  deemed  to  be  one  of  sale,  even 
though  it  may  have  been  ordered  from  a 
seller  who  is  to  do  some  work  upon  it  to 
adapt  it  to  the  uses  of  the  purchaser.  Such 
a  rule  makes  but  a  single  distinction,  and 
that  is  between  existing  and  non-existing 
chattels.  There  will  still  be  border  cases 
where  it  will  be  difficult  to  draw  the  line, 
and  to  discover  whether  the  chattels  are  in 
existence  or  not.  The  mass  of  the  cases 
will  however  readily  be  classified.  If,  on 
further  discussion,  the  rule  in  Lee  v.  Griffiu 
should  be  found  most  desirable  as  applicable 
to  both  kinds  of  transactions,  a  proper  case 
will  be  presented  for  the  consideration  of 
the  legislature. 

The  view  that  this  case  Is  one  of  sale  is 
sustained  by  Smith  v.  Central  R.  Co.,  *43  N. 
Y.  ISO,  and  by  Downs  v.  Ross,  23  Wend.  270. 

In  the  first  of  these  cases  there  was  a  con- 
tract for  the  sale  and  delivery  of  a  quantity 
of  wood,  to  be  cut  from  trees  standing  on 
the  plaintiff's  laud.  The  court  held  that  it 
could  not  be  treated  as  an  agreement  for 
work  and  labor  in  manufacturing  fire-wood 
out  of  standing  trees.  The  cases  already 
cited  were  distinguished  in  the  fact  that  no 
change  in  the  thing  sold  and  to  be  delivered 
was  contemplated,  and  that  the  transaction 
could  be  regarded  as  a  sale  in  perfect  con- 
sistency with  the  cases  which  hold  that 
where  the  substance  of  the  contract  consists 
in  the  act  of  converting  materials  into  a  new 
and  wholly  different  article,  it  is  an  agree- 
ment for  work  and  labor.  It  was  further 
considered  that  the  case  of  Towers  v.  Os- 
borne, 1  Strange,  500,  where  an  agreement 
for  the  manufacture  of  a  chariot  was  a  con- 
tract for  work  and  labor,  was  extreme  in  its 
natui'e,  and  was  not  to  be  carried  any  fur- 
ther. Page  200.  The  cases  of  Garbutt  v. 
Watson,  5  B.  &  Aid.  G13,  and  Smith  v.  Sur- 
man,  9  B.  &  C.  501,  were  cited  with  ap- 
proval. In  Garbutt  v.  Watson  a  sale  of 
flour  by  a  miller  was  held  within  the  statute, 
although  not  ground  when  the  bargain  was 
made. 

In  Downs  v.  Ross  there  was  a  contract 
for  the  sale  of  seven  hundred  and  fifty  bush- 
els of  wheat,  two  hundred  and  fifty  of  the 
quantity  being  in  a  granary,  and  the  residue 
unthreshed,  but  which  the  vendor  agreed  to 
get  ready  and  deliver.  The  court  held  the 
contract  to  be  within  the  statute  of  frauds, 
notwithstanding  that  the  act  of  threshing 
was  to  be  done  by  the  vendor.  The  rule 
that   governed    the   court    was    that   if   the 


158 


STATUTE  OF  FRAUDS. 


thing  sold  exist  at  the  time  in  solido,  the 
mere  fact  that  something  remains  to  be  done 
to  pnt  it  in  a  marlietable  condition  will  not 
talie  the  contract  out  of  the  operation  of  the 
statute.  Page  272.  This  proposition  is  in 
marlied  contrast  to  the  view  expressed  by 
Cowen,  J.,  in  a  dissenting  opinion.  His  the- 
ory was  that  where  the  article  which  forms 
the  subject  of  sale  is  understood  by  the  par- 
ties to  be  defective  in  any  particular  which 
demands  the  linishing  labor  of  the  vendor  in 
order  to  satisfy  the  bargain,  it  is  a  contract 
for  worli  and  labor  and  not  of  sale.  The 
two  theories  (where  the  goods  exist  at  the 
time  of  sale)  have  nowhere  been  more  terse- 
ly and  distinctly  stated  than  in  the  conflict- 
ing opinions  of  Bronson  and  Cowen,  JJ.,  in 
this  case.  See  also  Courtright  v.  Stewart, 
19  Barb.  455. 

The  fallacy  in  the  proposition  of  Cowen, 
J.,  is  in  assuming  that  there  is  any  "work 
and  labor"  done  for  the  vendee.  All  the 
work  and  labor  is  done  on  the  vendor's  prop- 
erty to  put  it  in  a  condition  to  enable  him 
to  sell  it.  His  compensation  for  it  is  found 
in  the  price  of  the  goods  sold.  It  is  a  juggle 
of  words  to  call  this  "a  mixed  contract  of 
sale  and  work  and  labor."  When  the  goods 
leave  the  vendor's  hands  and  pass  over  to 
the  vendee  they  pass  as  chattels  under  an 
executed  contract  of  sale.  While  any  thing 
remained  to  be  done  the  contract  was  exec- 
utory There  is  abundance  of  authority  for 
maintaining  that  a  contract  in  its  origin  ex- 
ecutory may,  by  the  performance  of  acts  un- 
der its  terms,  by  one  of  the  parties,  become 
in  the  end  executed.  Rohde  v.  Thwaites,  6 
B.  &  C.  3S8,  Benj.  Sales,  chap.  5,  and  cases 
cited. 

The  case  of  Donovan  v.  Willson.  2G  Barb. 
138,  and  Parke  v.  Scheuck,  28  Barb  38,  are 
to  be  upheld  as  falling  within  the  principle 
of  Parsons  v.  Loucks,  supra.  Both  of  these 
cases  concerned  articles  not  in  existence, 
but  to  be  produced  by  the  manufacturer;  in 
the  one  case  beer  was  to  be  manufactured, 
and  in  the  other  a  brass  pump.  So  in  Pas- 
saic Mauuf.  Co.  V.  Hoffman,  3  Daly,  405,  the 
contract  was  for  the  manufacture  and  deliv- 
ery of  tifty  warps.  None  of  these  were  in 
existence  when  the  order  was  received. 
While  the  case  appears  to  fall  within  the 
rule  of  Parsons  v.  Loucks,  the  eminent 
judge  who  wrote  an  elaborate  opinion  ex- 
pressing the  views  of  the  court  would  seem 
to  rely  upon  the  Massachusetts  rule  rather 
than  our  own.  Whatever  view  might  be  en- 
tertained of  the  soundness  of  that  distinc- 
tion it  is  now  too  late  to  adopt  it  here,  and 
the  case  cannot  be  sustained  on  that  ground. 

The  only  case  in  our  reports  appearing  to 
stand  in  the  way  of  the  conclusion  arrived 
at  in  this  cause  is  Mead  v.  Case,  33  Barb. 
202.  The  court  in  that  case  recognized  the 
distinction  herein  upheld.  The  only  doubt 
about  the  case  is  whether  the  court  coiTect- 
ly  applied  the  rule  to  the  facts.  These  were 
that  several  pieces  of  marble  put  together  in 


the  form  of  a  monument  were  standing  in 
the  yard  of  a  marble-cutter.  That  person 
agreed  with  a  buyer  to  polish,  letter  and  fin- 
ish the  article  as  a  monument,  and  to  dis- 
pose of  it  for  an  entire  price — $200.  The 
court  held  that  there  was  no  monument  in 
existence  at  the  time  of  the  bargain.  There 
were  pieces  of  stone  in  the  similitude  of  a 
monument,  and  that  was  all. 

It  is  unnecessary  to  quarrel  with  this  case. 
If  unsound,  it  is  only  a  case  of  a  misapplica- 
tion of  an  established  rule.  If  sound,  it  is  a 
so-called  "border  case,"  showing  the  refine- 
ments which  are  likely  to  arise  in  applying 
to  various  transactions  the  rule  adopted  in 
Sewall  v.  Fitch,  and  kindred  cases.  It  is 
proper  however  to  say  that  the  notion  that 
such  an  arrangement  of  marble  placed  in  a 
cemetery  over  a  grave  cannot  be  regarded 
as  a  monument,  in  the  absence  of  an  inscrip- 
tion, seems  highly  strained.  Then  there 
could  not  be  a  memorial  church  without  an 
inscription.  Then  it  could  not  have  been 
said  of  Sir  Christopher  Wren,  in  his  relation 
to  one  of  his  great  architectural  productions, 
"Si  quteris  monumentum,  circumspice."  It 
would  seem  to  be  enough  if  the  monument 
reminds  the  passer-by  of  him  whom  it  is  in- 
tended to  commemorate,  and  this  might  be 
by  tradition,  inscriptions  on  adjoining  or 
neighboring  objects,  or  otherwise. 

In  the  view  of  these  principles,  the  defend- 
ants had  the  right  to  set  up  the  statute  of 
frauds.  I  think  that  this  was  so  even  as 
to  the  clapboards.  Although  not  strictly  in 
existence  as  clapboards,  they  fall  within  the 
rule  in  Smith  v.  Central  R.  Co.  They  were 
no  more  new  products  than  was  the  wood  in 
that  case.  There  was  simply  to  be  gone 
through  with  a  process  of  dividing  and 
adapting  existing  materials  to  the  plaintiffs' 
use.  It  would  be  difficult  to  distinguish  be- 
tween splitting  planks  into  clapboards,  and 
ti'ees  into  wood.  No  especial  skill  is  re- 
quired, as  all  the  work  is  done  by  machinery 
in  general  use,  and  readily  managed  by  any 
producers  of  ordinary  intelligence.  The  case 
bears  no  resemblance  to  that  of  Parsons  v. 
Loucks,  where  the  product  was  to  be  created 
from  materials  in  no  respect  existing  in  the 
form  of  paper.  The  cases  would  have  been 
more  analogous  had  the  contract  in  that 
case  been  to  divide  large  sheets  of  paper  in- 
to small  ones,  or  to  make  packages  of  en- 
velopes from  existing  paper.  In  Oilman  v. 
Hill,  36  N.  H.  311,  it  was  held  that  a  con- 
tract for  sheep  pelts  to  be  taken  from  sheep 
was  a  contract  for  things  in  existence,  and 
a  sale. 

The  next  inquiry  is,  whether  there  have 
been  sufficient  acts  done  on  the  part  of  the 
buyers  to  comply  with  the  statute.  In  order 
to  properly  solve  this  question,  it  is  neces- 
sary to  look  more  closely  into  the  nature  of 
the  contract  As  has  been  already  suggest- 
ed, the  contract  was  in  its  origin  executory. 
It  called  for  selection  on  the  part  of  the  sell- 
ers from  a  mass  of  materials.     At  the  time 


SALE  OF  GOODS. 


159 


of  the  bargain  there  was  no  sale.  There 
was  at  most  only  an  agreement  to  sell.  The 
plaintiffs  however  laj-  much  stress  on  the 
fact  that  after  the  oral  bargain  and  after 
the  defendants  had  inspected  the  lumber, 
they  gave  directions,  also  oral,  to  the  plain- 
tiffs to  place  the  lumber  after  it  had  been 
made  ready  for  delivery  upon  the  dock  and 
to  give  notice  to  Porcival.  They  urge  that 
the  subsequent  compliance  with  these  direc- 
tions by  the  plaintiffs  satisfy  the  terms  of 
the  statute. 

It  will  be  observed  that  all  of  these  direc- 
tions were  given  while  the  contract  was  still 
wholly  executory,  and  before  any  act  of  se- 
lection had  been  performed  by  the  plaintiffs. 
It  will  thus  be  necessary  to  consider  whetli- 
er  these  directions  are  sufficient  to  turn  the 
executory  contract  of  sale  into  an  executed 
one,  independent  of  the  statute  of  frauds, 
and  afterward  to  inquire  whether  there  was 
any  sufficient  evidence  of  "acceptance  and 
receipt"  of  the  goods  to  take  the  case  out  of 
the  statute.  These  questions  are  quite  dis- 
tinct in  their  nature  and  governed  by  differ- 
ent considerations:  (1)  If  the  contract  had 
been  for  goods  less  than  ?50  in  value,  or  for 
more  than  that  amount,  and  ordered  by  the 
defendants  in  writing,  it  would  still  have 
been  executory  in  its  nature,  and  would  have 
passed  no  specific  goods.  It  would  have 
been  an  agreement  to  sell  and  not  a  sale. 
The  case  would  not  have  fallen  within  such 
authorities  as  Crofoot  v.  Bennett,  2  N.  Y. 
258,  and  Kimberly  v.  Patchin,  19  N.  Y.  330. 
Since  the  goods  could  not  have  been  identi- 
fied at  all,  except  by  the  act  of  the  seller  in 
selecting  such  as  would  comply  with  the  or- 
der, nor  could  the  purposes  of  the  contract 
have  been  performed  except  by  the  labor 
of  the  plaintiffs  in  adapting  the  goods  to  the 
defendants'  use,  the  case  falls  within  a  rule 
laid  down  by  Mr.  Blackburn  in  his  work  on 
Sales  (pages  151,  152):  "Where,  by  the  agree- 
ment, the  vendor  is  to  do  any  thing  to  the 
goods  for  the  purpose  of  putting  them  into 
that  state  in  which  the  purchaser  is  to  be 
bound  to  accept  them,  or  as  it  is  some  times 
worded,  into  a  deliverable  state,  the  per- 
formance of  these  things  shall,  in  the  ab- 
sence of  circumstances  indicating  a  conti'ary 
intention,  be  taken  to  be  a  condition  preced- 
deut  to  the  vesting  of  the  property."  Acra- 
man  v.  Morrice,  8  C.  B.  449;  Gillett  v.  Hill, 
2  C.  &  M.  530;  Campbell  v.  Mersey  Docks, 
14  C.  B.  (N.  S.)  412. 

Proceeding  on  the  view  that  this  was  an 
executory  contract,  it  might  still  pass  into 
the  class  of  executed  sales  by  acts  "of  sub- 
sequent appropriation."  In  other  words,  if 
the  subsequent  acts  of  the  seller,  combined 
with  evidence  of  intention  on  the  part  of  the 
buyer,  show  that  specific  articles  have  been 
set  apart  in  performance  of  the  contract, 
there  may  be  an  executed  sale  and  the  prop- 
erty in  the  goods  may  pass  to  the  purchaser. 
Blackburn,  Sales,  12S;  Benj.  Sales,  c.  5; 
Fragano  v.  Long,  4  B.  &  C.  219;    Kohde  v. 


Thwaites,  6  B.  &  C.  3SS;  Aldridge  v.  John- 
son, 7  E.  &  B.  885;  Calcutta,  etc..  Company 
V.  De  Mattos,  33  L.  J.  (Q.  B.)  214,  in  Exch. 
Cham.  This  doctrine  requires  the  assent 
of  both  parties,  though  it  is  held  that  it  is 
not  necessary  that  such  assent  should  be 
given  by  the  buyer  subseciuently  to  the  ap- 
propriation by  the  vendor.  It  is  enough 
that  the  minds  of  both  parties  acted  upon 
the  subject  and  assented  to  the  selection. 
The  vendor  may  be  vested  with  an  implied 
authority  by  the  vendee  to  make  the  selec- 
tion and  thus  to  vest  the  title  in  him.  Browne 
v.  Hare,  3  H.  &  N.  484;  s.  c,  4  H.  &  N.  822. 
This  doctrine  would  be  applicable  to  existing 
chattels  where  a  mere  selection  from  a  mass 
of  the  same  kind  was  requisite.  On  the  other 
hand,  if  the  goods  are  to  be  manufactured 
according  to  an  order,  it  would  seem  that 
the  mind  of  the  purchaser  after  the  manu- 
facture was  complete,  should  act  upon  the 
question  whether  the  goods  had  complied 
with  the  contract.  See  Mucklow  v.  Mangles, 
1  Taunt.  318;  Bishop  v.  Crawshay,  3  B.  & 
C.  415;  Atkinson  v.  Bell,  8  B.  &  C.  277.  This 
point  may  be  illustrated  by  the  case  of  a  sale 
by  sample,  where  the  seller  agrees  to  select 
from  a  mass  of  products  certain  items  cor- 
responding with  the  sample,  and  forward 
them  to  a  purchaser.  The  act  of  selection  by 
the  vendor  will  not  pass  the  title,  for  the 
plain  and  satisfactory  reason,  that  the  pur- 
chaser has  still  remaining  a  right  to  deter- 
mine whether  the  selected  goods  correspond 
with  the  sample.  Jenner  v.  Smith,  L.  R.  4 
C.  P.  270.  In  this  case  the  plaintiff  at  a  fair 
orally  conti-acted  to  sell  to  the  defendant  two 
pockets  of  hops,  and  also  two  other  pockets 
to  correspond  with  a  sample,  which  were 
lying  in  a  warehouse  in  Loudon,  and  which 
he  was  to  forward.  On  his  return  to  Lon- 
don, he  selected  two  out  of  three  pockets 
which  he  had  there,  and  directed  them  to  be 
marked  to  "wait  the  buyer's  order."  The 
buyer  did  no  act  to  show  his  acceptance  of 
the  goods.  The  court  held  that  the  appro- 
priation was  neither  originally  authorized 
nor  subsequently  assented  to  by  the  buyer, 
and  that  tlie  property  did  not  pass  by  the 
contract.  Brett,  J.,  put  in  a  strong  form  the 
objection  to  the  view  that  the  buyer  could 
have  impliedly  assented  to  the  appropriation 
by  the  seller.  It  was  urged,  he  said,  "that 
there  was  evidence  that  by  agreement  be- 
tween the  parties,  the  purchaser  gave  author- 
ity to  the  seUer  to  select  two  pockets  for  him. 
If  he  did  so,  he  gave  up  his  power  to  object 
to  the  weighing  and  to  the  goods  not  cor- 
responding with  the  sample;  for  he  could 
not  give  such  authority  and  reserve  his  right 
to  object,  and  indeed  it  has  not  been  contend- 
ed that  he  gave  up  those  rights.  That  seems 
to  me  to  be  couclusive  to  show  that  the  de- 
fendant never  gave  the  plaintiff  authority  to 
m:ike  the  selection  so  as  to  bind  him.  Un- 
der the  circumstances  therefore  it  is  impos- 
sible to  say  that  the  property  passed."  Page 
27S.    The  same  general  principle  was  main- 


i60 


STATUTE  OF  FRAUDS. 


tained  in  Kein  v.  Tupper,  52  N.  Y.  550,  where 
U  was  held  that  the  act  of  the  vendor  put- 
uug  the  goods  in  a  state  to  be  delivered  did 
aot  pass  the  title,  so  long  as  the  acceptance 
)t  the  vendee,  provided  for  under  the  terms 
of  the  contract,  had  not  been  obtained. 

The  result  is,  that  if  this  sale,  executory  as 
it  was  in  its  nature,  had  not  fallen  within 
the  statute  of  frauds,  there  would  have  been 
no  sutficient  appropriation  by  the  vendor  to 
pass  the  title.  The  transaction,  so  far  as 
it  went,  was  even  at  common  law  an  agree- 
ment to  sell  and  not  an  actual  saie. 

(2)  But  even  if  it  be  assumed  that  this 
would  have  been  an  executed  contract  of 
sale  in  its  own  nature,  without  reference  to 
the  statute  of  frauds,  was  there  "an  accept- 
ance and  a  receipt"  of  the  goods,  or  a  part  of 
them,  by  tJie  buyer,  so  as  to  satisfy  the  stat- 
ute? 

The  acceptance  and  receipt  are  both  neces- 
sai-y.  The  contract  is  not  valid  unless  the 
buyer  does  both.  These  are  two  distinct 
things.  There  may  be  an  actual  receipt 
without  an  acceptance,  and  an  acceptance 
without  a  receipt.  The  receipt  of  the  goods 
is  the  act  of  taking  possession  of  them. 
When  the  seller  gives  to  the  buyer  the  actual 
control  of  the  goods,  and  the  buyer  accepts 
such  control,  he  has  actually  received  them. 
Such  a  receipt  is  often  an  evidence  of  an  ac- 
ceptance, but  it  is  not  the  same  thing.  In- 
deed the  receipt  by  the  buyer  may  be,  and 
often  is,  for  the  express  purpose  of  seeing 
whether  he  will  accept  or  not.  Blackb.  Sales, 
lOG;  see  Brand  v.  Focht,  3  Keyes,  409;  Stone 
v.  Browning,  51  N.  Y.  211. 

There  are  some  dicta,  of  various  judges, 
cited  by  the  plaintiffs  to  the  effect  that  ac- 
ceptance and  receipt  are  equivalent.  Per 
Crompton,  J.,  and  Cockburn,  Ch.  B.,  in  Cas- 
tle V.  Sworder,  6  H.  &  N.  832;  per  Erie,  C. 
J.,  in  Mai-vin  v.  Wallis,  6  E.  «&  B.  726.  These 
remarks  cannot  be  regarded  as  of  any  weight, 
being  contrary  to  the  decided  current  of  au- 
thority. Indeed  a  late  and  approved  writer 
says:  "It  may  be  confidently  a.ssumed  how- 
ever that  the  constniction  which  attributes 
distinct  meanings  to  the  two  expressions,  "ac- 
ceptance' and  'actual  receipt,'  is  now  too 
firmly  settled  to  be  treated  as  an  open  ques- 
tion, and  this  is  plainly  to  be  infen-ed  from 
the  opinions  delivered  in  Smith  v.  Hudson." 
6  B.  «fe  S.  43G;   Benj.  Sales. 

It  cannot  be  conceded  that  there  was  any 
acceptance  in  the  present  case  by  reason  of 
the  acts  and  words  occurring  between  the 
parties  after  the  parol  contract  and  before 
the  goods  were  prepared  for  delivery.  There 
could  be  no  acceptance  without  the  assent 
of  the  buyers  to  the  articles  in  their  changed 
condition,  and  as  adapted  to  their  use.  If 
the  case  had  been  one  of  specific  goods  to  be 
selected  from  a  mass  without  any  preparation 
to  be  made,  and  nothing  to  be  done  by  the 
vendor  but  merely  to  select,  the  matter  would 
have  presented  a  very  different  aspect.  This 
distinction  ia  well  pointed  out  by  Willes,  J., 


in  Bog  Lead  Min.  Co.  v.  Montague,  10  C.  B. 
(N.  S.)  -ISl.  In  this  case  the  question  turned 
upon  the  meaning  of  the  word  "acceptance," 
in  another  statute,  but  the  court  proceeded 
on  the  analogies  supposed  to  be  derived  from 
the  construction  of  the  same  word  in  the 
statute  of  frauds.  The  question  was  as  ta 
what  was  necessary  to  constitute  an  "ac- 
ceptance" of  shares  in  a  mining  company,  un- 
der 19  &  20  Vict.  c.  47.  The  court  having 
likened  the  case  to  that  of  a  sale  of  chattels, 
said:  "It  may  be  that  in  the  case  of  a  con- 
tract for  the  purchase  of  unascertained  prop- 
erty to  answer  a  particular  description,  no 
acceptance  can  be  properly  said  to  take  place 
before  the  purchaser  has  had  an  oppoitimity 
of  rejection.  In  such  a  case,  the  offer  to 
purchase  is  subject  not  only  to  the  assent  or 
dissent  of  the  seller,  but  also  to  the  condition 
that  the  property  to  be  delivered  by  him  shall 
answer  the  stipulated  description.  A  right 
of  inspection  to  ascertain  whether  such  con- 
dition has  been  complied  with  is  in  the  con- 
templation of  both  parties  to  such  a  conti-act; 
and  no  complete  and  final  acceptance,  so  as 
irrevocably  to  vest  the  property  in  the  buy- 
er, can  take  place  before  he  has  exercised  or 
waived  that  right.  In  order  to  constitute 
such  a  final  and  complete  acceptance,  the 
assent  of  the  buyer  should  follow,  not  pre- 
cede, that  of  the  seller.  But  where  the  con- 
tract is  for  a  specific,  ascertained  chattel, 
the  reasoning  is  altogether  different.  Equal- 
ly, where  the  offer  to  sell  and  deliver  has  been 
first  made  by  the  seller  and  afterwards  as- 
sented to  by  the  buyer,  and  where  the  offer 
to  buy  and  accept  has  been  first  made  by 
the  buyer  and  afterwards  assented  to  by 
the  seller,  the  contract  is  complete  by  the 
assent  of  both  parties,  and  it  is  a  contract 
the  expression  of  which  testifies  that  the  sell- 
er has  agreed  to  sell  and  deliver,  and  the 
buyer  to  buy  and  accept  the  chattel."  Pages 
489,  490. 

This  view  is  confirmed  by  Maberley  v.  Shep- 
pard,  10  Bing.  99.  That  was  an  action  for 
goods  sold  and  delivered,  and  it  was  proven 
that  the  defendant  ordered  a  wagon  to  be 
made  for  him  by  the  plaintiff,  and,  during 
the  progress  of  the  work,  furnished  the  iron 
work  and  sent  it  to  the  plaintiff',  and  sent  a 
man  to  help  the  plaintiff  in  fitting  the  iron 
to  the  wagon,  and  bought  a  tilt  and  sent  it 
to  the  plaintiff  to  be  put  on  the  wagon.  It 
was  insisted,  on  these  facts,  that  the  defend- 
ant had  exercised  such  a  dominion  over  the 
goods  sold  as  amounted  to  an  acceptance. 
The  court,  per  Tindal,  C.  J.,  held  that  the 
plaintiff  had  been  rightly  nonsuited,  because 
the  acts  of  the  defendant  had  not  been  done 
after  the  wagon  was  finished  and  capable  of 
delivery,  but  merely  while  it  was  in  progress, 
so  that  it  still  remained  in  the  plaintiff's  yard 
for  further  work  until  it  was  finished.  The 
court  added:  "If  the  wagon  had  been  com- 
pleted and  ready  for  delivery  and  the  de- 
fendant had  then  sent  a  workman  of  his  own 
to  perfoiTH  any  additional  work  upon  it,  su'h 


SALE  OF  GOODS. 


161 


conduct  on  the  ijait  of  the  defendant  mit;ht 
have  amounted  to  an  acceptance."  See  also 
Benj.  Sales,  c.  4,  and  cases  cited. 

The  plaintiffs,  in  the  case  at  bar,  rely  much 
upon  the  decision  in  Morton  v.  Til:)bett,  15 
Ad.  &  El.  (N.  S.)  428.  Thoy  maintain  that 
this  case  clearly  establishes  that  there  may 
be  an  acceptance  and  receipt  of  goods  by  a 
purchaser,  within  the  statute  of  frauds,  al- 
though he  has  had  no  opportunity  of  exam- 
ining them,  and  although  he  has  done  noth- 
ing to  preclude  himself  from  objecting  that 
they  do  not  correspond  with  the  contract. 

The  expressions  in  :Mortou  v.  Tibl>ett  are 
not  to  be  pressed  any  further  than  the  facts 
of  the  case  require.  The  buyer  of  wheat  by 
sample  had  sent  a  carrier  to  a  phice  named 
in  a  verbal  contract  between  him  and  the 
seller  on  August  25.  The  wheat  was  received 
ou  board  of  one  of  the  carrier's  lighters  for 
conveyance  by  canal  to  Wi-sbeach,  where  it 
arrived  ou  the  2Sth.  In  the  mean  time  it 
had  been  resold  by  the  buyer,  by  the  same 
sample,  and  was  returned  by  the  second  pur- 
chaser because  foimd  to  be  of  short  weight. 
The  defendant  then  wrote  to  the  plaintiff  on 
the  30th,  also  rejecting  it  for  short  weight. 
An  action  was  brought  for  goods  bargained 
and  sold.  There  was  a  verdict  for  plaintiff, 
with  leave  to  move  for  a  nonsuit.  The  ques- 
tion for  the  appellate  court  was,  whether 
there  was  auj'  evidence  that  the  defendant 
had  accepted  and  received  the  goods  so  as  to 
render  him  liable  as  buyer.  The  court  held 
that  the  acceptance  under  the  statute  was 
not  an  act  subsequent  to  the  receipt  of  the 
goods,  but  must  precede,  or  at  least  be  con- 
tempoi'aneous  with  it;  and  that  there  might 
be  an  acceptance  to  satisfy  the  statute, 
though  the  purchaser  might  on  other  grounds 
disaffirm  the  contract. 

Morton  v.  Tibbett  decides  no  more  than 
this,  viz.,  that  there  maj'  be  a  conditional 
acceptance.  It  is  as  if  the  purchaser  had 
said:  "I  take  these  goods  on  the  supposi- 
tion that  thej'  comply  with  the  contract.  I 
am  not  bound  to  decide  that  point  at  this 
moment.  If,  on  examination,  they  do  not 
correspond  with  the  sample,  I  shall  still 
return  them  under  my  common-law  right, 
growing  out  of  the  very  nature  of  the  con- 
tract, to  declare  it  void,  because  our  minds 
never  met  on  its  subject-matter— non  in  haec 
foedera  veni."  It  is  not  necessary  to  decide 
whether  this  distinction  is  sound.  It  is 
enough  to  say  that  it  is  Intelligible.  The 
case.  In  no  respect,  decides  that  there  can  be 
an  acceptance  under  the  statute  of  frauds 
without  a  clear  and  distinct  intent,  or  that 
unfinished  articles  can  be  presumed  to  be 
accepted  before  they  are  finished.  The  act 
of  acceptance  was  clear  and  unequivocal. 
There  was  a  distinct  case  of  interraoddliug 
with  the  goods  in  the  exercise  of  an  act  of 
ownershii) — a  fact  entirely  wanting  in  the 
case  at  bar.  The  proof  of  acceptance  was  the 
act  of  resale  before  examination.  The  point 
of  the  decision  is,  that  this  was  such  an  ex- 

HOPK.  SEL.  CAS.  CONT.  — 1 1 


ercise  of  dominion  over  the  goods  an  Is  In- 
consistent with  a  continuance  of  the  rights 
of  property  in  the  vendor,  and  therefore  evi- 
dence to  justify  a  jury  in  finding  acceptance 
as  well  as  actual  receipt  by  the  buyer. 
Hunt  V.  Hecht,  8  Exch.  814. 

Even  when  interpreted  in  this  way,  Mor- 
ton V.  Tibbett  cannot  be  regarded  as  abso- 
lutely settled  law  in  England.  See  Coombs 
V.  Bristol  4S:  Exeter  Ry.  Co.,  3  II.  &  N.  510; 
Castle  V.  Sworder,  6  H.  &  N.  828.  The 
court  of  queen's  bench  recognizes  it,  vrhile 
the  court  of  exchequer  has  not  received  it 
with  favor.  Later  cases  distinctly  hold  that 
the  acceptance  must  take  place  after  an  op- 
portunity by  the  vendee  to  exercise  an  op- 
tion, or  after  the  doing  of  some  act  waiving 
it.  Bramwell,  B.,  said  in  Coombs  v.  Bristol 
&  Exeter  Ry.  Co.:  "The  cases  establish 
that  there  can  be  no  acceptance  where  there 
can  be  no  opportunity  for  rejecting."  All 
the  cases  were  reviewed  in  Smith  v.  Hud- 
son, 6  Best  &  Smith,  431  (A.  D.  1SG5),  where 
Hunt  V.  Hecht  was  approved.  The  two 
last  cited  cases  disclose  a  principle  applica- 
ble to  the  case  at  bar. 

In  Hunt  V.  Hecht  the  defendant  went  to 
the  plaintiff's  warehouse  and  there  inspect- 
ed a  heap  of  ox  bones,  mixed  with  others 
inferior  in  quality.  The  defendant  verbally 
agreed  to  purchase  those  of  the  better  quali- 
ty, which  were  to  be  separated  from  the 
rest,  and  ordered  them  to  be  sent  to  his 
wharfinger.  The  bags  were  received  on  the 
9th,  aiid  examined  next  day  by  the  defend- 
ant, and  he  at  once  refused  to  accept  them. 
There  was  held  to  be  no  acceptance.  The 
case  was  put  upon  the  ground  that  no  ac- 
ceptance was  possible  till  after  separation, 
and  there  was  no  pretense  of  an  acceptance 
after  that  time.  Martin,  B.,  said  that  an  ac- 
ceptance, to  satisfy  the  statute,  must  be 
something  more  than  a  mere  I'eceipt.  It 
means  some  act  done  after  the  vendee  has 
exercised  or  had  the  means  of  exercising 
his   right  of  rejection. 

In  Smith  v.  Hudson,  supra,  barley  was 
sold  on  November  3,  1SG3,  by  sample,  by 
an  oral  contract.  On  the  7th  it  was  taken 
by  the  seller  to  a  railway  station,  where  he 
had  delivered  grain  to  the  purchaser  on 
several  prior  dealings,  and  where  it  was 
his  custom  to  receive  it  from  other  sellers. 
The  barley  was  left  at  the  freight-house  of 
the  railway,  consigned  to  the  order  of  the 
purchaser.  It  was  the  custom  of  the  trade 
lor  the  buyer  to  compare  the  sample  with 
the  bulk  as  delivered,  and  if  the  examination 
was  not  satisfactory,  to  reject  it.  This  right 
continued  in  the  present  case,  notwithstand- 
ing the  delivery  of  the  grain  to  the  railway 
company.  On  the  9th  the  purchaser  became 
bankrupt,  and  on  the  11th  the  seller  notified 
the  station-master  not  to  deliver  the  barley 
to  the  purchaser  or  his  assignees.  The  court 
held  that  there  was  no  acceptance  sulficient 
to  satisfy  the  statute.  The  most  that  could 
be  said  was,  that  the  delivery  to  the  com- 


16:: 


STATUTE  OF  FRAUDS. 


pany,  considered  as  an  agent  of  the  buyer, 
was  a  receipt.  It  could  not  be  claimed  that 
it  was  an  acceptance,  the  carrier  having  no 
implied  authority  to  accept.  The  buyer  had 
a  right  to  see  whether  the  bulk  was  accord- 
ing to  the  sample,  and  until  he  had  exercis- 
ed that  right  there  was  no  acceptance.  Opin- 
ion of  Cockburn,  Ch.  J.,  440;  see,  also.  Caul- 
kins  V.  Hellman,  47  N.  Y.  449;  Halterline  v. 
Rice,  62  Barb.  593;  Edwards  v.  Grand  Trunk 
Ry.  Co.,  4S  Me.  379,  54  Me.  111. 

The  case  at  bar  only  differs  from  these 
cases  in  the  immaterial  fact  that  the  defend- 
ants, after  the  verbal  contract  was  made, 
gave  verbal  directions  as  to  the  disposition 
which  should  be  made  of  the  goods  after 
they  were  put  into  a  condition  ready  for 
delivery.  All  that  subsequently  passed  be- 
tween them  was  mere  words,  and  had  not 
the  slightest  tendency  to  show  a  waiver  of 
the  right  to  examine  the  goods  to  see  if  they 
corresponded  with  the  contract.  Whatever 
effect  these  words  might  have  had  in  indicat- 
ing an  acceptance,  if  the  goods  had  been  spe- 
cific and  ascertained  at  the  time  of  the  di- 
rections (see  Cusack  v.  Robinson,  1  Best  & 
S.  299),  they  were  without  significance  under 
the  circumstances,  as  the  meeting  of  the 
minds  of  the  parties  upon  the  subject  to  be 
settled  was  necessary.  Shepherd  v.  Pressey, 
32  N.  H.  57.  In  this  case  the  effect  of  subbe- 
quent  engagements  by  the  buyer  was  passed 
upon  as  to  their  tendency  to  show  a  receipt 
of  the  goods  by  him.  The  court  said:  "As 
mere  words  constituting  a  part  of  the  origi- 
nal contract  do  not  constitute  an  acceptance, 


so  we  are  of  opinion  that  mere  words  after 
words  used,  looking  to  the  future,  to  acts 
afterward  done  by  the  buyer  toward  carry- 
ing out  the  contract,  do  not  constitute  an 
acceptance  or  prove  the  actual  receipt  re- 
quired by  the  statute."  The  case  was  stron- 
ger than  that  under  discussion,  as  the  goods 
were  specific  and  fully  set  apart  for  the  pur- 
chaser at  the  time  of  the  subsequent  con- 
versations. No  distinction  is  perceived  be- 
tween future  acts  to  be  done  by  the  buyer 
and  by  the  seller,  as  both  equally  derive 
their  force  from  the  buyer's  assent. 

I  see  no  reason  in  the  case  at  bar  to  hold 
that  the  defendants  received  the  goods,  in- 
dependent of  the  matter  of  acceptance. 
There  was  no  evidence  that  Percival  became 
their  agent  for  this  purpose.  The  most  that 
can  be  said  is  that  they  promised  the  plain- 
tiffs that  they  would  make  Percival  their 
agent.  This  promise  being  oral  and  connect- 
ed with  the  sale,  is  not  binding.  They  did 
not  in  fact  communicate  with  him,  nor  did 
he  assume  any  dominion  or  control  over  the 
property.  The  promissory  representations  of 
the  plaintiffs  are  clearly  within  the  rule  In 
Shepherd  v.  Pressey,  supra. 

The  whole  case  falls  within  the  doctrine 
In  Shindler  v.  Houston,  1  N.  Y.  261,  there 
being  no  sufficient  act  of  the  parties  amount- 
ing to  transfer  of  the  possession  of  the  lum- 
ber to  the  buyer  and  acceptance  by  him. 

The  judgment  of  the  court  below  should  be 
affirmed. 

Ail  concur. 

Judgment  affirmed. 


SALE  OF  GOODS. 


163 


PRATT  et  al.  v.  MILLER  et  al. 

(18  S.  W.  965,  109  Mo.  78.) 

Supreme  Court  of  Missouri,  Division  No.  L 
March   14,  1892. 

Appeal  from  circuit  court,  Johnson  coun- 
ty; CiiAiti.KS  W.  Sloan,  .ludRo. 

Action  by  Pratt,  Warren  &  Co.  aRoinst 
Miller  &  Hel)«,'rlinK  to  recover  the  price  of 
a  bill  of  goods  ordered  by  defendants,  but 
not  accepted.  From  a  judRinent  of  the 
Kansas  f'ity  court  of  appeals  allirrainjz  a 
judgment  for  plaintiffs,  defendants  appeal. 
Reversed. 

S.  p.  Sparks,  for  appellants.  5.  T.Allen, 
for  respondents. 

BR/VCE,  J.  This  is  an  appeal  from  the 
Johnson  circuit  court  to  the  Kansas  City 
'  court  of  appeals,  certilied  here  from  the 
latter  court  (jn  the  ground  tiiat  the  con- 
clusion reached  by  that  court  is  in  conllict 
vvitii  the  decision  of  the  St.  Louis  court  of 
a()peals  in  Burrell  v.  Highleyman,  83  Mo. 
App.  183.  Plaintiffs'  cause  of  action,  set 
out  in  the  petition,  is  that  the  defendants 
ordered  and  requested  plaintiffs  to  manu- 
facture for  and  furnish  to  them  divers 
goods,  wares,  and  merchandise,  being 
boots  and  shoes,  of  which  an  itemized  ac- 
count, the  price  amounting  to  f  205. 4.5,  is 
filed;  that  plaintiffs  accepted  said  order, 
manufactured  said  goods,  and  shipped 
and  tendered  them  to  defendants,  who 
refused  to  pay  for  them.  The  defendants' 
answer  was  a  denial  of  the  material  alle- 
gations of  the  petition,  a  plea  of  the  stat- 
ute of  frauds,  a  warranty  of  quality  and 
breach  thereof.  The  evidence  tended  to 
show  that  the  plaintiffs  are  wholesale 
dealer.^  in  boots  and  shoes  in  the  city  of 
Boston,  Mas^.,  and  that  they  are  either 
themselves  manufacturers,  or  have  manu- 
factured for  them  their  stock  in  trade; 
that  the  defendants  were  retail  merchants 
in  llolden,  Mo.;  that  on  the  31st  of  May, 
1N77,  the  defendants,  at  Holden,  gave  the 
commercial  traveler  and  solicitor  of  plain- 
tiffs a  verbal  order  for  the  bill  of  goods 
sued  for;  that  the  solicitor  made  a  memo- 
randum of  the  order  in  writing,  signed  it 
himself,  gave  a  copj'  to  the  defendants, 
and  forwarded  it  to  the  plaintiffs,  who 
thereafter  proceeded  to  have  the  goods 
made;  that  on  the  Sth  of  July  the  defend- 
ants wrote  the  plaintiffs,  countermanding 
the  order,  and  again  on  the  2sth  to  the 
same  purport.  On  the  29th  of  July,  plain- 
tiffs replied  to  defendants' letter  of  the  Sth, 
refusing  to  accept  the  countermand,  and 
advising  the  defendants  that  the  goods 
would  bo  shipped  at  the  time  named  in 
the  order;  and,  on  the  13th  of  August, 
they  shipiied  the  goods,  addressed  to  the 
defendants  at  Holden,  Mo.,  where  they 
arrived,  and  defendants  refused  to  receive 
or  pay  for  them.  There  was  no  evidence 
tending  to  show  that  the  goods  were  not 
of  the  quality  contracted  for;  and  the  de- 
fendants refused  to  receive  the  goods,  not 
on  account  of  defect  in  quantity  or  qual- 
ity, but  for  the  reasons  assigned  in  their 
letters,  which  was  a  dissolution  of  their 
partnership,  in  the  first  letter,  and  the 
excessive  drought  prevailing  in  the  coun- 


tr3',  curtailing  trade,  in  their  second.  The 
court  refused  an  instruction  asked  for  by 
the  defendants  in  the  nature  of  a  demurrer 
to  the  evidence,  and  submitted  the  case  to 
the  jury  on  the  following  instruction  for 
the  i)lMintiffs:  "The  court  instructs  tlie 
jury  that  if  they  believe  from  the  evith-nce 
that  the  defendants  ordered  plaintiffs  t<j 
make  and  furnish  to  them  the  goods  set 
out  in  the  petition,  and  that  jilaintiffs  did 
commence  to  manufacture  said  goods  on 
or  about  tne  time  the  f)rder  was  received, 
and  had  a  large  portion  of  said  goods 
manufactured  on  the  Sth  day  of  July,  1S,'?7, 
when  defendants  countern)anded  said  or- 
der, and  that  i)laintiffs  did  manufacture 
said  goods  and  deliver  them  to  a  cf)mnion 
carrier,  directed  to  defendants  at  their 
place  of  business,  then  the  plaintiffs  must 
recover  for  the  price  sued  for."  The  jury 
found  the  issues  for  the  plaintiffs,  and  from 
the  judgment  of  the  circuit  court  theieon, 
for  the  price  of  the  goods  and  interest,  the 
defendants  appealed  to  the  Kansas  City 
court  of  appeals,  whi^re  the  judgment  of 
the  circuit  court  was  affirmed,  but  the 
case  certified  here,  for  the  reason  stated. 

1.  Section  2514,  Rev.  St.  1.S79,  provides 
that  "  no  contract  for  the  sale  of  goods, 
wares,  and  merchandise  for  the  price  of 
thirty  dollars  or  upwards  shall  be  allowed 
to  be  good  unless  the  buyer  shall  accejit 
part  of  the  goods  so  sold,  and  actually 
receive  the  same,  or  givp  something  in  ear- 
nest to  bind  the  bargain  or  in  part  pay- 
ment, or  unless  some  note  or  memoran- 
dum in  writing  be  made  of  the  bargain, 
and  signed  by  the  parties  to  be  charged 
with  such  contract,  or  their  agents  law- 
fully authorized. "  This  statute  was  first 
enacted  in  this  stale  in  1825,  (Laws  Mo. 
1825,  p.  214,)  and,  except  as  to  the  amount, 
is  almost  a  literal  transcript  of  the  En- 
glish statute,  (29  Car.  II.,  c.  3,  §  17.)  Thfi 
question  to  be  determined  in  this  case  is 
whether  the  contract  in  question  is  a  con- 
tract for  the  sale  of  goods,  wares,  and 
merchandise,  or  a  contract  for  work  and 
labor  to  be  done  and  materials  to  be  fur- 
nished. If  the  former,  it  is  within  the 
Kttitute,  and  the  plaintiffs  cannot  recover. 
If  the  latter,  it  is  not  within  the  statute, 
and  they  may.  The  Kansas  City  court  of 
appeals,  in  effect,  held  that  the  contract 
belonged  to  the  latter  class,  and  was  not 
within  the  statute,  without  discussing  the 
question,  but  simply  citing  Brown  on  the 
Statute  of  Frauds  (section  3GS;0  in  sup- 
port of  its  conclusion.  The  whole  ques- 
tion as  to  when  a  contract  is  to  be  held 
to  belong  to  one  or  the  other  of  these 
classes  was  maturely  considei-ed  and  ably 
discussed  in  Burrell  v.  llighley man. supra, 
by  the  St.  Louis  court  o!  ajjpeals;  tbe 
Dia'oritv  of  the  court,  in  an  oniuion  deliv- 
ered by  Ro.\ii5Ai;i;k,  P.  J.,  holding,  in  con- 
sonance with  the  ruling  in  Lee  v.  Griflin, 
1  Best  &  S.  272,  that  "when  the  subject- 
matter  of  a  contract  is  a  chattel  to  be 
afterwards  delivered,  then,  although  work 
and  labor  are  to  be  done  (m  such  chattel 
before  delivery,  the  cause  of  action  is 
goods  sold  and  delivered,  and  the  con- 
tract is  within  the  statute  of  frauds." 
TfioMPSON,  J.,  in  a  dissenting  opinion, 
after  reviewing  the  English  cases  from  the 
passage   of   the   act   in  England  until    the 


164 


STATUTE  OF  FRAUDS. 


date  of  its  adoption  in  tliis  state,  adhered 
to  the  construction  placed  upon  the  stat- 
ute bv  the  Engli^^h  courts  prior  to  tlie  lat- 
ter date,  and  by  the  supreme  court  of  New 
York  in  Crookshank  v.  Burrell,  18  Johns. 
58,  (decided  in  18:20,)  i.  e,  "that  a  contract 
to  deliver  at  a  future  day  a  thiuj^  not  then 
existing,  and  yet  to  be  made,  is  not  within 
the  statute;"  or,  as  stated  in  the  syllabus, 
"  where  work,  labor,  or  materials  are  to 
be  applied  to  the  chattel  in  order  to  put 
it  in  condition  for  delivery  to  tlie  pur- 
chaser, the  contract  is  not  witliin  the  stat- 
ute. "  ^Ir.  Benjamin,  in  his  excellent  trea- 
tise on  Sales,  in  entering  on  a  review  of  the 
English  cases,  says:  "There  have  been 
numerous  decisions,  and  much  diversity' 
and  conflict  of  opinion,  in  relation  to  the 
proper  principle  by  which  to  test  whether 
certain  contracts  are  'contracts  for  the 
sale,'  etc.,  under  the  seventeenth  section, 
or  contracts  for  w^ork  ami  labor  done  and 
materials  furnished,  "  (1  Benj.  Sales,  §  108,) 
—and  concludes  by  saying,  (section  117:) 
"In  reviewing  these  decisions,  it  is  surpris- 
ing to  find  that  a  rule  so  satisfactory  and 
api)arently  so  obvious  as  that  laid  down 
in  Lee  v.  Griflin.  in  18(51,  should  not  have 
been  earlier  suggested  by  some  of  the  emi- 
nent judges  who  had  been  called  on  to 
consider  the  subject,  beginning  wnth  Lord 
Ellenbohough  in  1S14,  and  closing  with 
Pollock,  C.  B.,  in  1S5G.  From  the  very 
definition  of  a  sale,  the  rule  would  seem  to 
be  deducible  that  if  the  contract  is  intend- 
ed to  result  in  transferring  for  a  price, 
from  B.  to  A.,  a  chattel  in  which  A.  had 
no  previous  property,  it  is  a  contract  for 
the  sale  of  a  cliattel,  and  unless  that  be 
the  case  there  can  be  no  sale.  In  several 
of  the  opinions  this  idea  was  evidently  in 
the  minds  of  the  judges.  Especially  was 
this  manifest  in  the  decision  of  Bayi.ey,  J., 
in  Atkinson  v.  Bell,  8  Barn.  &  C.  277,  and 
TiNDALL,  C.  J.,  in  Grafton  v.  Armitage,  2 
C.  B.  'i'iCr.  but  it  was  not  clearly  brought 
into  view  before  the  decision  in  Lee  v. 
Griffin.  The  same  tentative  process  for 
arriving  at  the  proper  distinctive  test  be- 
tween these  two  contracts  has  been  gone 
through  in  America,  but  without  a  satis- 
factory result."  The  result  of  that  pro- 
cess in  America,  briefiy  stated  in  a  general 
way,  may  be  found  in  8  Amer.  &  Eng. 
Enc.  Law,  p.  707  et  seq. 

In  New  York  the  ruio  is  that,  if  the  sub- 
ject-matter of  the  transfer  does  not  exist 
JD  soliflo  at  the  time  of  making,  the  con- 
tract is  for  work  and  labor,  but  if  it  does 
then  exist  the  c(mtract  is  none  the  less  a 
contract  of  sale;  that  work  and  labor  of 
the  vendor  is  to  be  t-xpended  upon  it  be- 
fore its  delivery.  This  rule  is  founded 
upon  the  decision  in  liurrell  v.  Johnson, 
supra,  afterwards  followed  in  Parsons  v. 
Loucks,  48  N.  Y.  17;  Cooke  v.  Millard,  G5 
N.  Y.  ::i52,  and  other  cases  based  on  old 
English  decisions,  such  as  Towers  v.  Os- 
borne, 1  Strange,  50G,  and  Clayton  v.  An- 
drews, 4  Burrow,  2101.  In  Cooke  v.  Mil- 
lard, supra,  (decided  in  187.'>,)  Dwigiit,  J., 
remarks:  "  Were  this  subject  now  open  to 
full  discussion  on  principle,  no  more  con- 
venient and  easily-understood  rule  could 
be  adopted  th'an  that  enunciated  in  Lee  v. 
Griffin.  It  is  at  once  so  philosophical  and 
so  readily  comprehensible  that  it  is  a  mat- 


ter of  surprise  that  it  should  have  been 
first  announced  at  so  late  a  stage  in  the 
discussion  of  the  statute.  It  is  too  late  to 
adopt  it  in  full  in  this  state.  So  far  as  au- 
thoritativedecisions  have  gone, they  must 
be  respected,  even  at  the  expense  of  sound 
principles. " 

In  Marvland,  in  Eichelberger  v.  Mc- 
Cauley,  5  Har.  &  J.  213,  (decided  in  1821,) 
the  rule  of  the  earlier  English  decision.s 
was  maintained;  Eahle,  J.,  in  delivering 
the  opinion  of  the  court,  saying:  "  What- 
ever opinion  may  be  entertained  of  the 
true  meaning  of  the  seventeenth  section  of 
the  statute,  the  court  thinks  the  distinc- 
tion between  mere  contracts  of  sale  of 
goods  and  those  contracts  for  the  sale  of 
goods  where  work  and  labor  is  to  be  be- 
stowed on  them  previous  to  delivery,  and 
subjects  are  blended  together,  some  of 
which  are  not  in  contemplation  of  the 
statute,  has  too  Jong  prevailed  to  be  at 
this  day  questioned."  Citing  the  English 
cases  of  Clayton  v.  Andrews,  (decided  in 
17(57,)  and  Rondeau  v.  Wyatt,  (in  1792,)  in 
support  of  the  conclusion.  In  the  later 
case  of  Rentch  v.  Long,  27  Md.  188,  the 
ruling  in  Eichelberger  v.  McCauley  was 
affirmed;  Baktol,  J.,  speaking  for  the 
court,  saying:  "Whatever  o[)inion  we 
might  entertain  on  this  question  if  it 
were  presented  for  our  consideration  for 
the  first  time,  we  are  not  willing  to 
disturb  the  rule  established  by  that 
case."  It  will  be  observed  that  the  rule 
of  construction  established  in  these 
states  is  not  maintained  in  the  later 
case  upon  the  ground  of  sound  principle, 
nor  yet  upon  the  ground  that  the  courts 
were  concluded  by  the  early  English  rul- 
ings made  before  the  statute  was  enacted 
in  those  states,  but  upon  the  ground 
that,  those  rulings  having  received  a 
particular  construction  by  their  own 
courts  in  their  early  rulings,  they  felt 
constrained  to  maintain  them,  to  the  ex- 
tent stated,  on  the  principle  of  stare  de- 
cisis. 

In  most  of  the  other  states  where  the 
courts  were  not  thus  fettered,  while  the 
rulings  cannot  be  said  to  go  the  length  of 
that  in  Lee  v.  Griffin,  which  is  now 
the  settled  rule  in  England,  they  trend 
in  that  direction.  As  illustrative  of  this 
fact  the  following  cases  may  be  cited: 
Mixer  v.  Howarth,  21  Pick.  205;  Spencer 
V.  Cone,  1  Mete.  (Mass.)  28;j;  Gardner  v. 
Joy,  9  Mete.  (Mf^ss.)  177;  Lamb  v.  Crafts, 
12  Mete.  (Mass.)  3.'):5;  Goddard  v.  Binney, 
115  Mass.  450;  Pitkin  v.  Noyes.  48  N.  H. 
294;  Prescott  v.  Locke,  51  N.  H.  94; 
Atwater  v.  Hough,  29  Conn.  508;  Fin- 
ney v.  Apgar,  31  N.  J.  Law,  20(5;  Cason  v. 
Cheely,  0  Ga.  554;  Edwards  v.  Railway 
Co.,  48  Me.  379 ;  Sawyer  v.  Ware,  36  Ala,  675 ; 
Mo.ncke  v.  Falk,  .55  Wis.  427,  13  N.  W.  Rep. 
545;  Brown  V.  Sanborn,  21  Minn.  402.  In 
many  of  these  cases,  rules  are  laid  down 
for  distinguishing  a  contract  of  sale  from 
one  for  work  and  labor  and  materials, 
not  always  harmonious  or  entirelj'  con- 
sistent with  each  other,  but  from  whict? 
a  general  rule  may  be  drawn,  broadly 
stated  as  well  in  Brown  on  Frauds  as 
elsewhere:  "That  if  the  contract  is  essen^ 
tially  a  contract  for  the  article  manufact- 
ured  or   to    be  manufactured   the  statu t«> 


SALE  OF  GOOD>^. 


165 


applies  to  it.  If  it  is  for  tlie  \vorI<,  Ifibor, 
and  skill  to  be  htstowcd  in  producing  tlie 
article,  the  statute  does  not  apply; 
•  *  •  the  true  qncstion  i)einji  whether 
the  essential  consideration  of  the  j)ur- 
chase  is  the  worlc  and  labor  of  the  seller, 
to  bo  a[)yjlied  upon  his  material,  or  the 
product  itself,  as  an  article  of  trade." 
Sections  .30X,.'U)Sifl.  And,  within  the  f;:eneral 
scope  of  the  American  authorities,  this  ri!;8 
may  be  formulated,  determinative  of  the 
case  in  hand:  That  where  tlie  contract  is 
for  articles  cominj;  under  the  general  de- 
nouiinaticin  of  goods,  wares,  and  mer- 
chandise, the  vendor  being  at  the  same 
time  a  manufacturer  and  a  dealerin  them, 
as  a  merchant,  or,  so  dealing,  lias  them 
manufactured  for  his  trade  by  others, 
and  the  vendee  being  also  a  merchant 
dealing  in  and  pui'chasing  the  same  line 
of  goods  for  his  trade,  of  which  fact  the 
vendor  is  aware,  the  quantitj'  reqtiired 
and  the  price  being  agreed  upon,  and  the 
goods  contracted  for  being  of  the  same 
general  line  which  the  vendor  manufactures 
or  has  manufactured  for  his  general  trade 
as  a  merchant,  requiring  the  bestowal  of 
no  peculiar  care  or  personal  skill,  or  the 
use  of  material  or  a  plan  of  construction 
different  from  that  obtaining  in  the  ordi- 
nary production  of  such  manufactured 
goods  for  the  vendor's  general  stock  in 
trade,  the  contract  is  one  of  sale,  and 
within  the  statute  of  frauds,  although  the 
goods  are  not  in  solido  at  the  time  of  the 
contract,  but  are  to  be  thereafter  made 
and  delivered.  This  rule,  predicated  upcju 
the  undisputed  facts  of  this  case,  is  with- 
in the  ruling  in  Burrell  v.  Highleyman, 
by  the  St.  Louis  court  of  appeals,  and  in 
conflict  with  tlie  conclusion  reached  by 
the  Kansas  City  court  of  appeals.  And, 
while  sufficient  for  the  disposition  of  this 
case,  it  is  proper  to  add  generally,  this  be- 
ing the  first  time  tliis court  has  been  called 
upon  to  pass  upon  this  question  directly, 
that  while  we  adhere  to  the  rulings  here- 
tofore made  in  Skouton  v.  Woods.  57  Mo. 
:{S0;  Skrainka  v.  Allen,  76  Mo.  384;  and 
Snyder  v.  Railroad,  86  Mo.  6i:j,  — in 
adopting  the  statute  of  another  state  <jr 
of  a  foreign  country.  It  is   to    be  presumed 


'  that  the  legislature  adopted  such  statute 
as  ccmstrued  by  the  courts  of  the  state  or 
country  from  which  such  statute  is  taken. 
Yat  it  is  to  fie  remembered  that  the  force 
of  this  presumption  must  always  deiiend 
up(Mi  the  extent  to  which  the  terms  (jf  the 
statute  have  actjuired  a  known  and  set- 
tk-d  incjiiiiiig  and  a  definite  application  at 
the  time  uf  its  adoption  in  the  courts  of 
the  jurisdiction  from  which  the  statute  is 
taken;  and,  while  such  construction  has 
more  weight  tlian  a  construction  of  the 
s;ime  statute  by  the  courts  (jf  the  same 
country  subsequent  to  its  adoption  in  this 
state,  yet  it  can  never  anujunt  to  more 
than  persuasive  authority  as  to  the  true 
Intent  and  meaning  of  the  statute  and 
the  proper  application  of  its  terms,  or  be 
permitted  to  prevail  against  a  plain  and 
obvious  interpretation  of  the  statute,  or 
countervail  the  geneial  policy  of  our  la'vs 
and  i)ractice.  Endl.  Interp.  St.  §  o71.  "The 
uniform  inclinaticm  of  the  courts  of  this 
state  is  to  give  the  words  of  this  sta  tute 
full  effect,  and  to  refuse  to  sanction  such  a 
latitudinous  construction  of  thcjse  words 
as  would  give  rise  to  all  the  evils  that  the 
statute  was  enacted  to  prevent."  Delven- 
thal  V.  Jones,  5;j  Mo.  460.  The  construc- 
tion by  the  English  courts  of  this  statute 
prior  to  1825  was  not  so  well  known,  def- 
inite, and  settled,  nor  its  apjilication  so 
uniform,  that  we  ought  to  be  concluded 
by  the  decisions  of  those  courts  prior  to 
that  date  from  adopting  a  rule  brought  to 
light  by  further  judicial  research,  and 
wjiich  gives  true  force  and  effect  to  the 
terms  of  this  statute,  as  does  the  rule  laid 
down  in  Lee  v.  Griffin,  supra,  and  ap- 
proved by  theSt.  Louis  court  of  appeals  in 
Burrell  v.  Highleyman.  The  undisputed 
facts  in  this  case  show  that  this  contract 
WHS  a  sale  of  goods,  wares,  and  merchan- 
dise, within  the  meaning  of  the  statute; 
and,  not  being  in  writing,  the  demurrei 
to  the  evidence  ought  to  have  been  sus- 
tained. The  judgment  of  the  Kansas 
City  court  of  appeals  will  therefore  be  re- 
versed, and  the  cause  remanded  to  that 
court,  where  judgment  will  be  entered, 
reversing  the  judgment  of  the  Johnson 
circuit  court. 


STATUTE  or  FRAUDS. 


CAULIOXS  V.  HELLMAN. 

(47   N.    y.   449.) 

Court  of  Appeals  of  New   York.    1S72. 

'^Action    to    recover    for    wines    and   casks 

sold. 

Stephen  K.  Williams,  for  appellant.  E.  G. 
Latham,  for  respondents. 

KArALLO,  J.  The  instructions  to  the 
jtiry  as  to  the  legal  effect  of  the  delivery 
of  the  wine  at  Blood's  Station  in  conform- 
ity with  the  terms  of  the  verbal  contract 
of  sale  were  clearly  erroneous.  No  act  of 
the  vendor  alone,  in  performance  of  a  con- 
tract of  sale  void  by  the  statute  of  frauds, 
can  give  validity  to  such  a  contract. 

"Where  a   valid   contract  of  sale   is   made 
in  writing  a  delivery  pursuant  to  such  con- 
tract  at   the   place   a},'reed    upon   for   deliv- 
ery,   or   a    shipment   of   the   goods    in   con- 
formity with  the  terms  of  the  contract,  will 
pass   the  title   to   the   vendee   without   any 
receipt  or  acceptance  of  the  goods  by  him. 
But    if    the   contract    is   oral,   and    no    part 
of   the  price  is  paid  by   the   vendee,   there 
must  be  not  only  a  delivery  of  the  goods 
by   the   vendor,    but   a   receipt   and   accept- 
ance  of  them   by   the   vendee   to   pass   the 
title    or    make    the    vendee    liable    for    the 
price;    and  this  acceptance  must  be  volun- 
tar3'    and    unconditional.    Even    the    receipt 
of  the  goods,  without  an  acceptance,  is  not 
sufficient.    Some  act  or  conduct  on  the  part 
of  the  vendee,  or  his  authorized  agent,  man- 
ifesting  an    intention   to    accept    the   goods 
as  a   performance   of   the  contract,   and   to 
appropriate  them,  is  required  to  supply  the 
place   of   a   written    contract.    This   distinc- 
tion seems  to  have  been  overlooked  in  tne 
charge.    The   learned    judge    instructed    the 
jury,  as  a  matter  of  law,  that  if  they  were 
satisfied  that  the  wine  or  any  portion  of  it 
was  actually  delivered  in  pursuance  of  the 
verbal  contract,  that  circumstance  Avas  suf- 
ficient   to    take    the    contract    out    of    the 
statute  of  frauds,   and  the  contract  was  a 
valid  one,  and   might  be  enforced   notwith- 
standing   it    was    not    in    writing.    The    at- 
tention of  the  jury  was  directed  to  the  in- 
quiry  whether  the  plaintiffs  had  faithfully 
performed  their  part  of  the  contract  rather 
than  to  the  action  of  the  defendant,  and  the 
judge  proceeded  to  state  that   if  the   wine 
was   delivered   to   the   express   company   at 
Blood's  Station  in  good  order,  in  merchant- 
able  condition,   and    corresponded    in   'qual- 
ity and  all  substantial  and  material  respects 
with    the   samples,   then    he    instructed    the 
jury  as  a  matter  of  law,  that  if  they  found 
the   contract   as    Gordon    testified    with    re- 
spect to  the  place  of  delivery,  that  was  a 
complete   delivery   under  the   contract,   and 
passed   the  title  from   the  plaintiffs   to   the 
defendant,  and   the  plaintiffs   were  entitled 
to  recover  the  contract  price  of  the  wines. 

The    plaintiff's    counsel    suggests    in    the 
statement  of  facts  appended  to  his   points, 


that  Gordon  was  the  agent  of  the  defend- 
ant, to  accept  the  goods  at  Blood's  Station. 
But  this  statement  is  not  borne  out  by 
the  evidence;  Gordon  was  the  agent  of  the 
plaintiffs  for  the  sale  of  the  goods;  it  was 
incumbent  upon  them  to  make  the  ship- 
ment. All  that  Gordon  testifies  to  is  that 
the  defendant  requested  him  to  make  the 
best  bargain  he  could  for  the  freight.  He 
does  not  claim  that  he  had  any  authority 
to  accept  the  goods  for  the  defendant. 

According  to  the  defendant's  .testimony 
Gordon  clearly  had  no  such  authority,  nor 
did  the  defendant  designate  any  convey- 
ance, and  the  judge  submitted  no  question 
to  the  jury  as  to  the  authority  either  of 
Gordon  or  the  express  company  to  accept 
the  goods.  On  the  contrary,  he  repeated 
that  if  when  the  wine  was  delivered  at 
Blood's  Station  it  was  in  good  order  and 
corresponded  with  the  samples,  the  plain- 
tiffs would  be  entitled  to  a  verdict  for  the 
contract  price,  upon  the  ground  that  the 
parties  by  the  contract  (assuming  it  to  be 
as  claimed  by  the  plaintiffs),  fixed  upon 
that  station  as  the  place  of  delivery;  "that 
it  was  true  that  the  defendant  was  not 
there  to  receive  it,  and  had  no  agent  at 
Blood's  Station  to  receive  it,  and  had  no 
opportunity  to  inspect  it  there;  but  that 
that  was  a  contingency  he  had  not  seen, 
and  which  he  might  have  guarded  against 
in  the  contract." 

It  is  evident  that  the  learned  judge  ap- 
plied to  this  case  the  rule  as  to  delivery, 
which  would  be  applicable  to  a  valid,  writ- 
ten contract  of  sale,  but  which  is  inappli- 
cable when  the  contract  is  void  by  the 
statute  of  frauds. 

The  effect  of  the  delivery  of  goods  at  a 
railway  station,  to  be  forwarded  to  the 
vendee  in  pursuance  of  the  terms  of  a 
verbal  contract  of  sale,  was  very  fully  dis- 
cussed in  the  case  of  Norman  v.  Phillips, 
14  Mees.  &  W.  277.  and  a  verdict  for  the 
plaintiff  founded  upon  such  a  delivery,  and 
upon  the  additional  fact  that  the  vendor 
sent  an  invoice  to  the  vendee,  which  he 
retained  for  several  weeks,  was  set  aside. 
The  English  authorities  on  the  subject  are 
reviewed  in  that  case,  and  the  American 
and  English  authorities  bearing  upon  the 
same  question  are  also  referred  to  in  the 
late  cases  of  Ilodgers  v.  Fhillips,  40  N.  Y. 
519,  and  Cross  v.  O'Donnell,  44  N.  Y.  661. 
The  latter  case  is  cited  by  the  counsel  for 
the  plaintiffs  as  an  authority  for  the  prop- 
osition that  a  delivery  to  a  designated  car- 
rier is  sufficient  to  take  the  case  out  of 
the  statute;  but  it  does  not  so  decide.  It 
holds  only  that  the  receipt  and  acceptance 
need  not  be  simultaneous,  but  that  they 
may  take  place  at  different  times,  and 
that  after  the  purchaser  had  himself  in- 
spected and  accepted  the  goods  purchased, 
the  delivery  of  them  by  his  direction  to  a 
designated  carrier  was  a  good  delivery,  and 
the  carrier  was  the  agent  of  the  purchaser 


SALE  OF  GOODS. 


167 


to  receive  them.  No  question  however  aris- 
es in  the  present  case  as  to  a  delivery  to  a 
desiguutc'd  carrier,  as  the  evidence  In  rtf- 
spect  to  the  agreed  mode  of  delivery  is  con- 
flicting, and  no  question  of  acceptance  by 
the  carrier  as  agent  for  the  defendant  was 
submitted  to  the  jury. 

The  judge  submitted  to  the  jury  two 
questions,  to  which  he  required  specific  an- 
swers. 

1st.  Was  the  wine  delivered  at  the  rail- 
road station  at  the  time  agreed  upon  by 
the  parties,  and  was  it  then  in  all  respects 
in  good  order,  and  like  the  samples  exhib- 
ited by  the  plaintiff  to  the  defendant  V  and, 

2d.  Was  the  wine  accepted  by  the  de- 
fendant after  it  reached  his  place  of  busi- 
ness in  New  York? 

The  jury  answered  both  of  these  ques- 
tions in  the  affirmative,  and  it  is  now  claim- 
ed that  the  answer  to  the  second  question 
renders  immaterial  any  error  the  judge 
may  have  committed  in  respect  to  the  ef- 
fect of  the  delivery  at  the  station. 

It  Is  difficult  to  find  any  evidence  justify- 
ing the  submission  to  the  jury  of  the  see 
ond  question;  but  no  exception  was  taken 
to  such  submission.  The  motion  for  a  non- 
suit Avould  have  raised  that  point,  were  it 
not  for  the  fact  that  there  was  evidence  to 
go  to  the  jury  on  the  claim  of  $j2  for  bar- 
rels, and  this  precluded  a  nonsuit.  We 
think  however  that  the  error  in  the  charge 
may  have  misled  the  jury  in  passing  upon 
the  second  question;  at  all  events,  it  is  not 
Impossible  that  it  should  have  done  so. 
Having  been  instructed  that  upon  the  fact 
as  they  found  it  in  respect  to  the  agree- 
ment for  a  delivery  at  Blood's  Station,  the 
title  to  the  goods  had  passed  to  the  de- 
fendant before  the  receipt  of  them  at  New 
York,  and  that  their  verdict  must  be  for 
the  plaintiffs,  they  may  have  examined  the 
question  of  his  acceptance  of  thorn  at  New 
York  with  less  scrutiny  than  they  would 
have  exercised  had  they  been  informed  that 
the  result  of  the  case  depended  upon  their 
finding  on  that  question.  And  the  construc- 
tion of  the  defendant's  acts  and  language 
may,  In  some  degree,  have  been  Influenced 
by  the  consideration  that  when  the  wine 
arrived  in  New  York  the  title  had,  accord- 
ing to  the  theory  on  which  the  case  was 
submitted  to  them,  passed  to  the  defend- 
ant, and  he  had  no  right  to  reject  the  wines. 
Furthermore,  we  think  the  judge  erred  In 
excluding  the  evidence  of  the  contents  of 
the  telegram  which  the  defendant  attempt- 
ed to  send  to  the  plaintiffs  immediately  up- 
on the  receipt  of  the  wine.  If,  as  was  of- 
fered to  be  shown,  it  stated  that  he  de- 
clined to  accept  the  wine,  it  was  material 
as  part  of  the  res  gesta?.  A  bona  fide  at- 
tempt, immediately  on  the  receipt  and  ex- 
amination   of    the    wine,    to    communicate 


such  a  mes.sage,  was  an  act  on  his  part 
explaining  and  qualifying  his  conduct  iu 
receiving  the  wine  into  his  store  and  al- 
lowing it  to  remain  there.  And  even  though 
the  message  never  reached  the  plaintiffs,  it 
bore  upon  the  question  of  acceptance  by 
the  defendant.  The  objection  to  the  evi- 
dence of  the  contents  of  the  telegram  was 
not  placed  on  the  ground  of  omission  to 
produce  the  original,  and  the  judge  in  his 
charge  instructed  the  jury  that  the  at- 
tempt to  send  this  telegram  did  not  affect 
the  plaintiffs'  rights,  for  the  reason  that  it 
was  not  shown  to  have  been  received  by 
them,  and  this  was  excepted  to.  In  Norman 
V.  Phillips,  14  Mees.  &  W.  277,  the  de- 
fendant was  allowed  to  prove  that  on  being 
informed  by  the  railwav  clerk  that  the 
goods  were  lying  for  him  at  the  station,  he 
said  he  would  not  take  them,  and  stress 
was  laid  upon  the  fact.  Yet  this  statement 
to  the  clerk  was  not  communicated  to  the 
plaintiffs.  Evidence  of  an  attempt  to  send 
a  message  to  them  to  the  same  effecr, 
though  unsuccessful,  would  have  been  no 
more  objectionable  than  the  declaration  to 
the  clerk.  The  acts  of  the  defendant  at 
the  time  of  the  receipt  of  the  goods,  and 
his  bona  fide  attempt  to  communicate  to 
the  plaintiffs  his  rejection  of  them  were  I 
think  material  and  competent  to  rebut  any 
presumption  of  an  acceptance  arising  from 
their  retention  by  him. 

The  judge  was  requested  to  instruct  the 
jury  that  the  true  meaning  of  the  defend- 
ant's letter  of  March  31  was  a  refusal  to 
accept  the  wine  under  the  contract.  A  care- 
ful examination  of  that  letter  satisfies  us 
that  the  defendant  was  entitled  to  have  the 
jury  thus  Instructed.  The  letter  clearly 
shows  that  the  defendant  did  not  accept 
or  appropriate  the  wines.  After  complain- 
ing in  strong  language  of  their  quality  and 
condition,  and  of  the  time  and  manner  of 
their  shipment,  he  says  to  the  plaintiffs, 
"What  can  be  done  now  with  the  wine  after 
it  suffered  so  much,  and  shows  itself  of 
such  a  poor  quality?  I  don't  know  myself 
and  am  awaiting  your  advice  and  opinion." 
He  concludes  by  expressing  his  regret  that 
their  first  direct  transaction  should  have 
turned  out  so  unsatisfactory,  and  by  stat- 
ing that  he  cannot  be  the  sufferer  by  it, 
and  he  awaits  their  disposition. 

This  language  clearly  indicates  an  inten- 
tion to  throw  upon  the  plaintiffs  the  re- 
sponsibility of  directing  what  should  be 
done  with  the  wine,  and  Is  Inconsistent 
with  any  acceptance  or  appropriation  of 
it  hy  the  writer. 

For  these  reasons  the  judgment  should 
be  reversed,  and  a  new  trial  granted,  with 
costs  to  abide  the  event. 

All  concur. 

Judgment   reversed. 


168 


STATUTE  OF  FRAUDS. 


\^  GARFIELD  v.  PARIS. 

(96  U.  S.  557.) 
Supreme  Court  of  the  United  States.    Oct.,  1877. 

Error  to  the  circuit  court  of  the  United 
States  for  the  Eafetern  district  of  Michigan. 

This  was  an  action  by  Paris,  Allen,  &  Co., 
of  New  York,  against  Garfield  &  Wheeler,  of 
Detroit,  Mich.,  to  recover  for  certain  spir- 
ituous liquors  sold  to  the  defendants  by  the 
plaintiffs,  in  the  city  of  New  York. 

The  facts  are  stated  in  the  opinion  of  the 
court. 

Verdict  and  judgment  for  the  plaintiffs; 
whereupon  the  defendants  sued  out  this  writ 
of  error. 

Mr.  Hairy  M,  Duffield,  for  plaintiffs  in 
error. 

Mr.  Justice  CLIFFORD,  delivered  the  opin- 
ion of  the  court.  Neither  the  manufacture  nor  the 
sale  of  spirituous  or  intoxicating  liquors  is  al- 
lowed by  the  law  of  the  state  where  the  pres- 
ent controversy  arose.  Instead  of  that,  the 
state  law  provides  that  all  payments  made 
for  such  liquors  so  sold  may  be  recovered 
back,  and  that  all  contracts  and  agi-eements 
in  relation  to  such  sales  shall  be  utterly  null 
and  void  against  all  persons  and  in  all  cases; 
with  an  exception  in  favor  of  the  bona  tide 
holders  of  negotiable  securities  and  the  pur- 
chasers of  property  without  notice.  1  Comp. 
Laws  Mich.  p.  690. 

Two  bills  of  goods,  consisting  of  spirituous 
liquors,  were  purchased  of  the  plaintiffs  by 
the  defendants,  which,  including  exchange, 
amounted  to  $4,143.09.  Payment  being  refus- 
ed, the  plaintiffs  brought  suit  in  the  court 
below  to  recover  the  amount,  and  the  verdict 
and  judgment  were  for  the  plaintiffs.  Ex- 
ceptions were  taken  by  the  defendants,  and 
they  sued  out  the  present  writ  of  error. 

Sufficient  appears  to  show  that  the  plaintiffs 
are  citizens  of  New  York,  and  that  the  de- 
fendants are  citizens  of  Michigan;  that  the 
liquors  were  purchased  of  the  plaintiffs,  as  al- 
leged; and  that  the  same  were  received  and 
sold  by  the  defendants:  but  they  set  up  the 
prohibitory  liquor  law  of  the  latter  state,  pro- 
viding that  all  such  contracts  are  utterly  null 
and  void. 

Evidence  was  introduced  by  the  plaintiffs, 
showing  that  the  liquors  were  ordered  by  one 
of  the  defendants  at  a  time  when  he  was  tem- 
porarily in  the  city  of  New  York;  and  that 
the  plaintiffs,  by  his  request,  sent  certain 
labels  to  be  attached  to  the  same,  to  the  de- 
fendant, at  the  hotel  in  that  city  where  he 
was  stopping.  By  the  agreement  at  the  time 
the  sale  was  made,  the  plaintiffs  were  to 
furnish  these  labels  to  the  purchasers;  and 
the  evidence  showed  that  the  value  of  the 
labels  entered  into  the  price  charged  for  the 
liquors,  and  that  the  labels,  by  the  terms  of 
the  contract,  were  to  be  furnished  to  the  buy- 
ers, by  the  sellers,  without  any  other  charge 
than  the  price  to  be  paid  for  the  liquors. 
Labels  of  the  kind  were  something  more  than 


ordinary  labels  affixed  to  bottles,  as  they  in- 
dicated not  only  the  kind  of  liquor  which  the 
bottle  contained,  but  also  embraced  an  af- 
fidavit that  the  distillation  was  genuine,  and 
of  the  particular  brand  manufactured  and  dis- 
tilled by  the  plaintiffs;  support  to  which  is 
derived  from  the  fact  that  the  label  was  copy- 
righted, so  that  no  other  person  than  the 
plaintiffs  had  any  right  to  make,  use,  or 
vend  it. 

Certain  questions  were  submitted  to  the 
jury,  among  which  were  the  following:  "Were 
there  any  receipt  and  acceptance  in  New  YorJi 
of  part  of  the  goods  sold;  and,  if  so,  what  was 
so  received?"  to  which  the  jury  answered, 
"There  was,  to  wit,  certain  labels."  "Was  any 
thing  added  to  the  price  of  the  liquors  on  ac- 
coimt  of  the  labels,  and,  if  so,  what  amount 
or  price?"  Answer:  "There  was  nothing  add- 
ed; but  the  labels  added  to  the  value  of  the 
liquors,  and  formed  part  or  parcel  of  the 
price." 

Testimony  was  offered  by  the  plaui tiffs  in 
respect  to  tha  delivery  of  the  labels  to  the  de- 
fendant while  he  was  at  the  hotel  in  New 
York,  to  which  the  defendants  objected;  but 
the  court  overruled  the  objection,  and  the  tes- 
timony was  admitted,  subject  to  the  defend- 
ant's objection. 

Errors  assigned  are  in  substance  and  effect 
as  follows:  (1)  That  the  court  erred  in  refus- 
ing to  charge  the  jury  that  the  delivery  of  the 
labels,  as  proved,  was  not  a  receipt  and  ac- 
ceptance of  part  of  the  goods  sold  within  the 
meaning  of  the  state  statute  of  frauds.  (2) 
That  the  court  erred  in  refusing  to  charge  the 
jury  that  the  evidence  was  not  sufficient  to 
take  the  case  out  of  the  statute  of  frauds.  (3) 
That  the  court  erred  in  refusing  to  charge  the 
jury  that  the  sale  was  not  consummated  until 
the  defendants  received  and  accepted  the  goods 
in  the  state  where  they  resided.  (4)  That  the 
court  erred  in  instructing  the  jury  that  the 
defence  set  up  is  one  not  to  be  favored,  and 
that  the  proof  to  support  it  must  be  clear  and 
satisfactory,  before  the  jury  can  consistently 
enforce  it.  (5)  That  the  statute  is  a  penal 
statute,  in  derogation  of  the  rights  of  prop- 
erty; and  that  for  that  reason,  if  for  no  oth- 
er, it  must  receive  a  strict  construction.  (6) 
That  the  court  erred  in  instructing  the  jury 
that  if  the  labels  were  included  in  the  con- 
tract, and  the  liquors  were  worth  more  to  the 
defendants  on  account  of  the  labels,  then  the 
receipt  and  acceptance  of  the  same  by  the 
acting  defendant  took  the  case  out  of  the 
New  York  statute  of  frauds,  and  their  verdict 
should  be  for  the  plaintiffs. 

Due  exception  was  also  made  to  the  ruhng 
of  the  court  in  admitting  the  evidence  report- 
ed in  respect  to  the  delivery  and  acceptance 
of  the  labels  furnished  to  the  purchasers  at 
the  time  the  order  for  the  liquors  was  filled, 
the  objection  being  that  the  labels  are  not 
mentioned  in  the  plaintiff's  bill  of  particulars 
filed  in  the  case. 

Matters  of  evidence  are  never  required  to 
be  stated  in  such  a  paper.    Courts  usually  re- 


SALE  OF  GOODS. 


169 


quire  such  a  notice  where  the  declaration  is 
general,  in  order  that  the  defendant  may  know 
what  the  cause  of  action  is  to  which  he  is  re- 
quired to  respond.  Nothinjj  is  wanted  in  this 
case  to  meet  tliat  requirement,  as  all  the  items 
of  the  demand  are  distinctly  and  spccilically 
stated  in  the  bill  filed  in  compliance  with  the 
order  of  the  court 

Merchants  selling  spirituous  liquors  in  bot- 
tles usually  label  the  bottles,  to  indicate  the 
kind,  character,  age,  quality,  or  proof  of  the 
liquor,  or  to  specify  the  name  of  the  manu- 
facturer, or  the  place  where  it  was  manu- 
factured or  distilled.  Such  are  somewhat  in 
the  nature  of  trade-marks,  and  are  useful  to 
the  seller  of  the  liquors,  to  enable  him  to  dis- 
tinguish one  kind  of  liquor  from  another  with- 
out opening  the  bottle,  and  to  commend  the 
article  to  liis  customers  without  oral  explana- 
tion. 

Commg  to  the  errors  formally  assigned,  it  is 
manifest  that  the  first  and  second  may  be  con- 
sidered together,  as  they  depend  entirely  upon 
the  same  considerations. 

Both  parties  concede  that  the  bargain  for  the 
sale  of  tlie  liquors  in  this  case  was  made  in 
New  York;  and,  by  the  laws  of  that  state, 
contracts  for  the  sale  of  any  goods,  chattels, 
or  things  in  action,  for  the  price  of  $50  or 
more,  shall  bo  void,  unless  (1)  a  note  or 
memorandum  of  such  conti'act  be  made  in 
writing,  and  be  subscribed  by  the  parties  to 
be  charged  thereby;  or  (2)  unless  the  buyer 
shall  accept  and  receive  part  of  such  goods, 
or  the  evidences,  or  some  of  them,  of  such 
things  in  action;  or  (3)  unless  the  buyer  shall 
at  the  time  pay  some  part  of  the  purchase- 
money.    3  Rev.  St.  N.  Y.  (Gth  Ed.)  142,  §  3. 

Four  answers  are  made  by  the  plaintiffs  to 
that  proposition,  each  of  which  will  receive  a 
brief  consideration: 

1.  That  the  defendants  received  and  accept- 
ed the  labels  which  the  plaintiffs  contracted  to 
furnish  at  the  time  they  filled  the  order  for 
the  liquors.  2.  That  the  case  is  not  within 
the  statute  of  frauds,  inasmuch  as  the  defend- 
ants received  the  liquors,  and  sold  the  same 
for  their  own  benefit.  3.  That  the  statute  of 
Michigan,  prohibiting  the  sale  of  such  liquors, 
and  declaring  such  contracts  null  and  void, 
has  been  repealed.  4.  That  the  subsequent 
letter  written  by  the  defendants  to  the  plain- 
tiffs takes  the  case  out  of  the  operation  of  the 
statute  requiring  such  a  contract  to  be  in 
writing. 

Authorities  almost  numberless  hold  that 
there  is  a  broad  distinction  between  the  prin- 
ciples applicable  to  the  formation  of  the  con- 
tract and  those  applicable  to  its  performance, 
which  appears  with  sufficient  clearness  from 
the  language  of  the  statute,— such  a  conti-act 
must  be  in  writing,  or  there  must  be  some 
note  or  memorandum  of  the  same  to  be  sub- 
scribed by  the  party  to  be  charged:  but  the 
same  statute  concedes  that  the  party  becomes 
liable  for  the  whole  amount  of  the  goods,  if  he 
accepts  and  receives  part  of  the  same,  or  the 
•evidences,   or  some  of  them,  of  such   things 


In  action;  and  the  authorities  agree,  that 
where  the  question  is  whether  the  contract 
has  been  fulfilled,  it  is  sufficient  to  show  an 
acceptance  and  actual  receipt  of  a  part,  how- 
ever small,  of  the  thing  sold,  in  order  that  the 
contract  may  be  held  to  be  good,  even  though 
it  does  not  preclude  tlie  purchaser  from  refu.s- 
ing  to  accept  the  residue  of  the  goods,  if  it 
clearly  appears  that  they  do  not  conform  to 
the  contract.  Benj.  Sales  (2d  Ed.)  117;  Hindo 
V.  Whitehouse,  7  East,  ijoS;  Morton  v.  Tib- 
bett,  15  Adol.  &  E.  (X.  S.)  4JT. 

Hence,  said  Lord  Campbell,  in  the  case 
last  cited,  the  paynient  of  any  sum  In  ear- 
nest to  bind  the  bargain,  or  in  part  p.iyraent, 
is  sufficient;  the  rule  being,  that  such  an 
act  on  the  part  of  the  buyer,  if  acceded  to 
on  the  part  of  the  vendee,  is  an  answer  to 
the  defence. 

"Accept  and  receive"  are  the  words  of  the 
statute  in  question;  but  the  law  is  well 
settled,  that  an  acceptance  sufficient  to  satis- 
fy the  statute  may  be  constructive,  the  rule 
being  that  the  question  is  for  the  jury  wheth- 
er the  circumstances  proved,  of  acting  or 
forbearing  to  act,  do  or  do  not  amount  to  an 
acceptance  within  the  statute.  Bushel  v. 
Wheeler,  15  Adol.  &  E.  (N.  S,)  445;  Chit. 
Cont.  (10th  Ed.)  367;  Parker  v.  WaUis,  5 
El.  &  Bl.  21;  Lilly  white  v.  Devereux,  15 
Mees.  &  W.  2S5;  Simmonds  v.  Humble,  13 
C.  B.  (N.  S.)  261;  Add.  Cont.  (6th  Ed.)  169. 

Questions  of  the  kind  are  undoubtedly  for 
the  jury;  and  it  is  well  settled  that  any 
acts  of  the  parties  indicative  of  ownership 
by  the  vendee  may  be  given  in  evidence  to 
show  the  receipt  and  acceptance  of  the 
goods  to  take  the  case  out  of  the  statute  of 
frauds.  Conduct,  acts,  and  declarations  of 
the  purchaser  may  be  given  in  evidence  for 
that  purpose;  and  it  was  held,  in  the  case 
of  Currie  v.  Anderson,  2  El.  &  El.  591,  that 
the  vendee  of  goods  may  so  deal  with  a 
bill  of  lading  as  to  afford  evidence  of  the 
receipt  and  acceptance  of  the  goods  therein 
described.     Gray  v.  Davis,  10  N.  Y.  2S.j. 

Throughout,  it  should  be  borne  in  mind 
that  one  of  the  defendants  in  person  visited 
the  plaintiffs'  place  of  business,  and  while 
there  ordered  the  liquors,  and  that  the  liq- 
uors were  all  received  by  the  defendants  at 
their  place  of  business,  and  were  sold  by 
them  for  their  own  benefit;  that  the  con- 
tract between  the  sellers  and  purchasei-s 
was  that  the  former  should  furnish  the  la- 
bels as  part  of  the  contract;  and  the  evi- 
dence shows  that  they  fidfilled  that  part  of 
the  contract,  and  that  they  delivered  the 
same  to  the  contracting  party  at  his  hotel, 
before  he  left  the  state  where  the  purchase 
was  made. 

Satisfactory  evidence  was  also  introduced 
by  the  plaintiffs,  showing  that  they  drew  a 
draft  on  the  defendants  for  the  payment  of 
the  price,  and  that  the  defendants  answered 
the  letter  of  the  plaintiffs  declining  to  ac- 
cept the  same,  as  more  fully  set  forth  in  the 
record,   in   which    they   state   that  the   pur- 


170 


STATUTE  or  FRAUDS. 


chase  was  on  four  aaonths.  with  the  further 
privilege  of  extending  the  time  two  months 
longer  by  allowing  se^en  per  cent,  interest, 
adding,  that  if  the  plaintiffs  doubted  their 
word,  they  had  "a  written  contract  to  that 
effect."  What  they  claim  in  the  letter  is 
that  the  arrangement  was  made  with  the 
salesman;  and  they  state  that  they  would 
not  have  given  him  the  order,  if  he  had  not 
given  them  "those  conditions."  They  make 
no  complaint  that  the  liquors  were  not  of 
the  agreed  quantity  and  quality,  and  certain- 
ly leave  it  to  be  implied  that  they  had  been 
duly  received,  and  that  they  were  satisfac- 
tory. 

It  was  contended  by  the  plaintiffs  that 
the  case  was  taken  out  of  the  statute  of 
frauds:  (1)  Because  the  labels  were  a  part 
of  what  was  purchased,  and  that  the  defend- 
ants accepted  and  received  the  same  at  the 
time  and  place  of  the  purchase.  (2)  That 
the  subsequent  letter,  as  exhibited  in  the 
record,  is  sufficient  for  that  purpose. 

Enough  appeared  at  the  trial  to  show  that 
the  labels  were  copyrighted,  and  that  the 
plaintiffs  agreed  to  furnish  the  same  without 
any  additional  charge;  and  the  bUl  of  excep- 
tions also  shows  that  it  was  conceded  that 
the  defendants  accepted  and  received  the 
labels  at  the  hotel,  as  claimed  by  the  plain- 
tiffs. StiU,  the  defendants  denied  that  the 
labels  were  of  any  value,  or  that  they  enter- 
ed into  or  constituted  any  part  of  the  things 
purchased;  both  of  which  questions  the  cir- 
cuit judge  submitted  to  the  jury,  remarking, 
at  the  same  time,  that  by  the  furnishing  the 
labels  with  the  liquors  the  defendants  ac- 
quired the  right  to  use  the  copyright  to  that 
extent,  without  which,  or  some  equivalent 
permission  or  license,  they  would  have  had 
no  such  lawful  authority. 

Pursuant  to  these  suggestions,  the  jury 
were  directed  to  ascertain  whether  the  liq- 
uors were  worth  more  to  the  defendants  on 
account  of  the  labels,  and  whether  the  labels 
were  included  in  the  contract;  and  they 
were  instructed,  that,  if  they  found  affirma- 
tively in  respect  to  both  of  these  inquiries, 
then  the  receipt  and  acceptance  of  the  labels 
as  alleged  took  the  case  oat  of  the  statute  of 
frauds,  because  then  there  was  a  receipt  and 
acceptance  by  the  defendants  of  a  portion 
of  the  things  purchased. 

Appropriate  instruction  was  also  given  to 
the  jury  in  respect  to  the  subsequent  letter 
sent  by  the  defendants  to  the  plaintiffs;  and 
the  jury  were  told  by  the  presiding  judge, 
that  if  they  found,  under  the  instructions 
given,  that  the  defendants  received  and  ac- 
cepted a  part  of  the  things  purchased,  then 
the  contract  was  made  valid  as  a  New  York 
contract,  and  that  their  verdict  should  be  in 
favor  of  the  plaintiffs.  Currie  v.  Anderson, 
supra.  That  if  the  contract  was  not  made 
valid  by  the  acceptance  and  receipt  of  the 
labels,  nor  by  the  letter  exhibited  in  the  rec- 
ord, then  it  was  a  Michigan  contract,  and 
their  verdict  should  be  for  the  defendants. 


Meredith  v.  Meigh,  2  El.  &  Bl.  3&4;  Castle  v. 
Sworder,  6  Hurl.  &  N.  828,  L.  R.  1  C.  P.  5. 

Controlling  authorities  already  referred  to 
show  that  the  question  whether  the  goods  or 
any  part  of  the  same  were  received  and  ac- 
cepted by  the  purchaser  is  one  for  the  jury, 
to  which  list  of  citations  many  more  may  be 
given  of  equal  weight  and  directness.  Just 
exception  cannot  be  taken  to  the  form  in 
which  the  question  was  submitted  to  the 
jury;  and  the  record  shows  that  the  verdict 
was  for  the  plaintiffs,  and  that  the  jury 
found,  in  response  to  the  fifth  question,  that 
the  labels  added  to  the  value  of  the  liquors, 
and  that  they  formed  part  or  parcel  of  the 
price.    Jackson  v.  Lowe,  7  Moore,  219. 

Where  goods  are  purchased  in  several  par- 
cels, to  be  paid  for  at  a  future  day,  the 
whole,  within  the  meaning  of  the  statute  of 
frauds,  constitutes  but  one  contract,  and  the 
defivery  of  part  to  the  purchaser  is  sufficient 
to  take  the  case  out  of  the  operation  of  the 
statute  of  frauds.  Mills  v.  Hunt,  20  Wend. 
431. 

Apply  the  finding  of  the  jury  in  this  case 
to  the  conceded  facts,  and  it  shows  that  the 
defendants  were  in  the  situation  of  a  pur- 
chaser who  goes  to  a  store  and  buys  differ- 
ent articles,  at  separate  prices  for  each  ar- 
ticle, under  an  agreement  for  a  credit,  as 
in  this  case,  accepting  a  part  but  leaving 
the  bulk  to  be  forwarded  by  public  convey- 
ance. Frequent  cases  of  the  kind  occur;  and 
It  is  well  settled  law  that  the  delivery  of  a 
part  of  the  articles  so  purchased,  without 
any  objection  at  the  time  as  to  the  delivery, 
is  sufficient  to  take  the  case  out  of  the  stat- 
ute of  frauds  as  to  the  whole  amount  of  the 
goods.    :Mms  V.  Hunt,  20  Wend.  431. 

The  delivery  in  such  a  case,  in  order  that 
it  may  have  that  effect,  must  be  made  in 
pursuance  of  the  contract,  the  question 
whether  it  was  so  made  or  not  being  one  for 
the  jury;  but  if  they  find  that  question  in 
the  affirmative,  then  it  follows  that  the  case 
is  taken  out  of  the  statute  of  frauds.  Van 
Woert  v.  Railroad  Co.,  67  N.  Y.  539. 

Parol  evidence  is  admissible  to  show  what 
the  circumstances  were  attending  the  con- 
tract, and  to  show  the  receipt  and  accept- 
ance, in  whole  or  in  part,  of  the  goods  pur- 
chased. Tomkinson  v.  Staight,  17  C.  B.  G95; 
Kershaw  v.  Ogden,  3  Hurl.  &  C.  715. 

Due  acceptance  and  receipt  of  a  substan- 
tial part  of  the  goods  wiU  be  as  operative  as 
an  acceptance  and  receipt  of  the  whole;  and 
the  acceptance  may  either  precede  the  recep- 
tion of  the  article,  or  may  accompany  their 
reception.    2  Whart.  Ev.  §  875. 

Differences  of  opinion  have  existed  upon 
some  of  these  matters;  but  all  the  authori- 
ties, or  nearly  all,  concur  that  the  question  is 
for  the  jury,  to  be  determined  by  the  circum- 
stances of  the  particular  case.    Id. 

Viewed  in  the  light  of  these  suggestions.  It 
is  clear  that  the  question  whether  the  evi- 
dence showed  that  the  case  was  taken  out 
of  the  statute  of  frauds  by  the  acceptance 


SALE  OF  GOODS. 


171 


and  receipt  by  the  defendants  of  a  part  of 
what  was  purchased  by  them,  In  connection 
with  the  letter  ot  the  defendants  exhibited 
in  the  record,  was  fairly  submitted  to  tJie 
jury,  and  that  their  finding  in  the  premises 
Is  final  and  conclusive. 

Attempt  was  also  made  by  the  plaintiffs 
to  support  the  judgment,  upon  the  ground 
that  the  defendants  were  estopped  to  set  up 
the  statute  of  frauds  as  a  defence.  In  view 
of  the  fact  that  they  had  received  the  liq- 
uors and  sold  the  same  for  their  own  bene- 
fit; but  It  Is  not  necessary  to  examine  that 
proposition  In  view  of  the  conclusion  that 
the  case  Is  taken  out  of  the  operation  of  the 
statute  by  the  other  evidence  and  the  finding 
of  the  jury.     Nor  is  it  necessary  to  give  any 


cousiileration  to  the  proposition  that  the  act 
of  the  state  of  Michigan  to  prevent  the  manu- 
facture and  sale  of  spirituous  and  intoxicat- 
ing li(iuors  as  a  beverage  is  repealed,  for 
the  same  reason,  and  also  for  the  additional 
reason,  that,  the  repealing  clause  saves  '"ail 
actions  pending,  and  all  causes  of  action 
which  had  accrued  at  the  time"  the  repealing 
act  took  effect.    Sess.  Acts  ISTij,  p.  27'J. 

Having  come  to  the  conclusion  that  the 
case  is  taken  out  of  the  statute  of  frauds, 
It  is  not  deemed  necessary  to  give  the  other 
assignments  of  error  a  separate  examina- 
tion. Suffice  It  to  say,  that  the  court  is  of 
the  opinion  that  there  is  no  error  in  the  rec- 
ord. 

Judgment  affirmed. 


STATUTE  OP  FRAUDS. 


EDGERTON  v.  HODGE. 

(41  Vt.  676.) 

Supreme    Court    of    Vermont.      Rutland.    Jan. 
Term.  1869. 

Assumpsit,  which  was  referred  to  a  referee, 
who  reported:  "That  on  the  30th  day  of  June, 
lt^G4.  the  parties  made  an  agreement  by  parol, 
by  which  the  defendant  agreed  to  sell  to  the 
plaintiff  what  new  milk  cheese  he  then  had  on 
hand,  and  unsold,  amounting  to  975  lbs.,  and 
the  new  milk  cheese  he  should  make  thereafter 
during  the  season,  and  the  plaintiff  agreed  to 
pay  the  defendant  therefor  at  the  rate  of  fifteen 
and  a  half  cents  per  pound,  and  every  twenty 
days  thereafter  agreed  to  call  at  the  defendant's 
house  in  Dorset,  select  such  cheese  as  would  be 
fit  for  market,  attend  its  weight  there,  and  pay 
the  defendant  for  the  cheese  so  selected  and 
weighed,  and  then  the  defendant  was  to  deliver 
thesame  to  the  plaintiff  at  the  railroad  depot 
in  JIanchester.  The  day  after  the  above  agree- 
ment was  made,  the  defendant,  by  his  son,  Al- 
bert Hodge,  wrote  and  sent  by  mail  a  letter  to 
the  plaintiff  (a  copy  of  which  is  annexed,  dated 
July  1,  1SG4,)  depositing  the  same  at  the  post 
oftlce  in  East  Rupert,  and  directed  to  the  plain- 
tiff at  Pawlet,  and  received  by  him  by  mail  on 
the  same  day.  The  next  day,  after  the  return 
mail  from  Pawlet  to  East  Rupert  had  gone  out, 
it  being  on  Saturday,  the  plaintiff  enclosed  in  a 
letter,  directed  to  the  defendant,  at  East 
Rupert,  and  left  it  in  the  post  office  at  Pawlet, 
to  be  carried  by  mail  to  the  defendant,  the  sum 
of  tjfty  dollars.  (A  copy  of  plaintiff's  letter  is 
hereunto  annexed,  and  the  envelope  enclosing 
the  fifty  dollars  is  postmarked  '  Pawlet,  July  4.') 
This  letter  of  the  plaintiff  was,  on  the  8th  day 
of  July,  1864,  handed  to  the  said  Albert  Hodge, 
by  the  postmaster  of  East  Rupert,  and  it  was  on 
the  same  da}'  carried  by  him  to  the  defendant, 
opened  by  the  said  Albert,  the  fifty  dollars  re- 
fused to  be  received  by  the  defendant,  and  the 
letter  of  the  plaintiff,  with  the  fifty  dollars,  and 
the  envelope  enclosing  them,  were,  bj'  mail,  re- 
turned to  the  plaintiff,  with  no  comrauni- 
*677  cation  accompanying  them  *from  the  de- 
fendant. The  plaintiff  received  the  so 
enclosed  wrapper,  money  and  letter,  on  the  9th 
of  July,  1864,  and  kept  the  same  fifty  dollars 
for  six  months  thereafter.  A  daily  mail  is 
carried  between  the  postoffices  of  Pawlet  and 
East  Rupert,  a  distance  of  six  miles.  On  the 
20lh  da}'  of  July,  18G4,  the  plaintiff  sent  word 
to  the  defendant  to  deliver  what  cheese  he  had 
fit  for  market  to  the  depot  in  Manchester.  The 
defendant  replied  to  the  messenger  that  he  had 
no  cheese  for  the  plaintiff.  No  other  com- 
munication ever  took  place  between  the  parties 
in  regard  to  the  cheese  after  the  return  of  tlie 
money  as  above  stated  until  this  suit  was 
brought.  The  defendant  sold  all  his  cheese  to 
other  parties,  making  his  first  sale  on  the  2Gth 
day  of  July,  18G4.  If  the  court  shall  be  of  opin- 
ion that  from  the  foregoing  facts  the  plaintiff 
is  entitled  to  recover,  and  that  the  rule  of  dam- 
ages should  be  the  New  York  market  price  for 
cheese  for  the  season  of  1864,  deducting  freight 
and  commission,  then  I  find  due  the  plaintiff 
$411.01.  If  the  current  price  in  the  country, 
paid  by  purchasers  and  sent  by  them  to  market, 
is  to  be  the  rule,  then  I  find  due  the  plaintiff'  the 
sum  of  ?306.32. " 

"  Dorset,  July  1st,  1864.  Mr.  Edgerton :  Sir :— 
According  to  our  talk  yesterday  you  bought  my 
cheese  for  the  season.  I  shall  stand  to  it,  but 
shall  want  you  to  pay  me  fifty  dollars  to  bind 
it.     I  spose  there    is    nothing  holding  unless 


there  is  money  paid.  I  do  not  wish  you  to  think 
I  wish  to  fly  from  letting  you  have  it  so  that  it 
is  sure.  I  will  pay  you  interest  on  the  money 
until  the  last  cheese  is  delivered.  Tours  in 
haste.     J.  H.  C.  Hodge,  per  A.  K. " 

"Pawlet,  July  2.  1864.  Mr.  Hodge:  Dear 
Sir: — I  enclose  you  fifty  dollars  to  apply  on  your 
dairy  of  cheese  as  you  proposed.  Yours,  truly, 
S.  Edgerton.  " 

The  court  at  the  March  term,  1868,  Pierpoint, 
C.  J.,  presiding,  rendered  judgment  on  the  re- 
port that  the  plaintiff  recover  of  the  defendant 
the  smaller  sum  reported  by  the  referee, 
and  for  his  costs,  to  which  the  defendant  ex- 
cepted. 

*Edger1on  <&  Nicholson,  and  J.  B.  Brom-  *678 
ley,  for  the  defendant. 

Fayette  Potter,  for  the  plaintiff. 

The  opinion  of  the  court  was  delivered  by 

■WILSON,  J.  The  parol  agreement,  entered 
into  by  the  parties,  June  30th,  being  for  the  sale 
of  goods,  wares  and  merchandise  for  the  price 
of  forty  dollars  and  more,  is  within  the  statute 
of  frauds,  and  inoperative,  unless  taken  out  of 
the  statute  by  the  subsequent  acts  of  the 
parties.  It  is  claimed  by  the  plaintiff  that  the 
defendant's  letter  under  date  of  July  1st,  and 
the  depositing  of  the  plaintiff's  letter  with  the 
fifty  dollars  in  the  postofl3ce  on  the  2d  of  that 
month,  constitute  a  payment  of  part  of  the  pur- 
chase money  within  the  meaning  of  the  statute. 
It  will  be  observed  that  when  those  letters  were 
written,  no  binding  agreement  had  been  con- 
cluded. The  defendant,  in  his  letter  of  July  1st, 
says:  "According  to  our  talk  yesterday,  you 
bought  my  cheese  for  the  season.  I  shall  stand 
to  it.  but  shall  want  fifty  dollars  to  bind  it. " 
By  that  letter  the  plaintiff  was  notified  that  he 
could  make  the  bargain  binding  upon  himself 
as  well  as  the  defendant,  by  paying  to  the  de- 
fendant the  sum  demanded  for  that  purpose. 
The  plaintiff  on  the  2d  day  of  July  enclosed 
fifty  dolhirs  in  a  letter,  directed  to  the  defend- 
ant and  deposited  it  in  the  postoffice,  which 
letter  was  delivered  to  the  defendant  on  the  8th 
of  that  month.  He  did  not  accept  the  money, 
but  returned  it  to  the  plaintiff'.  It  is  clear  that 
the  act  of  depositing  the  letter  and  the  money 
in  the  postottice  was  not  a  payment  to  the  de- 
fendant. His  letter  did  not  direct  the  money 
to  be  sent  by  maih'it  contains  nothing  that 
would  indicate  that  the  defendant  expected  the 
plaintiff  would  reply  by  letter,  or  accept  the 
proposition  by  depositing  the  money  in  the 
postoffice;  and  the  fact  that  the  defendant  by 
letter  ott'ered  to  allow  the  plaintiff  to  perfect 
the  agreement,  by  paying  part  of  the  purchase 
money,  did  not  authorize  or  invite  the  plaintiff 
to  send  the  money  by  mail,  or  make  the  mail 
the  defendant's  carrier  of  the  money.  The 
language  of  the  defendant's  letter  is:  "I  shall 
want  you  to  pay  me  fifty  dollars  to  bind  it," 
that  is,  to  make  it  a  valid  contract. 

The  money,  when  deposited  in  the  postoflBce, 
belonged  to  the  plaintiff;  it  belonged  to  the 
plaintiff  while  being  carried  by  mail 
*to  the  defendant,  and  it  would  continue  *679 
the  property  of  the  plaintiff  unless  ac- 
cepted by  the  defendant.  The  plaintiff  took 
the  risk  not  only  of  the  safe  conveyance  of 
the  money  to  the  defendant,  but  also  as  to  the 
willingness  of  the  defendant  to  accept  it. 
The  defendant's  letter,  not  constituting  such  a 
note  or  memorandum  of  the  agreement  as  the 
statute  required,  left  it  optional  with  the  de- 
fendant to  accept  or  refuse  part  payment  when 
offered  to  him,  the  same  as  if  the  defendant 
had  sent  to  the  plaintiff  a  verbal  communica- 


SALE  OF  GOODS. 


173 


tion  of  the  same  import  as  the  defendant's 
letter.  A  point  is  made  by  counsel  as  to  wheth- 
er llic  money  was  conveyed  and  delivered  or 
DlTered  to  the  defendant,  within  a  reasonahle 
time  after  his  letter  was  received  by  the  plain- 
tiff, but  it  seems  to  us  that  the  time  the 
mone}'  was  offered  is  not  material.  We  think, 
even  if  the  plaintiff  had  f,'one  immediately 
after  receiving  the  defendant's  letter,  and  of- 
fered and  tendered  to  him  the  fifty  dollars, 
the  defendant  would  have  been  under  no  le- 
pal  obligation  to  accept  it.  The  mere  offer  of 
the  defendant  to  receive  the  money  would  not 
estop  him  from  refusing  to  accept  it;  but  in 
order  to  take  the  case  out  of  the  operation  of 
the  statute,  it  refpiired  the  agreement  or  con- 
sent of  both  parties,  as  to  payment  by  the 
plaintiff  and  acceptance  of  it  by  the  defend- 
ant. Upon  the  facts  of  this  case,  we  think  the 
rights  of  the  parties  rest  upon  and  are  to  be 
determined  by  the  verbal  agreement  entered 
into  by  them  on  the  30th  of  June,  and  that 
their  subsequent  attempts  to  make  that  agree- 
ment a  valid  contract  can  not  aid  the  plaintiff. 
The  statute  provides  that  "no  contract  for  tho 
sale  of  any  goods,  wares  or  merchandize,  for 
the  price  of  forty  dollars  or  more,  shall  bo 
valid,  unless  the  purchaser  shall  accept  and  re- 
ceive part  of  the  goods  so  sold,  or  shall  give 
something  in  earnest  to  bind  the  bargain,  or 
in  part  payment,  or  unless  some  note  or  mem- 
orandum of  the  bargain  be  made  in  writing, 
and  signed  by  the  part}'  to  be  charged  there- 
by, or  by  some  person  thereunto  by  him  law- 
fully authorized. " 

The  very  language  of  the  statute  above  quoted 
implies  that  in  whichever  way  the  parties  ver- 
bally agree  or  propose  that  a  contract  for  the 
sale  of   goods,  wares  or  merchandise,  for  the 

price  of  $40  or  more,  shall  be  made  ex- 
*680    empt  from  the  statute  of  frauds,  *wheth- 

er  it  be  by  the  purchaser  accepting  and 
receiving  part  of  the  goods  so  sold,  by  giving 
something  in  earnest  to  bind  the  bargain,  or  in 
part  payment,  or  by  making  a  note  or  memo- 
randum of  the  bargain,  it  must  be  done,  if  done 
at  all,  by  the  consent  of  both  parties.  It  is  ob- 
vious that  it  would  require  the  consent  of  the 
purchaser  to    accept  and   receive  part  of  the 


goods,  and  he  could  not  receive  them  unless  bj^ 
consent  of  the  seller;  the  purchaser  could  not''* 
give  something  in  earnest  to  bind  the  bargain, 
or  in  part  payment,  unless  the  seller  accept 
and  receive  it;  nor  could  a  note  or  lucmorandum 
of  the  bargain  be  made  and  signed  unless  by  the 
consent  of  the  party  to  be  charged  thereby.  A 
valid  contract  is  an  agreement  or  covenant  be- 
tween two  or  more  persons,  in  which  each  parly 
binds  himself  to  do  or  forbear  some  act;  and 
eachactjuiresa  right  to  what  the  other  promises; 
but  if  the  parties,  in  making  a  contract  like  the 
present  one,  omitto  do  what  the  statute  requires 
to  be  done  to  make  a  valid  contract,  it  would  re- 
quire the  consent  of  both  parties  to  supply  the 
thing  omitted.  Suppose  it  had  been  one  stipu- 
lation of  the  verbal  agreement  on  the  yoth  of 
June  that  the  plaintiff  should  give  and  the  de- 
fendant receive  something  in  earnest  to  bind 
the  bargain,  and  in  |)ursuance  of  such  stipula- 
tion the  plaintiff  had  then  offered  to  give  or 
pay  the  amount  so  stipulated,  and  the  defend 
ant  had  refused  to  receive  it,  saying  that  he  pre- 
ferred not  to  receive  any  money  until  he  had 
delivered  the  whole  or  part  of  the  property',  or 
had  refused  to  accept  the  money  so  offered,  or 
do  any  other  act  to  bind  the  bargain,  without 
giving  any  reason  for  such  refusal,  it  would  be 
evident  that  he  did  not  intend  to  make  a  bind- 
ing contract.  But  the  fact  that  he  had  made 
such  verbal  agreement  to  receive  something  or 
to  do  some  other  act  to  bind  the  bargain,  and 
that  the  plaintiff  was  read\-  and  offered  to  com- 
ply on  his  part,  would  not  take  the  agreement 
out  of  the  statute.  A  verbal  stipulation  to  give 
and  to  receive  something  in  earnest  to  bind  the 
bargain  or  in  part  payment,  or  a  verbal  promise 
to  make  a  note  or  memorandum  in  writing  nec- 
essary to  e.xempt  the  agreement  from  the  oper 
ation  of  the  statute,  is  as  much  within  the  stat 
ute  of  frauds  as  is  the  agreement  or  con- 
tract taken  as  a  whole;  and  a  note  or  *mem-  *G81 
orandum  in  relation  to  giving  something 
in  earnest  to  bind  the  bargain,  or  in  part  pay- 
ment, which  is  insullicieut  of  itself  to  take  the 
contract  out  of  the  statute,  is  also  insuflicient  to 
make  the  contract  binding  upon  either  party. 
The  judgment  of  the  county  court  is  reversed 
and  judgment  for  the  defendant  for  his  costs. 


174. 


STATUTE  OF  FRAUDS. 


HUNTER  T.  WETSELL.i 

(84  N.  Y.  549.) 

CJonrt   of   Appeals    of    New    York.      March    22, 
ISSl. 

This  action  was  brought  to  recover  the  pur- 
chiise  price  of  a  quantity  of  hops  alleged  to 
have  been  sold  by  Richard  Hunter,  plaintiffs' 
testator,  to  defendants. 

The  proof  on  the  part  of  plaintiffs  was  to  the 
effect  that  one  of  the  defendants,  who  were 
pai-tners,  in  September,  1877,  looked  at  the 
hops  in  the  hop-house  and  agreed  to  give 
Hunter  50  cents  a  pound  for  the  lot  and  $10 
additional,  which  Hunter  agreed  to  take.  It 
was  agreed  that  Hunter  should  shovel  the 
hops  through,  bale  them  in  a  few  weeks  when 
they  were  dry  enough,  and  notify  defendants, 
who  were  then  to  direct  where  they  were  to 
be  delivered.  Himter  baled  and  weighed  the 
hops  and  notified  one  of  the  defendauts,  who 
promised  to  come  out  and  take  them.  After- 
ward Hunter  went  to  defendants'  place  of 
business,  where  the  contract  was  restated, 
the  weight  of  the  hops  was  given,  to  wit, 
2,370  pounds,  the  price  was  figured  up  at  50 
cents  a  poimd  and  $10  added,  thus  showing 
the  whole  purchase-price.  Plaintiff  then  re- 
ceived defendants'  check  for  $200  to  apply 
on  the  purchase-price,  and  defendants  agreed 
to  go  on  the  next  week,  take  the  hops,  and 
pay  the  balance.  The  check  was  paid  on 
presentation.  Defendants  did  not  come  for 
the  hops  or  notify  Himter  where  to  deliver 
rhem.  He  was  ready  and  offered  to  deliver. 
.\t  the  close  of  plaintiffs'  evidence,  defend- 
ants' counsel  moved  for  a  nonsuit  on  the 
ground  that  the  contract  was  void  under 
the  statute  of  frauds  and  that  the  check  was 
no  payment,  within  the  meaning  of  that  stat- 
ute. The  motion  was  denied,  and  said  cotm- 
sel  duly  excepted. 

The  further  material  facts  appear  in  the 
opinion. 

J.  H.  Clute,  for  appellants.  E.  W.  Paige, 
for  respondents. 

FINCH,  J.  We  are  to  assume  as  facts  in 
this  case,  from  the  verdict  of  the  jury,  that 
an  absolute  contract  for  the  sale  of  the  hops, 
after  they  were  weighed  and  baled,  was  en- 
tered into  verbally  by  the  parties,  by  the 
terms  of  which  the  hops  were  to  be  delivered 
where  the  defendants  determined  and  request- 
ed, and  were  to  be  paid  for  within  a  few 
weeks  upon  such  delivery,  at  the  rate  of  50 
cents  per  pound,  with  .^10  additional  on  the 
whole  lot.  Since  the  quantity  of  the  hops, 
as  baled  and  weighed,  carried  the  price  be- 
yond $50,  we  held  upon  a  previous  appeal  that 
the  contract  was  void  within  the  statute  of 
frauds,  because  no  memorandum  in  writing 
was  made,  no  part  of  the  property  delivered 
and  no  portion  of  the  purchase-money  paid  at 
the  time  of  the  transaction.     The  after-pay- 

1  Irrelevant  garts  omitted. 


ments  of  $300  we  decided  to  be  insufficient  to 
validate  the  contract,  because  when  made 
there  was  no  re-statement  or  recognition  of 
the  essential  terms  of  the  contract.  57  N.  Y. 
375.  In  the  case  as  now  presented  the  diffi- 
culty, fatal  before,  is  claimed  to  have  been 
obviated.  There  is  proof  of  a  re-statement 
of  the  essential  terms  of  the  contract  at  the 
time  of  the  delivery  of  the  check  for  $200. 
There  is  proof  also  contradicting  such  alleged 
fact  The  question  was  left  to  the  jury  un- 
der a  charge  from  the  court  which  does  not 
seem  to  be  the  subject  of  complaint,  and  they, 
in  rendering  a  verdict  for  the  plaintiffs,  neces- 
sarily found  the  fact  of  such  re-statement. 
That  finding  is  conclusive  upon  us. 

But  it  is  now  objected  that  conceding  the 
fact  of  such  re-statement,  there  was  no  pay- 
ment of  any  part  of  the  purchase-money  at 
that  time.  It  is  admitted  that  the  check 
was  then  given,  and  it  cannot  be  success- 
fully denied  that  it  was  both  delivered  and 
received  as  a  payment  upon  the  contract- 
price  of  the  hops,  but  it  is  claimed  that  the 
check  was  not,  in  and  of  itself,  payment, 
and  having  been  drawn  upon  a  bank,  could 
not  have  been  in  fact  paid  until  afterward, 
and  so  there  was  no  payment  "at  the  time" 
to  satisfy  the  requirements  of  the  statute. 
It  is  quite  true  that  a  check,  in  and  of  itself, 
is  not  payment,  but  it  may  become  so  when 
accepted  as  such  and  in  due  course  actually 
paid.  While  not  money,  it  is  a  tiling  of  value, 
and  is  money's  worth  when  drawn  against 
an  existing  deposit  which  remains  until  the 
check  is  presented.  We  must  assume  that 
the  check  of  the  vendee  in  this  case  was  good 
when  drawn  and  was  duly  paid  upon  presen- 
tation in  the  usual  and  regular  way,  for  it 
appears  in  the  possession  of  the  drawers,  and 
they  practically  assert  the  fact  of  its  pay- 
ment by  their  counter-claim  in  the  action,  by 
which  they  seek  to  recover  back  the  money 
so  paid.  There  was  therefore  an  actual  and 
real  payment  made  by  the  vendees  to  the 
vendor  upon  the  purchase-price  of  the  hops. 
It  is  said  however  that  the  actual  pajTuent 
of  the  money,  as  distinguished  from  the  de- 
livery of  the  check,  was  not  "at  the  time"  of 
the  contract,  but  at  some  later  period.  We  do 
not  know  accurately  when  the  check  was 
paid.  It  may  have  been  the  same  day.  It 
may  have  been  within  a  very  few  moments. 
It  may  not  have  been  till  the  next  day.  We 
are  not  to  presume,  for  the  purpose  of  mak- 
ing the  contract  invalid,  that  it  was  held 
beyond  the  natural  and  ordinary  time.  In 
such  event  it  is  a  very  narrow  construction 
to  say  that  the  payment  was  not  made  at  the 
time  of  the  contract.  The  purpose  and  object 
of  the  statute  should  not  be  forgotten.  Its  aim 
is  to  substitute  some  act  for  mere  words,  to 
compel  the  verbal  contract  to  be  accompanied 
by  some  fact  not  likely  to  be  mistaken,  and 
so  avoid  the  dangers  of  treacherous  memory 
or  downright  perjury.  The  delivery  of  the 
check  was  such  an  act.  Indeed  it  would  be 
an  entirely  reasonable  and  just  construction 


SALE  OF  GOODS. 


175 


to  say  that  the  dollvery  of  the  check  and  Its 
presentment  and  payment  constituted  one 
continuous  transaction,  and  should  be  taken 
as  such  without  reference  to  the  ordinary  de- 
lay attendant  upon  taming  the  check  into 
money.  The  statute  does  not  mean  rigorous- 
ly, eo  instanti.  It  does  contemplate  tliat  tlie 
i-ontract  and  the  payment  shall  be  at  Iho  same 


time,  in  the  sense  that  they  constitute  parts 
of  one  and  the  same  continuous  transaction. 
We  think  therefore  there  was  a  payment  "at 
the  time,"  within  the  meaning  of  the  statute, 
and  that  the  contract  of  sale  was  valid. 
Artcher  v.  Zeh,  5  Hill,  200;  Hawley  v.  Keelor, 
TjS  N.  Y.  114;   BissL'll  v.  IJalcoin.  .'iO  X.  V.  'J75. 


STATUTE  OF  FRxV^UDS. 


PEABODY  V.  SPEYERS. 

(56  N.  Y.  230.J 

<3oart   of    Appeals    of    New    York.      March   24, 
1874. 

Action  for  damages  for  breach  of  a  con- 
tract for  the  sale  of  $40,000  of  gold  coin. 
The  opinion  shows  the  facts. 

William  A.  Beach,  for  appellant.  S.  B. 
Brownell,  for  respondent. 

GROVER,  J.  The  appellant  sustained  no 
injury  from  the  parol  proof  of  the  contract. 
The  answer  does  not  deny  the  making  of  the 
contract  as  alleged  in  the  complaint,  but  sets 
up  facts  avoiding  it,  under  the  statute  of 
frauds.  The  exception  to  this  proof  is  not 
therefore  available.  The  constitution  and 
by-laws  of  the  New  York  Gold  Exchange 
were  competent  evidence.  The  parties  were 
both  members  of  the  association,  and  had 
both  subscribed  the  constitution.  By  this, 
and  the  by-laws  made  by  the  members  in 
pursuance  thereof,  the  mode  of  performing 
contracts  of  the  kind  in  question  between 
members  is  prescribed,  and  for  this  purpose, 
these  become  a  part  of  the  contract. 

The  finding,  by  the  trial  judge,  of  the  fact 
that  the  contract  was  for  the  sale  by  the 
plaintiff  to  the  defendant  of  $40,000  of  gold, 
to  be  paid  for  by  the  latter  in  currency  at  the 
stipulated  price,  if  correct,  entirely  obviates 
the  objection  of  the  coimsel  for  the  appel- 
lant, that  the  contract  is  made  void  by  the 
statute  prohibiting  betting  and  gaming.  1 
Rev.  St.  662.  The  testimony  supported  this 
finding,  and  this  court  cannot  consider  that. 
If  any,  in  conflict  therewith. 

A  contract  for  the  sale  of  gold  to  an 
amount  exceeding  $50  is  equally  within  sec- 
tion 3  (2  Rev.  St.  136)  as  that  for  the  sale  of 
any  other  personal  property.  When  the  sub- 
ject of  such  a  contract,  it  is  regarded,  not  as 
money,  but  as  a  commodity;  and  the  con- 
tract must  be  made  in  compliance  with  the 
statute  of  frauds,  or  it  will  be  void.  None 
of  the  gold  was  delivered  to  and  accepted  by 
the  defendant,  nor  did  the  latter  pay  any 
part  of  the  purchase-money.  The  inquirj'  is 
therefore,  whether  there  was  a  note  or  mem- 
orandum of  the  contract  signed,  as  requii-ed 
by  the  first  subdivision  of  section  3.  The 
verbal  contract  was  made  on  the  23d  of  Sep- 
tember, 1809.  By  the  constitution  and  by- 
laws of  the  association,  it  was  to  be  per- 
foi-med  by  the  delivery  of  the  gold,  by  the 
vendor,  for  the  purchaser,  at  the  Gold  Ex- 
change Bank  of  New  York,  and  the  pur- 
chaser was  then  to  receive  it,  and  pay  to 
the  bank  the  purchase-price  for  the  vendor. 
This  was  to  be  done  under  the  present  con- 
tract, if  valid,  at  a  specified  hour  on  the  24th. 
The  bank,  by  the  constitution  and  by-laws, 
was  made  the  agent  of  both  parties  for  the 
consummation  of  the  contracts  of  members. 
Before  eleven  o'clock  on  the  24th  of  Sep- 
tember the  plaintiff  delivered  to  the  defend- 
ant the  following  instrument: 


"New  York,  September  24,  1809.  To  the 
cashier  of  the  New  York  Gold  Exchange 
Bank:  You  are  advised  that  we  shall  settle 
through  the  clearing  department  to-day,  with 
Albert  Speyers,  $57,500  currency,  for  $40,000 
of  gold." 

This  was  properly  subscribed;  and  in  the 
left  margin  were  the  words  "deliver  gold." 
At  the  same  time  the  defendant  delivered  to 
the  plaintiff  the  following  instrument,  duly 
subscribed  by  his  authorized  agent: 

"No.  106.  New  York,  September  24,  1869. 
New  York  Gold  Exchange  Bank.  To  the 
cashier:  You  are  advised  that  I  shall  settle 
through  the  clearing  department,  to-day,  with 
Peabody,  for  W.  B.  Sancton,  $57,500  currency 
for  $40,000  gold." 

On  the  left  margin  were  the  words  "re- 
ceive gold."  All  the  previous  acts  of  the 
parties  rested  entirely  in  parol,  without  any 
writing  except  the  entries  that  each  had 
made  of  the  contract,  in  a  book  kept  by  him; 
and  there  was  nothing  in  these  entries  tak- 
ing the  case  out  of  the  statute  of  frauds. 
The  inquiry  is,  whether  it  is  so  taken  by  the 
above  instruments.  These  relating  to  the 
same  subject  and  delivered  at  the  same  time 
must  be  construed  together;  and  also  in  the 
light  of  the  constitTition  and  by-laws  of  the 
association,  showing  the  manner  of  perform- 
ing contracts  for  the  sale  and  purchase  of 
gold  by  the  members.  By  the  latter  we  have 
seen  that  officers  of  the  bank  were  constitut- 
ed agents  of  both  parties  for  the  performance 
of  their  contracts.  Now  what  is  the  fair 
meaning  of  these  instruments,  so  construed  V 
I  think  as  to  this  there  can  be  little  doubt 
after  reading  the  constitution  and  by-laws. 
They  can  only  mean  that  the  plaintiff  agreed 
to  sell  and  deliver  to  the  defendant  that  day 
$40,000  of  gold,  for  which  the  latter  agreed  to 
pay  the  plaintiff  $57,500  in  cuiTency,  at  the 
time  of  deliveiy;  the  gold  to  be  delivered  by 
the  plaintiff,  for  the  defendant,  to  the  clear- 
ing department  of  the  bank,  and  the  currency 
paid  in  there  for  the  plaintiff,  as  provided 
by  the  constitution  and  by-laws  of  the  asso- 
ciation. It  is  said  by  the  counsel  for  the 
defendant  that  the  instruments  would  have 
been  in  the  same  form  had  the  transaction 
been  a  loan  instead  of  a  sale  of  gold  by  the 
plaintiff  to  the  defendant.  If  this  be  so, 
and  the  defect  be  not  otherwise  supplied, 
the  contract  is  not  valid,  for  the  i-eason  that 
the  instrument  subscribed  must  show,  either 
by  itself  or  by  reference  to  some  other  wiit- 
ing,  what  the  contract  really  was,  and  its 
terms,  unaided  by  parol  proof,  further  than 
what  is  requisite  to  give  a  knowledge  of  the 
meaning  of  terms,  phrases  and  abbreviations 
found  in  the  writing.  But  the  papers  show 
that  the  plaintiffi  was  to  deliver  and  the  de- 
fendant to  receive  the  gold  on  the  day  in 
question,  and  that  the  defendant  was  at  the 
same  time  to  deliver  and  the  plaintiff  to  re- 
ceive the  stipulated  amount  of  currency  there- 
for. This,  in  the  absence  of  any  thing  show- 
ing the  contrary,  is  a  sale  of  the  gold,  all  the 


THE  MEMORANDUM  IX  WllITIXG. 


177 


terms  of  which  arc  specified  in  the  writings. 
If  a  loan  of  gold  secured  by  the  currency  was 
Intended,  the  papers  entirely  fail  to  show  it. 
The  writing  therefore  proves  a  contract  valid 
within  the  statute  of  frauds.  But  if  it  be 
conceded  that  the  two  instruments  which 
have  been  thus  far  considered  are  indetermi- 
nate in  their  terms,  and  leave  it  in  doubt 
whether  the  real  ti"ansaction  between  the 
parties  was  a  sale,  a  loan  or  a  deposit,  It 
does  not  follow  that  the  contract  to  which 
they  relate  must  be  deemed  invalid  if,  by 
any  other  writing  signed  by  the  proper  party, 
the  defect  can  be  supplied.  The  thing  requi- 
site to  the  validity  of  the  contract  is  that  it 
shall  be  manifested  by  writing,  signed  by  the 
party  to  be  charged.  It  matters  not  in  how 
many  papers  the  contract  is  contained,  so 
that  the  substance  of  the  statute  is  complied 
with.  The  defect,  if  any,  in  the  two  papers 
first  considered  is  that  while  they  disclose  all 
the  other  particulars  of  the  contract,  they  do 
not  determine  whether  it  is  a  contract  of  sale, 
or  loan,  or  deposit.  This  defect,  we  think, 
is  entirely  supplied  by  the  letter  signed  by 
the  defendajit  and  addressed  to  Me.ssrs.  Bel- 
den  &  Co.,  on  the  day  of  the  making  of  the 
contract.  This  shows  the  contract  to  have 
been  In  fact  one  of  purchase  and  sale,  and 
that  by  it  the  defendant  bought  the  gold  of 
Peabody,  at  the  price  mentioned.  It  is  true 
that  this  paper  also  discloses  that  the  pur- 
chase was  on  account  of  Wm.  Beldeu  &  Ck)., 
as  between  that  firm  and  the  defendant. 
But  that  fact  was  not  disclosed  to  the  plain- 
tiff; and  where  a  purchase  is  made  on  behalf 
of  an  undisclosed  principal  the  agent  is  per- 
sonally bound. 

It  is  argued  that  inasmuch  as  resort  is  nec- 
essary to  the  writing  to  prove  the  conti"act, 
it  discharges  the  agent  by  the  disclosure  of 
the  principal,  as  effectually  as  it  fixes  the 
character  of  the  transaction  to  have  been  a 
purchase.  But  this  does  not  follow.  The 
writings  are,  together,  only  the  evidence  of 
the  contract;  and  the  non-<li.sclosure.  in  fact, 
to  the  plaintiff  that  the  defendant  was  deal- 

nOPK.SEL.CAS.CONT.— 12 


ing  on  account  of  others,  will  leave  him' per- 
sonally liable  to  the  plaintiff.  This  seems  to 
be  a  necessary  con.sequence  of  the  pi"oposi- 
tion  that  a  writing  sigiierl  by  the  proper  party 
to  be  charged  and  addrt'ssed  to  a  stranger, 
though  it  did  not  at  the  time  come  to  the 
knowledge  of  the  other  party  to  the  contract, 
may  be  deemed  a  part  of  the  sufllcient  mem- 
orandum re(iuired  by.  the  statute.  The  nom- 
inal party  was  the  apparent  and  actiial  party 
so  far  as  the  other  contractor  was  concerned, 
and  was  shown  to  be  such  by  the  written 
memoranda,  of  which  both  parties  at  the 
time  had  knowledge.  That  he  is  compelled 
to  resort  to  a  further  writing  to  fix  and  de- 
termine the  character  of  the  transaction,  and 
thus  to  complete  the  written  evidence  of  the 
contract  ought  not  to  affect  his  rights  in  a 
particular  in  which  the  writings  known  to 
both  parties  were  sufficient  and  definite 
when  there  is  no  absolute  irreconcilability 
between  them.  Such  is  the  case  before  us. 
By  the  two  instruments  first  considered  the 
defendant  was  the  purcha.ser,  and  is  to  be 
deemed  so  in  respect  to  the  plaintiff,  with 
whom  he  dealt  as  purchaser.  That  the  other 
paper  shows  him  to  have  bought  for  a  prin- 
cipal, as  between  him  and  the  principal,  is 
entirely  consistent  with  his  being  deemed 
himself  the  principal  and  purchaser,  in  so  far 
as  the  plaintiff  is  concerned.  That  the  paper 
in  question,  though  addressed  to  third  par- 
ties, may  be  used  as  evidence  of  the  con- 
tract under  the  statute,  is  decided  in  Gib- 
son V.  Holland,  L.  R.  1  C.  P.  1,  where  the 
subject  is  fully  considered,  and  where  many 
analogous  decisions  under  other  sections  of 
the  statute  of  frauds  are  stated,  and  shown 
to  support  the  conclusions  announced.  We 
are  therefore  of  the  opinion  that  in  either 
view  of  the  case,  the  contract  in  suit  appear- 
ed to  be  sustained  by  sufficient  written  evi- 
denee  under  the  statute. 
The  judgment  must  therefore  be  affirmed^ 
All  concur,  except  RAPALLO,  J.,  not  sit- 
ting- 
Judgment  affirmed. 


STATUTE  OF  FRAUDS. 


LOUISVILLE  ASPHALT  VARNISH  CO.  v. 
LORICK  et  al. 

(S  S.  E.  S,  29  S.  C.  533.) 

Supreme   Court   of   South   Carolina.      Nov.   27, 
18S8. 

Appeal  from  common  pleas  circuit  court  of 
Richland  countj-;    Pressly,  Judge. 

Action  by  the  Louisville  Asphalt  Varnish 
Company  against  Preston  C.  Lorick  and  Wil- 
liam B.  Lowrance,  partners,  trading  as  Lorick 
&  Lo-wrance,  to  recover  for  goods  sold  them. 
At  the  trial,  a  nonsuit  was  granted,  and  judg- 
ment rendered  for  defendants.  Plaintiff  ap- 
peals.    Reversed. 

Bachman  &  Youmans,  for  appellant,  S.  W. 
Melton,  for  respondents. 

McR^ER,  J.  This  was  an  action  to  recover 
the  sum  of  $S3.05,  the  price  of  certain  varnish 
and  paint  alleged  to  have  been  sold  by  plain- 
tiff to  defendants.  The  defense  was  a  general 
denial.  At  the  trial  the  plaintiff  offered  testi- 
mony tending  to  show  that  on  the  IGth  Octo- 
ber, 1SS5,  one  of  its  traveling  salesmen,  Hutch- 
inson by  name,  took  from  Moore,  a  clerk  of 
defendants,  who,  it  was  admitted,  had  author- 
ity to  give  the  order,  a  verbal  order  for  the 
articles  specified  in  the  account  sued  on, 
which  Hutchinson  immediately  entered  in  his 
memorandum  book  as  follows: 
"No.  65.  Columbia,  S.  C,  Oct.  16,  18S5. 

"LouisvOle  Asphalt  Varnish  Co.,  Louisville,  Ky. 

Ship  Lorick  tSr  Lowrance,  Columbia,  S.  C: 
1.  Bbl.  No.  1  l^irpt  Asphalt  Black  Varnish  55c. 

1.    ••     D.  Roof  Paint  C 50c. 

12.  5  gall.  Pails  D.  Roof,  do 55c. 

"Cr.  by  2c  gal.,  on  acct.  freight. 

"60  days.        H.  L.  Hutchinson,  Salesman." 

On  the  same  day,  a  copy  of  this  order  was 
sent  by  mail,  by  said  salesman,  to  the  plain- 
tiff, who  received  it  on  the  19th  October,  1885, 
and  on  the  next  day  shipped  the  goods,  by 
rail,  to  defendants.  On  the  17th  October,  1885, 
the  defendants  wrote  to  plaintiff  as  follows: 
"Louisville  Asphalt  Varnish  Co.,  Louisville- 
Gents:  Don't  ship  pamt  ordered  through  your 
salesman.  We  have  concluded  not  to  handle 
it"  This  letter,  however,  was  not  received 
by  plaintiff  until  after  the  goods  had  been 
shipped;  and  upon  its  receipt  plaintiff  wrote 
defendants,  saying  "that  the  shipment  had 
gone  before  the  request  to  cancel  was  receiv- 
ed." When  the  goods  arrived  in  Columbia,  the 
defendants  declined  to  receive  them,  but  what 
became  of  them  the  testimony  does  not  show. 
At  the  close  of  plaintiff's  testimony,  defend- 
ants moved  for  a  nonsuit,  which  was  granted, 
upon  the  ground  that  section  2020,  Gen.  St., 
(statute  of  frauds,)  was  fatal  to  a  recovery. 
Plaintiff  appeals,  upon  the  several  grounds 
set  out  in  the  record  which  make  these  two 
questions:  First,  whether  there  was  such  a 
note  or  memorandum  in  writing  of  the  bargain 
as  would  satisfy  the  requirements  of  section 
2020  of  the  General  Statutes;  second,  if  not, 
whether  there  was  such  an  acceptance  and 
actual  receipt  of  the  goods  as  would  take  the 
case  out  of  the  operation  of  that  section. 


It  is  quite  certain  that  there  was  no  formal 
agreement   in  writing,   signed   by  the   parties 
to  be  charged,  for  the  sale  of  the  goods  in 
question,  and  we  think  it  equally  certain  that 
there  was  no  single  instrument  or  memoran- 
dum in  writing  sufficient  to  satisfy  the  require- 
ments of  the   statute;    for  the   letter   of   the 
defendants,  copied  above,  did  not  specify  the 
necessary  particulars  as  to  quantity,   nature, 
and  price  of  the  goods  which  were  the  sub- 
jects of  the  alleged  conti-act  of  sale,  and  the 
copy  of  the  order  sent  by  the  salesman  to  the 
plaintiff,  which  did  contain  all  the  necessary 
particulars,  was  not  signed  by  the  defendants. 
It  is  plain,  therefore,  that  neither  one  of  these 
papers,    standing   alone,    would   be   sufficient 
But  as  it  is  well  settled  that  the  whole  agree- 
ment need  not  appear  in  a  single  writing,  but 
may  be  made  out  from  several  instruments  or 
written  memoranda  referring  one  to  the  other, 
and  which,  when  connected  together,  are  found 
to  contain  aU  the  necessary  elements,  the  pre- 
cise, practical  question  in  this  case  is  whether 
the  letter  of  defendants  can  be  connected  with 
the  written  order  sent  by  the  salesman,  so  that 
the  two  together  may  constitute  a  sufficient 
note  or  memorandum  in  writing  to  satisfy  the 
requirements  of  the  statute.    In    Saunderson 
V.  Jackson,  2  Bos.  &  P.  238,  the  action  was 
for  not  delivering  certain  articles  alleged  to 
have  been  sold  by  defendant  to  plaintiff,  and 
the  question  was  whether  there  was  a  suf- 
ficient note  or  memorandum  in  writing  of  the 
bargain,  under  the  statute  of  frauds.    It  seems 
that  when  the  plaintiff  gave  the  verbal  order 
for  the  goods,  he  was  furnished  by  the  defend- 
ant with  a  bill  of  parcels,  not  signed,  but  writ- 
ten on  a  piece  of  paper,  with  a  printed  head- 
ing containing  the  name  and  place  of  business 
of   defendant.    Shortly    after   this,    defendant 
wrote  a  letter  to  plaintiff,  saying:    "We  wish 
to  know  what  time  we  shall  send  you  a  part 
of  your  order,"  etc.    The  court  held  that  the 
requirements    of   the   statute    were    complied 
with,   saying:    "This   bill   of   parcels,    though 
not  the  contract  itself,  may  amount  to  a  note 
or   memorandum  of  the   contract,   within  the 
meaning  of  the  statute.    *    *    *    At  all  events, 
connecting  this  bill  of  parcels  with  the  subse- 
quent letter  of  the  defendants,  I  think  the  case 
is  clearly  taken  out  of  the  statute  of  frauds; 
for,  although  it  be  admitted  that  the  letter, 
which  does  not  state  the  terms  of  the  agree- 
ment, would  not  alone  have  been  sufficient, 
yet,  as  the  jury  have  connected  it  with  some- 
thing which  does,  and  the  letter  is  signed  by 
the  defendants,  there  is  then  a  written  note 
or  memorandum  of  the  order  which  was  orig- 
inally given  by  the  plaintiff',  signed  by  the  de- 
fendants."   This  case  has  been  expressly  rec- 
ognized and  followed  in  this  state,  in  Toomer 
V.   Dawson,   Cheves,   68.    The  same   doctrine 
was  applied  in  Western  v.  Russell,  3  Ves.  & 
B.  188.     See,  also,  to  the  same  effect,  Drury 
V.  Young,  58  Md.  546,  where,  as  in  the  case 
now  under  consideration,  the  letter  of  defend- 
ant was  written  for  the  purpose  of  withdraw- 
ing from  the  contract;    but  as  it  referred  to  the 


THE  MEMORANDUM  IX   WRITING. 


179 


pnniuus  order,  the  two,  taken  together,  were 
held  to  satisfy  the  terms  of  the  statute.  In  a 
note  to  that  case,  at  pa;je  347  of  the  volume 
of  Anierlcan  Reports  above  cited,  we  find  the 
foUinviug:  "In  Cave  v.  Hastings,  7  Q.  B.  Div. 
llio,  an  action  for  broach  of  a  contract  for  the 
hire  of  a  carriage  for  more  than  a  year  from 
the  date  of  the  agreenieut,  at  a  specified  sum 
per  mouth,  it  was  proved  that  the  plaintiff 
agreed  to  let  the  carriage  to  tlie  defendant,  A 
memorandum  of  the  terms  of  the  agreement 
was  signed  by  the  plaiutiff,  but  not  by  the 
defendant.  The  defendant  subsequently  wrote 
a  letter  to  the  plaintiff,  desiring  to  terminate 
the  agreement,  in  which  he  referred  to  "our 
arrangement  for  the  hire  of  your  carriage," 
and  "my  monthly  payment,"  There  was  no 
other  arrangement  between  the  parties,  to 
which  the  expressions  of  the  defendant  could 
have  any  reference,  except  the  agreement  con- 
tained in  the  memorandum  signed  by  the 
plaintiff.  Held,  that  the  letter  of  the  defend- 
ant was  so  connected,  by  reference,  to  the 
document  containing  the  terms  of  the  arrange- 
ment, as  to  constitute  it  a  note  and  memoran- 
dum of  the  contract,  signed  by  him,  within  the 
fourth  section  of  the  statute  of  frauds.  The 
court  said:  "There  is  abundant  evidence  that 
there  was  an  agreement  which  was  not  re- 
scinded; but  the  defendant  now  contends  that 
he  is  not  liable,  because  he  signed  no  memo- 
randum in  writing  of  the  conti-act"  It  has, 
iiowever,  been  long  settled  that  the  whole 
agreement  need  not  appear  in  one  document, 
but  the  agreement  may  be  made  out  from  sev- 
eral documents.  The  only  document  signed 
in  this  case  by  the  defendant  was  the  letter 
of  the  11th  February,  which  does  not,  in  itself, 
contain  the  terms  of  the  contract.  In  Dobell 
V.  Hutchinson,  3  Adol.  &  E.  355,  Lord  Den- 
man  states  the  law  on  this  subject  to  be  as  fol- 
lows: "The  cases  on  the  subject  are  not,  at 
first  sight,  uniform;  but  on  examination  it  will 
be  found  that  they  establish  this  principle: 
that  when  a  contract  or  note  exists  which 
binds  one  party,  any  subsequent  note  In  writ- 
ing, signed  by  the  other,  is  sufliciont  to  bind 
him,  provided  it  either  contains  in  itself  the 
terms  of  the  contract,  or  refers  to  any  writing 
which  contains  them."  This  letter  in  question 
refers  to  "our  arrangement."  Mr.  Gully,  in 
his  argument,  contended  that  that  might  refer 
to  some  other  and  different  parol  arrangement; 
but  it  seems  to  us  that  this  reference  to  the 
former  document  is  sutliciont,  in  accordance 
with  the  principle  laid  down  in  Ridgway  v. 
Wharton,  G  H.  L.  Cas.  237,  where  "instruc- 
tions" were  referred  to,  and  it  was  held  that 
parol  evidence  might  be  given  to  identify 
the  instructions  referred  to  with  certain  in- 
structions in  writing.  This  principle  was  ap- 
plied in  Baumann  v.  James,  10  Law  T.  (N. 
S.)  105,  and  carried  still  further  in  Long  v. 
Millar,  41  Law  T.  (X.  S.)  300,  in  which  Bram- 
tvell,  L.  J.,  says:  "The  first  question  to  be 
considered  is  whether  there  is  a  contract,  valid 
-according  to  the  provisions  of  the  statute  of 


frauds,  section  4.  I  think  that  there  Is  a  suf- 
ficient memorandum.  The  plaintiff  has  signed 
a  document  containing  all  the  terms  necessary 
to  constitute  a  binding  agreement,  so  tliat,  if 
he  committed  a  breach  of  it,  he  would  be  lia- 
ble to  an  action  for  damages  or  to  a  suit  for 
specific  performance.  But  the  point  to  be  es- 
tablished by  the  plaiutiff  is  that  the  defendant 
has  bound  himself,  and  a  receipt  was  put  in 
evidence  signed  by  him,  and  containing  the 
name  of  the  plaintiff,  the  amount  of  the  de- 
Ijosit,  and  some  description  of  the  land  sold. 
The  receipt  also  uses  the  word  'purchase,' 
which  must  mean  an  agreement  to  purchase, 
and  it  becomes  apparent  tha^  the  agreement 
alluded  to  is  the  agreement  signed  by  the 
plaintiff,  so  soon  as  the  two  documents  are 
placed  side  by  side.  The  agreement  referred 
to  may  be  identified  by  parol  evidence."  He 
then  goes  on  to  add:  "I  may  further  illustrate 
my  view  by  putting  the  following  cases:  Sup- 
pose that  A.  writes  to  B.,  saying  that  he  will 
give  £1,000  for  B.'s  estate,  and  at  the  same 
time  states  the  terms  in  detail,  and  suppose 
that  B.  simply  writes  back  in  return,  T  accept 
your  offer.'  In  that  case,  there  may  be  an 
identification  of  the  documents  by  parol  evi- 
dence, and  it  may  be  shown  that  the  offer 
alluded  to  by  B.  is  that  made  by  A.  without 
infringing  the  statute  of  frauds,  section  4, 
which  requires  a  note  or  memorandum  in  writ- 
ing." These  observations,  coming  as  they  do 
from  high  authority,  seem  so  appropriate  to 
the  present  case  that  we  have  felt  justified  in 
inserting  them  at  length.  In  Beckwith  v.  Tal- 
bot, 95  U.  S.  289,  it  was  held  that,  while  the 
general  rule  is  "that  collateral  papers  adduced 
to  supply  the  defect  of  signature  of  a  written 
agreement,  under  the  statute  of  frauds,  should 
on  their  face  sufficiently  demonstrate  their 
reference  to  such  agreement,  without  the  aid 
of  parol  proof,"  yet  such  rule  is  not  absolute, 
as  "there  may  be  cases  in  which  it  would  be 
a  violation  of  reason  and  common  sense  to 
ignore  a  reference  which  derives  its  signifi- 
cance from  such  proof."  Accordingly,  it  was 
held  in  that  case  that  "the  defendant,  unless 
he  could  show  the  existence  of  some  other 
agi'oemeut,  was  estopped  from  denying  that 
the  agreement  referred  to  by  him  in  his  let- 
ters was  that  which  he  induced  the  plaintiff 
to  sign."  Even  in  tlie  case  of  Johnson  v. 
Buck,  35  N.  J.  Law,  338,  which  seems  to  he 
much  relied  on  by  the  counsel  for  respondents, 
it  is  conceded  that  parol  evidence  may  bo  re- 
ceived "to  identify  papers  which,  by  a  refei-- 
ence  in  the  signed  memorandum,  are  made 
parts  of  it."  While  it  is  true  that  some  of  the 
cases  which  we  have  cited  arose  under  the 
fourth  section  of  the  statute  of  frauds,  and 
not  under  the  seventeenth  section,  which  con- 
trols the  present  case,  yet  it  is  admitted  by 
Kent,  C.  J.,  in  Bailey  v.  Ogdens,  3  Johns.  412. 
that  the  words  of  the  two  sections  are  in  this 
respect  similar,  and  require  the  same  construc- 
tion, and  it  was  so  held  in  Townsend  v.  Har- 
graves,  118  Moss.  325.    It  seems  to  us,  there- 


180 


STATUTE  OF  FRAUDS. 


fore,  that  the  letter  of  defendants,  taken,  as 
it  must  be,  in  connection  with  the  order  sent 
to  plaintiff  by  the  salesman,  to  which  it  ex- 
pressly referred,  and  which  was  in  writing, 
and  specified  all  the  necessary  particulars  as 
to  price,  quantity,  quality,  and  time  of  pay- 
ment, constituted  a  sufficient  note  or  memoi-an- 
dum  in  writing  of  the  bargain  to  take  the  case 
out  of  the  statute  of  frauds.    In  the  absence  of 
any  evidence  that  any  other  order  was  given, 
the  language  of  the  letter— "Don't  ship  pamt 
ordered  through  your  salesman"— must  neces- 
sarily be  regarded  as  referring  to  the  order 
of  which  a  memorandum  in  writing  was  taken 
at  the  time  by  the  salesman,  and  a  copy  there- 
of   immediately  forwarded    to    the    plaintiff, 
who  at  once  filled  the  order,  and  shipped  the 
goods  to  the  defendants.    This  is  a  stronger 
case  than  that  of  Beckwith  v.  Talbot,  supra, 
for  there  the  letter  of  the  defendant  simply 
referred  to  the  agreement,  without  indicating 
when  or  how  it  had  been  made,  while  here 
the  letter  refers  to  a  particular  article  "order- 
ed through  your  salesman,"  and  we  hear  of 
no   other   order  through   the   salesman   or   in 
any  other  way.    The  only  necessity  for  any 
parol   evidence  at  all,   if,   indeed,   there  was 
any.   was  to  identify  the  order  sent  by   the 
salesman,  and  for  this  purpose,  as  we  have 
seen,  such  evidence  would  be  competent.  Sup- 
pose the  plaintiff  had,  on  the  16th   October, 
188.5,  written  a  letter  to  defendants,  proposing 
to   sell   them    the   articles   mentioned    in    the 
salesman's  order,  in  the  quantities  there  stat- 
ed, and  at  the  prices  and  on  the  time  there 
mentioned,   and  that   defendants   had   rephed 
by  letter,   simply  saying,   "I  accept  your  of- 
fer," without  repeating  thj  particulars  as  to 
quantity',  price,  etc.,  it  could  not  be  doubted 
that,  although  defendants'  letter— the  only  pa- 
per   which    they    signed— did    not    contain    in 
itself  the  necessary  particulars  of  the  bargain, 
yet  the  two  letters,  taken  together,  would  be 
held  a  sufficient  compliance  with  the  statute. 
It  seems  to  us  that  the  transaction  here  in 
question  was  in  principle  practically  the  same 
as  that  in  the  supposed  case,  and  we  think 
there  was  error  in  holding  that  the  contract 
sued  on  was  void  under  the  statute  of  frauds. 
We  do  not  see  how  it  is  possible  to  regard 
the  letter  of  the  defendants  as  a  denial  of  the 
order  given  to  the  salesman  by  their  clerk, 
Moore,  who,  it  was  conceded,  had  authority 
to  give  the  order,  for  the  only  testimony  upon 
the  subject  is  that  of  the  salesman,  who  says 
distinctly   that    Moore   gave   him   the   order, 
and  he  entered  it  in  his  memorandum  book, 
and    there    is  no  evidence  to  the  contrary. 
Moore  was  not  examined  as  a  witness.    It  is 
true    that,     after    the    controversy   between 
these  parties  had  arisen,  the  defendants,  in  a 
letter  as   late   as   31st   December,    1885,   ad- 
dressed to  the  attorney  who  had  been  con- 
sulted by  the  plaintiff,  do  repudiate  the  pur- 
chase; but  that  is  not  the  letter  relied  upon 
by  plaintiff  to  establish  the  contract.    On  the 
contrary,  the  one  relied  on  is  that  of  the  17th 


October,  1SS5,  which  ha.s  been  copied  above, 
and  the  question  is  whether  the  last-mention- 
ed letter  can  be  regarded  as  a  denial  of 
having  given  the  order.  The  manifest  pur- 
pose of  that  letter  was  to  countermand  the 
order,  and  this  necessarily  presupposed  that 
the  order  had  been  given.  The  tenns  used 
clearly  show  this:  "Don't  ship  the  paint  or- 
dered through  your  salesman.  We  have  con- 
cluded not  to  handle  it."  This  clearly  means 
that  the  paint  had  been  ordered,  but  that  de- 
fendants had  subsequently  changed  their 
minds  and  "concluded  not  to  handle  it;"  and 
we  don't  see  how  it  can  be  construed  to  mean 
anythmg  else.  We  have  then  an  admission 
in  writing  that  an  order  for  the  goods  in  ques- 
tion through  the  salesman  had  been  given, 
and  we  have  the  order  referred  to,  likewise 
in  writing;  and  the  two  together  fully  satisfy 
the  requirements  of  the  statute.  Under  the 
view  which  we  have  taken  of  the  first  ques- 
tion raised  by  this  appeal,  the  second  ques- 
tion becomes  immaterial,  and  need  not,  there- 
fore, be  considered.  The  judgment  of  this 
court  is  that  the  judgment  of  the  circuit 
court  be  reversed,  and  that  the  case  be  re- 
manded to  that  court  for  a  new  trial. 

McGOWAN,  J.,  concurs. 

SIMPSON,  C.  J.  (dissenting.)  The  plaintiff 
brought  the  action  below  to  recover  the  sum 
of  $8.3.95,  alleged  to  be  due  for  certain  paints 
claimed  to  have  been  sold  defendants  by  the 
plaintiff  The  defendants  denied  the  pur- 
chase of  said  paints.  At  the  trial,  the  plaintiff 
offered  testimony  showing  that  a  traveling 
salesman  of  plaintiff  called  at  the  place  of 
business  of  defendants  in  Columbia,  and, 
after  an  interview  with  one  Moore,  a  clerk 
of  defendants,  who  had  power  to  make  pur- 
chases of  the  kind  mentioned,  entered  an  or- 
der in  his  memorandum  book  as  follows: 
"No.  65.  Columbia,  S.  C,  Oct,  16,  1885. 

"LouisviUe   Asphalt    Varnish    Company,    Louis- 
ville, Kv:    Ship  Lorick  &  Lowrance,  Colum- 
bia. S.  G.: 
1.  Bbl.  1  Turpt.  Asphalt  Black  Varnish.  .   55c. 

1.     "      D.  Roof  Paint  C 50c. 

12.  5  gall.  Pails  D.  roof,  do 55c. 

"Cr.  by  2c.  gal.,  on  acct.  freight. 

"60  days.        H.  L.  Hutchinson,  Salesman." 

—Embracing  the  goods  which  Hutchinson 
swore  he  sold  to  defendants  through  their 
agent,  Mocre.  A  copy  of  this  order  was  im- 
mediately sent  to  plaintiff  at  Louisville, 
Ky.,  who  on  the  19th  of  October  put  said 
goods  up  for  shipment,  and  on  the  20th  of 
October  received  from  the  Cincinnati  South- 
ern Railway  a  bill  of  lading  executed  in 
duplicate.  After  this  shipment,  the  plaintiff 
received  a  letter  from  Lorick  &  Lowrance, 
dated  17th  of  October,  of  which  the  follow- 
ing is  a  copy:  "Louisville  Asphalt  Varnish 
Company,  Louisville— Gents:  Don't  ship 
paint  ordered  through  your  salesman.  We 
have  concluded  not  to  handle  it.  Resp't'y. 
Ix)rick  &  Lowrance.    M."    To  this  the  plain 


THE  MEMORANDUM   IX  WRITING. 


181 


tiff  replied,  2L'd  OcKiber,  18S3.  that  the  goods 
had  gone  forward  before  receipt  of  defend- 
ants' letter  above.  The  defendants  then  an- 
swered, denying  that  they  had  ever  pur- 
chased from  plaintiff,  stating  that  one  of  its 
salesmen  had  visited  Columbia  and  had  offer- 
ed to  sell,  but  that  their  Mr.  Moore  had  de- 
clined to  purchase,  and  that  the  goods  on  ar- 
rival had  be^n  promptly  reshippL-d  to  plain- 
tiff. Upon  testimony  of  plaintiff,  substan- 
tially as  above,  on  motion  of  defendants  a 
nonsuit  was  granted,  on  tlie  ground  that  sec- 
tion 2020  Gen.  St.,  was  fatal  to  a  recovery. 
The  plaintiff  has  appealed,  both  from  the  or- 
der grai'ting  the  nonsuit  and  from  the  judg- 
ment entered,  upon  the  following  grounds: 
(1)  That  there  was  sufficient  evidence  to  go  to 
the  jury,  and  his  honor  erred  in  holding  oth- 
erwise. (2)  That  the  evidence  produced  by 
plaintiff  clearly  took  the  case  out  of  the  stat- 
ute of  frauds,  and  out  of  section  2020,  Gen. 
St,  of  this  state.  (3)  That  the  evidence  clear- 
ly showed  the  acceptance  of  the  goods  sold, 
and  the  actual  receipt  thereof  by  the  defend- 
ants. (4)  That  the  evidence  clearly  showed 
the  note  and  memorandum  in  writing  of  the 
bargain,  signed  by  the  agent  lawfully  author- 
ized. It  is  conceded  that  plaintiff's'  action 
was  subject  to  the  application  of  the  statute 
of  frauds,  (section  2020,  Gen.  St.,)  and  the 
plaintiff  based  its  right  to  a  recovery  upon 
a  compliance  with  that  statute  in  two  of  its 
requirements,  to  wit:  First,  that  the  goods, 
after  being  ordered,  were  accepted  and  ac- 
tually received;  and,  second,  that  a  sufficient 
memorandum  in  writing  had  been  made  to 
bind  the  defendants. 

Now,  the  question  before  us  is  not  as  to 
the  merits  of  the  case,  but  simply  whether 
enough  testimony  had  been  introduced,  as  to 
one  or  both  of  the  grounds  above,  to  carry 
the  case  to  the  jury,  and  prevent  a  nonsuit. 
The  rule  as  to  nonsuits  is  well  understood, 
and  we  need  only  state  here,  what  has  often 
been  said  before,  that  a  nonsuit  is  proper, 
and  in  fact  demandable,  where  there  is  an 
absence  of  all  relevant  testimony  as  to  one 
or  more  of  the  material  disputed  issues  in  the 
case.  If,  however,  there  is  testimony  upon 
said  Issues  the  truth,  force,  and  effect  of 
which  is  to  be  weighed  and  determined,  the 
case  must  go  to  the  jury,  because,  under  our 
system,  the  jury  Is  alone  invested  with  power 
to  determine  disputed  facts  in  cases  at  law. 
As  to  what  amounts  to  an  acceptance  and  an 
actual  receipt  under  the  statute,  see  1  Chit. 
Cont.  (11th  Ed.)  555  et  seq.  We  have  found 
no  pertinent  testimony  upon  this  point.  His 
nonor.  in  the  absence  of  such  evidence,  was, 
therefore,  right  in  holding  that  there  was  no 
ground  upon  which  the  case  could  go  to  the 
ivrcy,  in  so  far  as  this  question  was  involved. 
Was  there  evidence  of  a  note  or  memorandum 
in  writing,  signed  by  the  defendants  or  their 
agent  thereunto  lawfully  authorized,  suffi- 
cient to  carry  the  case  to  the  jury?  There  Is 
no  pretense  that  the  order  sent  by  plaintiff's 


salesman  was  signed  by  the  defendants  or 
their  agent.  On  the  conti-ary,  the  order  was 
prepared  and  sent  by  the  plaintiff's  agent, 
and  no  doubt  was  sufficient  to  bind  the  plain- 
tiff if  it  was  the  party  .sought  to  be  charged, 
although  the  defendants  might  not  be  bound. 
It  is  not  necessary  that  both  parties  should 
sign  tlie  contract.  It  is  sufficient  that  the  de- 
fendant, whether  he  be  vendor  or  vendee,  has 
signed  the  contract,  and  it  is  no  objection 
that  he  has  no  remedy  thereon  against  the 
plaintiff,  inasmuch  as  the  latter  has  not  sign- 
ed it.  Id.  5G8.  It  may  be  urged,  however, 
that  It  is  not  necessary  that  the  whole  of  the 
terms  of  the  contract  should  be  confined  in 
one  memorandum,  it  being  sufficient  if  they 
can  be  collected  from  several  distinct  writ- 
ings having  reference  to  the  same  subject- 
matter.  This  is  true,  and  it  has  been  held 
that  if,  after  the  transaction  has  taken  place, 
it  be  recognized  in  a  letter  written  by  the 
party  to  be  charged,  which  refers  to  the 
specific  contract,  and  not  merely  to  the  sub- 
ject-matter, this  will  satisfy  the  statute.  Id. 
546.  Under  this  principle,  plaintiff  contends 
that  defendants'  letter,  in  which  they  wrote: 
"Don't  ship  paint  ordered  through  your  sales- 
man. We  have  concluded  not  to  handle  it,"— 
was  sutficient  to  carry  the  case  to  the  jury, 
on  the  question  whether  a  note  or  memoran- 
dum in  writing  of  the  contract  sufficient  to 
comply  with  the  statute  has  been  executed 
by  the  defendants.  The  nile  upon  this  sub- 
ject, as  will  be  seen  from  its  discussion  by 
Mr.  Chitty  (11th  Ed.)  544  et  seq.,  and  the 
cases  there  cited  in  notes,  seems  to  be  this: 
The  letter  relied  on  must  in  itself  contain  the 
terms  of  the  contract,  quantity,  quality,  and 
price  of  the  goods,  etc..  or  it  must  refer  to 
some  other  paper  containing  them  in  such 
way  as  by  its  own  terms  to  connect  itself 
with  said  paper.  Now,  the  letter  here  might 
possibly  be  construed  as  an  admission  by  the 
defendants  that  they  had  ordered  certain 
paints  from  the  plaintiff,  and  that  since  said 
order  they  had  concluded  not  to  take  said 
goods.  But  there  is  nothing  in  this  letter 
which  i)oints  distinctly  to  the  contract  sued 
on.  It  could  as  well  apply  to  any  othor  con- 
tract as  this,  and  therefore  a  most  important 
link  is  wanting,  which  could  be  supplied  only 
by  verbal  testimony.  If  the  case  had  gone 
to  the  jury,  there  was  no  testimony  by  which 
the  memorandum  made  by  plaintiff's  sales- 
man could  have  been  connected  with  de- 
fendants' letter.  It  was  said  in  Waterman 
v.  Meigs,  4  Cush.  407.  "that  a  letter  from  the 
purchaser  to  the  vendor,  alluding  to  a  parol 
agreement  for  the  sale  of  goods,  and  inquir- 
ing whether  they  will  be  ready  at  the  time 
agreed  upon  but  not  mentioning  the  quan- 
tity, quality,  or  price  of  the  goods,  or  the  time 
of  payment,  is  not  a  sufficient  memorandum 
to  take  the  agreement  out  of  the  statute  of 
frauds."  See,  also.  Manufacturing  Co.  v. 
Gaddard.  14  How.  446:  Bailey  v.  Ogden.  3 
Johns.  899.    We  think  there  was  an  absence 


182 


STATUTE  OF  FRAUDS. 


of  all  testimony  connecting  defendants'  let- 
ter distinctly  and  clearly  with  the  memoran- 
dum made  by  plaintiff's  agent,  and  sent  by 
him  as  an  order  for  the  goods,  so  that  the 
two  could  constitute  one  memorandum  in 
writing,  signed  by  the  defendants;  and,  the 
letter  itself  failing  to  embody  the  contract  as 
to    the    quantity,    quality,  and  price  of  the 


goods,  the  nonsuit  was  inevitable.  Thus  far 
it  has  been  admitted  that  the  letter  of  de-" 
fendants,  impliedly,  at  least,  acknowledged 
an  order  for  paints,  but  there  is  great  doubt 
whether  such  is  a  proper  construction  of  said 
letter  It  may  well  be  construed  as  a  denial 
of  the  order.  This  view  strengthens  the  con- 
clusion we  have  reached. 


THE  MEMORANDUM  IN  WRITING. 


183 


McGOVERN  V.   HERN. 

(26  N.  E.  861.  153  Mass.  308.) 

Supreme  Judicial   Court  of   Massachusetts. 
Suffolli.      Feb.  20,  1891. 

Exceptions  from  superior  court,  Suff(jll{ 
county;  Robert  R.  lii.sliop,  .Iu"I;^l'. 

Tlioinas  McGoverii  Hueil  Denis  J.  Hern 
to  recover  tiie  price  of  a  liouse  and  lot  al- 
leged to  have  l)een  purchased  by  Hern. 
The  nieinoranduin  of  sale  was  as  follows: 

"By  SULI.IVAX  P.KOS., 

"Auctioneers. 
"No.  9  School  Street. 

"Substantial  3%-story  brick  house,  with  store 
and  lot,  (about  1620  sq.  ft,)  87  and  89  Cove  St., 
next  the  corner  of  Kneeland  st. 

"Thursday,  Oct  18,  at  1  p.  m.,  on  the  premises  will 
be  sold  by  auction,  to  the  highest  bidder,  to  settle  the 
estate  of  John  Higglns,  deceased,  this  well-located 
and  desirable  property.  The  house  contains  a  store 
and  14  rooms,  arranged  for  families;  water  on  each 
floor;  In  fair  repair.  The  sale  of  this  property,  so 
centrally  located,  should  command  the  attention  of 
those  seeking  investments  In  business  property. 
Terms  at  sale.    $500  deposit  at  sale. 

"Sale  on  the  premises.  Boston,  Oct.  18, 
1888.  Terms  and  conditions  of  sale: 
Cash  on  delivery  of  the  deed.  Convey- 
ance to  be  made  in  ten  days  from  date,  at 
the  office  of  Sullivan  Bros.,  No.  9  School 
street,  by  a  good  and  siilficient  deed,  or 
the  seller  may  take  thirty  (oO)  days,  if 
necessary,  in  order  to  give  title.  Taxes 
for  1888  to  be  paid  by  the  purchaser.  $.iOO 
to  be  paid  into  our  hands,  to  bind  the  sale, 
and  form  part  of  the  purchase  money  in 
settlement  for  the  estate;  but  will  be  for- 
feited to  the  seller  if  the  purcha.ser  fails  to 
comply  with  the  terms  of  sale.  Forfeiture 
of  the  deposit  money  will  not  release  the 
purchaser  from  his  obligations  to  take  the 
property,  but  if  the  title  to  the  estateshall 
not  be  good  this   agreement  shall  be  void. 

"  Boston,  Oct.  18,  ISSS.  I  am  the  purchas- 
er of  the  estate  described  in  the  i)rinted 
advertisement  hereto  affixed,  for  the  sum 
of  twenty  thousand  six  hundred  and  fifty 
($20,050)  dollars,  and  heieby  assent  to  the 
terms  of  sale,  and  agree  to  abide  by  the 
same.  D.  J.  Hkhn,  Agent  for  the  Estate 
of  M.  Doherty  &  Co.  " 

Jutlgment  for  defendant,  and  plaintiff 
excepted. 

C.  F.  Donnellf^y,  for  plaintiff.  D.  E.  Ware 
and  J.  Hewins,  for  defendant. 

ALLEN,  J.  The  memorandum  of  the 
sale  is  insufficient  to  satisfy  the  statute  of 
frauds.      It  is  essential    that    it  should 


show  who  are  the  vendors.  It  is  true 
that  they  need  not  be  named.  It  is 
enough  if  they  are  described,  and  in  that 
case  parol  evidence  is  admissible  to  a|»ply 
the  descrii)tion  and  to  identify  the  persona 
meant.  Jones  v.  Df»w,  142  Mass.  l:jU, 
14U,  7  N.  E.  Rep.S.3!J;  Catling  v.  King,5  Ch. 
Div.  GOO;  RoKsiter  v.  Miller,  L.  R.  3  App. 
Cas.  1124,  1141,  5  Ch.  Div.  WS.  Merely  ta 
refer  to  the  persons  selling  as  the  vendors 
is  no  description.  Catling  v.  King,  5  ("h. 
Div^  OG.'j,  per  MicLtisii,  L.  J.  In  Gowen 
v.  Klous,  101  Mass.  449,  the  sellers  were 
described  as  "Eveline  Gowen,  guardian, 
and  the  heirs  of  Thomas  Gowen  ;"  and  it 
was  held  that  one  of  the  heirs,  who  owned 
the  lot  in  question,  might  maintain  the 
action.  The  court  said:  "It  is  no  objec- 
tion to  the  sufficiency  of  the  memorandum 
that  the  seller  therein  named  is  i)ut  an  agent 
of  the  real  owner,  and  on  proof  of  the 
agency  the  latter  may  sue  or  be  sued  on  the 
contract  made  by  the  agent  in  his  behalf." 
The  trouble  with  the  memorandum  in  the 
case  before  us  is  that  the  seller  is  neither 
named  nor  described.  Sullivan  Bros,  were 
indicated  in  one  corner  of  the  paper  as  the 
auctioneers,  and  it  cannot  fairly  be  con- 
sidered that  tliey  were  anything  else. 
Their  function  as  auctioneers  was  recog- 
nized in  the  memorandum  as  something 
distinct  from  that  of  parties  contracting 
for  unmentioned  principals.  Grafton  v. 
Cummings,  99  D.  S.  100.  107.  108.  There  is 
another  objection  which  is  fatal  to  the  ac- 
tion in  the  present  form,  though  it  might 
perhaps  be  cured  by  an  amendment,  sub- 
stituting the  proper  plaintiffs  for  the  pres- 
ent plaintiff.  At  the  time  of  the  sale  it 
ai)pears  that  the  estate  was  owned  b3- dev- 
isees of  John  Higgins,  and  by  grantees  of 
certain  of  the  devisees.  The  plaintiff  was 
not  at  that  time  interested  in  the  estate, 
out  acquirea  it  alterwarrls  Tor  the  pur- 
pose of  conveying  it.  If  anybody  had 
contracted  as  vendor,  then  it  would  be 
Buflicient  if  such  person  was  able  to  give 
a  good  title  at  the  time  specified.  Dresel 
V.  Jordan,  104  Mass.  407.  In  that  case  it 
was  held  that  the  person  who  contracted 
to  sell,  and  who  was  described  in  the 
memorandum,  might  maintain  an  action. 
But  such  a  contract  is  not  negotiable, 
and  it  could  not  be  said  that  the  pur- 
chaser is  liable  to  a  suit  in  the  name  of  a 
person  who  subsequently  acquires  the 
title  of  those  who  were  the  owners  at  the 
time  of  the  sale.  Grafton  v.  Cummings, 
ubi  supra.     Exceptions  overruled. 


1S4 


STATUTE  or  FllAUDS. 


DRAKE  V.  SEAMAN  et  aL 

,  (97  N.  Y.  230.) 

Court  of  Appeals  of  New  York.    Nov.  25.  1S84. 

Action  to  recover  damages  for  an  alleged 
breach  of  a  contract  of  employment.  The 
facts  are  sufficiently  stated  in  the  opinion. 

M.  M.  Waters,  for  appellant  Samuel 
Hand,   for   respondents. 

FINCH,  J.  The  court  below  has  defeated 
the  plaintiff  upon  the  groimd  that  his  cause 
of  action  rested  upon  a  contract  which,  by 
its  terms,  was  not  to  be  performed  within 
one  year,  and  which  was  rendered  void  by 
the  statute  of  frauds  for  the  want  of  a  suffi- 
cient note  or  memorandum.  That  determi- 
nation is  challenged  upon  this  appeal;  and 
it  is  contended  on  behalf  of  the  appellant 
that  the  memorandum  was  sufficient,  for  the 
double  reason  that  no  integral  or  material 
part  of  the  agreement  was  omitted,  but  if  it 
was,  the  omission  was  only  of  the  considera- 
tion, which,  under  the  statute,  no  longer 
needs  to  be  expressed.  It  will  be  conveni- 
ent to  consider  the  last  proposition  first, 
since,  if  it  is  sound,  it  determines  this  ap- 
peal. 

Before  the  Revised  Statutes  went  into  ef- 
fect the  consideration  of  an  agreement  with- 
in the  statute  of  frauds  was  required  to  be 
stated  in  the  memorandum.  In  the  early 
case  of  Wain  v.  Walters,  5  East,  10,  this 
was  put  upon  the  ground  of  a  distinction  be- 
tween the  word  "agreement"  and  the  word 
"promise"  as  used  in  the  statute;  but  later, 
upon  the  proposition  that  the  memorandum 
should  contain  within  itself  all  the  elements 
of  a  complete  cause  of  action  without  need 
of  resort  to  parol  evidence.  Saunders  v. 
Wakefield,  4  Barn.  &  Aid.  59.5.  Thereafter 
the  courts  in  this  state  admitted  and  en- 
forced that  rule  (Sears  v.  Brink,  3  Johns. 
210;  Kerr  v.  Shaw,  13  Johns.  236),  but  held 
the  memorandum  sufficient  if  its  language 
so  indicated  the  consideration  that  it  cotild 
be  argued  out  or  inferred,  and  very  much  of 
nice  criticism  and  narrow  distinction  fol- 
lowed as  a  result  (Rogers  v.  Kneeland,  10 
Wend.  251,  13  Wend.  114).  The  Revised 
Statutes  sought  to  remedy  the  difficulty  by 
an  amendment  requiring  the  consideration 
to  be  expressed,  but  the  question  whether  in 
each  case  it  was  expressed,  or  what  was  a 
sufficient  expression,  led  to  renewed  and 
continual  litigation.  It  was  soon  held  that 
the  words  "for  value  received"  were  enough 
to  satisfy  the  requirement  (Miller  v.  Cook, 
23  N.  Y.  495),  and  in  1863  the  legislature 
struck  out  the  clause,  and  restored  the  sec- 
tion to  its  old  form. 

But  in  all  the  current  of  authority  in  this 
state,  previous  to  that  final  amendment,  it 
was  steadily  ruled  that  the  memorandum 
must  contain  the  whole  agreement,  and  aU 
its   material   terms  and  conditions,   not  in- 


deed in  detail  and   with  absolute  precision, 
but  substantially,   and  so  that  one  reading 
the    memorandum    could    understand    from 
that    what    the    agreement    really    was.    In 
Wright  v.  Weeks,  25  N.  Y.  159,  which  pre- 
ceded   the  amendment    of  1SG3   but    a  few 
years,   that   doctrine   was  declared   in   very 
strong   terms  and   as  entirely    settled.    But 
the  change  of  1863  has  given  rise  to  a  new 
question,  and  bred  in  the  courts  a  wide  dif- 
ference of  opinion.    In  Speyers  v.  Lambert, 
6  Abb.  Prac.   [N.   S.]  309,  the  general  term 
of   the   superior   court   held  that  the   effect 
of  striking  out  the  clause  requiring  the  con- 
sideration to  be  expressed  was  not  merely 
to  restore  the  law  as  it  was  before  the  words 
were  inserted,— that  is  to  say,  that  the  con- 
sideration  must   appear   in    the   agreement, 
but  might  be  argued  out  or  inferred  from  its 
terms, — but    to    go    further    than    that,    and 
make  wholly  and  entirely  imnecessary  any 
statement  of  the  consideration  at  aU.    That 
was  said,  how^ever,  in  a  case  where  the  con- 
sideration was  rendered  at  the  moment  in 
which  the  contract  took  effect,  so  that  such 
contract  was  executory  upon  one  side  only, 
and  not  upon  both.    The  exact  contrary  of 
this    construction    was     held    in    Castle    v. 
Beardsley,  10  Htm,  343,  and  the  remark  of 
Bingham,  in  his  work  on  Contracts  for  the 
Sale  of  Real  Property  (303),  was  cited  with 
approval,    that    "it    is    certainly    a   singiUar 
way  of  construing  a  stattite  that  has  been 
once  amended  and  then  again  amended  by 
striking  out  the  amendment,  to  mean  some- 
thing  different  from   what   it   did   before   it 
was   amended   at  all."     What   was  said   in 
Evansville  National  Bank  v.  Kaufmann,  93 
N.  Y.  273,  was  not  at  all  intended  to  decide 
the   question   upon   which   the   courts    have 
thus  differed.    The  guaranty  there  was  spe- 
cial and  without  consideration  in  fact,  and 
the  question  now  imder  discussion  was  not 
before  the  court.    Very  early  it  was  doubted 
whether  the  amendment  of  1830  at  all  chan- 
ged the  law  (Church  v.  Brown,  21  N.  Y.  331, 
per  Comstock,  J.),  and  it  is  extremely  diffi- 
cult to  answer  the  logic  of  the  doubt.    In 
that   view    of  the    subject,    neither   amend- 
ment changed  the  law,  and  the  presence  or 
absence  of  the  omitted  clause  was  alike  im- 
material.    But    if    the    amendment    of   1830 
worked   any  change,   it  was  no   more  than 
this:  that  the  consideration  should  no  longer 
be  Implied  from  the  language  of  the  instru- 
ment, but  should  be  expressed  in  it.    Brews- 
ter V.  Silence,  8  N.  Y.  207.    And  the  subse- 
quent omission  of  the  inserted  clause  would 
seem  only  to  indicate  a  legislative  intent  not 
to  require  a  definite  expression  of  considera- 
tion, and  leave  the  contract  good  if  one  could 
be  implied  or  inferred  from  its  terms.    Reed, 
St.   Frauds,   §  423,    But   whatever  else  may 
be  said  of  the  amendment  of  1863,  we  are 
quite  sure  that  it  cannot  be  understood  to 
destroy  and  annul   the  requirement  that  the 
note   or   memorandum    must   contain  all   the 


THE  MEMORANDUM  IN   WRITIXG. 


186 


substantial  and  matoiial  terms  of  the  con- 
tract between  the  i)arties.  It  must  show  on 
Its  face  what  the  whole  agreement  is  so  far 
4is  the  same  is  executory,  and  remains  to  be 
performed,  and  rests  upon  uufulIiUed  prom- 
ise. 

Down  to  the  ann-udmeut  of  1SG3  no  case 
wandered  from  that  inile,  so  far  as  we  have 
been  able  to  discover;  and  since  that  date  it 
has  been  re-stated  and  enforced  in  this  court. 
In  Newberry  v.  Wall,  05  N.  Y.  4S4,  a  letter 
admitting  the  purchase  of  goods  by  the  writ- 
er from  the  pereon  to  whom  it  was  written 
was  held  to  be  an  insufficient  note  or  mem- 
orandum, because  it  did  not  "express  any 
consideration  or  terms  of  the  purchase,"  "and 
it  is  impossible  to  say  from  the  contents  of 
the  letter  what  the  contract  in  fact  was." 
And  again  in  Stone  v.  Browning,  G8  N.  Y. 
G04,  Rapallo,  J.,  said  of  a  similar  letter  ad- 
mitting the  agreement  to  purchase:  "It  does 
not  state  the  price  or  any  of  the  terms  of 
the  contract.  These  deficiencies  cannot  be 
supplied  by  oral  evidence.  All  the  essential 
parts  of  the  contract  must  be  evidenced  by 
the  writing."  Now  those  essential  parts  can- 
not be  omitted,  because,  in  addition  to  con- 
stituting such  material  elements,  they  consti- 
tute also  a  consideration  of  the  contract.  The 
agreement  of  the  defendants  in  this  ciise  was 
not  merely  to  pay  so  much  money  to  plain- 
tiff. It  was  to  pay  him  that  money  for  his 
services  as  salesman  to  be  thereafter  ren- 
dered. For  what  the  payment  was  to  be 
made  constituted  a  material  and  essential 
element  of  the  agreement  on  the  part  of  the 
defendants;  an  important  condition  of  the 
contract  on  their  side.  Their  agreement  was 
not  absolute  to  pay  the  money.  It  was  con- 
ditioned upon  the  rendition  of  the  stipulated 
services.  Any  memorandum  which  omits  the 
condition  falsifies  the  agreement  which  they 
actually  made,  and  represents  them  as  agree- 
ing to  pay  the  money  absolutely  when  they 
did  not  so  conti-aet.  It  is  no  answer  that 
the  omitted  condition,  coupled  with  the  other 
party's  promise  of  performance,  constituted 
a  consideration  for  his  own  agreement,  and 
so  need  not  be  expressed.  If  we  were  to 
^rant  that,  and  follow  Speyers  v.  Lambert  to 
its  full  extent,  it  would  only  justify  an  omis- 
sion from  the  memorandum  of  plaintiff's 
promise  to  perform  the  sorrices,  and  not  of 
defendants'  condition  modifying  and  limit- 
ing and  mca.suring  their  own  promise.  As 
in  the  cases  last  cited  in  our  own  reports, 
the  agreement  was  not  an  absolute  agree- 
ment to  purchase  irrespective  of  price,  but 
to  buy  at  an  agreed  and  specified  price,  so 
here  the  agreement  was  not  an  absolute 
agreement  to  pay  so  much  money,  but  to  pay 
it  upon  condition  that  certain  specific  serv- 
ices were  rendered.  And  if  we  conceded  that 
the  consideration  might  be  wholly  omitted 
from  the  memorandum,  it  would  still  be  req- 
uisite that  aU  the  essential  and  raateri;il  ele- 
cjKnts  of  defendants'  own  agreement  should 


be  stated,  and  they  are  not  stated  where 
the  vei-y  condition  upon  which  they  were  to 
pay  at  all  is  omitted,  and  the  subject-mat- 
ter of  their  agreement  is  absent. 

And  that  brings  us  to  the  question  whether 
the  memorandum  on  its  face  stated  the  ac- 
tual contract  which  the  defendants  made;  or 
whether  from  the  memorandum  we  can  de- 
termine what  the  real  coutmct  between  the 
parties  was.  The  actual  agreement  was 
that  the  defendants  would  pay  yearly  the 
sums  specified  in  the  memorandum  for  the 
services  of  the  plaintiff  as  a  salesman,  to  be 
rendered  for  three  years,  and  the  inquiry  is 
whether  that  contract  is  stated  in  the  mem- 
orandum. The  writing  begins  with  the 
words  "preserve  this,"  and  continues  thus: 
"The  understanding  with  Mr.  Drake  is  as 
follows:  2,000  doUai-s  for  the  first  year;  2,- 
500  dollars  for  the  second  year  sure,  and 
provided  the  increase  sales  shall  warrant  it, 
he  is  to  have  $3,000.  3  year  in  proportion  to 
business  as  above."  On  the  face  of  this 
writing  the  contract  of  the  defendants  with 
its  essential  terms  and  conditions  does  not 
at  all  appear,  imless  we  yield  to  the  con- 
struction very  ingeniously  suggested  and 
forcibly  argued  on  behalf  of  the  appellant, 
that  the  words  "for  the  first  year"  mean, 
for  the  first  year's  time  of  the  plaintiff,  and 
so  on  through  the  other  stipulations.  It  is 
said  the  word  "year"  means  a  period  of 
time,  and  must  be  held  to  refer  to  the  plain- 
tiff's time,  using  that  word  in  the  sense  of 
services,  and  the  construction  is  sought  to 
be  strengthened  by  parol  evidence,  show- 
ing that  plaintiff  was  a  salesman,  and  de- 
fendants manufacturers.  There  are  no  tech- 
nical or  ambiguous  words  in  the  memoran- 
dum requiring  explanation,  and  we  cannot 
resort  to  parol  evidence  to  insert  in  the 
writing  what  is  not  there.  Wright  v. 
AVeeks,  supra.  Confining  our  attention  to 
what  the  memorandum  says,  we  observe 
that  its  language  is  equally  applicable  to 
many  contracts  entirely  different  from  that 
actually  made.  Although  plaintiff  is  a  sales- 
man, he  mny  have  invented  or  purchased  a 
patent  valuable  for  the  use  of  the  defend- 
ants, and  bargained  to  give  them  that  use 
for  three  yeai-s,  in  return  for  which  plaintiff 
was  to  have  $2,000  for  the  first  year.  .?2,i500 
for  the  second  year,  sure,  and  provided  the 
increase  sales  shall  warrant  it  he  is  to  have 
$3,000.  Third  year  in  proportion  to  business 
as  above.  Or  the  plaintiff  may  have  rented 
to  the  defendants  a  store  or  factory  for 
three  years,  and  the  memorandum  recite  the 
rental.  And  so  the  illustrations  might  be 
multiplied.  Nothing  in  the  writing  indicates 
whicli  of  all  the  possible  contracts  was  in- 
tended, or  identifies  the  one  really  made.  To 
a  person  depending  wholly  upon  the  writing, 
the  real  contract  made  is  impossible  to  be 
ascertained.  And  here  comes  in  the  difficTilty 
against  which  the  statute  was  aimed.  If  the 
memorandum   be   held  sufficient,   any   false- 


1S6 


STATUTE  OF  FRAUDS. 


hoed  or  perjuiy  on  the  part  of  the  plaintiff 
might  apply  it  to  an  agreement  never  made 
or  tJiought  of,  and  against  that  the  memo- 
randum would  not  furnish  the  least  protec- 
tion. And  there  is  a  fui-ther  difficulty  as  to 
the  third  year,  which  is  the  only  one  here  in 
controversy.  Precisely  what  the  final  clause 
means  it  is  not  easy  to  say.  It  does  not  pro- 
vide in  terms  for  any  fixed  salary,  but  makes 
the  payment  dependent  upon  the  business  in 
proportion  to  the  rates  above  stated.  No  evi- 
dence was  given  showing  the  amount  of  busi- 
ness. We  cannot  hold  this  memorandum  suf- 
ficient without  a  dependence  upon  parol  evi- 
dence which  would  practically  nullify  the  stat- 


ute, and  since  we  have  held  that  one  party  may 
be  bound  by  his  signature  while  the  other 
party,  not  signing,  is  not  bound  at  all  (Mason 
V.  Decker,  72  N.  Y.  595),  it  becomes  very  im- 
portant for  the  party  who  does  sign  and  Is 
bound,  that  the  rule  should  be  firmly  ad- 
hered to  which  requires  the  real  contract  to 
be  stated  with  its  substantial  terms  and  con- 
ditions. We,  therefore,  agree  with  the  con- 
clusion of  the  general  term. 

The  order  of  the  general  term  should  be  af- 
firmed and  judgment  absolute  rendered  for 
the  defendants,  with  costs. 

All  concur. 

Order  aflarmed,  and  jv^dgment  accordingly. 


THE  MEMOllANDUM  IN  WRITING. 


Ib7 


JUSTICE  V.  LANG  et  aL 
(42  N.   Y.  493.) 

Jourt  of  Appeals  of  New  York.      March  2S, 
1870. 

Action  for  breach  of  contract.  The  opin- 
ion states  the  case.  Defendants  had  judg- 
ment  bel'jw. 

Edmund  Terry,  for  appellant  Samuel  E. 
IjJ'ou,  for  respondent 

LOTT,  J.  The  plaintiff  brought  this  ac- 
tion for  the  recovery  of  damages  from  the 
defendants  (composing  the  firm  of  W.  Bailey 
Lang  &  Co.),  for  the  non-performance  of  their 
promise,  contained  in  the  following  memoran- 
dum or  instrument  in  writing,  signed  by  them, 
viz.: 

"New  York,  13th  May,  1S61. 

"We  agree  to  deliver  P.  S.  Justice  one 
thousand  Enfield  pattern  rifl.es,  with  bayo- 
nets, no  other  extras,  in  New  York,  at  eight- 
een dollars  each,  cash  upon  such  delivery. 
Said  rifles  to  be  shipped  from  Liverpool  not 
later  than  1st  July,  and  before  if  possible. 
"W.  Bailey  Lang  &  Co." 

After  proof  of  the  negotiation  of  the  par- 
ties, the  execution  of  the  instrument  by  the 
defendants,  its  acceptance  by  tlie  plaintiff, 
and  the  introduction  by  him  of  other  evi- 
dence to  sustain  his  action,  but  without  show- 
ing that  a  counterpart  of  the  memorandum, 
or  any  instrument  in  writing  whatever,  was 
ever  signed  by  him  to  accept  the  rifles,  or 
pay  for  them,  he  rested  his  case.  Then  the 
counsel  of  the  defendants,  after  the  denial 
of  a  motion  to  dismiss  the  complaint,  pro- 
ceeded to  examine  witnesses  on  their  part; 
and  after  some  testimony  had  been  given  (but 
which  was  afterward  considered  as  stricken 
nut),  the  judge  stated  that  he  much  inclined 
to  think  that  the  memorandum  was  a  nudum 
pactum,  and  after  referring  to  its  contents, 
said:  "It  expresses  no  consideration,  and 
there  is  no  evidence  tending  to  show  that  the 
proposed  purchaser  ever  agreed  to  take  the 
rifles  or  to  pay  for  them;"  and  remarked  that 
the  admission  of  testimony  offered  to  prove 
that  the  contract  was  obtained  fraudulently, 
or  by  false  representations,  would  be  in  the 
face  of  his  impressions  in  regard  to  the  con- 
tract itself;  that  if  it  was  a  mere  nudum 
pactum,  without  consideration,  It  would  be 
useless  to  prove  any  conversation  in  regard 
to  It.  He  thereupon,  on  the  gi'ounds  above 
stated  by  him,  and  on  motion  of  the  defend- 
ants' counsel,  dismissed  the  complaint,  and 
an  exception  to  that  decision  was  duly  taken. 
The  ground  assigned  by  the  learned  judge 
for  the  dismissal  of  the  complaint  renders  it 
necessary  to  examine  into  the  validity  of  the 
contract  at  common  law,  as  well  as  under 
the  requirement  of  the  statute  of  frauds. 

Blackstone,  In  his  Commentaries  (volume  2, 
p.  422),  defines  a  contract  to  be  "an  agree- 
ment upon  sufficient  consideration  to  do,  or 
not  to  do  a  particular  thing;"  and  he  says 
the  price,  or  motive  of  the  contract,  we  call 


the  consideration  (page  444).  Kent's  dollni- 
tion  of  an  executory  contract  is  an  agree- 
ment of  two  or  more  persons,  upon  sufficient 
consideration,  to  do  or  not  to  do  a  particular 
thing.  2  Kent,  Comm.  449,  etc.  Comyn,  in 
his  work  on  Contracts  (page  2),  says:  A  sim- 
ple contract,  or  contract  by  parol.  Is  defined 
in  our  law  books  to  be  "a  bargain  or  agree- 
ment voluntarily  made  upon  good  considera- 
tion, between  two  or  more  persons  capable 
of  contracting  to  do,  or  forbear  to  do,  some 
lawful  act."  ♦  ♦  •  And  "six  things  appear 
necessary  to  concur:  (1)  A  person  able  to 
contract;  (2)  a  person  able  to  be  contracted 
with;  (3)  a  thing  to  be  contracted  for;  (4)  a 
good  and  sufficient  consideration,  or  quid  pro 
quo;  (.5)  clear  and  explicit  words  to  express 
the  contract  or  agreement;  (G)  the  assent  of 
both  the  contracting  parties."  He  adds: 
"So,  every  contract  should  be  obligatory  on 
both  the  contracting  parties,  or  both  should 
be  at  liberty  to  recede  therefrom:  but  to  an 
agreement  or  contract  there  is  no  prescribed 
form  of  words,  but  any  words  which  show 
the  assent  of  the  parties  are  sufficient,"  He 
also,  in  this  connection,  states  that  a  volun- 
tary promise,  without  any  other  considei-a- 
tion  than  mere  good- will,  or  natural  affec- 
tion, to  give  to  another  a  sum  of  money,  as 
for  instance  £20,  and  that  he  will  be  a  debtor 
for  such  sum,  is  no  contract,  but  a  mere 
nudum  pactum,  and  that  the  law  will  not 
compel  the  execution  by  a  person  of  what 
he  had  no  visible  inducement  to  engage  fur, 
but  any  degree  of  reciprocity  will  prevent 
the  agreement  or  promise  from  being  classed 
under  this  rule;  and  he  illustrates  the  dis- 
tinction by  saying,  that  in  the  instance  or 
case  put,  if  any  thing,  however  trifling,  were 
done  or  to  be  done,  or  given  for  the  £20,  it 
would  be  a  valid  contract,  and  binding  upon 
the  parties. 

Chitty  says:  "A  contract  or  agreement  not 
under  seal,  may  be  thus  defined  or  described: 
A  mutual  assent  of  two  or  more  persons  com- 
petent to  contract,  founded  on  a  sufficient  and 
legal  motive,  inducement  or  consideration,  to 
perform  some  legal  act,  or  to  omit  to  do  any 
thing,  the  performance  of  which  is  not  enjoin- 
ed by  law."  Chit  Cont  3.  All  of  these  def- 
initions are  substantially  the  same;  and  up- 
on the  application  of  tliat  given  by  Comyn, 
which  embraces  the  others,  and  appears  to 
me  to  be  a  precise  and  explicit  exposition  of 
the  necessary  ingredients  of  a  contract,  to 
the  memorandum  in  question,  with  his  illus- 
trations. It  will  be  seen  that  It  constitutes  a 
sufficient  and  perfect  agrcomont. 

It  shows  that  the  plaintiff  and  the  defend- 
ants were  the  contracting  parties,  the  first  as 
seller,  and  the  last  as  purchaser;  that  the 
thing  contracted  for  was  Enfield  pattern 
rifles;  that  a  good  and  sufflcient  considera- 
tion, or  quid  pro  quo,  was  expressed,  being 
the  delivery  of  such  rifles  to  the  defendant 
at  New  York,  on  the  payment  by  him  to  the 
plaintiff  of  $1S  each,  cash,  upon  such  delivery. 
Clear  and   explicit  words   were  used   to  ex- 


1S8 


STxVTUTE  OF  FRAUDS. 


press  the  terms  of  the  contract  and  agree- 
ment, leaving  no  doubt  as  to  the  subject-mat- 
ter thereof,  the  time  and  place  for  the  de- 
livery of  the  goods  to  be  delivered,  and  the 
price  or  sum  to  be  paid,  and  when  such  pay- 
ment was  to  be  made;  and  the  assent  of 
both  the  contracting  parties  also  appears, 
that  of  the  sellers,  by  subscribing  their  firm 
name  at  the  end  of  the  contract,  and  that 
of  the  buyer  by  the  acceptance  thereof.  Al- 
though there  is  no  distinct  and  express  prom- 
ise in  terms  by  the  plaintiff,  to  pay  the  price 
specified,  the  terms  "cash  on  delivery,"  im- 
ply a  promise,  and  create  an  obligation  to 
make  such  payment  when  the  rifles  are  de- 
livered. 

I  shall  therefore  assume  that  the  conti-act 
was  valid  and  binding  on  the  defendants  at 
cftmraon  law,  and,  as  I  understand  the  pre- 
vailing opinion  of  the  general  term,  its  valid- 
ity as  a  common-law  agreement  was  con- 
ceded; and  the  affirmance  of  the  judgment  at 
the  trial  term  was  placed  on  the  sole  ground 
that  it  was  void  under  the  statute  of  frauds. 
2  Rev.  St.  136,  etc. 

It  will  now  be  considered  with  reference 
to  the  requirements  of  that  statute,  which 
so  far  as  it  applies  to  the  sale  of  goods  and 
chattels,  declares  that  "every  contract  for  the 
sale  of  any  goods,  chattels  or  things  in  action 
for  the  price  of  $50  or  more,  shall  be  void, 
unless,  1st.  A  note  or  memorandum  of  such 
contract  be  made  in  writing  and  be  sub- 
scribe:! by  the  parties  to  be  charged  thereby; 
or  2d.  Unless  the  buyer  shall  accept  and  re- 
ceive part  of  such  goods  or  the  evidences,  or 
.some  of  them,  of  such  things  in  action;  or  3d. 
Unless  the  buyer  shall  at  the  time  pay  some 
part  of  the  purchase-money."  2  Rev.  St.  136, 
§  3.  And  a  subsequent  section  (section  8)  de- 
clares that  every  instrument,  by  any  of  the 
provisions  of  the  title  to  be  subscribed  by 
any  party,  may  be  subscribed  by  the  lawful 
agent  of  such  party. 

This  is  substantially,  so  far  as  it  affects 
this  case,  the  same  as  the  fifteenth  section  of 
the  former  statute  of  frauds  in  this  state,  en- 
titled "An  act  for  the  prevention  of  frauds," 
passed  26th  February,  1787.  1  Greenl.  Ed. 
Laws,  p.  391,  etc.,  and  1  R.  L.  1813,  p.  75. 
That  section  enacts  "that  no  contract  for  the 
sale  of  any  goods,  wares  and  merchandise,  for 
the  price  of  £10  or  upward,  shall  be  allowed 
to  be  good,  except  the  buyer  shall  accept  part 
of  the  goods  so  sold,  and  actually  receive  the 
same,  or  give  something  in  earnest  to  bind 
the  bargain,  or  in  part  pajonent;  or  that  some 
note  or  memorandum  in  writing  of  the  said 
bargain  be  made  and  signed  by  the  parties 
to  be  charged  by  such  contract,  or  their  agents 
thereunto  lawfully  authorized,"  and  is  in  its 
terms  a  transcript  of  the  seventeenth  clause 
of  the  English  statute  of  frauds  (29  Car.  II. 
c.  3)  which  Chancellor  Kent  says  "is  as- 
sumed to  be  the  basis  of  the  several  statute 
laws  of  the  several  states  on  this  subject"  2 
Kent.  Comm.  510. 

In  this  connection  it  may  be  useful  to  ad- 


vert to  the  fact  that  subdivision  1  of  section 
3  of  the  Revised  Statutes  as  above  set  forth 
is  materially  different  from  its  provisions  as 
reported  to  the  legislature  by  the  revisers. 
Those  were  in  the  following  terms,  viz.:  "A 
note  or  memorandum  of  such  contract,  con- 
taining the  names  of  the  parties,  a  descrip- 
tion of  the  things  sold  and  the  price  thereof, 
be  reduced  to  writing  at  the  time  the  contract 
is  made,  and  be  subscribed  by  all  the  parties 
thereto."  See  3  Revisers'  Notes  N.  Y.  St.  at 
Large  (Edmonds'  Ed.)  vol.  5,  p.  395.  The 
effect  of  the  statute  is  to  make  additional  re- 
quirements to  what  was  required  at  common 
law  to  make  a  valid  contract.  They  are 
specifically  stated;  and  so  far  as  it  relates  to 
or  affects  the  contract  in  question,  are  "that  a 
note  or  memorandum  of  such  contract  be 
made  in  writing  and  be  subscribed  by  the 
parties  to  be  charged  thereby." 

It  is  claimed  by  the  defendants,  and  it  was 
so  held  by  the  general  term,  that  the  omis- 
sion of  the  plaintiff  to  subscribe  the  contract 
rendered  it  void,  even  as  to  the  defendants, 
by  whom  it  was  subscribed,  and  consequently 
that  it  was  wholly  inoperative  and  ineffectual 
for  any  purpose  or  to  any  extent  whatever. 
Is  this  the  proper  construction  of  the  stat- 
utory provision? 

In  deciding  this  question  it  is  important  to 
consider  the  object  of  the  statute.  That  is 
declared  in  the  act  of  26th  February,  1787. 
It  is  entitled  "An  act  for  the  prevention  of 
frauds;"  and  after  making  several  enact- 
ments it  enacts  (as  is  stated  in  the  beginning 
of  section  9)  "for  the  prevention  of  many 
fraudulent  practices  which  are  commonly  en- 
deavored to  be  upheld  by  perjury  and  sub- 
ornation of  perjury,"  several  provisions,  and 
among  others,  the  fifteenth  section,  above 
cited. 

The  present  statute  on  the  subject  is  con- 
fessedly for  the  same  purpose.  The  enact- 
ment that  every  contract  for  the  sale  of  any 
goods  for  the  price  of  $50  or  more,  where 
the  buyer  neither  accepts  nor  receives  a  part 
of  them,  nor  at  the  time  pays  some  part  of 
the  purchase-money,  shall  be  void  "unless  a 
note  or  memorandum  of  such  contract  be 
made  in  writing,  and  be  subscribed  by  the 
parties  to  be  charged  thereby,"  does  not  make 
such  a  contract  unlawful,  but  its  object  is  to 
declare  that  it  shall  be  of  no  binding  force 
to  charge  any  partj'  who  has  not  subscribed 
a  note  rr  memorandum  thereof  in  writing, 
with  any  liability  thereon.  It  evidently  con- 
templates legal  proceedings  against  one  of  the 
parties  to  it,  and  its  design  is  to  prevent  per- 
jury and  subornation  of  perjury  by  refusing 
the  aid  of  the  law  in  the  enforcement  of  any 
rights  claimed  imder  it  against  him,  without 
such  written  evidence. 

The  end  and  object  of  the  statute  are  at- 
tained by  written  proof  of  the  obligation  of 
the  defendant;  he  is  the  party  to  be  charged 
with  a  liability,  dependent  on,  and  resulting 
from  the  evidence,  and  he  is  intended  to  be 
protected  against   the   dangers  of  false   oral 


THE  MEMORANDUM  IN   WIUTIXG. 


189 


testimony.  To  say  that  the  plaintiff  or  the 
party  seeking  to  enforce  a  contract  is  himself 
a  party  to  be  cliargod  therewith  is  a  perver- 
sion of  lanffuage. 

The  term  "parties"  in  the  section  quoted  is 
used  in  connection  with  the  words  "to  be 
cliarged  thereby,"  and  does  not  necessarily 
Include,  nor  can  it  be  construed  to  include,  all 
the  parties  to  the  contract.  It  is  on  the  con- 
trary limited  and  restricted  by  the  qualifying 
words,  to  such  only  of  those  parties  as  are 
to  be  bound  or  hold  chargeable  and  legally 
responsible  on  the  contract,  or  on  account  of 
a  liability  created  by  or  resulting  from  it. 

If  it  had  been  intended  to  extend  to,  and 
include  all  of  the  parties,  those  words  "to  be 
charged  thereby"  would  have  been  unneces- 
sary and  superfluous.  The  appropriate  lan- 
guage to  express  such  intention  would  have 
been,  that  the  note  or  memorandum  should  be 
subscribed  "by  all  the  parties  thereto,"  or  "by 
the  parties  thereto,"  or  some  general  terms, 
without  any  limitation  or  restriction  to  any 
particvilar  class  or  designation  of  parties. 

The  action  of  the  legislature,  moreover, 
when  considered  in  connection  with  the  rec- 
ommendation of  the  revisers,  is  in  harmony 
with  and  strongly  confirmatory  of  this  con- 
struction. That  recommendation  was.  that 
the  note  or  memorandum  should  be  subscrib- 
ed by  all  the  parties  thereto;  and  if  it  had 
been  adopted  there  would  have  been  no  room 
for  doubting  as  to  the  intent  of  the  require- 
ment. So  on  the  other  hand  the'  omission  to 
make  the  change  recommended,  and  the  en- 
actment of  the  provision  by  the  continuance 
of  the  phraseology  and  terms,  "the  parties  to 
be  charged  thereby,"  clearly  indicate  that  the 
construction  that  had  been  given  thereto  in 
numerous  cases,  declaring  that  it  was  enough 
tliat  the  note  or  memorandum  of  the  contract 
he  signed  or  subscribed  by  the  party  to  be 
charged,  was  expressive  of  the  true  meaning 
of  those  terms. 

The  coimsel  for  the  respondent  however  in 
arguing  that  the  memorandum  must  be  sub- 
scribed by  both  parties,  claims  and  insists 
that  "an  examination  of  the  history  of  the 
question  will  show  that  no  decisions  to  the 
contrary  have  been  made  In  the  court  of  last 
resort  in  this  state,  and  that  those  which  had 
been  made  to  the  contrary  in  other  courts 
have  not  been  well  considered;"  and  in  sup- 
port of  that  proposition  he  refers  to  several 
reported  cases  where  the  question  has  been 
the  subject  of  consideration,  and  it  will  be 
proper  to  examine  them  with  the  view  of  as- 
certaining whether  he  is  sustained  in  the  con- 
struction he  Mas  given  to  them,  or  as  to  the 
effect  to  which  they  are  entitled  as  authority. 
The  first  is  that  of  Koget  v.  Merritt,  2  Caine, 
117,  decided  in  1804.  It  was  an  action  for  not 
delivering  two  hundred  and  twenty  barrels  of 
flour,  according  to  agreement.  It  appear- 
ed that  the  defendant  agreed  to  sell  the 
flour,  and  a  memorandum  of  the  sale,  made 
and  signed  by  him,  was  delivered  to  the 
plaintiff's  broker,  who  negotiated  the  sale  for 


!  him.  A  note  of  one  Lyon  was  to  be  given 
!  for  the  flour,  but  before  it  was  tendered  he 
I  failed.  One  of  the  objections  taken  to  the  re- 
covery was,  that  the  contract  was  void  under 
the  statute  of  frauds,  because  the  memoran- 
dum or  agreement  was  signed  only  by  one 
party,  and  therefore,  though  obligatory  on 
him.  it  could  not  be  enforced  against  the 
plaintiff,  and  that  this  rendered  the  whole  a 
mere  nudum  pactum.  .ludge  Spencer  held 
the  objection  to  be  untenable,  and  said:  "The 
sta^'ute  of  frauds*  requires  in  certain  contracts 
a  memorandum  to  be  signed  by  the  parties  to 
be  charged.  If  there  are  acts  to  be  done  by 
both  parties,  and  the  one  who  is  to  perform  a 
principal  part  (as  here,  the  delivery  of  the 
flour)  sign,  and  it  is  accepted  by  the  other 
party,  there  can  exist  no  doubt  but  that  such 
contract  would  be  mutually  obligatory.  In 
this  case  I  hold  that  there  was  a  valid  con- 
tract executory  in  its  nature;  but  before  the 
period  of  its  execution  arrived,  the  considera- 
tion agreed  to  be  given  by  the  plaintiff  wholly 
failed  by  the  insolvency  of  Lyon." 

The  question  of  the  necessity  of  the  exe- 
cution or  signing  of  the  agreement  by  both 
parties  thereto  was  involved  in  the  case,  and 
although  it  is  true  that  the  judge  said  be- 
fore he  made  those  remarks,  that  as  the 
opinion  he  was  about  to  give  in  deciding  it 
was  not  founded  on  either  of  the  objections 
taken  (the  other  being  as  to  a  variance  be- 
tween the  contract  set  forth  in  the  declara- 
tions and  the  proof)  it  would  be  unnecessary 
to  enter  into  a  minute  examination  of  them, 
yet  what  he  did  say  in  reference  thereto 
was  nevertheless  an  authority  on  the  ques- 
tion. 

The  next  case  was  that  of  Bailey  v.  Ogden, 
3  Johns.  399  (decided  in  1808),  which  was  an 
action  of  assumpsit  by  the  plaintiffs  for  the 
price  of  a  quantity  of  sugar  alleged  to  have 
been  sold  by  them  to  the  defendants  through 
the  agency  of  one  Iluguet,  acting  as  a  broker 
for  them.  An  entry  of  the  sale  and  the  terras 
was  made  by  one  of  the  plaintiffs  and  kept 
by  them,  commencing  "sold  Huguet  for  J. 
Ogden  (fc  Co.  notes,  with  approved  indorser." 
and  then  stating  some  other  terms,  but  not 
specifying  the  quantity  of  the  sugar  sold. 
It  was  read  to  Huguet,  and  there  was  evi- 
dence tending  to  prove  that  he  said  it  was 
correct.  He  himself  had  on  the  previous 
day  made  an  entry  of  the  transaction  in  pen- 
cil in  his  own  memorandum  book,  commen- 
cing "J.  Ogden  &  (Jo.— Bailey  v.  Bogert,"  stat- 
ing some  other  particulars,  but  saying  noth 
ing  about  an  indorsement;  and  he  testified 
that  he  did  not  assent  to  that.  The  extent  of 
Huguet's  authority  and  some  other  matters 
were  the  subject  of  dispute  on  the  trial.  The 
judge  among  other  things  charged:  "That 
a  note  or  memorandum  to  satisfy  the  stat- 
ute of  frauds,  must  contain  the  names  of  the 
parties  and  the  terms  of  the  contract;  and 
that  if  the  names  of  the  parties  bo  inserted 
at  the  top.  in  the  middle,  or  at  the  bottom, 
by  their  authority,  it  is  sufficient;"  and  then 


190 


STATUTE  OF  FRAUDS. 


after  adverting  to  the  fact  that  there  was 
but  one  special  count  on  the  contract  which 
averred  a  delivery,  and  that  averment  must 
be  proved,  even  if  there  had  been  a  note 
or  memorandum  within  the  statute,  sub- 
mitted it  to  the  jury  to  find  whether  there 
had  been  an  absolute  delivery  to  the  de- 
fendants and  acceptance  by  them  of  the 
goods.  They  found  a  verdict  for  the  defend- 
ants. 

A  motion  was  made  in  the  supreme  court 
to  set  aside  that  verdict  and  for  a  new  trial. 
The  counsel  for  the  plaintiffs  among  other 
points,  insisted  that  it  was  not  necessary 
that  both  parties  should  sign  the  note  or 
memorandum  of  the  contract,  citing  Roget 
V.  Merritt,  supra,  and  Saunderson  v.  Jack- 
son. 2  Bos.  &  P.  238,  and  that  if  there  was  a 
siiflieient  memorandum  in  writing,  proof  of 
a  delivery  of  the  goodfi  was  not  required. 

The  counsel  for  the  defendants  in  refer- 
ence to  the  sufficiency  of  the  note  or  memo- 
randum, after  referring  to  the  language  of 
the  statute,  said  that  none  of  the  authori- 
ties cited  by  the  plaintiffs'  counsel  applied 
to  the  case;  that  "when  the  memorandum  is 
signed  by  one  party  only  it  must  be  by  the 
party  to  be  charged;"  and  argued  that  the 
"bare  assent"  of  the  party  to  be  charged 
was  not  equivalent  to  a  signing. 

Kent,  C.  J.,  in  delivering  the  opinion  of 
the  court,  stated  that  the  case  depended  on 
the  decision  of  two  general  questions;  one 
of  which  and  the  first  of  them  was  whether 
there  was  a  note  or  memorandum  in  writ- 
ing, binding  upon  the  defendants,  within 
the  meaning  of  the  statute  of  frauds;  and 
after  referring  to  the  memorandum  made 
relative  to  the  transaction  as  above  stated, 
he  said:  "The  entry  of  the  plaintiffs  made 
and  retained  by  them  was  not  binding  up- 
on the  defendants,  because  the  statute  re- 
quires the  note  or  memorandum  to  be  sign- 
ed by  the  party  to  be  charged.  The  numer- 
ous cases  admitting  an  agreement  to  be 
valid  within  the  statute  if  signed  by  one 
party  only,  are  all  of  them  cases  in  which 
the  agreement  was  signed  by  the  party 
against  whom  the  performance  was  sought. 
Some  of  the  cases  arose  under  the  fourth 
and  others  under  the  seventeenth  section  of 
the  English  statute,  but  the  words  are  in 
this  respect  similar  and  require  the  same 
construction."  He  then,  after  remarking 
that  it  had  been  said  "that  there  would  be 
a  want  of  mutuality,  if  the  plaintiffs  in  the 
case  were  bound  by  the  entry  and  the  de- 
fendants would  not  be,"  says:  "Whether 
the  plaintiffs  in  the  present  case  would  be 
bound  at  law  by  their  memorandum,  or  if 
bound,  whether  they  might  have  relief  in 
equity,  are  questions  not  before  us,  and  con- 
corning  which  we  are  not  now  to  inquire," 
and  after  an  examination  of  the  facts  dis- 
closed in  the  case,  he  came  to  the  conclu- 
sion that  there  was  no  note  or  memorandum 
in  writing  which  took  the  contract  there 
relied  on  out  of  the  statute  of  frauds,  so  far 


at  least  as  it  respected  the  defendants,  nor 
a  delivery  or  acceptance  of  the  sugars,  and 
that  therefore  the  motion  for  a  new  trial 
should  be  denied. 

This  case,  while  it  cannot  be  considered  as 
an  actual  authority  in  support  of  the  pres- 
ent action,  is  nevertheless  important  as 
recognizing  the  fact  that  there  were  numer- 
ous cases  holding  an  agreement  to  be  valid 
within  the  statute  if  signed  by  one  party 
only,  when  such  party  was  the  one  against 
whom  the  performance  was  sought,  and  the 
remark  of  the  learned  chief  justice,  "whether 
the  plaintiffs  in  that  case  were  bound  at 
law  by  their  memorandum,  or  if  bound, 
whether  they  might  have  relief  in  equity, 
were  questions  not  then  before  the  court, 
and  concerning  which  they  were  not  then 
bound  to  inquire;"  was  as  consistent  with  a 
doubt  or  question  as  to  the  sufficiency  of  the 
memorandimi  to  bind  the  plaintiffs,  conced- 
ing it  to  have  been  signed  by  them,  as  it 
was  in  reference  to  their  liability,  if  it  had 
been  so  signed  and  was  in  other  respects 
sufficiert. 

What  was  thus  said  can  on  no  groimd  be 
considered  as  questioning  the  force  or  effect 
of  the  "numerous  cases"  referred  to  by  him 
as  authority. 

The  next  case  was  that  of  Merritt  v.  Cla- 
son,  12  Johns.  102  (decided  in  1815).  There 
it  appears  that  John  Townsend,  a  broker, 
was  employed  by  the  defendant  to  purchase 
rye;  that  he,  on  application  to  Isaac  Wright 
&  Son,  in  New  York,  the  agents  of  the 
plaintiffs,  agreed  to  purchase  of  them  ten 
thousand  bushels  at  $1  per  bushel,  and  they 
authorized  him  to  sell  the  same  to  the  de- 
fendant on  the  terms  agreed  on;  he  then 
informed  the  defendant  of  the  terms  of  sale 
and  was  directed  by  him  to  make  the  pur- 
chase accordingly.  Thereupon  he  went  to 
Wright  &  Son  and  closed  the  bargain  with 
them,  as  agents  of  the  plaintiffs,  and  in 
their  presence  wrote  in  his  memorandum 
book  with  a  pencil  as  follows:  "February 
18th,  bought  of  Daniel  &  Isaac  Merritt  by 
Isaac  Wright  &  Son,  10,000  bushels  of  good 
merchantable  rye,  at  one  dollar  per  bushel, 
deliverable  in  the  last  ten  or  twelve  days  of 
April  next,  alongside  of  any  vessel  or  wharf 
the  purchaser  may  direct,  for  Isaac  Clason, 
of  New  York,  payable  on  delivery."  All  the 
other  memoranda  in  the  same  book  were 
written  with  a  lead  pencil.  Soon  after  the 
purchase  was  thus  completed,  the  broker 
informed  the  defendant  of  it,  but  did  not 
give  him  a  copy  of  the  memorandum.  The 
plaintiffs  repeatedly  tendered  the  rye  to  the 
defendant,  according  to  the  terms  of  the 
agreement,  and  he  refused  to  accept  and  pay 
for  it.  They  then  gave  him  notice  that  un- 
less he  received  and  paid  for  the  rye,  they 
would,  on  a  day  and  place  specified,  sell 
the  same  at  public  auction  and  hold  him 
accountable  for  the  deficiency,  in  case  it 
should  sell  for  less  than  the  price  mention- 
ed in  the  contract  and  the  expenses.    On  his 


THE  MEMORANDUM  IN  WRITING. 


191 


rofiisal  to  complt>te  the  purchase,  the  prop- 
erty was  sold  by  the  plaintiffs  at  public  auc- 
tion, pursuant  to  the  notice;  and  the  suit 
was  brought  by  them  to  recover  the  differ- 
ence between  the  net  proceeds  of  such  sale 
and  the  contract  price.  A  verdict  was  tak- 
en, subject  to  the  opinion  of  the  court,  on  a 
case  containing  the  facts  above  stated,  and 
which  either  party  was  to  be  at  liberty  to 
turn  Into  a  special  verdict. 

On  the  argument  of  the  case  In  the  su- 
preme coui"t,  Mr.  Baldwin,  one  of  the  coun- 
sel of  the  defendants,  among  other  ques- 
tions, raised  the  point,  on  the  authority  of 
Champion  v.  Plummer,  4  Bos.  &.  P.  252,  that 
a  memorandum  signed  by  the  seller  only 
was  not  sufficient;  that  the  plaintiffs  were 
not  bound  thereby,  and  if  they  were  not, 
neither  could  the  defendant  be   bound. 

PLatt,  J.,  In  delivering  the  opinion  of  the 
court,  stated  that  the  only  point  was  whether 
the  memorandum  made  by  John  Townsend 
was  a  sufficient  memorandum  of  the  con- 
tract, within  the  statute  of  frauds,  to  bind 
the  defendant;  and  after  expressing  an 
opinion  on  other  questions  presented  by  the 
case  than  that  raised  by  Mr.  Baldwin  as 
above  stated,  as  to  which  he  said  nothing, 
he  came  to  the  conclusion  that  the  memoran- 
dum stated  with  reasonable  certainty,  every 
essential  part  of  the  agreement,  and  that 
the   plaintiffs   were   entitled   to   judgment. 

The  case  was  carried  to  the  court  for  the 
correction  of  errors  on  a  special  verdict  find- 
ing the  facts  above  stated  (with  two  other 
causes  in  which  the  facts,  so  far  as  affected 
the  questions  involved,  were  substantially 
the  same),  and  is  reported  In  14  Johns.  484, 
imder  the  title  of  Executors  of  Clason  v. 
Merritt;  and  one  of  the  other  cases  is  by 
same  plaintiffs  in  error  against  Bally,  and 
that  case  is  the  one  particularly  referred  to 
in  the  opinion  of  the  court.  In  that  court 
the  point  was  raised  on  the  part  of  Clason's 
executors,  that  the  agreement  wus  not  sign- 
ed by  both  parties;  and  Chancellor  Kent, 
in  giving  the  opinion  of  the  court,  said: 
"Clason's  name  (that  of  the  purchaser)  was 
Inserted  In  the  contract  by  his  authorized 
agent;  and  if  it  were  admitted  that  the 
name  of  the  other  party  was  not  there  by 
their  direction,  yet  the  better  opinion  is  that 
Clason,  the  party  who  is  sought  to  be  char- 
ged, is  estopped  by  his  name  from  saying 
that  the  contract  was  not  duly  signed  with- 
in the  purview  of  the  statute  of  frauds, 
and  that  it  was  sufficient  if  the  agreement 
was  signed  by  the  party  to  be  charged," 
adding:  "It  appears  to  me  that  this  is  the 
result  of  the  weight  of  authority,  Doth  in  the 
courts  of  law  and  equity;"  and  after  review- 
ing several  cases  in  both  courts  sustaining 
that  result,  he  said:  "There  was  nothing  to 
disturb  the  strong  and  united  current  of  au- 
thority of  those  cases,  but  the  observations 
of  Lord  Chancellor  Redesdale,  In  Lawreu- 
son  V.  Butler,  1  Schoales  &  L.  13,  who 
thought  that  the  contract  ought  to  be  mutu- 


al to    be    binding,    and    that    If    one    party 
could   not  enforce  it,   the  other  ought   not; 
and  said   that  to  decree  performance  when 
one   party    only    was    bound,    would    "make 
the  statute  really  a  statute  of  frauds,  for  it 
would  enable  any  person  who  had  procured 
another   to   sign    an   agreement   to    make   it 
depend  on  his  own  will  and  pleiusure  whether 
it  shoiild  be  an  agreement  or  not"     He  then 
after  remarking  that  the   intrinsic  force  of 
the   argument,    the   boldness   with   which    It 
was   applied,   and    the   commanding   weight 
of  the  very  respectable  character  who  used 
it,   caused   the  courts  for   a  time  to   pause, 
but  that  they  had  on  further  consideration 
resumed  their  former  track,  and  citing  au- 
thorities on  both  sides  of  the  question,  added: 
"I  have  thought  and   have  often  intimated, 
that  the  weight  of  argument  was  in  favor  of 
the    constniction    that    the    agreement    con- 
cerning   lands,    to    be    enforced    in    equity, 
should   be   mutually   binding,   and   that   the 
one  party  ought  not  to  be  at  liberty  to  en- 
force at  his  pli'asure,  an  agreement  which  the 
other    was    not    entitled    to    claim.     It    ap- 
pears to  be  settled  (Hawkins  v.  Holmes,   1 
P.  Wms.  770),  that  though  the  plaintiff  has 
signed  the  agreement,  he  never  can  enforce 
it  against  the  party  who  has  not  signed  it 
The   remedy  therefore   In  such   case   is   not 
mutual.     But    notwithstanding    this    objec- 
tion, it  appears  from  the  review  of  the  cases, 
that  the  point  is  too  well  settled  to  be  now 
questioned."     He    then    says:    "There    Is    a 
slight    variation    in    the   statute    respecting 
agreements  concerning  the  sale  of  lands,  and 
agreements  concerning  the  sale  of  chattels, 
inasmuch   as   the    one    section     (being   the 
fourth    section     of    the     English     and     the 
eleventh   section   of   our   statute)   speaks   of 
the  pai-ty,  and  the  other  section  (being  the 
seventeenth  of  the  English  and  the  fifteenth 
of  ours)  speaks  of  the  'parties'  to  be  charged; 
but  I  do  not  find  from  the  cases  that  this 
variation  has  produced  any  difference  in  the 
decisions.     The  construction  as  to  the  point 
under  consideration  has  been  uniformly  the 
same  in  both  cases;"  and  after  the  full  dis- 
cussion and  consideration   of  this   question 
he  comes  to  the  conclusion  that  "Clason  who 
signed    the    agreement,    and    is    the    p.arty 
sought  to  be  charged,  is  then,  according  to 
the  authorities,  bound  by  the  agreement,  and 
he  cannot  set  up  the  statute  in  bar;"  adding, 
"but  I  do  not  deem  It  absolutely  necessary 
to  place   the  cause  on  this  ground,   though 
as  the  question  was  raised  and  discussed.  1 
thought  it  would  be  useful  to  advert  to  the 
most  material  cases,  and  to  trace  the  doc- 
trine through  the  course  of  authority." 

He  then  says  that  In  his  opinion  "the  ob- 
jection Itself  is  not  well  founded  In  point 
of  fact;"  and  after  a  reference  to  the  memo- 
randum and  its  contents,  and  the  facts  found 
by  the  special  verdict,  he  concludes  that  the 
contract  was.  In  judgment  of  law.  reduced 
to  writing  and  signed   by  both   parties. 

Another  objection  taken  by  Clason  in  the 


192 


STATUTE  OF  FRAUDS. 


supreme  court  axid  by  the  executors  in  the 
court  for  the  correction  of  errors,  to  the 
validity  of  the  contract  (not  material  to  the 
case  now  under  review),  was  then  consider- 
ed by  the  learned  chancellor,  and  held  to  be 
untenable;  and  thereupon  the  judgment  of 
the  supreme  court  was  affirmed  (two  sena- 
tors dissenting). 

It  may  be  important  in  this  connection  to 
advert  to  the  fact  that  this  opinion  was  de- 
livered in  1817,  nea:iy  nine  years  after  what 
was  said  by  him  as  chief  justice  in  Bailey 
V.  Ogden,  supra,  and  about  three  years  after 
the  intimations  made  by  him  in  Parkhurst 
V.  Van  Coi-Uandi,  1  Johns.  Ch.  282,  and 
Benedict  v.  Lynch,  Id  370,  to  the  effect 
that  an  agreement  concerning  lands,  to  be 
enforced  in  equity,  should  be  mutually  bind- 
ing, and  to  which  he  probably  had  refer- 
ence in  that  opinion,  and  as  to  which  he 
said  therein,  that  it  appeared  from  the  view 
of  the  cases  that  the  point  was  too  well  set- 
tled to  be  then  questioned. 

Although,  in  view  of  the  conclusion  ar- 
rived at  by  the  learned  chancellor  on  the 
other  point  (that  the  contract  was,  in  judg- 
ment of  law,  reduced  to  writing  and  signed 
by  both  parties),  it  was  not,  as  he  himself 
stated,  absolutely  necessary  to  place  the 
cause  on  the  groimd  first  discussed  and  con- 
sidered by  him  as  above  mentioned;  yet 
as  it  was  raised  by  the  facts  found  by  the 
special  verdict,  on  which  the  supreme  court 
had  given  judgment,  and  on  the  argument 
in  the  court  for  the  correction  of  errors, 
it  was  material  that  it  should  be  considered 
by  him.  He  remarked,  in  the  commence- 
ment of  that  opinion,  that  the  case  struck 
him  on  the  argument  as  being  plain;  but 
as  it  may  have  appeared  to  other  members 
of  the  court  in  a  different,  or  at  least  in  a 
more  serious  light,  he  deemed  it  proper  and 
necessary  to  state  the  reasons  for  his  opin- 
ion on  both  the  questions  subsequently  ex- 
amined and  discussed  by  him.  It,  as  it 
appears  to  me,  is  a  perversion  of  terms  and 
an  entire  misconception  of  the  effect  and 
force  of  the  able  and  elaborate  opinion  of 
that  learned  and  distinguished  jurist,  to 
characterize  or  treat  it  as  a  mere  obiter  dic- 
tum. 

Gardiner,  J.,  in  James  v.  Patten,  G  N.  Y. 
9,  in  which  it  had  been  claimed  by  comisel 
that  a  case  cited  on  the  argument  in  sup- 
port of,  and  indeed  decisive  of,  the  question 
then  under  review  and  consideration,  might 
have  been  decided  on  other  grounds  than 
those  stated  in  the  prevailing  opinion  on  that 
point,  said:  "We  are  now  gravely  informed 
that  it  was  possible  to  reverse  the  judgment 
upon  other  grounds.  The  effect  of  any  de- 
cision in  a  court  composed  of  more  than  a 
single  judge  might  in  this  way  be  avoided. 
But  when  two  questions  are  presented  to 
the  appellate  court,  upon  which  their  deci- 
sion is  asked,  both  of  which  are  discussed 
by  counsel,  and  each  is  considered  and  de- 
termined in  the  only  opinions  read   in   the 


hearing  of  the  members,  the  majority  must 
be  deemed  to  acquiesce  in  the  conclusions 
upon  those  questions  reached  in  those  opin- 
ions, unless  some  one  dissents.  With  a  dif- 
ferent rule  there  could  be  no  such  thing  as 
the  establishment  of  a  principle  by  the  court 
of  last  resort,  when  more  than  a  single  point 
was  pre.sented."  And  Paige,  J.,  said  in  the 
same  case:  "Where  several  questions  arise 
in  a  cause  and  the  opinions  delivered  agree 
in  regard  to  all  of  them,  and  the  other  mem- 
bers give  a  silent  vote  of  concurrence,  then 
all  the  questions  will  be  deemed  to  have 
been  determined  by  a  majority  of  the  court, 
and  the  case  will  be  regarded  and  respected 
as  an  authoritative  adjudication  of  all  such 
questions." 

In  the  case  of  Exocutoi-^  of  Clason  v.  Baily, 
supra,  the  opinion  of  the  chancellor  was  the 
only  one  delivered,  and  must  be  held  to  be 
an  authority  of  the  court  of  last  resort  on 
the  very  question  now  presented  for  our  de- 
cision and  adjudication. 

The  question  again  aix>se  in  the  supreme 
court  in  1829,  in  Russell  v.  Nicoll,  3  Wend. 
112,  20  Am.  Dec.  670,  which  was  an  action 
by  the  plaintiffs  claiming  damage  for  the 
non-delivery  of  a  quantity  of  cotton  alleged 
to  have  been  purchased  by  them  of  the  de- 
fendants. 

The  contract  was  substantially  in  all  essen- 
tial particulars  like  the  one  in  the  present 
case.    It  was  in  these  words: 

"Sold  by  Daniel  Rapalye,  for  our  account, 
to  R.  M.  and  J.  Russell  five  hundred  bales 
of  cotton,  at  sixteen  and  a  half  cents  per 
pound.  Said  cotton  was  purchased  for  our 
account  at  Huntsville,  and  is  to  be  delivered, 
on  its  arrival  at  this  port  from  New  Orleans, 
at  any  time  between  the  present  date  and 
the  first  day  of  June  next,  and  the  amovmt 
to  be  cash  on  delivery,  to  be  reweighed,  and 
two  per  cent  tare  allowed. 

"New  York.  Febmary  9,  1825. 

"Francis  H.  NicoU  &  Co." 

The  plaintiffs  were  nonsuited  on  the  trial 
at  the  circuit,  on  grounds  other  than  that 
now  under  consideration.  But  on  the  re- 
view of  the  case  by  the  supreme  court,  the 
counsel  for  the  defendants  stated  that  the 
plaintiffs,  if  an,  action  had  been  brought 
against  them  on  the  contract,  might  have 
interposed  the  statute  of  frauds  as  a  defense, 
they  not  having  signed  any  note  or  memo- 
randum in  writing  of  the  bargain;  and,  the 
agreement  produced  being  signed  only  by 
the  defendants,  that  the  plaintiff  could  not 
have  been  holden,  and  the  defendants  were 
not  boimd,  and  that,  though  this  objection 
was  not  taken  at  the  circuit,  the  court  woiild 
not  grant  a  new  trial  if  they  perceived  that 
the  plaintiffs  mu.st  be  nonsuited  on  that 
ground;  as  to  which  point  the  court,  by 
Marcy,  J.,  said,  in  the  commencement  of 
his  opinion:  "It  was  insisted  on  the  argu- 
ment that  the  contract  declared  on  was 
within  the  statute  of  frauds,  and  void  for 


THE  MEMORANDUM  IN  WUITING. 


193 


not  being  reduced  to  writing  and  signed  as 
the  statute  directs.  This  objection  is  not 
sustainable.  If  the  contract  be  within  the 
statute,  it  is  very  clear  that  the  signing  by 
the  defendants  is  a  compliance  with  its  re- 
quirements. Egerton  v.  Mathews,  G  East, 
307;  Saunderson  v.  Jackson,  2  Bos.  &  P. 
238." 

Tlie  question  was  thus  distinctly  raisefl 
and  d<^eided  in  the  supreme  court,  and  the 
decision  is  a  distinct  and  positive  authority 
thereon.  If  the  objection  had  been  well 
founded,  it  would  have  been  decisive  against 
the  plaintiffs'  right  of  recovery,  and  there 
would  have  been  no  necessity  to  consider 
tlie  questions  raised  at  the  circuit,  and  which 
were  afterward  elaborately  discussed  in  the 
opinion.  Those  questions  were  based  on 
the  assumption  that  the  contract  was  valid 
Mild  obligatorj'  on  the  defendants.  The  cir- 
cumstance that  the  question  arising  on  the 
statute  of  frauds  was  not  raised  at  the  cir- 
cuit does  not  impair,  or  in  the  least  weaken, 
the  effect  of  the  decision  thereon  by  the  su- 
preme court.  On  the  contrary,  it  shows  that 
the  eminent  counsel  for  the  defendants  did 
not  at  that  time  deem  it  available  and  ef- 
fectual, and  they  proljably  presented  it  in 
opposing  the  motion  to  set  aside  the  nonsuit, 
on  the  principle  that  they  would  not  then 
fail  to  present  and  urge  any  point  on  which 
the  nonsuit  might  be  sustained  or  supported 

The  next  case  referred  to  by  the  counsel 
was  that  of  Dykers  v.  Towusend,  24  N.  Y. 
57,  etc.  That  was  an  action  to  recover  dam- 
ages for  the  failure  of  the  defendant  to  re- 
ceive any  pay  for  one  thousand  one  hundred 
shares  of  the  capital  stock  of  the  New  York 
and  Erie  Railroad  Company,  purchased  un- 
der three  several  contracts,  one  of  which 
is  set  forth  in  the  ease,  and  is  in  the  follow- 
ing foiTo: 

"New  York,  May  2d,  1854. 

"I  have  purchased  of  Dykers,  Alstyne  & 
Co.  500  shares  of  the  New  York  and  Erie 
Railroad  Company  at  seventy  (70)  per  cent, 
and  deliverable  in  sixty  days,  buyer's  option, 
with  interest  at  the  rate  of  six  per  cent  per 
annum.  W.  S.  Hoyt" 

The  other  two  were  in  the  same  form,  ex- 
cept that  one  of  them  was  signed  by  one 
Brown.  It  was  alleged  and  proved  on  the 
trial  that  Hoyt  and  Brown  were  brokers, 
and  acted  as  the  agents  of  the  defendant  in 
making  the  contract. 

When  the  plaintiff  rested,  the  defendant 
moved  to  dismiss  the  complaint,  on  the 
grounds  that  the  contracts  were  signed  by 
Brown  and  Hoyt  in  their  own  names,  and 
that  the  name  of  the  defendant  nowhere 
appeared  upon  them;  that  parol  evidence 
could  not  be  introduced  to  show  that  the  de- 
fendant was  the  person  for  whose  benefit 
the  contracts  were  made,  and  that  tlie  plain- 
tiffs had  not  shown  any  valid  contract  be- 
tween themselves,  and  the  defendant  took 
an  exception.    Proof  was  then  offered  of  cer- 

UOPK.  SEL.  CAS.  CONT. — 13 


tain  facts  for  the  purpose  of  showing  the 
contract  void  under  the  stock-jobbing  act,  in 
force  at  the  time  of  the  sale,  which  was  re- 
jected, and  the  defendant  took  an  exception. 
The  plaintiff  recovered  a  verdict,  and  judg- 
ment thereon  was  rendered  at  general  term, 
in  the  First  district,  which,  on  an  appeal  to 
this  court,  was  affirmed  without  any  dissent 
to  such  alhrniance.  One  of  the  judges,  Sel- 
den,  J.,  was  absent,  and  another,  James,  J., 
expressed  no  opinion.  That  decision,  so  far 
as  it  affects  the  present  question,  gives  no 
color  for  sustaining  the  judgment  in  the  case 
now  under  review.  It  is  true  that  Judge 
Hoyt,  in  giving  las  opinion  for  its  athrmance, 
remarked  that  as  an  original  question,  he 
should  have  had  no  hesitation  in  saying,  In 
a  ease  where  the  contract  was  entirely  ex- 
ecutoiy  on  both  sides,  and  no  part  of  the 
consideration  had  been  paid,  that  it  was  nec- 
essary that  it  should  be  in  writing,  under  the 
statute,  and  be  signed  by  both  parties  there- 
to, or  their  agents,  in  order  to  be  binding 
upon  either;  or,  in  other  words,  there  being 
no  considei-ation  paid,  the  promise  of  one 
party  would  be  the  consideration  for  the 
promise  of  the  other,  and  that  both  must  be 
in  writing  to  charge  either;  and  after  re- 
ferring to  the  distinction  between  the  sec- 
tion of  the  statute  applicable  to  that  case 
and  section  8,  relating  to  a  contract  for  the- 
sale  of  land,  which  he  concedes,  on  the  au- 
thority of  this  court,  in  Worrall  v.  Munn,  5 
N.  Y.  244,  Is  only  required  to  be  signed  by 
the  party  by  whom  the  sale  is  to  be  made, 
and  after  adding  that  in  the  case  of  a  con- 
tract for  the  sale  of  goods,  he  should  say  the 
party  to  be  charged  means  the  vendor  upon 
his  contract  to  seU,  and  the  vendee  upon  his 
contract  to  accept  and  pay  for  the  goods, 
he  added  that  this  question  did  not  appear 
to  have  been  directly  raised  on  the  trial;  if 
it  had  been,  it  might,  perhaps,  have  been 
obviated  by  the  profluction  of  a  counterpart 
of  the  contract,  signed  by  the  plaintiffs,  and 
then  said:  "As  there  are  several  authorities 
which  seemingly,  at  least,  give  a  different 
construction  to  this  and  similar  provisions  in 
the  former  statute  of  frauds,  I  do  not  pn^x)se 
further  to  discuss  the  question  at  this  time." 
And  after  a  more  particular  reference  to  the 
requirements  of  the  statute,  he  concludes 
with  the  remark:  "In  this  case,  a  note  or 
memorandum  of  the  contract  was  made  In 
writing,  and  signed  by  the  lawful  agent  of 
the  defendant,  and  we  think  that  this  was 
sufficient  compliance  with  the  statute,  ac- 
cording to  the  settled  construction  that  has 
been  given  to  it." 

The  only  other  ease  referred  to  by  the  re- 
spondent's coimsel,  on  this  question,  was  that 
of  Brabin  v.  Hyde,  32  N.  Y.  519,  which  he 
says  decided  that  the  memorandum  must  be 
signed  by  both  parties.  This  is  clearly  a  mis- 
take. 

The  action  was  brought  by  the  plaintiff  to 
recover  the  possession  of  a  mare  and  colt, 
which    he    claimed    as    owner,    by    purchase 


194 


STATUTE  or  FRAUDS. 


from  one  Milton  Blackmer  in  Au^iist,  lSo7; 
and  whicli,  on  the  tliird  day  of  September 
next  thereafter,  the  defendant  took  from  his 
possession,    under    a    claim    that    he    owned 
them  under  a  purchase  from  the  same  ven- 
dor  in   the  month   of  July    preceding.     The 
plaintiff  recovered  a  verdict,  on  which  judg- 
ment was  entered.     That  judgment  was  re- 
versed by  the  general  term  on  appeal,  and 
the  plaintiff  thereupon  appealed  to  this  court. 
The  judge  on  the  trial  in  his  charge  to  the 
jury,  after  stating   tliat  the  defendant  had 
given  evidence  of  a  prior  bargain,  and  that 
it    was    objected    by    the    plaintiff   that    the 
contract  under  which  he  claimed  ownership 
was  void  by  the  statute  of  frauds,  read  and 
explained    the    statute,    and    then    cliai-ged, 
"that  according  to  the  defendant's  nan-ative 
of  facts,  the  contract  rested  solely  in  words. 
There    was   no   other   evidence   of    it;    there 
was  no  deliveiy  of  the  property  or  memo- 
randum made,  as  the  contract  was  narrated 
by  him.  nor  any  payment,  nor  was  the  prop- 
erty present  at  any   time,   or  any  thing  to 
save  it  from  the  statute  of  frauds.     I  advise 
you  that  the  contract  for  the  purchase  of  the 
horse  by  the  defendant,  as  narrated  by  him- 
self,- is   invalid."     To   which   there   was   an 
exception.    When  the  case  was  reviewed  by 
this  court.  Brown,  J.,  in  giving  the  opinion 
on  the  reversal  of  the  order  of  the  general 
term  granting  a  new  trial,  referred  to  the 
facts  detailed  in  the  narrative  of  the  defend- 
ant;   and  from  the  learned  judge's  statement 
of  them,  it  appeared  that  a  part  of  the  price, 
agreed  to  be  paid  by  the  defendant  for  the 
mare   and   colt,   was   to   be   credited  on   his 
books  when  he  got  to  his  house,  on  account 
of  a  debt  owing  and  due  to  him  from  Black- 
mer;    that  he  went  home  and  made  the  en- 
try in  his  book,  giving  him  credit  on  the  day 
of  the  purchase  for  the  amount  that  was  to 
be   so   credited.     It   was   an  original    entry. 
On  his  cross-examination,  it  further  appeared 
that  he  kept  a  day-book  and  a  ledger,  for  the 
purposes  of  his  business;    that  the  entries  to 
Blackmer's  credit  were  not  upon  those  books, 
or  in  any  account  of  his  daily  transactions; 
and   that  all  that  appeared  upon  any   book 
was   an   entry   made  of  the   mare  and  colt 
upon  a  blank  leaf,  on  which  there  were  no 
other   entries.     It   was   not   claimed   that   he 
gave  Blackmer  any  receipt,  or  discharge  for 
the  money  for  the  mare  and  colt,  or  that  he 
communicated   to    him    what   he   had    done. 
There  were  some  additional  facts  stated,  for 
the   purpose   of   showing  a  delivery   of   the 
mare  and  colt,  which  are  immaterial  to  be 
noticed  here,  and  the  learned  judge,  after  the 
conclusion  of  his  .statement  of  the  facts,  said: 
"These  are  the  facts  upon  which  the  defend- 
ant relied  to  take  the  case  out  of  the  statute 
of  frauds.     There   was   no   deliveiy   of   the 
property  to  the  purchaser,  and  no  memoran- 
dum of  the  sale  signed  by  the  parties;"    and 
then,  after  stating  the  charge  to  the  jury  as 
above  set  forth,  and  making  some  general  re- 
marks on  the  insufficiency  of  words  merely, 


and  the  necessity  of  acts  as  evidence  of  a 
purpose  to  part  with,  or  to  accept,  the  own- 
ership of  personal  property,  he  said:  "There 
must  have  occiirred  one  of  the  three  acts 
mentioned  in  the  statute,  or  the  sale  will 
not  bo  affected.  These  acts  are  not  to  be 
performed  by  one  party  only,  they  are  to 
be  concurred  in  by  both  parties  to  the  con- 
tract. If  the  memorandum  in  writing  is  re- 
lied upon,  it  must  be  signed  by  the  parties, 
not  the  party,  to  be  charged  thereby."  He 
then,  after  giving  his  views  of  what  is  nec- 
essary, when  either  a  delivery  of  the  goods, 
or  a  part  of  them,  or  the  payment  of  some 
part  of  the  purchase-money  is  depended  up- 
on as  the  consummation  of  the  conti-act,  and 
after  the  application  of  his  construction  of 
the  requirements  of  that  statute  to  the  facts 
of  the  case,  closes  the  opinion  with  this  re- 
mark: "I  think  the  judge  at  the  circuit,  in 
his  charge  to  the  jury,  was  entirely  right;" 
and  thereupon  the  order  of  the  general  term 
granting  a  new  trial  was  reversed,  and  the 
judgment  on  the  verdict  was  affirmed. 

No  other  opinion  appears  to  have  been  giv- 
en in  the  case. 

It  is  evident  from  the  opinion  and  the  con- 
clusion arrived  at  by  the  learned  judge,  that 
there  was  no  question  involving  the  construc- 
tion of  the  section  of  the  statute  now  under 
consideration.  On  the  contrary,  he  declares 
that  the  judge  at  the  circuit,  who  had  char- 
ged the  jury,  "that  according  to  the  defend- 
ant's narrative  of  the  facts,  the  contract 
rested  solely  in  words,"  was  entirely  right 
The  remark,  that  it  was  necessary  that  a 
written  memorandum  in  writing  of  a  con- 
tract should  be  signed  by  both  parties  to  it, 
was  gratuitous;  and  certainly  there  is  not 
the  least  color  for  saying  that  this  court  Ln 
that  case  "decided  that  the  memorandum 
must  be  signed  by  both  parties." 

I  have  now  examined,  with  much  and  per- 
haps unnecessary  particularity,  the  cases  re- 
ferred to  by  the  counsel  to  sustain  his  po- 
sition that  there  has  been  no  decision  in  the 
court  of  last  resort,  and  no  weU-considered 
one  in  the  other  courts,  holding  it  to  be  vm- 
necessary  that  the  note  or  memorandum  of 
the  contract  for  the  sale  of  goods  should  be 
signed  by  both  parties.  That  examination 
shows  not  only  that  all  of  them,  except  the 
case  of  Bailey  v.  Ogden,  3  Johns.  399,  in- 
volve the  question,  and  hold  that  the  statute 
is  complied  with  when  the  note  or  memoran- 
dum of  the  contract  is  signed  or  subscribed 
by  the  party  to  be  charged  thereby,  but  also 
that  the  question  has  been  decided  after  a 
careful  consideration  thereof;  and  in  the  case 
of  Bailey  v.  Ogden,  supra,  tJie  same  principle 
is  distinctly  and  f  uUy  recognized  by  Kent  C. 
J.,  as  appears  by  his  statements  above  re- 
ferred to. 

I  wiU  add  another  case,  that  of  Davis  v. 
Shields,  2G  Wend.  341,  in  the  court  for  the 
correction  of  errors,  decided  in  1841,  where 
the  question  was  again  raised  and  consid- 
ered  by   Chancellor  Walworth  and   Senator 


THE  MEMORANDUM  IN  WRITING. 


195 


Vorjil.'ink.  Tho  chancellor,  at  page  350,  said 
that  "the  former  statute  of  frauds  required 
the  note  or  memorandum  of  the  agreement  to 
be  signed  by  the  parties  to  be  chaiged  there- 
by, and  the  courts  had  not  only  decided  that 
it  was  not  necessary  tliat  it  should  be  signed 
by  both  parties,  so  as  to  nxake  it  legally  bind- 
ing on  both,  or  upon  neither,  but  they  had 
in  many  cases  held  that  a  literal  signing  of 
the  memorandum  by  the  party  who  was 
sought  to  be  charged  tliereby  was  not  neces- 
sary." Senator  Verplank,  at  page  3G2,  said: 
"A  doubt  naturally  arises  whether,  under  our 
Revised  Statutes,  the  words  to  'be  subscrib- 
ed by  the  parties  to  be  charged'  do  not  re- 
quire that  the  agreement  should  be  from  the 
first  binding,  by  means  of  an  authorized  sign- 
ing, upon  all  the  pai-ties  to  the  bargain;" 
and,  after  referring  to  the  case  of  Clason  v. 
j\Ierritt,  which  he  considered  as  having  set- 
tled the  question  in  that  court,  and  stating 
that  the  decision  was  Ln  conformity  with  nu- 
merous prior  decisions,  as  was  shown  in  the 
opinion  of  Chancellor  Kent  in  that  case,  he 
said:  "It  seems  to  me  these  words  must  be 
taken  in  their  fixed  and  adjudicated  sense, 
according  to  which  it  is  enough  that  the 
agreement  be  signed,  or  be  authorized  to  be 
signed  by  the  party  to  be  charged  in  the 
suit;"  and  adds,  "nor  is  this  interpretation 
without  the  support  of  reasons  of  equity  in- 
dependent of  authority.  It  is  within  the  lit- 
eral sense  of  the  words  used;"  and  then,  aft- 
er some  remarks  in  support  of  those  views, 
he  concludes:  "I  adhere  then  to  the  old  ad- 
judicated meaning  of  the  words  retained 
from  the  original  statute,  and  consider  it  suf- 
ficient if  the  memorandum  was  authorized  by 
the  vendors  who  are  now  to  be  charged,  al- 
though it  might  not  have  been  originally 
binding  on  the  vendee." 

In  that  case  the  question  was  also  pre- 
sented whether  the  contract  was  "subscrib- 
ed" within  the  requirements  of  the  Revised 
Statutes,  witliout  being  actually  signed  be- 
low or  at  the  end  of  the  memorandum,  and 
it  was  decided  that  it  was  not;  and  the  de- 
cision of  the  supreme  court  holding  to  the 
contrary,  as  the  case  is  reported  in  24  Wend. 
324,  was  reversed. 

In  addition  to  the  above  cases  I  wUl  cite, 
as  authority  sustaining  the  sufiiciency  of  the 
signature  by  the  party  to  be  charged,  tlie 
following:  West  v.  Newton,  1  Duer,  277-2S3; 
Woodward  v.  Harris,  3  Sandf.  272-277;  Fen- 
ley  V.  Stewart,  5  Sandf.  101-105.  These  au- 
thorities are  In  conformity  to  the  decisions 
on  the  English  statute,  which  were  recog- 
nized as  authority  by  Chancellor  Kent  in 
Clason  V.  Baily.  14  .Johns.  4S4,  etc.  Among 
those  were  Saunderson  v.  .Tackson,  2  Bos.  & 
P.  238;  Champion  v.  riiunmer.  4  Bos.  &  P. 
252;  Egerton  v.  Matthews,  6  East.  307;  Al- 
len V.  Bennett.  3  Taunt.  1G9.  In  Egerton  v. 
Matthews,  tlie  action  was  brought  by  the 
seller  against  the  buyers  for  not  accepting 
and  paying  for  certain  goods,  which  the  de- 
fendants had  contracted  to  purchase  by  the 


following  memorandum  In  writing:  "We 
agree  to  give  Mr.  Egerton  nineteen  cents  per 
pound  for  thirty  bales  of  Smyrna  cotton,  cus- 
tomary allowance  cash,  three  per  cent  as  soon 
as  our  certificate  is  complete."  It  was  dau-d 
2d  September,  1803,  and  was  signed  by  the 
defendauLs,  the  buyers,  only.  They  had  be- 
fore that  time  become  bankrupts,  and  their 
certificate  was  waiting  for  the  lord  chancel- 
lor's allowance,  and  after  it  was  allowed, 
they  signed  the  memorandum  again.  On  the 
opening  of  the  case  upon  the  trial  it  was  ob- 
jected that  the  contnxct  was  altogether  ex- 
ecutory, that  no  con.sid(;ration  appeared  on 
the  face  of  the  writing  for  the  promise,  and 
that  there  was  not  any  mutuality  in  tlie  en- 
gagement, and  therefore  that  it  was  void  by 
the  statute  of  frauds.    20  Car.  II.  c  3. 

The  objection  prevailed,  and  the  plaintiff 
was  nonsuited;  but  on  a  motion  to  set  aside 
the  nonsuit,  Lord  Elleuborough,  C.  J.,  ob- 
served that  the  seventeenth  clause  of  that 
statute  required  "some  note  or  memorandum 
in  writing  of  the  bargain  signed  by  the  par- 
ties to  be  chiirged  by  the  contract;"  and  that 
this  memorandum  above  quoted  was  a  mem- 
oi-andum  of  the  bargain,  or  at  least  so  much 
of  it  as  was  sufiicient  to  bind  the  parties  to 
be  charged  tlierewith,  and  whose  signature 
to  it  was  all  that  the  statute  required. 

The  question  again  arose  in  Allen  v.  Ben- 
nett, 3  Taunt  1G9.  The  action  was  brought 
by  the  buyer  against  the  seller  for  the  non- 
delivery of  goods,  and  was  based  on  ceitain 
entries  of  the  sale  made  by  defendant's 
agent  in  a  book  of  the  plaintiff.  The  sale 
was  subsequently  recognized  in  a  correspond- 
ence by  the  plaintiff  with  the  defendant,  but 
there  was  no  evidence  that  the  plaintiff  had 
signed  any  contract  to  bind  himself.  It  was 
objected  on  the  trial  that  there  was  not  a 
sufficient  note  in  writing  within  the  statute 
of  frauds  for  the  sale  of  the  goods,  inasmuch- 
as  It  did  not  at  all  appear  by  the  contract 
who  was  the  buyer;  that  all  that  could  be 
gathered  from  the  entries  was,  that  they 
were  contracts  entered  into  by  Bennett,  to 
seU  goods  to  persons  not  named,  and  who 
the  persons  were  could  not  be  supplied  by 
oitil  evidence.  There  was  a  verdict  for  tne 
plaintiff.  On  a  motion  to  set  it  aside,  the 
correspondence  was  held  sufficient  to  connect 
the  parties.  It  was  then  objected  that  the 
party  who  had  not  signed  was  not  bound,  as 
to  which  Mansfield.  C.  J.,  said  that  the  cases 
of  Egerton  v.  Matthews,  Saunderson  v.  Jack- 
son, and  Champion  v.  Plummer,  supra,  "sup- 
pose a  signature  by  the  seller  to  be  suifi- 
cient,  and  every  one  knows  it  is  the  daily 
practice  of  the  court  of  chancery  to  estab- 
lish contracts  signed  by  one  person  only; 
and  yet  a  court  of  equity  can  no  more  dis- 
pense with  the  statute  of  frauds  than  a  court 
of  law  can."  and  he  held  that  the  verdict 
should  be  sustained.  Heath,  J.,  was  of  the 
same  opinion,  and  said  there  was  a  case  in 
Strange  by  which  it  appeared  that  a  voidable 
promise  was  sufficient  to  sustain  a  promise. 


196 


STATUTE  OF  FRAUDS. 


Lawrence,  J.,  after  showing  that  it  was  evi- 
dent that  the  contract  was  entered  into  by 
the  authority  of  the  defendants,  said  that 
the  objection  would  quite  overturn  the  aises 
of  Egei-ton  v.  Matthews,  Saunderson  v.  Jacli- 
son.  and  Champion  v.  Plummer,  and  the 
statute  of  frauds  clearly  supposes  the  proba- 
bility of  there  being  a  signature  by  one  per- 
son only. 

"VMthout  multiplying  cases,  I  will  content 
myself  with  quoting  the  remark  of  Earl,  C. 
J.,  in  the  case  of  Parton  v.  Crofts,  IG  C.  B. 
(N.  S.)  Ill,  E.  C.  L.  11,  where  he,  after  dis- 
cussing and  considering  the  effect  of  bought- 
and-sold  notes,  in  reference  to  the  require- 
ment of  the  statute  of  frauds,  says:  "To  sat- 
isfy the  seventeenth  section  of  the  statute,  it 
is  enough  to  produce  a  memorandum  of  the 
contract  signed  by  the  party  to  be  charged 
thereby,  or  by  an  agent  thereunto  duly  au- 
thorized." 

This  is  recognized  as  the  rule  by  the  ele- 
mentary writers.  Chancellor  Kent,  in  his 
Commentaries  (volume  2,  p.  510),  says:  "The 
signing  of  the  agreement  by  one  party  only 
is  sufficient,  provided  it  be  the  pai-ty  sought 
to  be  charged.  He  is  estopped  by  his  sig- 
nature from  denying  that  the  contract  was 
validly  executed,  though  the  paper  be  not 
signed  by  the  other  paity,  who  sues  for  the 
performance." 

Starkif,  in  his  work  on  Evidence  (volume  2, 
p.  614),  says:  "It  is  sufficient  if  there  be  a 
momoi-andum  signed  by  the  defendant,  the 
vendor,  although  it  be  not  signed  by  the 
plaiutifiC,  the  vendee,  and  although  it  could 
not  have  been  enforced  by  the  latter."  See, 
also,  Comyn,  Cont.  123.  In  view  of  the  nu- 
merous decisions,  both  in  this  state  and  in 
England,  it  appears  to  me  to  be  impossible 
now  to  hold  a  different  rule  by  giving  a  dif- 
ferent construction  to  the  statute  of  frauds. 
Assuming  then  that  the  memorandum,  on 
which  the  present  action  is  based,  is  valid 
and  binding  on  both  parties  at  common  law, 
and  that  the  statute  only  requires  it  to  be 
signed  by  the  party  to  be  charged,  it  ap- 
pears to  me  to  follow  a;s  a  necessary  con- 
sequence, that  the  defendants,  the  vendors, 
in  this  case  having  by  their  signature  in 
writing  given  the  written  evidence  to  charge 
them,  are  liable  thereon;  and  that  the  non- 
suit in  the  court  below  was  improperly  grant- 
ed. 

As  however  a  majority  of  this  court  was 
unable  to  concur  in  a  judgment  on  the  first 
argument,  it  may  be  proper  to  refer  briefly 
to  the  opinion  then  read  in  affirmance  of 
the  nonsuit,  and  which  has  been  presented 
to  us  on  the  present  argument.  It  concedes 
that  it  is  not  necessary,  under  the  require- 
ments of  the  statute  of  frauds,  that  the  con- 
tract should  be  signed  by  both  parties;  and 
that  prior  to  the  statute,  it  would  have  been 
valid  and  binding  upon  both  of  them  with- 
out being  reduced  to  writing  and  signed  by 
either.  But  the  learned  justice,  by  whom  it 
was    delivered,    adds    that:     "The    statute 


makes  the  contract  void,  although  reduced 
to  writing,  as  to  the  party  not  subscribing 
it;  and  it  follows  that  the  void  promise  of 
the  latter  furnished  no  consideration  for  the 
agreement  of  the  party  who  subscribes  it." 

This  appears  to  me  to  be  a  misconstruction 
of  the  statute.  TTaat  does  not  define  or  pre- 
scribe what  shall  be  necessaiy  to  constitute 
a  contract.  On  the  contraiy,  it  assiimes  the 
existence  of  one  that  is  valid  and  binding  in 
all  respects,  and  on  that  assumption  declares 
that  it  shall  be  "void,"  not  unlawful  but  in- 
effectual, of  no  binding  force  to  charge  any 
0*  the  parties  with  a  liability  thereon  who 
does  not  subscribe  a  note  or  memorandum 
thereof  in  writing.  It  did  not  affect  nor 
was  it  intended  to  affect  an  oi-al  agreement, 
otherwise,  or  to  a  greater  extent,  than  by 
the  requirement  of  written  evidence  of  its 
terms  by  the  signature  or  subscription  of  the 
party  who  was  to  be  charged  with  a  legal 
liability  thereon.  It  is  true  that  the  party 
who  does  not  sign  or  subscribe  it  may  not  be 
liable  thereon  in  an  action,  as  to  which  I 
deem  it  unnecessary  to  express  an  opinion; 
but  that  fact  does  not  destroy  or  annul  the 
consideration  and  terms  which  form  the  in- 
ducement of  the  other  party  to  make  it  ob- 
ligatory on  himself  by  compliance  with  all 
the  requirements  of  the  law  to  make  it  so. 
On  the  contrary,  the  same  consideration  con- 
tinued without  being  impaired  or  annulled, 
and  no  new  or  further  evidence  of  it  was 
requisite. 

It  is  too  late  for  him,  after  executing  an 
agreement  conformable  in  all  respects  with 
the  requirements  of  lue  law,  and  with  the 
avowed  intention  to  bind  and  charge  him- 
self, for  the  purpose  of  avoiding  the  liability 
thus  voluntarily  assumed,  to  say  that  the 
other  party  thereto  cannot  be  charged  there- 
on, on  the  sole  ground  that  he  himself  did 
not  take  the  precautionary  means  required 
by  the  law  to  charge  such  other  party,  either 
through  neglect  or  in  reliance  on  his  promise 
to  fulfill  his  part  of  it  without  being  legally 
bound  thereto. 

The  object  of  the  statute  is  attained  by 
protecting  a  vendor  against  a  liability,  found- 
ed on  oral  evidence  only  of  his  contract, 
without  relieving  him  from  an  obligation 
clearly  assumed  and  created  by  a  written 
evidence  thereof,  the  evidence  of  which  un- 
der such  circuDJStancos,  would  make  the  stat- 
ute the  means  of  pei-petrating  fraud,  as  well 
as  a  protection  against  it,  and  against  per- 
jury or  subornation  of  perjury.  A  construc- 
tion that  leads  to  such  a  result  is  not  neces- 
sary and  is,  in  my  opinion,  unwaiTanted. 

The  .substance  of  these  views  is  tersely  ex- 
pressed by  Parsons  in  his  work  on  Mercan- 
tile Ivaw  (page  78),  where  he,  after  consider- 
ing the  several  clauses  of  the  statute  of 
frauds,  says:  "The  operation  of  the  statute 
in  the  clauses  we  have  considered  is  not  to 
avoid  the  contract,  but  only  to  inhibit  and 
prevent  actions  from  being  brought  upon  it. 
In  other  respects  it  is  valid." 


THE  MEMORANDUM  IX  WRITING. 


197 


Concediug  it  to  be  true  that  the  considera- 
tion for  a  promise,  as  well  as  the  promise  it- 
self, must  be  in  writing  to  give  any  right  of 
action  thereon  against  a  party  who  has  sign- 
ed it,  as  was  decided  in  Waine  v.  Wailters, 
5  East,  10,  and  in  Sears  v.  Bnnli,  3  Johns. 
210,  it  does  by  no  means  follow  that  when 
those  and  the  other  requisite  elements  to 
constitute  a  valid  contract  appear,  it  is  also 
necessary  that  there  should  be  a  mutuality 
of  obligation  to  give  a  right  of  action  against 
either  party. 

Chancellor  Kent,  in  Executors  of  Clason 
V.  Baily,  14  Johns.  4S8,  supi-a,  says  that  al- 
though Lord  Chancellor  Redesdale,  in  Law- 
renson  v.  Butler,  1  Schoales  &  L.  13,  had  ex- 
pressed the  opinion  that  the  contract  ought 
to  be  mutual  to  be  binding,  and  that  if  one 
party  could  not  enforce  it  the  other  ought 
not,  and  that  he  himself  had  thought,  and 
had  often  intimated,  that  the  remedy  ought 
to  be  mutual,  yet  it  appeared  fi*om  a  review 
of  the  cases  that  it  had  been  too  well  settled 
to  the  contrary  to  be  now  questioned. 

It  was  subsequently  (in  1836)  said  by  Tin- 
dal,  J.,  in  Laythoarp  v.  Bryant,  2  Bing.  N.  C. 
735,  speaking  of  the  clause  of  the  English 
statute  requiring  an  agreement  for  the  sale 
of  lands  or  any  interest  therein,  or  a  note 
or  memorandum  thereof  in  writing,  to  be 
signed  by  the  party  to  be  charged  therewith, 
or  some  other  person  thereunto  lawfully  au- 
thorized by  him,  that  the  party  who  has  sign- 
ed the  agreement  is  the  party  to  be  charged, 
and  he  cannot  be  subject  to  any  fraud;  that 
there  had  been  some  confusion  in  the  argu- 
ment of  the  case  between  the  consideration 
of  the  agreement  and  the  mutuality  of  claim; 
and  although  it  was  true  that  the  considera- 
tion must  appear  on  the  face  of  the  agi'ee- 
ment,  yet  he  had  found  no  case  nor  any  rea- 
son for  saying  that  it  is  the  signature  of 
both  parties  that  makes  the  agreement. 
Vaughn,.  J.,  in  the  same  case,  said  that  the 
argument  had  proceeded  on  a  fallacy  arising 
out  of  a  misconception  of  the  case  of  Waine 
v.  Wailters;  that  the  decision  therein  never 
turned  on  the  groimd  that  the  mutuality  of 
the  contract  must  appear,  but  only  that  the 
note  or  memorandum  must  show  the  consid- 
eration, as  well  as  the  promise. 

An  objection  of  the  same  nature  as  that 
now  under  consideration  was  raised  in  Bal- 
lard V.  Walker,  3  Johns.  Cas.  60,  which  was 
an  action  by  the  vendee  on  a  written  agree- 
ment for  the  sale  of  land  to  him,  which  was 
signed  by  the  vendor  alone.  In  which  the 
name  of  the  parties  and  all  the  terms  of  sale 
were  stated,  as  to  which  RadcliCf,  J.,  said: 
"The  first  objection,  so  far  as  it  rests  on 
the  want  of  consideration,  appears  to  mo  in- 
applicable to  the  case.  If  the  contract  would 
be  valid,  as  a  contract  by  parol  merely,  there 
would  certainly  be  an  ample  consideration. 
The  defendant  agreed  to  convey  lands  to 
the  plaintiffi  for  a  stipulated  price,  and  the 
plaintiff,  in  consideration  of  such  convey- 
ance, agreed  to  pay  the  price  to  the  defend- 


ant. Here  were  mutual  and  valid  consid- 
erations. If  the  agreement  was  not  suffi- 
ciently reduced  to  writing,  or  signed  by  the 
parties,  agreeably  to  the  statute  of  frauds,  it 
is  void  by  force  of  that  statute,  but  not  for 
want  of  consideration."  He  then  proceeded 
to  show  that  the  plaintiff  could  not  be  de- 
prived of  a  recovery  becau.se  it  was  not 
signed  by  the  plaintiffs.  And  Kent,  J.,  said: 
"This  contract  is  valid  so  far  as  a  considera- 
tion is  in  question.  One  agrees  to  sell,  and 
the  other  to  convey.  It  is  suflicient  if  the 
writing  be  signed  by  one  party  only,  and  ac- 
cepted by  the  other.  This  takes  the  case 
out  of  the  statute  of  frauds." 

The  objection  based  on  a  want  of  mutual- 
ity, was  also  urged  in  Re  Hunter,  1  Edw. 
Ch.  1,  and  overruled  by  Vice-Chancellor  Mc- 
Cown.  That  decision  wns  recognized  and 
approved  in  McCrea  v.  Purmort,  10  Wend. 
460;  decided  in  the  court  for  the  correction 
of  errors,  in  1836,  where  Cowan,  J.,  said,  that 
the  objection  that  the  agreement  there  in 
question  was  void,  as  being  signed  by  one 
party  only,  and  thus  wanting  mutuality,  and 
that  it  must  therefore  go  for  nothing,  was 
fuUy  answered  by  the  learned  vice-chancel- 
lor in  Hunter's  Case,  supra,  and  Paige,  J., 
in  the  case  of  Worrall  v.  Munn,  5  N.  Y.  229 
(decided  in  this  court),  said:  "A  contract, 
valid  within  the  statute,  even  if  not  binding 
on  the  party  who  has  not  subscribed  it,  can 
nevertheless  be  enforced,  either  at  law  or  in 
equity,  against  the  party  (if  the  contract  is 
for  the  sale  of  land)  by  whom  the  siile  is  to 
be  made,  or  (if  for  the  sale  of  goods)  who  is 
to  be  charged  thereby,  if  subscribed  by  him. 
Want  of  mutuality  is  no  defense  to  the  suit. 
The  vendor,  a  party  to  be  charged,  who  has 
subscribed  tlie  contract,  is  estopped  by  his 
signature  from  denying  that  the  contract 
was  validly  executetl,  although  not  signed 
by  the  other  party  who  sues  for  the  perfonn- 
ance;"  and  added,  "it  is  the  constant  prac- 
tice of  the  court  of  chancery  to  compel  a 
specific  performance,  by  a  vendor,  of  a  con- 
ti-act  for  the  sale  of  lands  subscribed  by  him. 
although  the  vendee  has  not  bound  himself 
by  subscribing  the  contract.  These  eases 
show  a  clear  distinction  between  a  consider- 
ation and  the  mutuality  of  obligation,  and 
that  the  former  is  necessary  while  the  latter 
is  not.  See,  also,  Fenley  v.  Stewart,  5  Saudf. 
101,  supra. 

The  views  above  expressed  show  that  the 
defendants  had  boimd  themselves  by  the 
contract  in  question  to  deliver  the  rifies 
therein  agreed  to  be  delivered,  and  that  there 
was  a  good  and  suflicient  consideration  for 
their  obligation- 
It  follows  that  the  judgment  of  the  court 
below  should  be  reversed,  and  a  new  trial 
ordered,  costs  to  abide  the  event. 

All  concur,   except  INGALLS,  J.,   dissent- 


INGALLS,    J.    (dissenting).     The    defendi- 
ants  executed  and  delivered  to  the  plaintiff 


198 


STATUTE  OF  FRAUDS. 


an  insti-ument  in  writing,  of  which  the  fol- 
lowing is  a  copy: 

-New  York,  May  13,  1S61. 
-We  agree  to  deliver  P.  S.  Justice,  one 
thousand  Enfield  pattern  rifles  (with  bayonets, 
no  other  extras),  in  New  York,  at  eighteen 
dollars  each,  cash  upon  such  delivery;  said 
rifles  to  be  shipped  from  Liverpool  not  later 
than  1st  July,  and  before  if  possible. 

"W.  Bailey  Lang  &  Co." 

The  plaintiff  subscribed  no  agreement  or 
memorandum,  paid  no  money,  parted  with 
nothing  of  value,  and  assumed  no  obligation 
on  account  of  the  defendants'  promise.  The 
contract  remains  wholly  executory,  no  part 
of  the  rifles  having  been  delivered.  The 
plaintifG  instituted  this  action  to  recover 
damages  for  the  failure  of  the  defendants  to 
deliver  the  rifles.  The  only  question  of  any 
importance  is,  whether  the  mere  subscribing 
and  delivery  of  the  above  instrument  by  the 
defendants  created  a  legal  obligation  on 
their  part,  which  entitles  the  plaintiff  to 
damages  for  a  failure  to  deliver  the  rifles. 
The  counsel  for  the  appellant  insists  that  the 
mere  subscribing  and  delivery  of  the  said  in- 
strument by  the  defendants  constituted  a 
valid  and  binding  obligation  on  their  part, 
within  the  provisions  of  the  statute  of 
frauds,  and  consequently  the  defendants 
were  liable  to  respond  in  damages  for  a  vio- 
lation of  their  agreement.  The  provision  of 
the  statute  of  frauds,  which  has  any  appli- 
cation to  this  case,  is  as  follows:  "Every 
contract  for  the  sale  of  any  goods,  chattels 
or  things  in  action  for  the  price  of  fifty  dol- 
lars or  more,  shall  be  void;  unless:  1st.  A 
note  or  memorandum  of  such  contract  be 
made  in  writing  and  be  subscribed  by  the 
parties  to  be  charged  thereby."  The  instru- 
ment in  question  was  subscribed  by  the  de- 
fendants; and  so  fa-r  the  statute  was  com- 
plied with.  But  something  further  was  re- 
quired to  constitute  it  a  valid  and  binding 
contract;    the  agreement   being   wholly    ex- 


ecutory, it  was  indispensable  that  there 
should  be  some  consideration  for  the  agree- 
ment of  the  defendants,  without  which  it 
was  void.  K  the  defendants  uad  offered  the 
rifles,  the  plaintiff  was  at  liberty  to  refuse 
to  receive  them,  and  the  defendants  would 
have  been  wholly  without  remedy.  The 
statute  of  frauds,  while  it  declares  that  a 
contract  for  the  sale  of  personal  property 
for  the  price  of  $50  or  more  shall  be  void, 
unless  there  is  a  note  or  memorandum  sub- 
scribed by  the  party  to  be  charged,  does  not 
declare  that  such  note  or  memorandum  so 
subscribed,  is  all  that  is  essential  to  consti- 
tute a  valid  contract.  The  statute  may  be 
complied  with  in  the  above  particular,  and 
yet  the  contract  be  wholly  void  because  there 
is  no  consideration  to  support  it.  It  was 
not  the  intention  of  the  legislature,  in  adopt- 
ing that  statute,  to  dispense  with  the  neces- 
sity of  having  a  consideration  to  support  an 
agreement,  but  to  require  such  note  or  mem- 
orandum in  addition  to  such  consideration. 
If  there  had  been  a  consideration,  however 
slight,  for  the  defendants'  promise,  they 
would  have  been  bound,  because  they  com- 
plied with  the  statute  so  far  as  the  writing 
was  concerned.  If  the  instrument  in  ques- 
tion had  been  subscribed  by  the  plaintiff, 
and  had  contained  a  promise  on  his  part  to 
receive  the  rifles  and  pay  for  them,  such 
promise  would  have  been  a  good  considera- 
tion for  the  defendants'  undertaking.  We 
are  not  called  upon  to  examine  the  numerous 
cases  cited  by  the  counsel,  touching  the  stat- 
ute of  frauds,  because  most  of  them  have 
little  or  no  bearing  upon  the  question  involv- 
ed in  the  disposition  of  this  appeal.  In  my 
judgment  the  case  is  reduced  to  one  ques- 
tion; whether  an  executory  contract  can  be 
enforced  when  sub.scribed  by  one  party  only, 
and  there  is  no  consideration  whatever  for 
such  contract.  I  cannot  bring  my  mind  to 
doubt  but  that  such  agreement  is.  wholly 
void.  The  judgment  of  the  general  term 
should  be  affirmed,  with  costs. 


THE  MEM011ANI)UM  I\  WRITING. 


109 


WILKINSON  T.  HEAVENRICH  et  aL 

(26  N.  W.  139,  58  Mich.  574.) 

Supreme  Court  of  Michigan.     Jan.  6,  18S6. 

Error  to  Saginaw. 

Wheeler  &  McKnight,  for  plaintiff  and  ap- 
pellant.    Wisner  &  Draper,  for  detendoiits. 

CHAMPLIN,  J.  But  one  question  13  in- 
volved in  this  case,  and  that  is  as  to  plain- 
tiff's right  to  maiuLain  the  action.  The  dec- 
laration alleges  that  on  or  about  the  four- 
teenth day  of  October,  1S82,  the  defendants 
entered  into  a  written  contract  with  plaintiff 
as  follows: 

"We  promise  and  agree  to  pay  Thomas 
Wilkinson  wages  or  salary  at  the  rate  of 
$3,500  a  year,  for  three  years,  from  the  sec- 
ond day  of  October,  1SS2,  in  consideration  of 
his  working  for  us  for  that  length  of  time  as 
cutter  in  our  merchant  tailoring  department 
in  the  city  of  East  Saginaw,  Michigan.  Pay- 
ments to  be  made,  as  earned,  in  such  sums 
and  at  such  times  as  he  may  desire. 

"Dated  October  14,  1SS2. 
"[Signed]  Heaveurich  Bros.  &  Co." 

—That  he  worked  for  defendants  under  tliis 
contract,  and  in  the  business  and  employ- 
ment aforesaid,  and  was  always  ready  and 
willing  to  so  work  and  be  employed  for  de- 
fendants for  the  term  of  three  years  in  said 
contract  mentioned,  and  so  worked  until  on 
or  about  the  fifth  day  of  July,  1SS4,  when, 
without  cause  and  against  the  wishes  and 
contrary  to  the  will  and  against  the  consent 
of  the  plaintiff,  the  defendants  wrongfully 
dismissed  and  discharged  the  plaintiff  from 
their  employment,  and  refused  to  allow  the 
plaintiff  to  work  for  them  in  the  employment 
mentioned  in  said  contract,  whereby  plain- 
tiff lost  the  wages  and  profits  and  advantages 
which  he  would  have  derived  from  being 
continued  in  said  employ,  was  thrown  out  of 
work,  and  was  unable  to  get  any  employment 
for  a  long  space  of  time,  to-wit,  for  four 
months.  A  second  count  alleges  that  on  the 
fourteenth  day  of  October,  1SS2,  defendants 
entered  into  another  contract  with  plaintiff, 
and  in  consideration  that  plaintiff  would 
work  for  them  promised  and  agreed  to  em- 
ploy the  plaintiff  for  three  years  as  cutter  in 
defendants'  merchant  tailoring  department, 
and  pay  him,  as  such  cutter,  at  the  rate  of 
$3,500  each  year,  as  earned,  in  sums  and  at 
times  desired  by  plaintiff";  that  plaintiff  en- 
tered upon  such  employment  as  cutter  and 
worked  until  about  the  fffth  day  of  July, 
1SS4,  when  he  was  wrongfully  and  against 
his  will  discharged,  etc.  The  plea  was  the 
general  issue,  with  notice  that  plaintiff  did 
not  perform  the  contract  on  his  part,  and  for 
that  reason  they  discharged  him. 

On  the  trial,  after  the  introduction  of  the 
agreement  in  evidence.  It  was  admitted  that 
the  defendants  constituted  the  firm  of  Heav- 
eurich Bros.  &.  Co.  at  the  time  of  the  making 
of  the  contract  that  is  off'ered  in  evidence; 
that  plaintiff  was  discharged  on  the  seventh 


day  of  July,  1881;  that  the  defendants  paid 
the  plaintiff  in  full  for  his  services  up  to  the 
time  of  his  discharge;  that  upon  the  eighth 
day  of  July  the  plaintiff  served  upon  the  de- 
fendants the  following  notice: 

"Heavenrich  Bros.  &  Co.,  East  Saginaw, 
Michigan  — Gentlemen:  I  hereby  protest 
against  your  attempt  to  cancel  our  contract. 
I  hold  your  written  agreement  for  a  three- 
j-ears  term  of  service,  from  October  2,  1882, 
That  contract  I  am  ready  and  willing  to  per- 
form on  my  part,  and  I  hereby  ottVjr  to  con- 
tinue, and  request  you  to  furnirih  mt.-  employ- 
ment, under  the  terms  of  that  arrangement 

"Datfd  East  Saginaw,  July  S,  1884. 
"[Signed]  Thomas  Wilkinson." 

The  plaintiff  was  sworn  in  his  own  behalf, 
and  was  cross-examined  relating  to  his  per- 
formance of  the  contract  on  his  part;  bat 
the  scope  of  his  evidence  was  unimportant, 
in  view  of  the  charge  given  by  the  court, 
which  wus  that  there  was  no  mutuality  in 
the  agreement,  for  Mr.  Wilkinson  was  not 
bound  to  stay  three  years,  and  Heavenrich 
Bros.  &  Co.  cotild  not  be  bound  to  keep  him 
three  years,  and,  for  want  of  such  mutuality, 
the  plaintiff  could  not  recover;  and  he  di- 
rected a  verdict  for  the  defendants. 

The  conflict  of  authority  upon  questions  of 
the  kind  raised  upon  this  record  is  truly  be- 
wildering, and  the  cases  are  incapable  of 
being  reconciled  with  each  other;  a  large 
and  respectable  class  holding  that  a  contract 
which  the  statute  of  frauds  declares  shall  not 
be  valid  unless  in  writing,  and  signed  by  the 
party  to  be  charged  therewith,  need  only  be 
signed  (by  the  party  defendant  in  the  suit, 
and  thaTTTTs^o  objection^ Tmrniiutaining 
such  suit,  and  recovering  upon  such  conti-act, 
that  the  other  party  did  not  also  sign,  and 
was  not  bound  by  its  terms.  2  Kent,  Comm. 
510;  2  Stavkie,  Ev.  614;  Smith's  Appeal,  69 
Pa.  St.  481;  Tripp  v.  Bishop,  50  Pa.  St.  428; 
Perkins  v.  Hadsell,  50  111.  217;  Old  Colony  B, 
Coi"p.  v.  Evans,  72  Mass.  31;  Williams  v. 
Robinson,  73  Me.  ISO.  Another  and  equally 
respectable  class  of  jurists  hold  that,  unless 
the  party  bringing  the  action  is  bound  by  the 
contract,  neither  is  bound,  because  of  the 
want  of  mutuality.  Lees  v.  Whitcomb,  14  E. 
G.  L.  572;  Sykes  v.  Dixon,  36  E.  C.  L.  300, 
9  Adol.  &  E.  693;  Krohn  v.  Bantz.  OS  Ind. 
277;  Stiles  v.  McClellan,  0  Colo.  89.  And  see. 
also,  as  bearing  upon  the  question.  Hall  v. 
Soule,  11  Mich.  496;  Scott  v.  Bush,  26  Mich. 
418;  Liddle  v.  Needham,  39  Mich.  147;  Mc- 
Donald V.  Bewick,  51  Mich.  79,  16  N.  W.  240. 
The  cases  above  cited  are  not  intended  to  be 
exhaustive  on  either  side  of  the  proposition. 

I  shall  not  attempt  a  reconciliation  when 
reconciliation  Is  impossible;  but  as  the  ques- 
tion is  new  in  this  state,  the  court  is  left  to 
adopt  such  view  as  appears  to  rest  upon 
principle.  It  is  a  general  principle  in  the  law 
of  contracts,  but  not  without  exception,  that 
an  agreement  entered  into  between  parties 
competent  to  contract,  in  order  to  be  bind- 
ing, must  be  mutual;    and  this  is  especially 


200 


STATUTE  OF  FRAUDS. 


so  when  the  consideration  consists  of  mutual 
promises.  In  such  cases,  if  it  appears  that 
the  one  party  never  was  bound  on  his  part 
to  do  the  act  which  forms  the  consideration 
for  the  promise  of  the  other,  the  agreement 
is  void  for  want  of  mutuality.  Hopliins  v. 
Logan.  5  Mees.  &  W.  241;  Dorsey  v.  Pack- 
wood,  12  How.  126;  Ewins  v.  Gordon,  49  N. 
H.  444;  Hoddesdon  Gas  Co.  v.  Haselwood,  6 
C.  B.  (N.  S.)  239;  Souch  v.  Strawbridge,  2  C. 
B.  SOS;  Callis  v.  Bothamly,  7  Wkly.  R.  87; 
Sylies  V.  Dixon,  9  Adol.  &  E.  693;  Add.  Gont, 
§'lS;  Pars.  Cont  §  449;  Railroad  Co.  v. 
Brinckerhoff,  21  Wend.  139;  Lester  v.  Jewett, 
12  Barb.  502. 

Such  was  the  case  here.  The  consideration 
consisted  of  mutual  promises  of  the  parties, 
not  to  be  performed  within  a  year  from  the 
making  thereof.  The  defendants'  promise 
was  in  writing,  and  signed  by  them;  but  the 


plaintiff's  promise  does  not  appear  in  the 
writing  signed  by  the  defendant,  nor  was 
any  note  or  memorandum  made  and  signed 
by  him  promising  to  labor  for  defendants 
three  years  or  any  length  of  time.  Plaintiff 
was  never  bound  by  the  agreement.  There 
never  was,  then,  any  consderation  to  support 
defendants'  promises.  The  agreement  was 
void  for  _\maL.of_  mutuality.  The  plaintiff 
.  was  imder  no  legal  obligation  to  work  for  de- 
fendants a  moment  longer  than  he  chose,  and  • 
the  defendants  were  under  none  to  keep  him  i 

Vin  their  employment.  The  plaintiff  could  nei- 
ther revive  nor  make  a  contract  with  defend- 
ants after  he  was  discharged  by  them  with- 
out their  consent  and  concurrence.  The  let- 
ter written  after  he  was  discharged  was  of 
no  avail. 
The  judgment  is  affirmed. 
The  other  justices  concurred. 


THE  MEMORANDUM  IX  WRITING. 


201 


XJLASOX  V.  BAILEY  et  al 
.iV      TUX  et  al.    SAME  v.  IS 

yV  11  A        T«l,..„         /I 


SAME  V.  DEN- 
MEKIUT  et  al^n 


ij^  (14    Johns.    484.)  Q^^i  I 

Court  of  Errors  of   New   York.    March,   x817. 

These  causes  carae  before  this  court  on 
writs  of  error,  to  the  supi-fine  court.  The 
facts  in  all  were,  substantially,  the  same. 
See  Merrit  v.  Clason,  12  Johns.  102. 

Townsend,  a  brolvor,  was  employed  by 
Clason,  a  merchant,  in  the  city  of  New  York, 
.  in  February,  1812,  to  purchase  a  quantity  of 
rye  for  him.  Townsend  applied  to  Bailey  & 
Voorhees,  to  linow  if  they  had  rye  for  sale; 
and  they  agreed  to  sell  him,  for  Clason,  3,000 
bushels  of  rye,  at  one  dollar  per  bushel,  pay- 
able on  delivery,  and  authorized  him  to  make 
sale  thereof  to  Clason,  accordin.idy.  Townsend 
informed  Clason  of  the  quantity  of  rye  he 
could  purchase  of  Bailey  «fc  Voorhees.  and  the 
terms  of  sale,  and  he  was  directed  by  Clason 
to  purchase  it.  Townsend  then  went  to  Bailey 
&  Voorhees  and  closed  the  bargain;  and  there- 
upon wrote  the  following  memorandum  in  his 
memorandum  book,  in  the  presence  of  Bailey 
&  Voorhees:  "February  29th,  bought  for  Isaac 
Clason,  of  Bailey  &  Voorhees,  three  thousand 
bushels  of  good  merchantable  rye,  deliverable 
from  the  5th  to  the  loth  of  April  next,  at  one 
dollar  per  bushel,  and  payable  on  delivery." 
The  memorandum  was  made  the  29th  of  Feb- 
ruary, 1812,  and  was  written,  as  well  as  the 
other  memoranda,  in  the  same  book,  with  a 
lead  pencil.  The  day  after  making  the  bar- 
gain, Townsend  informed  Clason  of  it;  and 
be  gave  him  a  copy  of  the  memorandum,  in 
the  latter  part  of  the  month  of  April,  but  not 
before.  On  the  14th  of  April,  1812,  Bailey  & 
Voorhees  tendered  3,000  bushels  of  good  mer- 
chantable rye  to  Clason,  requesting  him  to 
take  the  same  away,  and  paj-  for  it,  according 
to  the  terms  of  the  bargain;  but  Clason  re- 
fused to  accept  and  pay  for  it.  On  the  IGth 
of  April,  Bailey  &  Voorhees  addressed  a  let- 
ter to  Clason,  giving  him  notice,  that  unless 
he  took  the  rye  and  paid  for  it,  in  the  mean 
time.  It  would  be  sold  on  the  Tuesday  follow- 
ing, at  public  auction,  etc.,  and  that  they 
should  hold  him  accountable  for  whatever 
deficiency  there  might  be,  after  charging  the 
original  price,  charges,  &c.  Clason  neglecteil 
to  receive  and  pay  for  the  rye,  which  was 
sold  pursuant  to  the  notice,  at  the  best  price 
that  could  be  got  for  it;  and  the  deficiency, 
after  deducting  the  uett  proceeds  from  the 
price  at  w'hicU  it  was  purchased  by  Clason, 
was  $1,150.50  to  recover  which  sum,  the  suit 
was  brought  by  Bailey  &  Voorhees  against 
Clason.  There  was  a  special  verdict,  on 
which  the  court  below  gave  judgment  for  the 
plaintiffs  below,  on  which  the  defendant 
brought  a  writ  of  error. 

Tlie  reasons  of  the  judgment  below,  were  as- 
signed by  the  chief  justice;  being  the  same  as 
delivered  by  the  supreme  coui't,  in  Merrit  v. 
Clason,  12  Johns.  100. 


Mr.  "\'an  Bouren,  Atty.  Cen.,  for  plaintiff 
in  error.  S.  Junes,  Jr.,  and  Mr.  Henry,  for  de- 
fendants in  error. 

THE  CHANCELLOR.  The  case  struck  me 
upon  the  argument  as  being  very  plain.  But 
as  it  may  have  appeared  to  other  members  of 
the  court  in  a  dlfterent,  or,  at  least,  in  a  more 
serious  light,  I  will  very  briefly  state  the  rea- 
sons why  I  am  of  opinion,  that  the  judg- 
ment of  the  supreme  court  ought  to  be  af- 
firmed. 

The  contract  on  which  the  controversy  aris- 
es, was  made  in  the  following  manner: 

Isaac  Clason  employed  John  Townsend  to 
purchase  a  quantity  of  rye  for  him.  He,  in 
pursuance  of  this  authority,  purchased  of 
Bailey  &  Voorhees  3,0U0  bushels,  at  one  dollar 
per  bushel,  and  at  the  time  of  closing  the  bar- 
gain, he  wrote  a  memorandum  in  his  memo- 
randum book,  in  the  presence  of  Bailey  & 
Voorhees,  in  these  words:  "February  29th, 
bought  for  Isaac  Clason,  of  Bailey  &  Voorhees, 
3,000  bushels  of  good  merchantable  rye,  deliv- 
erable from  the  5th  to  the  15th  of  April  next, 
at  one  dollar  per  bushel,  and  payable  on  deliv- 
ery." 

Tlie  terms  of  the  sale  and  pm-chase  had 
been  previously  communicated  to  Clason,  and 
approved  of  by  him,  and  yet  at  the  time  of 
delivery,  he  refused  to  accept  and  pay  for  the 
rye. 

The  objection  to  the  contract,  on  the  part  of 
Clason,  is  that  it  was  not  a  valid  contract 
within  the  statute  of  frauds: 

(1)  Because  the  contract  was  not  signed  by 
Bailey  «&  Voorhees. 

(2)  Because  it  was  written  with  a  lead  pen- 
cil, instead  of  pen  and  ink. 

I  will  examine  each  of  these  objections. 

It  is  admitted  that  Clason  signed  this  con- 
tract, by  the  insertion  of  his  name  by  his 
authorized  agent,  in  the  body  of  the  memo- 
randum. The  counsel  for  the  plaintiff  in  error 
do  not  contend  against  the  position,  that  this 
was  -A  sufficient  subscription  on  his  part.  It 
is  a  point  settled,  that  if  the  name  of  a  party 
appears  in  the  memorandum,  and  is  applicable 
to  the  whole  substance  of  the  writing,  and  is 
put  there  by  him  or  by  his  authority,  it  is 
immaterial  in  what  part  of  the  instrument 
the  name  appears,  whether  at  the  top,  in  the 
middle,  or  at  the  bottom.  Saunderson  v. 
Jackson,  2  Bos.  &  P.  238;  Welford  v.  Beaz- 
ely,  3  Atk.  503;  Stokes  v.  Moor,  cited  by  Mr. 
Coxe  in  a  note  to  1  P.  Wms.  771.  Forms  are 
not  regarded,  and  the  statute  is  satisfied  if  the 
terms  of  the  contract  are  in  writing,  and  the 
names  of  the  contracting  parties  appear. 
Clasou's  name  was  inserted  in  the  contract,  by 
his  authorized  agent,  and  if  it  were  admitted 
that  the  name  of  the  other  party  was  not  there 
by  their  direction,  yet  the  better  opinion  is, 
that  Clason,  the  party  who  is  sought  to  be 
charged,  is  estopped,  by  his  name,  from  say- 
ing that  the  contract  was  not  duly  signed 
within  the  purview  of  the  statute  of  frauds; 


202 


STATUTE  OF  FEAUDS 


and  that  It  is  sufficient,  if  the  agreement  be 
signed  by  the  party  to  be  charged. 

It  appeai-s  to  me,  that  this  is  the  result  of 
the  weight  of  authority  both  in  the  courts  of 
law  and  equity. 

In  Ballard  v.  Walker,  3  Johns.  Cas.  GO,  de- 
cided in  the  supreme  court,  in  1S02,  it  was 
held,  that  a  contract  to  sell  land,  signed  by 
the  vendor  only,  and  accepted  by  the  other 
party,  was  binding  on  the  vendor,  who  was 
the  party  there  souglit  to  be  charged.  So  in 
Eoget  V.  Merritt,  2  Caines,  117,  an  agree- 
ment concerning  goods,  signed  by  the  seller, 
and  accepted  by  the  buyer,  was  considered  a 
valid  agreement,  and  binding  on  the  party 
who  signed  it. 

These  were  decisions  here,  under  both  branch- 
es of  the  statute,  and  the  cases  in  the  English 
courts  are  to  the  same  effect. 

In  Saunderson  v.  Jackson,  2  Bos.  &  P.  23S, 
the  suit  was  against  the  seller,  for  not  deliv- 
ering goods  according  to  a  memorandum  sign- 
ed by  him  only,  and  judgmeut  was  given  for 
the  plaintiff,  notwithstanding  the  objection 
that  this  was  not  a  sufficient  note  within  the 
statute.  •  In  Champion  v.  Plumer,  4  Bos.  &  P. 
252,  the  suit  was  against  the  seller,  who  alone 
had  signed  the  agreement.  No  objection  was 
made  that  it  was  not  signed  by  both  parties, 
but  the  memoraudum  was  held  defective,  be- 
cause the  name  of  the  buyer  was  not  men- 
tioned at  all,  and  consequently  there  was  no 
certainty  in  the  writing.  Again,  in  Egerton 
V.  Matthews,  6  East,  307,  the  suit  was  on  a 
memorandum  for  the  purchase  of  goods,  sign- 
ed only  by  the  defendant,  who  was  the  buyer, 
and  it  was  held  a  good  agreement  within 
the  statute.  Lastly,  in  Allen  v.  Beunet,  3 
Taunt.  1C.9,  the  seller  was  sued  for  the  non- 
delivery of  goods,  in  pursuance  of  an  agree- 
ment signed  by  him  only,  and  judgment  was 
rendered  for  the  plaintiff.  In  that  case.  Chief 
Justice  Mansfield  made  the  observation,  that 
"the  cases  of  Egerton  v.  Matthews,  Saunder- 
son V.  Jackson,  and  Champion  v.  Plumer,  sup- 
pose a  signatm-e  by  the  seller  to  be  suflicicnt; 
and  every  one  knows  it  is  the  daily  practice 
of  the  court  of  chancery,  to  establish  con- 
tracts signed  by  one  person  only,  and  yet  a 
court  of  equity  can  no  more  dispense  with 
the  statute  of  frauds  than  a  court  of  law  can." 
So  Lawrence,  J.,  observed,  that  "the  statute 
clearly  supposes  the  probability  of  there  being 
a  signature  by  one  person  only." 

If  we  pass  from  the  decisions  at  law  to  the 
courts  of  equity,  we  meet  with  the  same  uni- 
form construction.  Indeed,  Lord  Eldon  has 
said  (18  Ves.  183)  that  chancery  professes  to 
follow  courts  of  law,  in  the  construction  of  the 
statute  of  frauds. 

In  Hatton  v.  Gray,  2  Ch.  Cas.  164,  1  Eq. 
Ca.s.  Abr.  21,  pi.  10,  the  purchaser  of  land 
signed  the  agreement,  and  not  the  other  party, 
and  yet  the  agreement  was  held  by  Lord 
Keeper  North  to  be  binding  on  him,  and  this 
too,  on  a  bill  for  a  specific  performance.  So 
in  Coleman  v.  Upcol,  5  Vin.  Abr.  527,  pi.  17, 
the  Lord  Kpeper  Wright  held,  that  an  agree- 


ment concerning  lands  was  within  the  stat- 
ute, if  signed  by  the  party  to  be  charged,  and 
that  there  was  no  need  of  its  being  signed  by 
both  parties,  as  the  plaintiff,  by  his  bill  for 
a  specific  performance,  had  submitted  to  per- 
form what  was  required  on  his  part  to  be 
performed. 

Lord  Hardwicke  repeatedly  adopted  the 
same  language.  In  Buckhouse  v.  Crosby,  2 
Eq.  Cas.  Abr.  32,  pi.  44,  he  said,  he  had  often 
known  the  objection  taken,  that  a  mutual 
contract  in  writing,  signed  by  both  parties, 
ought  to  appear,  but  that  tlie  objection  had  as 
often  been  overruled;  and  in  Wefford  v, 
Beazely,  3  Atk.  503,  he  said,  there  were  cases 
where  writing  a  letter,  setting  forth  the  terms 
of  an  agreement,  was  held  a  signing  within 
the  statute;  and  in  Owen  v.  Davies,  1  Ves.  Sr. 
82,  an  agreement  to  sell  land,  signed  by  the 
defendant  only,  was  held  binding. 

The  modern  cases  are  equally  explicit.  In 
Cotton  V.  Lee,  before  the  lords  commissioners, 
in  1770,  which  is  cited  in  2  Brown,  Ch.  564, 
it  was  deemed  sufficient,  that  the  party  to  be 
charged  had  signed  the  agreement  So  in 
Seton  V.  Slade,  7  Ves.  275,  Lord  Eldon,  on  a 
bill  for  a  specific  performance,  against  the 
buyer  of  laud,  said,  that  the  agreement  being 
signed  by  the  defendant  only,  made  him, 
within  the  statute,  a  party  to  be  charged.  The 
case  of  Fowle  v.  Freeman,  9  Ves.  351,  was  an 
express  decision  of  the  master  of  the  rolls,  on 
the  veiy  point,  that  an  agreement  to  sell 
lands,  signed  by  the  vendor  only,  was  bind- 
ing. 

There  is  nothing  to  disturb  this  strong  and 
united  current  of  authority,  but  the  observa- 
tions of  Lord  Chancellor  Redesdale,  in  Law- 
reuson  v,  Butler,  1  Schoales  &  L.  13,  who 
thought  that  the  contract  ought  to  be  mutual, 
to  be  binding,  and  that  if  one  party  could  not 
enforce  it,  the  other  ought  not.  To  decree 
performance,  when  one  party  only  was 
bound,  would  "make  the  statute  really  a  stat- 
ute of  frauds,  for  it  would  enable  any  per- 
son who  had  procured  another  to  sign  an 
agreement,  to  make  it  depend  on  his  own 
will  and  pleasure  whether  it  should  be  an 
agreement  or  not."  The  intrinsic  force  of 
this  argument,  the  boldness  with  which  it 
was  applied,  and  the  commanding  weight  of 
the  very  respectable  character  who  used  it, 
caused  the  courts,  for  a  time,  to  pause. 
Lord  Eldon,  in  11  Ves.  592,  out  of  respect  to 
this  opinion,  waived,  in  that  case,  the  dis- 
cussion of  the  point;  but  the  courts  have, 
on  further  consideration,  resumed  their  for- 
mer tract.  In  Western  v.  Russell,  3  Ves.  & 
B.  192,  the  master  of  the  rolls  declared  he 
was  hardly  at  liberty,  notwithstanding  the 
considerable  doubt  thrown  upon  the  point 
by  Lord  Redesdale,  to  refuse  a  specific  per- 
formance of  a  contract  to  sell  land,  upon  the 
ground  that  there  was  no  agreement  signed 
by  the  party  seeking  a  performance:  and  in 
Ormond  v.  Anderson,  2  Ball  &  B.  370,  the 
present  lord  chancellor  of  Ireland  (and  whose 
authority,  if  we  may  judge  from  the  ability 


THE  MEMORANDUM  IN  WRITING. 


203 


of  his  decisions,  Is  not  far  short  of  that  of 
his  predecessor),  has  not  felt  himself  au- 
thorized to  follow  the  opinion  of  Lord  liedes- 
dale.  "I  am  well  aware,"  he  observes,  "that 
a  doubt  has  been  entertained,  by  a  judse  of 
this  court,  of  very  hiyh  authority,  whether 
courts  of  equity  would  specUically  execute 
an  agreement  where  one  party  only  was 
bound;  but  there  exists  no  provision  in  the 
statute  of  frauds  to  prevent  the  execution  of 
such  an  agreement."  He  then  cites,  with  ap- 
probation, what  was  said  by  Sir  J.  Manslield, 
in  Allen  v.  Bonnet, 

I  have  thought,  and  have  often  intimated, 
that  the  weiglit  of  argmnent  was  in  favour  of 
the  construction  that  the  agreement  concern- 
ing lands,  to  be  enforced  in  equity,  should 
be  mutually  binding,  and  that  the  one  party 
ought  not  to  be  at  liberty  to  enforce,  at  his 
pleasure,  an  agreement  which  the  other  was 
not  entitled  to  claim.  It  appears  to  be  set- 
tled (Hawkins  v.  Holmes,  1  P.  Wms.  770), 
that  though  the  plaintiff  has  signed  the 
agreement,  he  never  can  enforce  it  against 
the  party  who  has  not  signed  it.  The  reme- 
dy, therefore,  in  such  case,  is  not  mutual. 
But,  notwithstanding  this  objection,  it  ap- 
pears from  the  review  of  the  cases,  that  the 
point  is  too  well  settled  to  be  now  questioned. 

There  is  a  slight  variation  in  the  statute 
respecting  agreements  concerning  the  sale  of 
lands,  and  agreements  concerning  the  sale 
of  chattels,  in  as  much  as  the  one  section 
(being  the  fourth  section  of  the  English,  and 
the  eleventh  section  of  our  statute,)  speaks 
of  the  party,  and  the  other  section  (being 
the  seventeenth  of  the  English,  and  the  fif- 
teenth of  ours,)  speaks  of  the  parties  to  be 
charged.  But  I  do  not  find  from  the  cases 
that  this  variation  has  produced  any  differ- 
ence in  the  decisions.  The  construct;on.  as 
to  the  point  under  consideration,  has  been 
uniformly  the  same  in  both  cases. 

Clason,  who  signed  the  agreement,  and  Is 
the  party  sought  to  be  charged,  is  then,  ac- 
cording to  the  authorities,  bound  by  the 
agreement,  and  he  cannot  set  up  the  statute 
In  bar.  But  I  do  not  deem  it  absolutely  nec- 
essary to  place  the  cause  on  this  ground, 
though  as  the  question  was  raised  and  dis- 
cussed, I  thought  it  would  be  useful  to  ad- 
vert to  the  most  material  cases,  and  to  trace 
the  doctrine  through  the  course  of  authoritj'. 
In  my  opinion,  the  objection  itself  is  not  well 
founded  in  point  of  fact. 

The  names  of  Bailey  &  Yoorhecs  are  as 
much  in  the  memorandum  as  that  of  Clason. 
The  words  are,  "Bought  for  Isaac  Clason,  of 
Bailey  &  Voorhees,  3,000  bushels,"  &c.;  and 
how  came  their  names  to  be  inserted?  Most 
undoubtedly  they  were  inserted  by  their  di- 
rection and  consent,  and  so  it  appears  bj'  the 
special  verdict.  The  jury  find,  that  when 
the  bargain  was  closed,  Towusend,  the  agent 
of  Clason,  did,  at  the  time,  and  In  their  pres- 
ence, write  the  memorandum;  and  if  so, 
were  not  their  names  inserted  by  their  con- 
sent?   Was    not   Townsend    their   agent    for 


that  purpose?  If  they  had  not  assented  to 
the  memorandum,  they  should  have  spoken. 
But  they  did  assent,  for  the  memorandum 
was  made  to  reduce  the  bargain  to  writing 
In  their  presence,  at  the  time  it  was  closed. 
It  was,  therefore,  as  much  their  memoran- 
dum as  if  they  had  written  it  themselves. 
Townsend  was,  so  far,  the  acknowledged 
agent  of  both  parties.  The  auctioneer  wlio 
takes  down  tlie  name  of  the  buyer,  when  he 
bids,  is  quoad  hoc  his  agent.  Emmerson  v. 
Heells,  2  Taunt.  38.  The  contract  was,  then, 
in  judgment  of  law,  reduced  to  writing,  and 
signed  by  both  parties,  and  it  appears  to  me 
to  be  as  unjust  as  it  is  illegal,  for  Clason,  or 
his  representatives,  to  get  rid  of  so  fair  a 
bargain,  on  so  groundless  a  pretext. 

2.  The  remaining  objection  Is,  that  the 
memorandum  was  made  with  a  lead  pencil. 

The  statute  requires  a  writing.  It  does  not 
undertake  to  define  with  what  instrument, 
or  with  what  material  the  contract  shall  be 
written.  It  only  requires  it  to  be  in  writing, 
and  signed,  &c.;  the  verdict  here  finds  that 
the  memorandum  was  written,  but  it  pro- 
ceeds further,  and  tells  us  with  what  instru- 
ment it  was  written,  viz.  with  a  lead  pencil. 
But  what  have  we  to  do  with  the  kind  of  in- 
strument which  the  parties  employed,  when 
we  find  all  that  the  statute  required,  viz.  a 
memorandum  of  the  contract  in  writing,  to- 
gether with  the  names  of  the  parties? 

To  write  is  to  express  our  ideas  by  letters 
visible  to  the  eye.  The  mode  or  manner  of 
impressing  those  letters  is  no  part  of  the 
substance  or  definition  of  writing.  A  pencil 
is  an  instrument  with  which  we  write  with- 
out ink.  The  ancients  understood  alpha- 
betic writing  as  well  as  we  do,  but  it  is  cer- 
tain that  the  use  of  paper,  pen,  and  ink,  was, 
for  a  long  time,  unknown  to  them.  In  the 
days  of  Job  they  wrote  upon  lead  with  an 
iron  pen.  The  ancients  used  to  write  upon 
hard  substances,  as  stones,  metals,  ivory, 
wood,  &c.  with  a  style  or  iron  instrument. 
The  next  improvement  was  writing  upon 
waxed  tables;  until,  at  last,  paper  and  parch- 
ment were  adopted;  when  the  use  of  the 
calamus  or  reed  was  introduced.  The  com- 
mon law  has  gone  so  far  to  regulate  writ- 
ings, as  to  make  it  necessary  that  a  deed 
should  be  written  on  paper  or  parchment, 
and  not  on  wood  or  stone.  This  was  for  the 
sake  of  durability  and  safety;  and  this  is 
all  the  regulation  that  the  law  has  prescrib- 
ed. The  instrument,  or  the  material  by 
which  letters  were  to  be  impressed  on  paper 
or  parchment,  has  never  yet  been  defined. 
This  has  been  left  to  be  governed  by  public 
convenience  and  usage;  and  as  far  as  ques- 
tions have  arisen  on  this  subject,  the  courts 
have,  with  great  latitude  and  liberality,  left 
the  parties  to  their  own  discretion.  It  has, 
accordingly,  been  admitted  (2  Bl.  Comm.  297; 
2  Bos.  &  P.  23S:  3  Esp.  ISO),  that  printing 
was  writing,  within  the  statute,  and  (2  Brown, 
Ch.  5So)  that  stamping  was  equivalent  to 
signing,  and  (S  Yes.  175)  that  making  a  mark 


204 


STATUTE  OF  FRAUDS. 


was  subscribing  within  the  act.  I  do  not 
find  any  case  in  the  courts  of  common  law 
in  which  the  very  point  now  before  us  has 
been  decided,  viz.  whether  writing  with  a 
lead  pencil  was  sufficient;  but  there  are  sev- 
eral cases  in  which  such  writings  were  pro- 
duced, and  no  objection  taken.  The  courts 
have  impliedly  admitted  that  writing  with 
such  an  instrument,  without  the  use  of  any 
liquid,  was  valid.  Thus  in  a  case  in  Comyn 
(page  451),  the  counsel  cited  the  case  of 
Loveday  v.  Claridge,  in  1730,  where  Love- 
day,  intending  to  make  his  will,  pulled  a  pa- 
per out  of  his  pocket,  wrote  some  things 
down  with  ink,  and  some  with  a  peucil,  and 
it  was  held  a  good  will.  But  we  have  a  more 
full  and  authentic  authority  in  a  late  case 
decided  at  doctors  commons  (Rymes  v.  Clark- 
son,  1  Phillim.  Ecc.  Judgm.  22),  where  the 
very  question  arose  on  the  validity  of  a  codi- 
cil written  with  a  pencil.  It  was  a  point 
over  which  the  prerogative  court  had  com- 
plete jurisdiction,  and  one  objection  taken 
to  the  codicil  was  the  material  with  which 
it  was  written,  but  it  was  contended,  on  the 
other  side,  that  a  man  might  write  his  will 
with  any  material  he  pleased,  quocuuque 
modo  velit,  quocunque  modo  possit,  and  it 
was  ruled  by  Sir  John  NichoU,  that  a  will 
or  codicil  written  in  pencil  was  valid  in  law. 
The  statute  of  frauds,  in  respect  to  such 
contracts  as  the  one  before  us,  did  not  re- 


quire any  formal  and  solemn  instrument. 
It  only  required  a  note  or  memorandum, 
which  imports  an  informal  writing  done  on 
the  spot,  in  the  moment  ahd  hurry  and  tu- 
mult of  commercial  business.  A  lead  pencil 
is  generally  the  most  accessible  and  conven- 
ient instrument  of  writing,  on  such  occasions, 
and  I  see  no  good  reason  why  we  should  wish 
to  put  an  interdict  on  all  memoranda  written 
with  a  pencil.  I  am  persuaded  it  would  be 
attended  with  much  inconvenience,  and  af- 
ford more  opportunities  and  temptation  to 
parties  to  break  faith  with  each  other,  than 
by  allowing  the  writing  with  a  pencil  to 
stand.  It  is  no  doubt  very  much  in  use.  The 
courts  have  frequently  seen  such  papers  be- 
fore them,  and  have  always  assumed  them 
to  be  valid.  This  is  a  sanction  not  to  be  dis- 
regarded. 

I  am,  accordingly,  of  opinion  that  the  judg- 
ment of  the  supreme  court  ought  to  be  af- 
firmed. 

This  was  the  opinion  of  the  court,  BLMEN- 
DORF  and  LIVINGSTON,  Senators,  dissent- 
ing. 

It  was  thereupon  ordered,  adjudged,  and 
decreed,  that  the  judgment  of  the  supreme 
court  be,  in  all  things,  affirmed,  and  that  the 
defendants  recover  from  the  plaintiffs  their 
double  costs,  to  be  taxed,  and  that  the  rec- 
ord be  remitted,  etc.    Judgment  affirmed. 


0 


EFFECT  OF  NON-COMPLIANCE  WITH  STATUTE. 


:u5 


TOWNSEND  V.  HARGRA 
(U8  Mass.  325.) 


Supreme  Judicial  Court  of  MassachusettaT* 
Suffolk.    Sept.  17,  1875. 


M.  Storey,  for  plaintiff, 
defendant. 


F.  A.  Brooks,  for 


COLT,  J.  The  plaintiff  relied  on  an  oral 
contract  of  sale  to  the  defendant  of  a  quantity 
of  wool  in  bales  then  in  Boston,  and  held  in 
store  by  one  Williams.  The  sale  was  by 
sample  at  the  invoice  weight  for  a  given  price 
per  pound,  and  the  bales  were  specifically 
designated  and  appropriated  by  the  terms  of 
the  contract 

At  the  time  of  the  great  fire  of  November 
9,  1872,  a  part  of  the  wool  had  been  sent  to 
the  railroad  station  in  Boston,  and  was  either 
there  or  at  the  defendant's  mill  in  Maine,  or 
in  transit  to  the  mill,  and  a  part  remained  and 
was  burned  in  the  storehouse  of  Williams. 
The  defendant  denies  his  liability  for  the  wool 
burned. 

He  contends,  first,  that  the  contract  was  not 
a  completed  contract  of  sale,  because  some- 
thing connected  .with^tlie  shipment  or  dcliv- 
_ory  of  tho  wool  remained  to  bcnlbne  by  the 
j3l;iintirr.  r.ut  the  instructions  upon  this  point" 
were  sufliciently  favorable  to  the  defendant, 
and  upon  evidence  which,  though  conflicting, 
was  sufficient  to  warmnt  the  finding.  The 
jury  must  have  found  that  nothing  remained 
to  be  done  on  the  part  of  the  seller  in  the  way 
of  ascertaining,  appropriating  or  delivering 
the  property.  It  is  well  settled  that  by  such 
a  conti-act,  independently  of  the  statute  of 
frauds,  the  property  immediately  vests  in  the 
buyer,  and  a  right  to  the  price  in  the  seller, 
unless  it  can  be  shown  that  such  was  not  the 
intention  of  the  parties.  Morse  v.  Sherman, 
lOG  Mass.  430;  Foster  v.  Ropes,  111  Mass.  10; 
Haskins  v.  Warren,  115  Mass.  514;  Goddard 
V.  Binney,  Id.  4.j0. 

The  defendant  next  relies  upon  the  statute 
of  frauds  set  up  in  his  answer,  and  contends 


that  there   was.  ,n^ acceptance  or  receipt  p£_.  by  railroad  at  the  defendant's  expense. 


art  of  the_wool  sufficient  tQ_taJ^  thp, 
ont   Qf,    iti^^provisions    as   to    the    part 


any 
case 
burned. 

mere  was,  however,  evidence  which  justi- 
fied the  jury  in  finding  that  the  storekeeper, 
Williams,  after  Wing  uotilicd  of  the  sale  by 
both  parties,  and  of  the  fact  that  the  property 
belonged  to  the  defendant,  undertook  at  his 
request  to  deal  with  and  hold  it  for  him. 
Such  an  arrangement  the  jury  may  have 
found  constituted  a  sufficient  accopt;ince  and 
receipt  to  make  the  contract  "good  and  valid." 
It  is  well  settled  that  the  warehouseman  in 
such  case  becomes  the  agent  of  the  buyer  and 
holds  possession  for  his  principal.  Gushing  v. 
Brood,  14  Allen,  376;  Boardman  v.  Spooner, 
13  Allen,  353;  Hatch  v.  Bayley,  12  Cush.  27; 
Browne,  St.  Frauds.  §  31S.  But  the  evidence 
upon  this  point  was  conflicting,  and  some  of 
it  tended  to  prove  that  there  was  no  accept- 
ance of  the  vool  or  any  part  of  it  through 


the  agency  of  Williams,  or  until  after  the 
fire.  It  cannot  be  certainly  known  that  the 
verdict  was  not  founded  upon  an  acceptance 
by  the  defendant  at  his  mill  in  Maine,  after 
the  fire,  of  a  part  of  the  wool  which  had  been 
sent  on  by  railroad. 

The  instructiqns  given  by  the  court  appli- 
cable to  this  aspect  of  the  case  were  not  ex- 
cei)ted  to,  and  are  not  reported.  It  is  to  be 
presumed  that  they  were  apt  and  sufficient, 
unless  the  specific  instructions  requested  by 
the  defendant  should  have  been  given  in 
whole  or  in  part;  and  that  is  the  remaining 
question. 

The  first  two  instructions  requested  were 
designed  to  support  the  statute  defence,  by 
avoiding  the  legal  effect  of  the  alleged  ac- 
ceptance, at  the  mill,  of  part  of  the  wool.  The 
acceptance  referred  to  is  that  which  the  stat- 
ute requires  to  give  validity  to  the  contract. 
It  must  be  with  intention  to  perform  the 
whole  contract  and  assert  the  buyer's  owner- 
ship under  it,  but  it  is  sufficient  if  it  be  of 
part  of  the  goods  only.  Such  an  acceptance 
implies  the  existence  of  a  completed  contract, 
sufficient  to  pass  the  title,  which  is  not  to  be 
confoimded  with  that  actual  transfer  of  pos- 
session necessary  to  defeat  the  vendor's  lien 
or  his  right  of  stoppage  in  transitu,  or  to 
show  an  actual  receipt  under  the  statute. 
Morse  v.  Sherman,  supra;  Browne,  St. 
Frauds,  §  317. 

The  first  request  In  all  its  parts  is  to  be 
taken  together  and  treated  as  one;  the  prop- 
osition that  delivery  of  part  to  the  Eastern 
Railroad  Company  would  not  satisfy  the  stat- 
ute of  frauds,  even  as  to  that  part,  being 
preliminary  only,  and  for  the  purpose  of  lead- 
ing up  to  the  main  proposition  in  regard  to 
the  subsequent  acceptance  of  such  part. 

The  judge  properly  declined  to  rule  that  an 
acceptance,  as  thus  defined,  of  part  of  the 
wool  would  not  operate  to  take  the  contract 
out  of  the  statute,  as  to  the  part  which  the 
plainiff  had 'not  sent,  although  by  the  terms 
of  the  contract  the  seller  was  to  ship  it  all 


In  the  second  request  the  judge  was  asked 
distinctly  to  rule  that  an  acceptance  of  part 
of  the  wool  would  not  operate  upon  the  con- 
tract to  render  it  valid  retrospectively,  or 
malce  the  defendant  liable  to  pay  for  that 
which  had  been  destroyed  by  fire.  This  pre- 
sents the  question  whether  the  date  of  the  ac- 
ceptance or  tlie  date  of  the  agreement  will  be 
treated,  as  between  the  parties,  as  the  time 
when  the  contract  was  made,  and  the  risk  of 
loss  of  the  goods  was  cast  on  the  buyer.  No  di- 
rect adjudication  of  tliis  precise  point  is  cited, 
if  we  accept  a  New  York  case  in  which  it  seems 
to  bo  held,  in  a  per  curiam  opinion,  that  a  loss 
which  happens  after  the  original  agreement 
and  before  the  acceptance  required  by  the 
statute,  must  fall  on  the  purchaser.  Vincent 
v.  Germond,  11  .Johns.  2S3. 

The  decision  of  it  depends  upon  the  con- 
struction to  be  given  to  that  part  of  the  stat- 
ute applicable  to  sales  of  personal  prooerty, 


206 


STATUTE  OF  FilAUDS. 


which  Is  Incorporated  in  Gen.  St.  c.  105, 
§  5,  and  follows,  with  slight  variation,  the 
words  of  the  seventeenth  section  of  the  Eng- 
lish statute. 

The  pm-pose  of  this  celebrated  enactment, 
as    declared    in   the   preamble   and    gathered 
from  all  its  provisions,  is  to  prevent  fraud  and 
falsehood,  by  requiring  a  party,  who  seelis  to 
enforce  an  oral  contract  in  court,  to  produce, 
as  additional  evidence,   some   written   memo- 
randum signed  by  the  party  sought  to  be  char- 
ged, or  proof  of  some  act  confirmatory  of  the 
contract  relied  on.    It  does  not  prohibit  sucli 
contract.    It  does  not  declare  that  it  shall  be 
void  or  illegal,  unless  certain  formalities  are 
observed.    If  executed,  the  effect  of  its  per- 
formance on  the  rights  of  the  parties  is  not 
changed,  and  the  consideration  may  be  recov- 
ered.   Stone    V.    Dennison,    13    Pick.    1;    Bas- 
ford    V.    Pearson,    9    Allen,    3S7;    Nutting    v. 
Dickinson,  S  Allen,  540.    The  memorandum  re- 
quired is  the  memorandum  of  only  one  of  the 
parties.    The   alternative   acts   of   the   seven- 
teenth section  proceed  from  one  only.    They 
presuppose  a  contract,  and  are  in  affirmance 
or  partial  execution  of  it    They  are  not  es- 
sential to  its  existence,  need  not  be  contem- 
poraneous,  and   are   not  prescribed   elements 
in  its  formation.    It  is  declared  in  the  fourth 
section  that  no  action  shall  be  brought  upon 
the    promises    therein    named,    unless    some 
niemorandum   of   the   agreement   shaU   be   in 
writing;    and  in  the  seventeenth  that  no  cou- 
ti-act  for  the  sale  of  goods  "shall  be  allowc»d 
to  be  good,"  or,  as  m  oiu-  statute,  "shall  De 
good  and  valid,"  unless  the  buyer  accepts  and 
receives  part  or  gives  earnest  or  there  is  some 
memorandum  signed  by  the  parties  to  be  char- 
ged, or,  as  in  om-  statute,  by  the  party  to  be 
charged.    It    is    true    there    is    difference    in 
phraseology  in  these  sections;    but  in  view  of 
the  policy  of  the  enactment  and  the  necessity 
of    giving    consistency    to   all    its    parts,    this 
difference  cannot  be  held  to  change  the  force 
and  effect  of  the  two  sections.    "Allowed  to  be 
good"  means  good  for  the  purpose  of  a  recov- 
ery under  it;    and  the  clause  in  the  last  part 
of  the  latter  section,  which  requires  the  mem- 
orandum to  be  signed  by  the  party  or  parties 
to  be  charged,   implies  that  the  vahdity   in- 
tended is  that  which  will  support  an  action 
on  the  contract.    We  find  no  case  in  which 
it  is  distinctly  and  authoritatively  held  other- 
wise.   See  Leroux  v.   Brown,   12   C.   B.   801; 
Carrington  v.  Roots,  2  Mees.  &  W.  248;  Reade 
V.  Lamb,  6  Exch.   130;    Browne,   St.   Frauds. 
§§  115,   136.      With  reference  to  the  change 
in  our  statute  by  the  use  of  the  words  "good 
and   valid,"   which  first  appears  in   Rev.   St 
c.  74,  §  4,  it  is  enough  to  say  that  the  provin- 
cial statute  of  1692,  c.  15,  §  7,  and  St.  1788, 
c.   16,   §  2,   foUow   the   precise   words  of   the 
English   statute;    and   the   commissioners   on 
the   Revised    Statutes,    in   their   report    (page 
107)   declare   that   they   intend   to   retam   the 
well-known  and  familiar  phraseology  of  the 
old  statute,  which  has  received  judicial  con- 
struction.   Tisdide  v.  Harris,   20  Pick.  9,   12. 


It  is  apparent  that  the  legislature  of  this  state 
did  not  intend  to  change  the  meaning  of  the 
original  provision. 

In  carrying  out  its  puriJose,  the  statute  only 
affects  the  modes  of  proof  as  to  all  contracts 
within  it.  If  a  memorandum  or  proof  of  any 
of  the  alternative  requirements  peculiar  to  the 
seventeenth  section  be  furnished,  if  acceptance 
and  actual  receipt  of  part  be  shown,  then  the 
oral  contract,  as  proved  by  the  other  evi- 
dence, is  established  with  all  the  consequen- 
ces which  the  common  law  attaches  to  it  If 
it  be  a  completed  contract  according  to  com- 
mon-law rules,  then,  as  between  the  parties 
at  least,  the  property  vests  in  the  purchaser, 
and  a  right  to  the  price  in  tlie  seller,  as  soon 
as  it  is  made,  subject  only  to  the  seller's  lien 
and  right  of  stoppage  in  transitu. 

Many  points  decided  in  the  modern  cases 
support  by  the  strongest  implication  the  con- 
stniction  here  given.  Thus,  if  one  party  has 
signed  the  memorandum,  the  contract  can  be 
enforced  against  him,  though  not  against  the 
other,— showing  that  the  promise  of  the  other 
is  not  wholly  void,  because  it  affords  a  good 
and  valid  consideration  to  support  the  promise 
which  by  reason  of  the  memorandum  may  be 
enforced.  Reuss  v.  Picksley,  L.  R.  1  Exch. 
342. 

The  memorandum  is  sufficient  if  it  be  only 
a  letter  written  by  the  party  to  his  own  agent, 
or  an  entry  or  record  in  his  own  books,  or 
even  if  it  contain  an  express  repudiation  of 
the  contract.  And  this  because  it  is  evidence 
of,  but  does  not  go  to  make,  the  contract. 
Gibson  v.  Holland,  L.  R.  1  C.  P.  1;  Buxton 
V.  Rust,  L.  R.  7  Exch.  1,  279;  Allen  v.  Ben- 
net,  3  Taunt.  169;  Tufts  v.  Mining  Co.,  14 
Allen,  407;  Argus  Co.  v.  Albany,  55  N.  Y. 
495. 

A  creditor,  receiving  payment  from  his  debt- 
or, without  any  direction  as  to  its  application, 
may  apply  it  to  a  debt  upon  which  no  action 
can  be  maintained  under  the  statute.  Haynes 
v.  Nice,  100  Mass.  327. 

The  contract  is  treated  as  a  subsisting  valid 
contract  when  it  comes  in  question  between 
other  parties  for  purposes  other  than  a  re- 
covery upon  it  Hence  the  statute  cannot  be 
used  to  charge  a  trustee,  who  may  set  up 
against  his  debt  to  the  principal  defendant  a 
verbal  promise  within  the  statute  to  pay  the 
defendant's  debt  to  another  for  a  greater 
amount.  Cahill  v.  Bigelow,  18  Pick.  369. 
And  a  guarantor  may  recover  of  his  principal 
a  debt  paid  upon  an  unwritten  guaranty.  Beal 
v.  Brown,  13  Allen,  114. 

On  the  ground  that  the  statute  affects  the 
remedy  and  not  the  validity  of  the  contract, 
it  has  been  held  that  an  oral  contract,  good 
by  the  law  of  the  place  where  made,  will  not 
be  enforced  in  the  com-ts  of  a  country  where 
the  statute  prevails.  Leroux  v.  Brown,  12  C. 
B.  801.  The  defendant  may  always  waive 
its  protection,  and  the  court  will  not  interpose 
the  defence.  Middlesex  Co.  v.  Osgood,  4  Gray, 
447.  And,  except  that  the  statute  provides 
that  no  action  sliaU  be  brought,  there  would 


EFFECT  OF  NON-COMPLIANCE  WITH  STATUTE. 


207 


be  no  good  reason  to  hold  that  a  memorandum 
signed,  or  an  act  of  acceptance  proved,  at  any 
time  before  the  trial  would  not  be  sufficient. 
Bill  V.  Bameut,  9  Mees.  &  W.  3G;  Tisdale  v. 
Harris,  20  Pick.  9. 

In  a  recent  case  In  the  queen's  bench,  a 
memorandum  in  writing  made  by  the  defend- 
ant, after  the  goods  had  been  delivered  to  a 
carrier  and  been  totally  lost  at  sea  while  In 
his  hands,  was  held  sufficient  to  take  the  case 
out  of  the  statute,  and  no  notice  is  taken  of 
the  fact  that  the  goods  were  not  in  existence 
when  the  memorandum  was  furnished.  Cloth 
Co.  V.  Hieronimus,  L.  R.  10  Q.  B.  140. 

In  the  case  of  Marsh  v.  Hyde,  3  Gray,  331, 
relied  on  by  the  defendant,  although  there  are 
some  inconsistent  expressions  in  the  opinion, 
the  general  course  of  reasoning  supports  this 
result  The  facts  in  that  case  showed  a  com- 
pleted sale  by  oral  agreement,  with  an  ac- 
ceptance and  receipt  of  part,  which  was  held, 
although  subsequent  In  point  of  time  to  the 
original  contract,  to  tike  the  case  out  of  the 
statute.  The  point  decided  Is  not  in  conflict 
with  tlie  law  here  stated. 

The  case  of  Stockdale  t.   Dunlop,  6   Mees. 


&  W.  224,  also  fails  to  sustain  the  defendant's 
case.  That  was  a  sale  of  goods  "to  arrive," 
and  it  was  expressly  found  tliat  by  the  use 
of  this  mercantile  term,  if  the  property  or  the 
vessel  named  did  not  arrive,  the  buyer  would 
have  no  right  to  the  goods,  and  so  no  present 
insurable  interest  in  them. 

It  follows  that  it  would  have  been  erroneous 
to  have  given  the  instructions  requested.  Up- 
on the  point  closely  allied,  namely,  what  ef- 
fect, if  any,  the  defendant's  mistake  or  ig- 
norance of  a  material  fact,  such  as  the  destruc- 
tion ofthe  rest  of  the  wool,  would  have  on  the 
alleged  act  of  acceptance,  we  are  not  required 
by  the  terms  of  the  request  to  pass. 

The  third  and  last  request  was  also  properly 
refused  for  the  reasons  above  given.  /If  the 
property  in  the  wool  passed  by  the  terms  of 
the  original  agreement,  and  the  contract  was 
taken  out  of  the  statute  by  the  subsequent 
acceptance  and  receipt,  then,  as  we  have  seen, 
as  between  the  parties,  the  risk  of  loss  was 
on  the  defendant  at  the  tim'^  of  the  fire,  and 
the  plaintiff  may  recover  the  agreed  price  5I 
the  whole. 

Exceptions  overruled. 


:03 


STATUTE  OF  FRAUDS. 


^^ 


WHEELER  V.  REYNOLDS. 

(66  N.  Y.  227.) 


3' 

Court  of  Appeals  of  New  York-    May  23,  1876. 

Action  for  specific  performaDce  of  a  parol 
agreement  in  reference  to  lands.  The  facts 
appear  in  the  opinion.  Judgment  for  plain- 
tiff. 
John  Van  Voorhis,  for  appellant 
The  agreement  claimed  by  plaintiflf  was 
void  by  the  statute  of  frauds.  2  Rev.  St. 
(Edm.  Ed.)  139,  §  G;  Lathrop  v.  Hoyt,  7  Barb. 
59;  Levy  v.  Brush,  45  N.  Y.  5S9;  Sturtevant 
V.  'sturtevant,  20  N.  Y.  39;  2  Story  Eq.  Jur. 
61,  §  1201;  Getman  v.  Getman,  1  Barb.  Ch. 
499. 
Geo.  H.  Humphrey,  for  respondent 
Equity  will  not  allow  defendant  to  retain  the 
property  obtained  on  the  faith  of  the  oral  con- 
tract without  performing  the  same  on  his 
part.  Ryan  v.  Dox,  34  N.  Y.  307;  Church  v. 
Kidd,  3  Hun,  254.  This  case  was  not  within 
the  statute  of  frauds.  2  Rev.  SL  (Edm.  Ed.) 
139;  2  Story,  Eq.  §  759;  34  N.  Y.  311;  Stod- 
dard V.  Whiting.  46  N.  Y.  627;  Dodge  v.  WeU- 
man,  43  How.  Prac.  427. 

EARL,   J.    In  1S55   the   plaintiff   was   the 
owner  in  fee  of  the  lands  described  in  the 
complaint,  and  then  executed  to  the  defend- 
ant a  mortgage  upon  the  lands,  which  is  also 
described   in  the  complaint.    In  April,   1SP.5, 
the  plaintiff  had  become  insolvent,  and  the 
mortgage  remained  unpaid,  and  he  was  una- 
ble to  pay  it.    At  that  time  the  plaintiff  claims 
a  parol  agreement  was  made  as  to  the  fore- 
closure of  the  mortgage,  which  he  seeks  to 
enforce  in  this  action.    No  one  was  present 
when  the  agieement  was  made  except  the 
parties,   and   they  are    the    only    witnesses 
thereto.    The  defendant,  as  a  witness,  denied 
the  agreement    The  plaintiff,  as  a  witness, 
stated   the   agreement  as   follows:    That   he 
went  to  the  defendant  and  stated  to  him  that 
he  would  like  to  have  him  foreclose  the  mort- 
gage and  bid  m  the  land  at  the  sale,  and  then 
sell  the  land  or  hold  it  to  such  time  until  they 
could  sell  it  for  what  it  was  worth;  that  he 
would  do  what  he  could  toward  soiling  the 
land  and  that  defendant  should  do  the  same; 
and  that  when  the  land  was  sold  he  should 
take  out  the  amount  due  upon  his  mortgage, 
and  his  costs  and  expenses,  and  pay  the  bal- 
ance to   the   plaintiff.    This   was   the   whole 
agreement  as  proved  by  the  plaintiff.    It  was 
not  agreed  that  plaintiff  should  not  attend 
the  sale,   or  that  he   should  prevent  others 
from    attending.     The  judge   who  tried   the 
cause  found  that  this  agreement  was  made, 
and  also  found  that  it  was  made  by  the  de- 
fendant upon  the  consideration  that  the  plain- 
tiff would  not  attend  the    sale    or    procure 
others  to  bid  against  the  defendant  at  the 
sale.    There  was  no  proof  whatever  of  such 
a  consideratioiL    The  learned  judge  probably 


inferred  it  from  all  the  facts  of  the  case.    It 
would  doubtless  have  defeated  the  agreement 
if  plaintiff  had  attended  at  the  sale  and  bid, 
or  if  he  had  procured  others  to  bid;  and  yet 
it  could  not  be  said  that  in  either  event  he 
would  have  violated  his  agreement    The  al- 
leged agreement  was  wholly  for  his  benefit, 
and  if  he  had  before  the  day  of  sale  obtained 
the  money  to  bid 'in  the  land,  and  thus  ena- 
bled  the   defendant  to  realize  all  that   w:\3 
due  him,  there  would  have  been  no  ground  of 
complaint  on  the  part  of  the  defendant,  and 
no  breach  of  faith  on  the  part  of  the  plaintiff; 
so  if  the  plaintiff  had  procured  other  parties 
to  bid  sufficiently,  the  substantial  purpose  of 
the  agreement  would  have  been  accomplish- 
ed.   The  plaintiff  therefore  gave  up  no  right 
which  he  possessed,  and  the  defendant,  by 
virtue    of   the    agreement,    could   receive   no 
more  than  his  due,  and  obtained    no    right 
which   he   did   not  before   have.    The   judge 
found  that  in  pursuance  of  this  agreement 
the  defendant  proceeded  to  foreclose  his  mort- 
gage.   There  was  however  no  proof  that  he 
foreclosed  it  in  pursuance  of  the  agreement 
The    defendant    testified    that    he    did   not. 
Nothing  was  said  at  the  sale  about  the  agree- 
ment; and  there  was  no  act  of  either  party  in- 
dicating that  the  foreclosinre  was  in  pursuance 
of  the  agreement.    Nothing  was  done  at  the 
sale  by  the  defendant  to  prevent  competition; 
and  one  or  more  other  parties  did  bid.    There 
was  no  proof  or  finding  that  plaintiff  omit- 
ted to  attend  the  sale,  or  to  procure  others  to 
attend,   in   reliance   upon   the   agreement,   or 
that    the    plaintiff,   but   for  the   agreement 
could  or  would  have  bid  off  the  property,  or 
procured  some  one  else  to  do  so  for  him.    The 
defendant  bid  off  the  property  for  $S00,  but 
the  amount  due  him  upon  his  judgment   in 
foreclosure,  including  costs  and  expenses  of 
sale,  was  about  $1,800,  which  was  substan- 
tially all  the  land  was  worth.    There  was  no 
allegation  in  the  complaint,  nor  proof  upon 
the  trial  of  any  fraud  practiced  by  the  de- 
fendant  upon    the   plaintiff    in     making    the 
agreement,  or  in  the  foreclosure  of  the  mort- 
gage and  the  sale  of  the  land.    The  defend- 
ant,  after  the   sale,   took   possession  of  the 
land  under  his  deed,  and  retained  it,  and  paid 
the  taxes  and   received  the  rents,   and   this 
suit   was   not    commenced   until   nearly    nine 
years  after  the  sale,  when  the  land  had  great- 
ly increased  in  value.    If  under  such  circum- 
stances this  alleged  parol  agreement  can  be 
enforced,  our  statute  in  reference  to  fraudu- 
lent conveyances   and   contracts,   relative   to 
lands  will,  in  large  part,  be  nullified. 

It  must  be  conceded  that  the  parol  Hgree- 
ment  was  of  itself  absolutely  void  and  con- 
ferred no  rights  and  imposed  no  obligations 
upon  any  one.  But  one  ground  upon  which 
it  is  sought  to  maintain  this  action  is  that 
the  agreement  was  partly  performed  so  as  to 
take  it  out  of  the  statute  of  frauds.  2  Rev.  St 
135,  §§  6,  10.  To  have  such  effect  the  part  per- 
formance must  be  substantial,  and  nothing 
will  be  considered  as  part  performance  which 


EFFECT  OF  XOX-COMPLIANCE  Willi  STATUTE. 


2uy 


does  not  put  the  party  into  a  situation  which 
is  a  fraud  upou  him  unless  the  agreement  be 
fullj'  perforniod;  and  the  acts  of  part  per- 
forniauce  should  clearly  appear  to  be  done 
solely  with  a  view  to  the  agreement  being 
performed.  Generally  if  they  are  acts  which 
might  have  been  done  with  other  views,  they 
will  not  take  the  case  out  of  the  statute,  since 
they  cannot  properly  be  said  to  be  done  by 
way  of  part  performance  of  the  agreement 
The  acts  should  be  so  clear,  certain  and  defi- 
nite in  their  object  and  design  as  to  refer  ex- 
clusively to  a  complete  and  perfect  agree- 
ment, of  which  they  are  a  part  execution.  2 
Story,  Eq.  Jur.  §§  TGI,  7t;2;  Phillips  v.  Thomp- 
son, 1  Johns.  Ch.  lol;  Byrne  v.  Romaine,  2 
Edw.  Ch.  445;  Jervis  v.  Smith,  Iloff.  Ch.  470; 
Wolfe  V.  Frost,  4  Sandf.  Ch.  77.  The  object 
of  the  statute  is  to  prevent  frauds  and  per- 
juries, and  hence  courts  of  equity  will  take 
uo  notice  of  agreements  dopcndiiig  upon  parol 
evidence  and  otherwise  within  the  statute, 
unless  there  are  acts  of  part  performance 
which  go  along  with,  relate  to,  and  confirm 
the  agreement,  and  which  were  clearly  done 
in  part  execution  thereof,  and  thus  with  the 
parol  evidence  established  the  existence  of  the 
a.grcement.  Now,  what  have  we  in  this  case? 
Every  act  done  by  the  defendant  was  such  as 
he  had  a  perfect  right  to  do  by  virtue  of  his 
mortgage  and  his  deed  upon  the  foreclosure 
sale,  and  apparentlj'  had  no  reference  what- 
ever to  any  agreement  with  the  plaintiff.  There 
was  no  act  of  the  plaintiff  which  could  be  re- 
ferred exclusively  to  the  agreement.  The  only 
act  of  part  performance  pretended  is  that  the 
plaintiff  did  not  attend  the  sale  and  bid.  But 
his  absence  from  the  sale  was  just  as  con- 
sistent with  other  circumstances.  He  was  in- 
solvent and  luiable  to  pay  the  mortgage;  and 
the  amount  due  thereon,  with  the  costs  and  ex- 
penses of  sale,  was  equal  to  the  value  of  the 
land.  Hence  he  could  have  had  little  motive 
to  attend  the  sale,  of  which  public  notice  was 
given,  as  required  by  the  statute.  To  hold 
that  his  mere  omission  to  attend  the  sale  un- 
der such  circumstances  was  a  part  perform- 
ance would  be  an  application  of  the  equity 
rule  upon  the  subject  wholly  unauthorized  by 
the  best  authorities. 

The  court  at  general  term  atfinued  the 
judgment  upon  the  authority  of  the  case  of 
Kyan  v.  Dox,  34  N.  Y.  307.  That  case  *ls 
quite  unlike  this  in  its  essential  fesitures. 
There  there  was  a  sale  under  a  foreclosure 
judgment,  and  the  plaintiffs,  the  owners  of 
the  land,  procured  the  defendant  to  bid  off 
the  same  under  a  parol  agreement  that  he 
would  attend  the  sale  and  bid  off  the  land 
for  their  benefit  and  advantage,  and  take  the 
deed  as  his  security  for  the  amount  paid  by 
him,  they  agreeing  that  they  would  not  find 
any  other  person  to  attend  the  sale  and  bid 
for  them.  He  was  to  hold  the  deed  as  his  se- 
curity, and  whenever  the  plaintiffs  repaid  him 
the  amount  paid  at  the  sale,  together  with  in- 
terest and  a  reasonable  compensation  for  his 
services,  he  was  to  convey  the  land  to  them. 

nOPE.SEL.CAS.COXT. — 14 


In  pursuance  of  the  agreement  he  attended 
the  sale  and  bid  off  the  laud  for  $100,  which 
was  then  worth  ?4,0<J0.  The  others  present 
at  the  sale  were  informed  of  the  agreement, 
and  therefore  abstained  from  bidding.  If 
plaintiffs  had  not  relied  upon  the  agreement, 
they  would  not  have  allowed  the  land  to  have 
been  struck  off  for  the  sum  of  $100,  but  could 
have  found  other  persons  to  have  purchased 
the  land,  and  thus  would  have  saved  the 
same  from  sacrifice.  They  relied  upon  the 
agreement,  and  made  no  other  effort  to  pro- 
cure the  money  or  the  assistance  of  friends 
to  save  and  buy  the  land.  They  continued  in 
the  possession  of  the  land  after  the  sale  for 
six  years,  and  during  all  that  time  had  the 
use  of  the  land  with  the  knowledge  and  con- 
sent of  the  defendants,  and  they  paid  the 
taxes  thereon  and  made  payments  on  account 
of  incumbrances  thereon.  After  the  plaintiffs 
had  been  in  possession  of  the  land  for  six 
years  the  dcfeud;uit  obtained  the  possession, 
and  then  repudiated  the  agreement  and  de- 
nied plaintiffs'  rights.  The  plaintiffs  brought 
the  action  to  enforce  the  agreement,  and  they 
were  defeated  in  the  supreme  court;  but  this 
court  reversed  the  judgment  on  the  ground 
that  there  was  sufficient  part  performance  of 
the  contract  to  take  it  out  of  the  statute. 
Levy  V.  Brush,  45  N.  Y.  5S9,  590.  There  the 
acts  of  part  performance  were  clearly  refera- 
ble to  the  agreement,  and  were  done  in  re- 
liance thereon,  and  in  part  execution  thereof, 
and  the  equity  rule  as  to  part  perfonnance, 
as  above  laid  down,  was  fully  satisfied. 

But  it  is  uncertain  from  the  complaint  and 
the  findings  of  the  judge  upon  what  ground 
relief  was  granted  to  the  plaintiff  in  this 
action,  whether  upon  the  ground  of  specifi.: 
performance  of  a  parol  contract  partly  per- 
formed, or  upon  the  ground  that  a  trust  had 
been  created  by  the  agreement  of  the  parties 
and  the  circumstances  of  the  case  which  the 
defendant  was  bound  to  execute.  We  must 
therefore  further  inquire  whether  there  was 
any  trust  which  could  properly  be  enforced. 
Parol  trusts  in  lands  are  condemned  by  the 
statute  (2  Rev.  St.  135,  §  G),  and  no  mere 
parol  agreement  creating  them  will  ever  be 
enforced  in  equity.  Sturtevant  v.  Sturte- 
vant,  20  N.  Y.  30.  They  are  sometimes  en- 
forced where  there  is  an  element  of  fraud  in 
the  case,  as  where  the  parol  agreement  is 
obtained  as  part  of  a  scheme  of  fraud,  or 
when  by  a  parol  agreement,  a  person  is 
fraudulently  deprived  of  his  valuable  rights 
or  his  property;  and  in  such  case  a  court  of 
equity  does  not  intervene  to  uphold  or  en- 
force the  parol  trust,  but  to  relieve  against 
the  fraud  which  has  been  perpetrated  by  rais- 
ing an  implied  trust;  and  it  will  treat  the 
pei*son  who  perpetrated  the  fraud  as  a  trus- 
tee, not  by  virtue  of  the  parol  agreement,  but 
as  a  trustee  ex  maleficio  on  account  of  the 
fraud.  The  mere  refusal  to  perform  a  parol 
agreement  void  under  the  statute  may  be  a 
moral  wrong,  but  it  is  in  uo  sense  a  fraud  in 
law  or  equity.     Levy  v.  Brush,  supra.     Here 


210 


STATUTE  or  FRAUDS. 


there   was   no   allegation   or   finding   of   any 
fraud,  and  hence  if  this  agreement  should  he 
treated  as  an  attempt  to  create  a  parol  trust, 
It  could  not  be  upheld  or  enforced.    In  Brown  v. 
I.j-nch.  1  Paige,  147;   Cos  v.  Cox,  5  Rich.  Eq. 
3Go;    Keith  v.  Purvis,  4  Dess.  114;    Peebles 
y.   Reading,  8  Serg.   &  R.  402;    Trapnall   v. 
Brown,  19  Ark.  49,— there  was  fraud  which 
enabled   the   courts   to  enforce   parol   trusts. 
In  Levy  v.  Brush,  a  verbal  agi-eement  was 
entered   into   between   the   plaintiff   and   de- 
fendant by   which  the   latter  agreed  to   bid 
off  in  his  own  name  and  enter  into  a   con- 
tract for  the  purchase  of  land,  and  pay  from 
his  own  funds  the  necessaiy  amount  for  that 
purpose,   for  the  joint   benefit  of  both;    the 
plaintiff  was   to   re-imburse   one-half   of   the 
money  so  paid,  the  deed  to  be  taken  in  the 
name  of  both;    and  it  was  held,  the  defend- 
ant having  bid  off  the  land  in  his  name  and 
taken  a  contract  thereof,  but  having  refused 
to    convey   one-half   of    the   contract   to   the 
plaintiff,  that  no  action  would  he  to  compel 
the  execution  of  the  agreement.     There  was 
much  ground  for  saying  there  as  here  that 
the   plaintiff   relied   upon   the  agreement,    so 
far  that  he  did  not  himself  bid  or  make  ar- 
rangements  with    other   parties   for   bidding, 
and  yet  it  was  held  that  it  was  not  a  case 
for  the  enforcement  of  the  agreement  either 
upon  the  ground  of  part  performance  or  of  a 
parol  trust  repudiated  by  the  trustee  in  wrong 
of  the  plaintiff.     If  one  employs  another  by 
parol  to  buy  land  for  him  with  his  own  mon- 
ey, and  the  latter  buys  the  land  and  takes 
the  deed  to  himself  and   refuses   the  former 
any  right  therein,  the  former  cannot  compel 
a  conveyance  to  him,  even  by  showing  that 
but  for  his  reliance  upon  the  fidelity  of  his 
agent  he  would  have  purchased  in  person  or 
through   some  other  agent.     Smith  v.   Burn- 
ham,  3  Sumn.  4.35,  Fed.   Cas.   No.  13,019;    2 
Story,  Eq.  Jur.  1201a.     In  Kellum  v.  Smith, 
33  Pa.   St  158,  it  was  held  that  a  promise 
to    purchase   real   estate   at   a   sheriff's    sale 
and  to  convey  it  to  the  defendant  in  the  exe- 
cution whenever  he  should  repay  to  the  pur- 
chaserers    their   advances   to   him,    does    not 
raise  a  resulting  trust  in  favor  of  tlie  defend- 
ant.     Strong,    J.,    says:      "A   resulting    trust 
cannot  be  created   in  such  a  way.     Such  a 
trust    can  arise   only   from   the   payment   of 
the  purchase-money  or  from  fraud  in  the  pur- 
chase;    fraud    perpetrated    by    the    grantee. 
Here  the  purchase-money  of  the  sheriff's  sale 
was  paid  Bell   &  Co.  and   consequently   the 
beneficial   interest  as   well   as   the   legal   es- 
tate went  to  them.    Had  there  been  fraud  in 
the  purchase  they  might  have  been  held  ti-us- 
tees  ex  maleficio.     But  the  fraud  which  wUl 
convert  the  purchaser  at  a  sheriff's  sale  into 
a  trustee,  ex  maleficio,   of  the  debtor,   must 
have    been   fraud   at    the   time   of   the   sale. 
Subsequent  crime  will  not  answer  any  more 
than   subsequent  payment   of    the   purchase- 
money  will  convert  an  absolute  purchase  into 
a   naked   trust.     Where   the   purcliaser   at   a 
sheriff's  sale  promises  to  hold  for  the  debtor 


and  afterward  refuses  to  comply  with  his  en- 
gagement, the  fraud,  if  auy,  is  not  at  the 
sale,  not  in  the  promise,  but  in  its  subse- 
quent breach.  That  is  too  late.  It  is  abun- 
dantly settled  that  equity  will  not  decree 
such  a  purchaser  to  be  a  trustee,  unless  there 
is  something  more  in  the  transaction  than  the 
mere  violation  of  a  parol  agreement."  The 
learned  judge  further  says:  "It  may  in  all 
cases  be  assumed  that  where  a  promise  is 
made  to  buy  or  to  hold  for  another,  con- 
fidence is  invited  and  more  or  less  reposed. 
So  it  is  in  every  parol  contract  for  the  pur- 
chase of  lands;  but  the  statute  of  frauds 
would  be  worse  than  waste  paper  if  a  breach 
of  the  promise  created  a  trust  in  the  prom- 
isor which  the  contract  itself  was  insuffi- 
cient to  i-aise.  It  may  be  that  if  at  the  in- 
stance of  the  promisor,  the  promisee  is  in- 
duced to  incur  some  expense  or  perform  some 
act  which  he  otheiT\'ise  would  not  have  done, 
the  former  shaU  be  estopped  from  denying  the 
trust  But  however  this  may  be,  mere  ac- 
quiescence or  omission  to  take  other  steps 
to  obtain  the  property,  though  induced  by 
faith  in  the  promisor,  is  not  available  for 
such  a  purpose."  If  in  the  case  under  con- 
sideration, the  defendant  at  the  sale  had  de- 
clared that  he  was  bidding  Ln  the  property  for 
the  plaintiff,  and  had  thus  induced  other  per- 
sons to  refrain  from  bidding  and  purchased 
the  property  for  less  than  its  value,  a  case 
would  probably  have  been  made  for  holding 
him  as  trustee  ex  maleficio  of  the  plaintiff. 
Brown  v.  Dysinger,  1  Rawle,  408;  Ryan  v. 
Dox,  supra;    2  Washb.  Real  Prop.  444. 

The  ease  nearest  like  this  which  I  have 
been  able  to  find  in  the  reports  of  this  state 
is  that  of  Lathrop  v.  Hoyt  7  Barb.  59.  In 
that  case  the  defendant,  at  plaintiff's  re- 
quest, agreed,  by  parol,  that  he  would  go  ami 
attend  a  sale  of  the  plaintiff's  farm  under  a 
decree  of  foreclosure;  that  he  would  bid  off 
the  premises  and  take  a  deed  in  his  own 
name,  but  he  would  give  the  plaintiff  an  op- 
portunity to  repay  him  the  amount  of  his 
bid  and  have  a  re-conveyance  of  the  premises, 
and  that  the  plaintiff  should  have  two  weeks' 
notice  to  pay  the  amount.  The  defendant 
accordingly  bid  off  the  farm  and  took  a  deed 
in  his  own  name,  and  it  was  held  that  the 
agreement  was  void  as  being  within  the  stat- 
ute of  frauds  and  would  not  support  an  ac- 
tion, and  that  there  was  no  trust  which  could 
be  enforced.  That  case  was  decided  by  a 
learned  court  and  contains  a  correct  exposi- 
tion of  the  law.  Although  it  was  decided 
nearly  thirty  years  ago  our  attention  has  not 
been  called  to  any  reported  case  in  this  state 
In  conflict  with  it 

It  is  a  mistake  to  suppose  that  parol  agree- 
ments relating  to  lands  are  any  more  valid 
In  equity  than  at  law.  They  are  always  and 
everywhere  invalid.  But  courts  of  equity 
have  general  jurisdiction  to  relieve  against 
frauds,  and  where  a  parol  agreement  relating 
to  lands  has  been  so  far  partly  performed  that 
it  would  be  a  fraud  upon  the  party  doing  the 


EFFECT  OF   XOX-COMPLIAXCE  WITH  STATUTE. 


211 


acts,  unless  the  agreement  should  be  per- 
formed by  the  other  party,  the  court  will  re- 
lieve against  this  fraud  and  apply  the  remedy 
by  enforcing  the  agreement  It  is  not  the 
parol  agreement  which  lies  at  the  founda- 
tion of  the  jurisdiction  in  such  a  case,  but 
tlie  fraud.  So  in  reference  to  parol  trusts 
in  lands.  They  are  invalid  in  equity  as  well 
as  in  law.  But  in  cases  of  fraud  courts  of 
equity  will  sometimes  imply  a  trust  and  will 
treat  the  pei-petrator  of  the  fraud  as  a  trus- 


tee, ex  maleficio,  for  the  purpose  of  adminis- 
tering a  remedy  against  the  fraud.  For  the 
same  purpose  it  will  take  the  trust  which  the 
parties  liave  attempted  to  create  and  enforce 
it;  and  in  such  a  case  the  fraud,  not  the  parol 
agreement,  gives  the  Jurisdiction. 

It  follows  from  these  views  that  the  order 
must  be  reversed  and  new  trial  granted,  costs 
to  abide  event. 

All  concur. 

Order  reversed  and   ordered  accordingly. 


212 


STATUTE  OF  FRAUDS. 


^ 


.^^ 


NALLY  T.   READING. 
(17  S.  W.  978,  107  Mo.  350.) 


A^ 


Supreme  Court  of  Missouri,   Division  No.  1. 
Dec.  7,  1S91. 

Case  certified   froin   St.   Louis  court   of 

appeals. 

Action  by  Charles  W.  D.  Nally,  as  admin- 
istrator, etc.,  of  James  W.  Johnson,  de- 
ceased, to  recover  on  a  contract  of  assign- 
ment of  an  interest  in  a  lease.  Defendant 
appealed  to  the  8t.  Louis  court  of  appeals 
from  a  judgment  for  plaintiff,  rendered  in 
the  circuit  court  of  Pike  county,  where 
the  judgment  was  reversed,  and  the  cause 
certiHed  to  this  court.     Affirmed. 

Robinson  &  Farrell,  for  appellant. 
Reynolds  &  Lewis,  for  respondent. 

SHT']RWOOD,  J.  This  cause  has  been 
Transferred  to  this  court  from  the  St. 
Louis  court  of  appeals  under  the  consti- 
tutional provision.  The  only  point  pre- 
sented—  the  turning  point  in  the  case — for 
consideration  is  whether  such  a  contract 
as  the  pleadings  and  evidence  present  is 
capable  of  being  sold,  transferred,  or  as- 
signed by  parol;  that  is.  whether  one  of 
five  parties,  lessees  of  a  large  tract  of  land 
for  the  term  of  ten  years,  can  make  a 
valid  verbal  contract  with  an  outsider, 
whereby  the  interest  of  such  party  in  the 
lease  can  be  transferred  to  such  outsider 
for  four  years, — the  residue  of  the  term, 
— tlie  latter  agreeing  to  stand  in  the  stead 
of  tIT5~one  party  to  the  lease,  and  to  pay 
the  same  amount  he  would  have  had  to 
do^^to  Tils  lessor,  to- wit,  $100  per  year. 
Under  such  a  contract,  and  as  contem- 
plated therein,  the  defendant  received  and 
took  possession  from  the  party  from 
whom  he  purchased  of  a  portion  of  the 
land,  pastured  his  cattle  there  for  one 
season,  and  paid  to  the  original  lessor 
the  agreed  sum  for  the  year  of  his  occu- 
pancy;  but.  having  done  so,  abandoned 
that  occupancy,  and  refused  longer  to  oc- 
cupy the  premises,  or  to  pay  the  residue 
of  the  sum  agreed  upon.  On  being  sued 
for  the  residue  of  such  money  by  the 
plaintiff,  who  had  to  pay  such  residue  of 
the  rent  money  himself,  the  defendant,  after 
pleading  several  matters  of  defense,  inter- 
posed as  a  further  defense  that  the  con- 
tract was  not  in  writing,  and  pleaded  the 
provisions  of  chapter  35,  Rev.  St.  187'J,  in 
support  of  this  plea.  Section  2  of  the 
chapter  referred  to — it  being  section  2510, 
Kev.   St.   1879 — provides:    "No   leases,   es- 


tates, interests,  either  of  freehold  or  terra 
of  years,  or  any  uncertain  interest  of,  in, 
to,  or  out  of,  any  messuages,  lands,  tene- 
ments, or  hereditaments,  shall  at  anytime 
hereafter  be  assigned,  granted,  or  sur- 
rendered, unless  it  be  by  deed  or  note,  in 
writing,  signed  by  the  parties  so  assign- 
ing, granting,  or  surrendering  the  same, 
or  their  agents,  lawfully  authorized  by 
writing,  or  by  operation  of  law."  Sec- 
tion 5  of  the  same  chapter — it  being  sec- 
tion 251 B— declares  :  "No  action  shall  be 
brought  *  *  *  to  charge  any  person 
upon  any  contract  for  the  sale  of  any 
lands,  *  *  *  or  any  lease  thereof  for 
any  longer  time  than  one  year,  or  any 
agreement  that  is  not  to  be  performed 
within  one  year  from  the  making  thereof, 
unless  the  agreement  upon  which  the  ac- 
tion is  brought,  or  some  memorandum  or 
note  thereof,  shall  be  in  writing,  and 
signed  by  the  party  to  be  charged  there- 
with, or  some  other  person  by  him  there- 
to lawfullj'  authorized."  It  seems,  at 
first  blush,  that  the  contract  in  suit  plain- 
ly infract!^"|bO_t|lJ^qr_the^'secfions  aJ)av£ 
qu(5Ted,"in  that  it  attempts  bj^"  parol  to 
'assign  a  lease  for  a  term  of  years  under 
srectioa  2510,  and  to  make  a  sale  of  a  lease 
by  parol  under  section  2518.  And  said  con- 
tract also  infracts  the  latter  section,  in- 
asmuch as  the  contract  is  not  to  be  per- 
formed, and  cannot  be  performed,  ac- 
cording toils  terms,  within  one  year  from 
the  time  of  its  making.  These  views  are 
readily  seen  to  be  supported  by  an  exam- 
ination of  the  following  authorities: 
Browne,  St.  Frauds,  §§  230,  231,  272,  281, 
290;  Tavl.  Landi.  &  Ten.  §  427;  Durand  v, 
Curtis,  57  N.  Y.  7;  Pierce  v.  Paine,  28  Vt. 
34.  And  the  fact  that  defendant  took  pos- 
session under  the  verbal  contract,  and 
made  f)ne  payment,  cuts  no  figure  in  this 
case.  Whatever  may  be  the  rule  in  eq- 
uity as  to  the  doctrine  of  part  perform- 
ance, that  rule  has  no  place  in  an  aetion 
at  law,  as  is  the  present  instance.  3 
Pars.  Cont,  (7th  Ed.^  (50;  Sharp  v.  Rhiel, 
.55  Mo.  97.  It  is  unnecessary  to  review  the 
authorities  in  this  state.  That  has  been 
well  done  by  Rombauer,  P.  J.,  in  3(5  Mo. 
App.  306.  If  there  are  any  authorities  in 
conflict  with  the  views  here  announced 
we  overrule  them.  We  hold,  as  did  the 
court  of  appeals,  that  the  demurrer  to  the 
evidence  of  plaintiff  should  have  been 
granted.  We  therefore  affirm  the  judg- 
ment of  the  court  of  appeals,  and  remand 
this  cause  to  that  court  for  further  pro- 
ceedings.    All  concur. 


EFFECT  OF  NON-COMPLIANCE  WITU  STATUTE. 


213 


0{         BEITAIN  V.  ROSSITER.  0/ 

in  V^  (11  Q.  B.  Div.  123.)  I 

^    CJourt  of  Appeal     March  4.  1879. 

Action  for  wrongful  dismissal. 

At  the  trial  it  appeared  tlial  the  plaintiff  en- 
tered into  the  defendant's  service  as  clerk  and 
accountant  for  one  year. 

The  plaintiff  and  the  defendant  had  inter- 
views upon  tlie  17th,  19th,  and  21st  of  April, 
1877.  The  21st  was  a  Saturday,  and  the  plain- 
tiff entered  upon  the  defendant's  service  upon 
Monday,  the  23d.  The  final  arrangement  be- 
tween the  parties  was  arrived  at  upon  the  Sat- 
urday. 

The  plaintiff  remained  some  months  in  the 
defendant's  service  and  was  then  dismissed 
without  a  three  months'  notice.  The  defend- 
ant relied  upon  the  statute  of  frauds  (section 
4).  At  the  trial  before  Hawkins,  J.,  the  ver- 
dict was  entered  for  the  defendant  upon  the 
grounds:  First,  that  the  contract  was  made 
linally  upon  Saturday,  the  21st  of  April,  and 
being  made  upon  that  day  was  within  the 
statute  of  frauds  (section  4);  secondly,  that 
there  was  no  evidence  of  a  new  conti-act  on 
Monday,  April  the  23d,  it  not  being  proved 
that  the  contract  made  on  the  previous  Sat- 
urday was  altered  or  rescinded.  The  excheq- 
uer division  having  refused  a  new  trial  on  the 
ground  of  misdirection: 

1878,  May  29.  Mr.  Firth  moved  in  this 
court,  by  way  of  appeal.  He  contended:  First, 
that  the  rnn|-rnpt  cf  gpryice  for  one  vear  atos 
to  begin  from  Monday,  the  23d  of  ApHl,  and 
therefore  that  it  was  a  contract  to  be  per- 
tormod  within  a  .Yearj  secondly,~~that  the 
plaintiff  could  not  be  dismissed  without  np- 
Hce,    a    vei-bal   contract    being    in    existence ; 


thirdly,  that  the  contract  having  been  liarTTy 
performed,  was  taken  out  of  the  statute  of 
frauds  (section  4).  As  to  the  first  point  he 
cited  Cawthorne  v.  Cordrey,  13  C.  B.  (N. 
S.)  40G,  32  Law  J.  C.  P.  152.' 

BRETT,  L.  J.  It  seems  to  me  that  this  con- 
tract is  within  the  statute  of  frauds  (section 
4).  I  take  the  evidence  to  be  clear  in  this 
case.  The  contract  was  made  on  the  Satur- 
day, and  the  terms  of  the  contract  were  that 
the  plaintiff  was  to  commence  his  sei-vice  on 
the  Monday,  and  to  serve  for  a  year  from  the 
Monday,  and  to  be  paid  for  a  year  from  the 
Monday;  therefore  the  contract  was  not  to 
be  performed  within  a  year,  and  falls  within 
the  statute^  of  frauds  (section  4).  It  was  con- 
tended that  Cawthorne  v.  Cordrey.  13  C.  B. 
(N.  S.)  40(>.  32  Law  .1.  C.  P.  152.  was  contrary 
to  our  decision.  It  seems  to  me  that  that  ca.se 
contains  two  things, — one  a  decision,  and  the 
other  a  dictum.  The  decision  is  not  against 
our  judgment;  for  it  was  that,  although  the 
parties  spoke  to  each  other  on  a  Sunday,  there 
was  evidence  upon  which  the  jury  might  find 
that  the  contract  was  made  on  the  Monday, 
and  that  that  contract  was  for  sei-vice  for  a 
year  from  that  Monday,  and  that  the  service 
was  to  be  performed  within  a  year  from  that 


time.  That  decision  was  in  accorda.^e  with 
all  the  other  cases.  If  the  contract  w«is  made 
on  the  Monday,  and  If  the  service  was  to  com- 
mence on  the  Monday,  it  is  obvious  tnat  the 
sei-vice  was  to  be  performed  within  oae  year 
from  the  making  of  the  contract.  There  was, 
however,  a  dictum  of  Willes,  J.,  which  seems 
to  be  supported  by  the  opinion  of  Byles,  J. 
These  are  great  authorities,  and  that  dictum 
seems  to  have  been  that  if  a  contract  is  made 
on  a  day,  say  Monday,  for  a  .service  for  a  year, 
to  commence  on  the  following  day,  say  a 
Tuesday,  the  service  is  to  be  performed  within 
365  daj-s  from  the  making  of  the  contract, 
but  that  inasmuch  as  the  law  takes  no  notice 
of  part  of  a  day,  and  the  contract  was  made 
in  the  middle  of  the  Monday,  the  service  to 
be  perf(jrmed  within  305  days  after  tliat,  the 
law  did  not  count  that  half  day  of  the  Monday, 
and  therefore  the  contract  was  to  Ix;  perform- 
ed within  3G5  days  after  it  was  made,  and 
that  was  within  a  year.  This  view  was  found- 
ed upon  a  fiction,  namely,  that  the  law  does 
not  take  notice  of  part  of  a  day.  I  am  not 
prepared  to  say  that  under  like  circumstances 
one  might  not  follow  that  dictum  and  carry 
it  to  the  length  of  a  decision.  It  is  not  neces- 
sary to  say  so  here,  becaase  the  case  has  not 
arisen.  This  conti-act  was  made  on  the  Sat- 
urday, and  the  service  was  not  to  begin  until 
the  Mondaj-;  that  is,  not  the  next  day  to  Sat- 
urday, but  the  day  save  one  after.  The  dic- 
tum does  not  apply.  To  say  that  the  Simday 
is  not  to  be  counted  in  the  year's  sei'vice  would 
not  do,  because  if  one  Sunday  is  not  to  be 
counted,  no  Sunday  is  to  be  coimted.  As  to 
Cawthorne  v.  Cordrey,  13  C.  B.  (N.  S.)  403.  32 
Law  J.  C.  P.  152,  the  decision  is  not  differ- 
ent from  other  cases.  As  to  the  dictum,  we 
can  say  nothing  about  it  in  this  case,  because 
the  point  does  not  arise.  Therefore  we  have 
not  to  overrule  Cawtliorne  v.  Cordrey,  13  C. 
B.  (N.  S.)  406,  32  Law  J.  C.  P.  152.  either  aa 
to  its  decision  or  its  dictum.  I  think  that  the 
contract  falls  clearly  within  the  statute  and 
within  the  principle  of  Bracegirdle  v.  Heald,  1 
Barn.  &  Aid.  722.  Therefore  no  rule  will  be 
gitinted  as  to  the  point  whether  the  contract 
is  within  the  statute;  but  the  plaintiff  may 
take  a  rule  upon  the  questions  whether  the 
operation  of  the  statute  of  frauds  (section  4) 
may  be  defeated  by  part  performance.  ;iud 
also  whether  the  plaintiff  was  entitled  to  any 
notice  of  dismissal,  a  verbal  contract  being  in 
existence. 

COTTON  and  THESIGER,  L.  JJ.,  concur- 
red. 

1879,  March  4.  J.  C.  Lawrence,  Q.  C.  and 
P.  B.  Hutcliins,  shewed  cause.  The  plaintiff 
cannot  recover  in  this  action.  Snelling  v.  Lord 
Huntingfield,  1  Cromp.,  M.  &  R.  20,  shews 
that  the  express  verbal  contract  of  Satur- 
day, the  21st  of  April,  was  still  in  existence, 
and  that  no  fresh  contract  can  be  implied 
from  acts  done  in  pursuance  of  it  That  con- 
tract was  for  a  year's  service  to  commence  at 
a  future  day,  and  was  therefore  a  contract  not 
to  be  performed  within   a  year.    Bracegirdle 


214 


STATUTE  OF  FRAUDS. 


V.  Heald,  1  Bam.  &  Aid.  722;  Banks  v.  Cross- 
land.  L.  R.  10  Q.  B.  97.  Nevertheless,  whilst 
it  remained  uurescinded  no  other  contract  be- 
tween the  pai'ties  can  be  implied.  The  words 
of  the  statute  of  frauds  (section  4)  are  ex- 
press, and  no  action  can  be  brought  upon  a 
contract  falling  within  its  prohibition.  Lerous 
V.  Brown,  12  C.  B.  SOI.  The  fact  that  the  con- 
tract has  been  partly  performed,  does  not  af- 
fect the  position  of  the  parties.  Giraud  v. 
Richmond,  2  C.  B.  835.  The  equitable  doc- 
■  tiine  of  part  performance,  whereby  the  opera- 
tion of  the  statute  of  frauds  has  been  defeat- 
f>d,  han  always  been^onfined  to  contracts  for 
the  sale  and  purchase  of  lands,  and  has  not 
been  extended  to  contracts  of  other  kinds. 

Mr.  Firth,  in  support  of  the  rule.  A  con- 
tract falling  within  the  prohibition  of  the  stat- 
ute of  frauds  (section  4)  is  void  to  all  intents 
and  purposes.  Carrington  v.  Roots,  2  Mees. 
&  W,  248;  Reade  v.  Lamb,  6  Exch.  130;  In- 
man  v.  Stamp,  1  Starkie,  12.  A  contract  that 
is  void  in  part  is  void  altogether.  Thomas  v. 
Williams,  10  Barn.  &  C.  6G4.  Therefore  the 
conti-act  of  Saturday,  the  21st  of  April,  may 
be  treated  as  no  contract,  and  a  fresh  contract 
of  service  may  be  implied  from  the  acts  of  the 
parties. 

As  to  the  doctrine  of  part  performance  it  is 
true  that  the  court  of  chancery  formerly  applied 
it  only  to  contracts  for  the  sale  of  land,  and  there 
may  have  been  a  difficulty  in  decreeing  specific 
performance  of  a  contract  for  personal  serv- 
ices. Pickering  v.  Bishop  of  Ely,  2  Younge 
&  C.  249;  Johnson  v.  Railway  Co.,  3  De  Gex, 
M.  &  G.  914.  But  the  court  of  chancery 
would  not  allow  the  provisions  of  a  statute 
to  defeat  a  claim  which  good  conscience  re- 
quired to  be  carried  out.  Bond  v,  Hopkins, 
1  Schoales  &  L.  413;  Morphett  v.  Jones,  1 
Swanst.  172.  The  defence  set  up  by  the  de- 
fendant is  wholly  against  good  conscience. 
Ajid  now  by  Judicature  Act  1873  (36  &  37 
Vict.  c.  6G)  §  2.5,  subsec.  7,  the  doctrines  of 
equity  may  be  applied  to  cases  decided  in  the 
f'ommon  law  divisions. 

BRETT,  L.  J.  Upon  the  best  considera- 
tion which  I  can  give  to  this  case,  it  seems 
to  me  that  this  rule  should  be  discharged. 
I  think  that  Hawkins,  J.,  was  right,  and  that 
the  exchequer  division  was  also  right.  It 
was  clearly  established  that  on  Saturday, 
the  21st  of  April,  a  contract  of  service  was 
in  express  terms  entered  into  between  the 
plaintiff  and  the  defendant  that  the  plaintiff 
should  serve  the  defendant  for  one  year,  the 
contract  to  commence  the  Monday  following. 
It  cannot  be  disputed  that  a  contract  of  that 
kind  is  within  the  4th  section  of  the  statute 
of  frauds, — that  is  to  say,  it  is  a  promise 
founded  upon  a  sufficient  consideration,— but, 
it  being  only  verbal,  neither  party  can  bring 
an  action  upon  it  so  as  to  charge  the  other. 
It  is,  however,  contended  that  as  the  plaintiff 
did  on  Monday,  the  23d  of  April,  enter  into 
the  defendant's  service  and  continue  in  it  for 
some  months,  another  contract  to  serve  for  a 


year  ought  to  be  Implied,  attended  with  the 
same  consequences  as  the  original  contract, 
but  outside  the  statute  of  frauds.  It  is  al- 
leged that  this  contract  can  be  implied,  be- 
cause the  conti"act  originally  entered  into  is 
voia.  But,  according  to  the  true  construction 
of  the  statute,  it  is  not  correct  to  say  that  the 
contract  is  void;  and,  in  my  opinion,  no  dis- 
tinction exists  between  the  4th  and  the  17th 
sections  of  the  statute.  At  all  events,  the 
contract  is  not  void  under  the  4th  section. 
The  contract  exists,  but  no  one  is  liable  upon 
it.  It  seems  to  me  impossible  that  a  new 
contract  can  be  implied  from  the  doing  of 
acts  which  were  clearly  done  in  performance 
of  the  first  contract  only,  and  to  infer  from 
them  a  fresh  contract  would  be  to  draw  an 
inference  contrary  to  the  fact.  It  is  a  prop- 
osition which  cannot  be  disputed  that  no  new 
conti"act  can  be  implied  from  acts  done  un- 
der an  express  contract,  which  is  still  sub- 
sisting. All  that  can  be  said  is  that  no  one 
can  be  charged  upon  the  original  contract  be- 
cause it  is  not  in  writing.  At  the  bar  re- 
liance was  placed  upon  Carrington  v.  Roots, 
2  Mees.  &  W.  248,  and  Reade  v.  Lamb,  6 
Exch.  130.  In  the  former  case  Parke,  B.,  said: 
"I  think  the  right  interpretation  of"  the  4th 
section  of  the  statute  of  frauds  "is  this:  that 
an  agreement  which  cannot  be  enforced  on 
either  side  is  as  a  contract  void  altogether." 
In  the  latter,  Pollock,  C.  B.,  said:  "Carring- 
ton v.  Roots,  2  Mees.  &  W.  248,  is  in  effect  a 
decision  that,  for  the  pui-poses  of  the  present 
question,  there  is  no  distinction  between  the 
4th  and  17th  sections  of  the  statute  of  frauds, 
and  that  not  only  no  action  can  be  brought 
upon  an  agreement  within  the  4th  section  of 
that  statute  if  it  be  not  reduced  into  writ- 
ing, but  that  the  contract  is  also  void."  With 
regard  to  these  dicta  it  is  enough  to  say  that 
the  doctrine  thereby  laid  down  was  unnec- 
essary for  the  decisions  in  those  cases;  for  it 
being  clear  that  no  action  can  be  brought  on 
the  verbal  contract  itself,  it  is  also  clear  that 
neither  party  can  be  held  liable  upon  it  in- 
directly in  any  action  which  necessitates  the 
admission  of  the  existence  of  the  contract. 
The  two  cases  which  I  have  mentioned  were 
considered  in  Leroux  v.  Brown,  12  C.  B.  801; 
and  Jervis,  C.  J.,  undoubtedly  took  the  same 
view  of  them  as  I  do,  and  gave  the  inteii:)re- 
tation  necessary  for  that  case,  namely,  that 
the  contract  is  not  void,  but  only  incapable 
of  being  enforced,  and  that  any  claim  which 
depends  upon  the  contract  as  such  cannot  be 
maintained.  If  the  contrai-y  view  had  pre- 
vailed, it  would  have  been  decided  in  that 
case  that  the  statute  of  frauds  (section  4), 
had  a  territorial  operation;  whereas  if  it  ap- 
plies merely  to  the  enforcement  of  the  con- 
tract, then  it  is  a  statute  with  respect  to  the 
procedure  of  the  English  courts,  and  it  is  ap- 
plicable to  contracts  made  abroad  as  well  as 
in  England.  Moreover,  the  case  of  SnoUing 
V.  Lord  Huntingfiold,  1  Cromp.,  M.  &  R.  20, 
has  not  been  overiniled  by  subsequent  cases, 
but  the  doctrine  there  laid  down  has  been 


EFFECT  OF  NON-COMPLIANCE   WITH  STATUTE. 


215 


fftrongly  supported  by  subsuqueut  cases,  and 
in  my  opiuion  it  certainly  ought  uot  to  be 
overruled  now.  In  my  view  the  contract 
entered  into  on  the  21.st  of  April  Nvas  not 
void,  but  existing,  and  from  a  part  perform- 
ance of  it  a  fresh  contract  ought  uot  to  bo 
implied.  The  plaintiff,  therefore,  is  driven 
to  rely  upon  the  ori;;inal  contract,  but  he  can- 
not maintain  an  action  upon  that,  inasmuch 
as  it  is  not  in  wi'itiug. 

It  has  been  further  contended  that,  as  the 
contract  of  the  21st  of  April  has  been  partly 
performed,  it  may  be  enforced,  notwithstand- 
ing the  statute  of  frauds,  and  that  the  equi- 
table doctrine  as  to  part  performance  may 
be  applied  to  it.  It  is  well  laiown  that  where 
a  contract  for  the  sale  of  laud  had  been  part- 
ly performed,  courts  of  equity  did  in  certain 
cases  recognize  and  enforce  it;  but  this  doc- 
t rine  was  exercised  only  as  to  cases  concern- 
in^^lnnd,  nnrl  Tjyas  ^iever_PYtpnded  to  c.nn- 
tra cts  like  that  before  us.  because  they  coidd 
not  be  brought  \vithin__jyic_JiiiiadicUon_-«f 
cCTTrts  of  equity. .    Those  courts  could  not  en- 


tertam  siITTS^ibr  specific  performance  of  con- 
tracts of  service,  and  therefore  a  case  iike 
the  present  could  not  come  before  them.  As 
to  the  application  of  the  doctrine  of  part  per- 
formance to  suits  concerning  land,  I  will 
merely  say  that  the  cases  in  the  com-t  of 
chanceiy  were  bold  decisions  on  the  words 
of  the  statute.  The  doctrine  was  not  ex- 
tended to  any  other  kind  of  contract  before 
the  judicature  acts.  Can  we  so  extend  it 
now?  I  think  ttiat  the  true  construction  of 
the  judicature  acts  is  that  they  confer  no 
new  rights;  they  only  confirm  the  rights 
which  previously  were  to  be  found  existing 
in  the  courts  either  of  law  or  of  equity.  If 
they  did  more,  they  would  alter  the  rights  of 
parties,  whereas  in  tinith  they  only  change 
the  procedure.  Before  the  passing  of  the 
judicature  acts  no  one  could  be  charged  on 
this  contract  either  at  law  or  in  equity;  and 
if  the  plaintiff  could  now  enforce  this  con- 
tract, it  would  be  an  alteration  of  the  law. 
I  am  of  opinion  that  the  law  remains  as  it 
was,  and  that  the  plaintiff  cannot  maintiiin 
this  action  for  breach  of  contract 

COTTON,  L.  J.  We  refused  to  grant  a 
nile  on  the  ground  that  the  contract  entered 
into  on  Saturday,  the  21st  of  April,  was  to 
be  performed  within  a  year,  and  therefore 
not  within  the  operation  of  the  4th  section  of 
the  statute  of  frauds.  The  contract  clearly 
was  within  that  enactment.  On  the  otlier 
points  we  granted  a  rule,  but  after  having 
heard  the  arguments  on  behalf  of  the  plain- 
tiff, I  tliink  that  the  rule  for  a  new  trial  must 
be  discharged.  It  has  been  contended  that 
although  the  express  contract  cannot  be  en- 
forced, nevertheless  a  contract  which  can  l>e 
enforced  may  be  implied  from  conduct  of  the 
parties,  and  it  has  been  argiied  that  tlie 
rule  does  not  apply  which  forbids  a  contract 
to  be  implied  where  an  express  contract  has 
been   concluded,    because   the   contract    was 


void  under  the  provisions  of  the  statute  of 
frauds  (.section  4);  but  in  my  opinion  that 
is  not  the  true  construction  of  the  enact- 
ment, which  provides  that  no  action  shall  be 
brought  to  charge  any  person  upon  the  ver- 
bal contract. 

In  the  lirst  place,  I  may  observe  that  to 
hold  that  this  enactment  makes  void  verbal 
contracts  falling  within  its  provisions,  would 
be  inconsistent  with  the  doctrine  of  the 
courts  of  equity  with  regard  to  part  per- 
formance in  suits  concerning  land.  If  such 
contracts  had  been  rendered  void  by  the  leg- 
islature, courts  of  equity  would  not  have 
enforced  them,  but  their  doctrine  was  that 
the  statute  did  not  render  the  contracts  void, 
but  required  written  evidence  to  be  given  of 
them;  and  courts  of  equity  were  accustomed 
to  dispense  with  that  evidence  in  certain  in- 
stances. During  the  argument  some  deci- 
sions were  relied  upon  as  shewing  that  the 
contract  in  the  present  case  was  void.  In 
Carrington  v.  Roots,  2  Mees.  &  W.  248,  cer- 
tain expressions  were  used  by  the  judges 
which  indicated  that  in  their  opinion  a  ver- 
bal contract  falling  within  section  4  was  void; 
but  I  think  that  their  language,  when  care- 
fully analyzed,  merely  means  that  the  con- 
tract was  uot  enforceable,  either  directly  or 
indirectly  by  action  at  law.  I  think  it  un- 
necessary to  go  into  the  case  of  Reade  v. 
Lamb,  6  Exch.  130.  It  was  a  case  decided 
upon  special  demurrer,  and  the  question  to 
which  the  attention  of  the  judges  was  direct- 
ed, was  whether  the  pleadings  were  correct 
in  point  of  form. 

It  has  been  further  argued  that  the  con- 
tract may  be  enforced,  because  it  has  been 
in  part  performed.  Let  me  consider  what 
is  the  nature  of  the  doctrine  as  to  part  per- 
formance. Tt  has  been  said  that  the  prin- 
ciple of  that  doctrine  is  that  the  court  will 
not  allow  one  party  to  a  contract  to  take  ad- 
vantage of  part  performance  of  the  contract, 
and  to  permit  the  other  party  to  change  his 
position  or  incur  expense  or  risk  under  the 
contract,  and  then  to  allege  that  the  con- 
tract does  not  exist;  for  this  would  be  con- 
trary to  conscience.  It  is  true  that  some 
dicta  of  judges  may  be  found  to  support  this 
view,  but  it  is  not  the  real  explanation  of 
the  doctrine,  for  if  it  were,  part  payment  of 
the  purchase  money  would  defeat  the  opera- 
tion of  the  statute.  But  it  is  well  estab- 
lished and  cannot  be  denied  that  the  receipt 
of  any  sum,  however  large,  by  one  party  un- 
der the  contract,  will  not  entitle  the  other 
to  enforce  a  contract  which  comes  within  the 
4th  section.  What  can  be  more  contrary 
to  conscience  than  that  after  a  man  has  re- 
ceived a  large  sum  of  money  in  pursuance  of 
a  contract,  he  should  allege  that  it  was  nev- 
er entered  into?  The  true  ground  of  the  doc- 
trine in  equity  is  that  if  the  court  foimd  a 
man  in  occupation  of  land,  or  doing  such  acts 
with  regard  to  it  as  would,  prima  facie,  make 
him  liable  at  law  to  an  action  of  trespass, 
the  court  would  hold  that  there  was  strong 


216 


STATUTE  or  FRAUDS. 


evidence  from  the  nature  of  the  user  of  the 
land  that  a  contract  existed,  and  would  there- 
fore allow  verbal  evidence  to  be  given  to 
show  the  real  circumstances  under  which 
possession  was  taken.  Does  this  doctrine, 
when  so  explained,  apply  to  the  present  case? 
I  will  first  mention  the  provisions  of  Judica- 
ture Act  1S73,  §  24,  subsecs.  4,  7.  These 
provisions  enable  the  courts  of  common  law 
to  deal  with  equitable  rights  and  to  give 
relief  upon  equitable  grounds;  but  they  do 
not  confer  new  rights.  The  different  divi- 
sions of  the  high  com!  may  dispose  of  mat- 
ters within  tlie  jurisdiction  of  the  chancery 
and  the  common  law  courts;  but  they  can- 
not proceed  upon  novel  principles.  Coiild  the 
present  plaintiff  have  obtained  any  relief  in 
equity  before  the  passing  of  the  judicature 
acts?  I  think  that  he  could  not.  The  doc- 
ti-ine  as  to  part  performance  has  always  been 
confined  to  questions  relating  to  land;  it  has 
never  been  applied  to  contracts  of  service, 
and  it  ought  not  now  to  be  extended  to  eases 
in  which  the  court  of  chancery  never  inter- 
fered. 

THESIGER,  L.  J.  Two  questions  must  be 
considered  in  this  case:  First,  whether  the 
plaintiff  could  maintain  an  action  at  law; 
secondly,  whether,  if  he  could  not  maintain 
an  action  at  law,  he  could  maintain  a  suit 
in  equity.  I  am  compelled  to  subscribe  to 
the  opinion  that  the  plaintiff  had  no  remedy 
either  at  law  or  in  equity.  I  have  been  un- 
willing to  come  to  this  conclusion,  because  it 
is  manifestly  unjust  that  where  a  contract 
of  hiring  has  been  acted  on  for  a  certain 
time,  one  party  who  has  had  the  advantage 
of  it  should  be  able  to  put  an  end  to  it;  and 
I  should  have  been  glad  to  decide  that  the 
plaintiff  was  entitled  to  a  reasonable  notice 
of  dismissal.  First,  has  the  plaintiff  a  right 
of  action  at  law?  It  is  clear  that  a  con- 
tract was  made  on  Saturday,  the  21st  of 
April,  and  it  cannot  be  contended  that  a  con- 
tract made  at  that  date  to  commence  from 
the  2.3d  of  April  is  not  within  the  4th  sec- 
tion of  the  statute  of  frauds.  It  is  neces- 
sary to  consider  what  is  the  effect  of  the 
statute  upon  such  a  contract.  Is  it  that  the 
contract  is  wholly  null  so  that  it  does  not 
prevent  the  proof  of  any  other  contract,  or  is 
it  that  the  contract  exists  but  cannot  be  en- 
forced? Certain  dicta  are  to  be  found  in  the 
books  from  which  it  might  appear  that  some 
of  the  judges  have  considered  the  verbal  con- 
tract as  absolutely  void.  But  if  those  dicta 
are  carefully  examined,  it  will  be  found  that 
they  are  not  necessary  for  the  decision  of 
the  cases  in  which  they  appear,  and  upon  re- 
ferring to  subsequent  cases  it  will  be  found 
that  it  has  been  decided  in  clear  terms  that 
the  verbal  contract  is  not  actually  void.  It 
is  im.possible  to  say  that  the  words  of  the 
statute  make  the  verbal  contract  void.  That 
a  verbal  contract  is  not  void,  is  proved  by 
the  circumstance  that  where  one  party  has 
signed  the  contract  and  the  other  has  not. 


the  party  who  has  signed  may  be  charged 
upon  it,  but  that  the  party  who  has  not  sign- 
ed cannot  be  charged.  It  may  also  be  urged 
with  some  show  of  reason  that  though  there 
is  a  difference  in  language  between  the  4th 
and  17th  sections  of  the  statute  of  frauds, 
they  are  substantially  identical  in  construc- 
tion, and  Carrington  v.  Roots,  2  Mees.  &  W. 
248,  and  Reade  v.  Lamb,  6  Exch.  130,  may 
perhaps  be  cited  in  support  of  that  argument. 
And  it  is  plain  that  verbal  contracts  under 
the  17th  section  are  not  absolutely  void  for 
all  pui-poses,  for  the  section  provides  that  part 
performance  by  payment  or  acceptance  and 
receipt  of  goods  stiall  authorize  the  court  to 
look  at  the  terms  of  the  contract,  although 
it  is  not  in  writing.  But  I  need  not  discuss 
this  question  further,  for  in  Snelling  v.  Hunt- 
Ingfield,  1  Cromp.,  M.  &  R.  20,  which  has 
never  been  overruled,  but,  on  the  contrary, 
has  been  often  followed,  it  was  held  that  a 
contract  not  enforceable  by  reason  of  the 
statute  of  frauds  (section  4)  nevertheless  ex- 
isted, and  no  contract  can  be  implied  where 
an  express  contract  exists.  I  thinlc  that  we 
are  bound  by  the  authori-ty  of  that  case. 
There  was,  therefore,  in  existence  a  contract 
made  in  express  terms  on  Saturday,  the  21st 
of  April,  and  the  plaintiff  cannot  sue  upon  it, 
as  it  is  not  in  writing.  It  appears  to  have 
been  held  that,  though  there  may  be  no  right 
to  recover  on  an  executory  contract,  never- 
theless, if  it  has  been  executed  to  the  extent 
of  the  oontractee  entering  upon  the  service, 
that  is  euougb  to  entitle  him  to  be  paid^r 
his  servicers,  and  if  we  were  not  bound  by 
authority  it  would  be  difficult  to  understand 
why,  if  the  plaintiff  can  sue  for  services  ren- 
dered, he  should  not  equally  be  entitled  to 
allege  tliat  he  shall  not  be^dismissed  with- 
out notice  or  without  such  notice  as  was 
stipulated  for  in  the  contract  But  in  Snell- 
ing V.  Huntingfield,  1  Cromp.,  M.  &  R.  20, 
the  court  of  exchequer  appears  to  have 
thought  that  the  contractoe  can  recover  for 
services  rendered  but  not  for  dismissal  with- 
out notice.  This  seems  to  have  been  the  con- 
struction at  common  law.  If  we  turn  to 
equity,  we  find  that  it  has  been  held,  as  re- 
gards a  sale  of  land,  that  when  there  has 
been  an  entry  by  one  party  to  the  contract, 
that  is  an  overt  act  apparently  done  under 
a  contract  which  entitles  the  court  to  look 
at  the  contract  to  see  to  what  contract  the 
overt  act  is  really  referable.  I  confess  that 
on  principle  I  do  not  see  why  a  similar  doc- 
trine should  not  be  applied  to  the  case  of  a 
contract  of  service,  and  as  the  doctrine  of 
equity  is  based  upon  the  theory  that  the 
court  will  not  allow  a  fraud  on  the  part  of 
one  party  to  a  contract  on  faith  of  which  the 
other  party  has  altered  his  position,  I  do  not 
see  why  a  similar  doctrine  should  not  com- 
prehend a  contract  of  service.  At  the  same 
time  I  feel  that  doctrines  of  this  nature  are 
not  to  be  unwarrantably  extended,  and  that 
we  ought  not  to  go  further  than  the  decisions 
of  courts  of  equity  as  to  the  principles  of  re- 


EFFECT  OF  NON-COMPLIANCE  WITH  STATUTE. 


217 


lief,  and  as  to  the  Instances  to  which  the 
doctrine  of  part  porformance  is  to  be  ap- 
plied. Therefore,  as  we  cannot  clearly  see 
that  the  equitable  doctrine  of  part  perform- 
ance ought  to   be   extonded  to  contracts  of 


service,  I  think  that  we  ought  to  keep  with- 
in the  limits  observed  by  the  court  of  chan- 
cery before  the  passing  of  the  judicature  acts 
of  1873  and  1875. 
Rule  discharged. 


218 


STATUTE  OF  FRAUDS. 


.'^ 


V  J}       BAKER  et  aL  v.  LAUTERBAC 
\0  (11  Atl.  703.  68  Md.  64.) 

Coart  of  Appeals  of  Maryland.    Dec.  13,^8S7. 

Appeal  from  circuit  court,  Howard  coun- 
ty. 

Catherine  Lauterback,  administratrix  of 
John  Lauterback,  plaintiff,  sued  Baker  Bros. 
&  Co.,  defendants,  to  recover  balance  due 
for  services  of  deceased.  Judgment  was 
rendered  for  plaintiff  for  $160,  and  defend- 
ants appealed. 

John  T.  Mason,  W.  A  Hammond,  and  E. 
C.  Williams,  for  appellants.  T.  C.  Weeks, 
R.  D.  Johnson,  and  W.  Reynolds,  for  ap- 
pellee, 

BRYAN,  J.  John  Lauterback  entered  the 
service  of  Baker  Bros.  &  Co.  on  the  first 
day  of  March,  ISSO,  and  remained  in  their  em- 
ployment until  August,  1S83,  when  he  was 
killed  by  an  accident.  He  was  20  years  of 
age  on  the  twenty-ninth  of  March,  ISSO. 
His  father  died  some  years  previously  to 
his  entering  this  service.  But  it_  appears 
that  his  mother  signed  a  written  contract 
with  Baker  Bros.  &  Co.,  by  which  she  un- 
dertook to  bind  him  to  them  as  an  appren- 
tice for  five  years  to  learn  the  art  and  trade 
of  glass-blowing.  The  contract  stipulated 
t^aTT^if  the  Hboy  was  considered  competent 
to  learn  and  be  instructed,  he  was  to  re- 
ceive for  his  services  one-half  of  the  rate 
of  wages  paid  journeymen  for  similar  work 
for  the  first  four  ye^rs,  and  two-thirds  of 
such  wages  for  the  fifth  year;  and  it  was 
further  stipulated  that  $200  should  be  held 
by  the  employers  out  of  his  wages  as  se- 
curity, to  be  paid  at  the  expiration  of  the  term 
of  the  apprenticeship,  or  forfeited  if  he  should 
leave  their  employment  for  any  cause  whatev- 
er before  the  expiration  of  the  term  of  Sv,e 
^ears._  All  the  wages  were  paid  with  the 
exception  of  $200,  and  the  present  suit  was 
brought  by  the  administratrix  of  the  deceased 
apprentice  against  Baker  Bros.  &  Co.  to  re- 
cover this  amoimt.    The  verdict  was  for  $1G0. 

The  contract  was  not  signed  by  the  employ- 
ers, but  only  by  the  mother  of  the  boy.  In 
the  view  which  we  have  taken  of  the  case, 
this  circumstance  is  immaterial.  A  father 
may  bind  out  his  son  as  an  apprentice  until 
he  reaches  the  age  of  21  years,  provided  he 
pursues  the  mode  authorized  by  the  twentietli 
section  of  article  6  of  the  Code;  Ijut  a-  con- 
tract of  apprenticeship  executed  by  the  moth- 
er Ls  simply  void.  The  boy  would  not  be 
obhged  to  serve  according  to  the  terms  of  such 
an  instrument;  nor  would  the  employer,  by 
force  of  it,  acquire  any  control  over  him.  He 
did,  however,  serve  for  three  years  and  five 
months,  with  a  full  knowledge  of  the  terms 
of  this  contract  He  knew,  therefore,  the  rate 
of  compensation  which  his  employers  expected 
to  pay  for  his  work;  it  would  not  then  be  just 
that  he  should  receive  more.  The  law  would 
Imply  a  contract  on  the  part  of  his  employ- 
ers to  pay  him  what  his  services  were  rea- 


sonably worth.  It  would  not,  however,  imply 
a  contract  on  the  part  of  the  boy  to  serve  for 
five  years,  nor  to  pay  a  forfeiture  in  case  he 
should  leave  the  service  before  the  expiration 
of  that  time.  A  contract  of  this  kind  is  re- 
quired, by  the  fourth  section  of  the  statute 
of  frauds,  to  be  in  writing.  The  terms  of  the 
statute  are  that  no  action  shall  be  brought 
"upon  any  agreement  that  is  not  to  be  per- 
formed within  the  space  of  one  year  from  the 
making  thereof,  unless  the  agreement  upon 
which  such  action  shall  be  brought,  or  some 
memorandum  or  note  thereof,  shall  be  in  writ- 
ing, and  signed  by  the  party  to  be  charged 
therewith,  or  by  sonTe  person  tlu'idunEo  bv  him 
lawfully  authorized."  If,  therefore,  the  boy 
"had  in  express  terms  made  a  verbal  contract 
to  serve  for  five  years,  it  could  not  have  been 
enforced  against  him  by  the  other  party.  And 
if,  after  serving  a  portion  of  the  time,  he 
should  refuse  to  caiTy  out  his  contract,  and 
bring  suit  to  recover  the  value  of  the  serv- 
ices rendered,  the  verbal  contract  would  not 
avail  the  employer  as  a  defense.  It  could 
not  be  set  up  as  a  contract  at  all;  the  breadi 
of  it  would  impose  no  liability  which  the  law 
could  enforce;  the  obligation  to  perform  it 
could  not  be  maintained  in  an  action  at  law. 
In  Browne  on  the  Statute  of  Frauds  the  law 
is  thus  stated:  "As  a  general  proposition,  how- 
ever, we  shall  hereafter  see  that  a  verbal  con- 
tract within  the  statute  cannot  be  enforced  in 
any  way,  directly  or  indirectly,  whether  by 
action  or  in  defense."  Section  122.  "The  su- 
preme court  of  Connecticut,  in  a  case  where 
the  plaintiff,  by  oral  agreement,  bound  him- 
self to  serve  the  defendant  for  a  term  longer 
than  one  year,  for  a  consideration  to  be  paid 
at  the  end  of  that  time,  and  having  repudiated' 
the  contract,  and  quitted  his  employer  at  the 
end  of  six  months,  brought  his  action  to  re- 
cover the  value  of  the  services  so  rendered, 
held  that  he  could  recover,  and  that  the  de- 
fendant could  not  set  up  the  existing  ver- 
bal agreement  to  defeat  his  claim."  Section 
122a.  "The  clear  rule  of  law  is  that  such 
a  contract  cannot  be  made  the  ground  of  de- 
fense any  more  than  of  a  demand.  The  obli- 
gation of  the  plaintiff  to  perform  it  is  no  more 
available  to  the  defendant  in  the  former  case 
than  the  obligation  of  the  defendant  to  per- 
form it  would  be  to  the  plaintiff  in  the  latter 
case."  Section  131.  It  appears  to  us,  there- 
fore, upon  the  uncontested  facts  in  the  case, 
that  the  plaintiff  is  entitled  to  recover  the  full 
value  of  the  boy's  services,  less  such  sums 
as  have  been  paid.  It  seems  to  be  unneces- 
sary to  notice  in  detail  the  rulings  of  the  court 
below.  It  is  suflicient  to  say  that  they  accord 
with  the  views  which  we  have  expressed. 

It  must  be  observed  that,  although  contracts 
within  the  statute  of  frauds  are  void  unless 
they  are  in  writing,  yet  the  voluntary  per- 
formance of  them  is  in  no  respect  unlawful. 
If  services  be  rendered  in  pursuance  -of  a, 
contract  of  this  kind  by  one  party,  and  be.  ac- 
cepted by  the  other,  they  must  be  compen- 
sated.   EUicott  v.  Peterson's  Ex'rs,  4  Md.  491. 


EFFECT  OF  NON-COMPLIANCE  WITU  STATUTE. 


219 


And  if  an  action  be  brought  against  a  defend- 
ant for  acts  done,  which  were  in  performance 
of  such  a  contract,  or  authorized  by  its  terms, 
no  recovery  can  be  had  against  him.  Cane  v. 
Gough,  4  Md.  333;  Browne,  St.  Frauds,  §  133. 
It  is  said  that  the  contract  operates  as  a  li- 
cense to  do  these  acts,  although  it  cannot  be 
set  up  as  conferring  any  right  of  action.  As 
said  by  Lord  Ablnger  in  Carrington  v.  Roots, 
2  Mees.  &  W.  248,  in  speaiving  of  a  case  with- 
in the  statute:  "I  tliink  the  contract  cannot 
be  available  as  a  contract  at  all,  unless  an  ac- 


tion can  be  brought  upon  it.  What  is  done 
undgr  the  contract  may  admit  of  apologj'  or  ex- 
cuse, diver.so  intuitu,  if  I  may  so  speak;  as 
where,  under  a  contract  by  parol,  the  party  is 
put  in  possession,  that  possession  may  be  set 
up  as  an  excuse  for  a  trespass  alleged  to  have 
been  committed  by  him.  *  •  •"  The  agree- 
ment might  have  been  available  in  answer  to 
a  trespass  by  setting  up  a  license;  not  setting 
up  the  contract  itself  as  a  contract,  but  only 
showing  matter  of  excuse  for  the  trespass. 
Judgment  affirmed. 


220 


CONSIDERATION. 


*\ 


HAMER  V.  SIDWAY. 
(27  N.  E.  256,  124  N.  Y.  538.) 


Court  of  Appeals  of  New  York,  Second  Divi- 
sion.   April  14,  1891. 

Appeal   from    an   order    of    the  greneral 
term  of  the  supreme  court  in    the  fourth 
judicial  department,  reversing  a  judgment 
entered  on  the  decision  of  the  court  at  spe- 
cial term   in   the  county   clerk's   office   of 
Chemuns  county  on  the  1st   day  of  Octo- 
ber, 18S9.     The  plaintiff  presented   a  claim 
to  the  executor   of    William    E.  Story,  8r., 
for  |.5,000  and  interest  from  the  6th  day  of 
February,  1S75.     She   acquired   it  through 
several  mesne  assignments  from  \A'illiam 
E.  Story,  2d.     The  claim  being  rejected  by 
the  executor,  this  action  v^-as  brought.     It 
appears   that   William    E.  Story,  Sr.,  was 
the  uncle  of  William  E.  Story,  2d;  that  at 
the  celebration   of  the  golden    wedding   of 
Samuel  Storv  and  wnfe,  fatherand  mother 
of  William  E.  Story,  Sr.,  on  the  20th   day 
of  March,  1869.  in  the  presence  of  the  fami- 
ly  and    invited   guests,   he  promised     his 
nephew   that  if    he   would    refrain    from 
drinking,   using    tobacco,   swearing,   and 
plaving  cards  or  billiards  for   money  until 
he  became  21   years   of  age,  he  would  pay 
him  the  sum  of  §5,000.     The  nephew  assent- 
ed thereto,  and  fully  performed  the  condi- 
tions  inducing   the  promise.      When    the 
nephew  arrived  at  the  age  of  21  years,  and 
on  the  :51st  day  of  January,  1875,  he  wrote 
to  his  uncle,  informing   him    that   he   had 
performed  his  part  of  the   agreement,  and 
had  thereby  become  entitled  to  the  sum  of 
$5,000.     The  uncle  received  the  letter,  and 
a  few  days  later,  and   on   the  6th  day   of 
February,  he    wrote    and   tnailed    to    his 
nephew   the    following   letter:     "Buffalo, 
Feb.    6,    1S75.     W.      E.    Story,     .7r.— Dear 
Nephew:     Your  letter  of  the  ;51st  ult.  came 
to   hand   all    right,  saying  that   you   had 
lived  up  to  theprtmiise  made  to  me  several 
years   ago.     I    have    no    doubt    but  you 
have,  for  which  you  shall  have  five  thou- 
sand   dollars,  as  I    promised   you.     I   had 
the  money  in  the  bank    the   day  you  was 
twenty-one  years   old   that   I    intend   for 
you,  and  you    shall    have  the   money   cer- 
tain.    Now,  Willie,  I  do  not   intend    to  in- 
terfere with  this   money  in  any  way  till   I 
think  you  are  capable  of  taking  care  of  it, 
and  the  sooner  that  time  comes  the  better 
it   will   please  me.      I    would     hate  very 
much  to  have  you   start  out  in  some   ad- 
venture that  you    thought   all    right   and 
lo.se  this  money  in  one  year.     The  first  live 
thousand  dollars  that  I  got  together  cost 
me  a   heap   of    hard    work.     You    would 
hardl3'  believe  me  when  I  tell  you  that  to 
obtain  this  I  shoved  a  jack-plane   many  a 
day,  butchered   three   or  four  years,  then 
came  to  this  city,  and,  after  three  months' 
perseverance,  I  obtained  a  situation   in  a 
grocery  store.     I  opened  this   store  early, 
closed   late,  slept   in    the  fourth   story    of 
the  building  in  a    room    80  by  40  feet,  and 
not  a  human  being  in  the  building  but  my- 
self.    All  this  I  done  to  live  as  cheap   as 
I  could   to  save  something.     I  don't  want 
you  to  take  up  with   this   kind   of  fare.     1 
was  here  in  the  cholera  season   of  '49  and 
'52,   and   the    deaths   averaged  80  to   125 


daily,  and  plenty  of  small-pox.     I  wanted 
to   go  home,  but  Mr.  Fisk,  the  gentleman 
I  was  working  for,  told  me,  if  1   left  them, 
after  it  got  healthy   he  probably  would 
not  want  me.     I  stayed.     All   the  money 
1  have  saved  I   know  just   how  I  got  it. 
It  did  not  come   to  me  in  any  mysterious 
way,  and  the  reason  I  speak  of  this  is  that 
money  got  in  this  way  stops   longer  with 
a  fellow  that  gets  it   with   hard   knocks 
than  it  does  when  he  finds  it.     Willie,  you 
are  twenty-one,   and   you   have   many   a 
thing  to  learn  yet.     This  money  you  have 
earned  much  easier  than  I  did,  besides   ac- 
quiring good  habits  at  the  same  time,  and 
you   are    quite    welcome    to   the  money. 
Hope  you  will  make  good  use  of  it.    1  was 
ten  long  years  getting  this   together  after 
T  was  your  age.     Now,  hoping  thi^  will  be 
satisfactory,    I   stop.      One    thing    more. 
Twenty-one  years   ago   I   bought  you   15 
sheep.     These  sheep  were  put  out  to  double 
every  four  years.      I   kept   track   of   them 
the  first  eight  years.     I   have  not  heard 
much  about  them  since.     Your  father  and 
grandfather  promised  me  that  they  would 
look  after  them  till  you  were  of  age.    Ha  ve 
they  done  so?     I  hope  they  have.     By  this 
time  you  have   between  five  and  six   hun- 
dred sheep,  worth  a  nice  little  income  this 
spring.     Willie,   I   have  said   much   more 
than  I  expected  to.     Hope  you  can   make 
out  what  I   have  written.     To-day  is   the 
seventeenth  day  that  I  have  not  been  out 
of  my  room,  and  have   had  the  doctor  as 
many  days.     Am   a   little   better  to   day. 
Think  I  will  get  out  next  week.     You  need 
not  mention  to  father,  as  he   always  wor- 
ries  about   small   matters.     Truly  yours, 
W'.  E.  Stoky.     p.  S.  You  can  consider  this 
money  oninterest."    The  nephew  received 
the  letter,  and   thereafter  consented   that 
the  money  should  remain  with  his  uncle  in 
accordance  with  the  terms  and  conditions 
of  the  letter.      The  uncle  died  on  the  29th 
day  of  January,  1887,  without  having  paid 
over  to   his  nephew   any   portion   of  the 
said  $5,000  and  interest. 

H.    J.    Swift,    for    appellaut.    Adelbert 
Moot,  for  resi)ondent. 

PARKER,  J.,  (after  stating  the  facts  as 
above.)  The  question  which  provttkfd 
the  most  discui-sion  l»y  counsel  on  this  ap- 
peal, and  which  lies  at  the  foundation  of 
plaintiff's  asserted  right  of  recovery,  is 
whether  bv  virtue  of  a  contract  defend- 
ant's testator,  William  E.  Story,  became 
indebted  to  his  nephew,  William  E.  Story, 
2d,  on  his  twenty-first  birthday  in  the 
sum  of  $5,000.  The  trial  court  found  as  a 
fact  that  "on  the  20th  day  of  March,  1869, 
*  *  *  William  E.  Story  agreed  to  and 
rtMth  William  E.  Story,  2d,  that  if  he 
would  refrain  from  drinking  liquor  using 
tobacco,  swearing,  and  playing  cards  or 
billiards  for  money  until  should  become 
twenty-one  years  of  age,  then  he,  the  said 
William  E.  Story,  would  at  that  time  pay 
him,  the  said  William  E.  Story,  2d,  the 
sum  of  .$5,000  for  such  refraining,  to  which 
the  said  William  E.  Story,  2d,  agreed, 
and  that  he  "  in  all  things  fully  performed 
his  part  of  said  agreement."  The  defend- 
ant contends  that  the  contract  was  with- 
out consideration  to  support  it.  and  there- 
fore invalid.     He  asserts   that  the  prom- 


DEFINED. 


221 


isee,   by  refraining   from    the  use  of  liquor 
find  tohacco,  wuh   not  luirnied,  l)ut    bene- 
fited; that  tiiat  whicli  he  did  was  best  for 
him    to   do,    independently    of   his    uncle's 
promise, — and  insists  that  it  follows  that, 
unless    the   promisor    was    benefited,    the 
contract   was    without  consideration, — a 
contention  whicli,  if    well   founded,  would 
seem    to   leave    open    for  controversy'   in 
many    cases    whether     that     which     the 
I)romisee  did  or  omitted  to  do  was  in  fact 
of  such  benefit  to  him  as    to   leave  no  con- 
sideration to   8uj)port    the  enforcement  of 
the   promisor's    agreement.     Such    a   rule 
could    not   be    tolerated,  and   is    without 
foundation    in    the    law.     The  exchequer 
chamber  in   1S75  defined  "consideration" 
as  follows:   "A  valuable  consideration,  in 
the  sense  of  the  law,  may  consist  either  in 
some   riffht,  interest,  profit,  or  l)cnefit  ac- 
cruin{2:  to  the  one  tnirty,  or  some   forbear- 
ance,   detriment,    loss,    or    responsibility 
given,  Buffered,  or  undertaken    l)y  the  oth- 
er. "    Courts   "will   not   asic    whether  the 
thing  which  form.s  the  consideration   does 
in  fact  benefit  the  promisee  or  a  third  par- 
tj',  or  is  of  any  substantial    value  to   any 
one.     It    is    enough     that    something    is 
promised,  done,  forborne,    or   suffered    by 
the  party  to  whom    the   promise   is  mad(! 
as  consideration  for   the  promise  made  to 
liim."     Anson,    Cont.    (')8.     "In    general    a 
waiver  of  any  legal  right  at  the  request  of 
another  party   is   a  sufficient    cojisidera- 
tion    for    a    promise."     Pars.   Cont.  *444. 
"Any  damage,  oi"   suspension,  or  forbear- 
ance of  a  right  will  be  suHlcient  to  sustain 
a    promise."     2   Kent,   Comm.   (12th    Ed.) 
*4(')'y.     Pollock    in  his  work  on    Contracts, 
([•age   1()G,)  after  citing  the  definition  giv- 
en   by    the    exchequer    chamber,    already 
quoted,  says:    "The  second  branch  of  this 
judicial   description    is  really  the  most  im- 
portant one.     'Consideration '  means   not 
so    much    that   one   party  is    profiting  as 
that     the     other     abandons     some    legal 
right  in  the  present,  or  limitshis  legal  free- 
dom of  action  in  the  future,  as  an   induce- 
ment for  the  promise  of   the  first. "     Now, 
applying  this   rule  to  the  facts  before  us, 
the   promisee  used    tobacco,  occasionally 
drank    liquor,  and  he  had  a  legal    right  to 
do  so.     That  right  he  abandoned  for  a  pe- 
riod   of  years   upon    the   strength  of    the 
promise  of    the   testator  that  for  such  for- 
bearance he  would   give  him   .f.".,OU(i.     We 
need   not  speculate  on   the    effort    wiiich 
may  have  been  required  to  give  up  the  use 
of   those  stimulants.     It  is  suHicient  that 
he  restricted   his  lawful  freedom  of  action 
within   certain  prescribed    limits  upoTi  the 
faith  of   liis  uncle's   agreement,  and    now. 
having  fuU^-  performed    the  conditions  im- 
I»osed,  it   is   of   no  moment  whether   such 
I)erformance   actually  proved  a    benefit  to 
the   promisor,  and    the  court  will    not  in- 
quire into   it;  but,  were  it  a  proper  sub- 
ject of  iiHjuiry,  we  see   nothing  in  this  rec- 
ord   that    would    pertnit    a  determination 
that  the  uncle  was  not  benefited  in  a  legal 
sense.     Few   cases  liave  been  found  wliiili 
may  be  said    to    be   precisely  in  point,  but 
such   as   l)ave  been,  su|)port   the  position 
we  have  taken.     In  Sliadwell  v.  Shad  well, 
9   C.  B.  (N.  S.  )  159,    an    uncle  wrote  to  his 
nephew  as  follows:   "ily  dear  Lancey  :     I 
am   so    glad    to    hear   of  your    intended 


marriage   with    Ellen    Nicholl,   and,  as   I 
promised  to   assist  you  at  starting,  I  am 
happy  to  tell   you  that  I  will    pay  you  150 
[lounds   yearly  during   my   life  and    until 
your   annual    income   derived   from    y(Hir 
pr(jfessi(;n    of   a   chancery    barrister  shai! 
amount  to  fJOiJ  guineas,  of  which  your  own 
admission  will  be  the  only  evidence  that  I 
shall  receive  or  require.    Your  affectionate 
uncle,  CuA HI, Es   Suauwei.i..  "     It  was  held 
that    the  promise  was    binding,  and  made 
upon   good    C(insideration.     In  Lakota  v. 
Newton,  (an    unrei)orted  case  in  the  supe- 
ricjr  court  of    Worcester,  Mass..)  the  com- 
plaint  averrefl    defendant's    i)romise  that 
"if  you  [meaning    the   plaintiff]  will  leave 
off  drinking   for  a  year   I   will   give  you 
$100, "  plaintiff's   assent    thereto,  perform- 
ance of  the  condition  by  him,  and  demand- 
ed     judgment      therefor.     Defendant     de- 
murred,   on    the   ground,    among   others, 
that  the  plaintiff's  declaration  did    not  al 
lege   a    valid    and    su/licient  consideration 
for  the  agreement  of   the  defendant.     The 
demurrer   was   overruled.     In   Talbott  v. 
Stemmons,   12    S.    \V.    Rep.    297,    (a    Ken- 
tucky  case,   not  yet  officially   reported.) 
the     step-grandmother    of     the    plaintiff 
made  with    him  the  following  agreement: 
"I  do  i)romise  and  bind  myself  to  give  mv 
grandson    Albert   11.  Talbott  fioOO   at    my 
death  if  he  will  never   take  another  cliew 
of  tobacco  or  smoke  another  cigar  during 
my  life,  from   this   date   up   to  my  death ; 
and  if  he  breaks  this  pledge  he  is  to  refund 
double  the  amount  to    his   mother."     The 
executor  of   Mrs.  Stemmons   demurred    to 
the    complaint    on   the   ground    that   the 
agreement  was   not   based  on   a  sufficient 
consideration.     The    demurrer    was    sus- 
tained,  and   an    apjjcal   taken   therefrom 
to   the  court   of  appeals,    where    the  de- 
cision   of   the  court   below  was   reversed. 
In  the  opinion  of  the  court  it  is  said  that 
"the  right    to  use  and   enjoy  the  use  of  to- 
bacco   was    a    right    that  belonged  to  the 
plaintiff,  and   not  forbidden  by  law.     The 
abandonment  of   its   use   maj- have  saved 
him    money,  or  contributed  to  his  iiealth  ; 
nevertheless,  the   surrender   of   that  right 
caused  the  promise,  and,  having  the  riglit 
to   contract  with    reference  to  the  subje.-t- 
matter,  the   abandonment  of   the  use  was 
a   sulficient  consideration    to   uphold  the 
promise."     Abstinence  from  the  use  of  in- 
toxicating liquors  was   held    to   furnish  a 
good  consideration  for  a  promissorv  note 
in  Lindell  v.  Hokes,  ()0  Mo.  249.     The  cases 
cited    by   the  defendant   on    chis  question 
are  not  in  point.     In  Malloi-v  v.  Uiilett,  21 
N.  Y.  412;  Belknap  v.  liender,  75  N.  Y.  44(5; 
and    Berry  v   Brown,  107   N.  Y.  059,  14    N. 
E.  Rep.  2^9, — the   promise  was   in   contra- 
vention of  that  provision  of  the  statute  of 
frauds  which  declares  void  all  i)romises  to 
answer  for  the  debts  of  third  persons  unless 
reduced    to     writing.      In     Beaumont    v. 
Reeve,    Shir.    Lead.    Cas.   7,    and    Porter- 
field    V.  Butler,  47    .Miss.    I(i5,  the   question 
was  whether  a  moral  obligation  furnishes 
sufficient  consideration  to  uphold  a  subse- 
(juent  expr(>ss  promise.     In    Uuvoll  v.  Wil- 
son, 9    Barb.   4S7,  and    Wilbur    v.   Warren, 
104   N.  Y.  192,  10  N.  E.  Rep.  203,  the  propo 
sition  involved  was  whether  an  executory 
covenant   against  incumbrances  in  a  deed 
given  in  consideration  of  natural  love  and 


222 


CONSIDERATION. 


affecHon  coukl  be  enforced.  In  Vandei-bilt 
V.  Schreyer.  91  N  Y.  392,  the  plaintiff  con- 
tracted Witli  defendant  to  build  a  house, 
ajri'eeing  to  accept  in  part  payment  there- 
for a  specific  bond  and  mortgage.  After- 
wards he  refused  to  finish  his  contract  un- 
less the  defendant  would  guaranty  its 
payment,  which  was  done.  It  was  held 
that  the  guaranty  could  not  be  enforced 
for  want  of  ccmsideration  ;  for  in  building 
the  house  the  plaintiff  only  did  that 
which  he  had  contracted  to  do.  And  in 
Robinson  v.  Jewett,  11(5  N.  Y.  40,  22  N.  E. 
Rep.  224,  the  court  simply  held  that  "the 
performance  of  an  act  which  the  party  is 
under  a  legal  obligation  to  perform  can- 
not constitute  a  consideration  for  a  new 
contract."  It  will  be  observed  that  the 
agreement  which  we  have  been  consider- 
ing was  within  the  condemnation  of  the 
statute  of  frauds,  because  not  to  be  per- 
formed within  a  year,  and  not  in  writing. 
But  this  defense  the  promisorcould  waive, 
and  his  letter  and  oral  statements  subse- 
quent to  the  date  of  final  performance  on 
the  part  of  the  promisee  must  be  held  to 
amount  to  a  waiver.  Were  it  otherwise, 
the  statute  could  not  now  be  invoked  in 
aid  of  the  defendant.  It  does  not  appear 
on  the  face  of  the  complaint  that  the 
agreement  is  one  prohibited  by  the  stat- 
ute of  frauds,  and  therefore  such  defense 
could  not  be  made  available  unle^ss  set  up 
in  the  answer.  Porter  v.  Wormser,  94  N. 
Y.  431,  450.     This  was  not  done. 

In  further  consideration  of  the  questions 
presented,  then,  it  must  be  deemed  estab- 
lislied  for  the  purposes  of  this  appeal  that 
on  the  31st  day  of  January,  1875,  defend- 
ant's testator  was  indebted  to  William  E. 
Story,  2d,  in  the  sura  of  |5,000;  and,  if  this 
action  were  founded  on  that  contract,  it 
would  be  barred  by  the  statute  of  limita- 
tions, which  has  been  pleaded,  but  on 
that  date  the  nephew  wrote  to  his  uncle 
as  follows:  "Dear  Uncle:  I  am  21  years 
old  to-day,  and  I  am  now  my  own  boss; 
and  I  believe,  according  to  agreement, 
that  there  is  due  me  $5()00.  I  have  lived 
up  to  the  contract  to  the  letter  in  every 
sense  of  the  word.  "  A  few  days  later,  and 
on  February  6th, the  uncle  replied,  and,  so 
far  as  it  is  material  to  this  controversy, 
the  reply  is  as  follows:  "Dear  Nephew; 
Your  letter  of  the  31st  ult.  came  to  hand 
all  right,  saying  that  you  had  lived  up  to 
the  promise  made  to  me  several  years  ago. 
I  have  no  doubt  but  you  have,  for  which 
you  shall  have  $5,000,  as  I  promised  you. 
I  had  the  money  in  the  bank  the  day  you 
was  21  years  old  that  I  intend  for  you, 
and  you  shall  have  the  money  certain. 
Now,  Willie,  I  don't  intend  to  interfere 
with  this  money  in  any  way  until  I  think 
you  are  capable  of  taking  care  of  it,  and 
the  sooner  that  time  comes  the  better  it 
will  please  me.  1  would  hate  very  much 
to  have  you  start  out  in  some  adventure 
that  you'thought  all  right,  and  lose  this 
money  in  one  year.  *  *  *  This  money 
you  have  earned  much  easier  than  I  did, 
besides  acquiring  good  habits  at  the  same 
time;  and  you  are  quite  welcome  to  the 
money.  Hope  you  will  make  good  use  of 
it.  *  •  »  W.  E.  Stouy.  p.  S.  You  can 
consider  this  money  on  interest."  The 
trial  court  found  as  a  fact  that  "said  letter 


was  received  by  said  William  E.  Story,  2d, 
who  thereafter  consented  that  said  money 
should  remain  with  the  said  William  E. 
Story  in  accordance  with  the  terms  and 
conditions  of  said  letter."  And  further, 
"that  afterwards,  on  the  1st  day  of  March, 
1S77,  with  the  knowledge  and  consent  of 
his  said  uncle,  he  duly  sold,  transferred, 
and  assigned  all  his  right,  title,  and  intei'- 
est  in  and  to  said  sum  of  $5,000  to  his  wife, 
Libbie  H.Story,  who  thereafter  duly  sold, 
transferred,  and  assigned  the  same  to  the 
plaintiff  in  this  action."  We  must  now 
consider  the  effect  of  the  letter  and  the 
nephew's  assent  thereto.  W^ere  the  rela- 
tions of  the  parties  thereafter  that  of 
debtor  and  creditor  simply,  or  that  of 
trustee  and  cestui  que  trust?  If  the  for- 
mer, then  this  action  is  not  maintainable, 
because  barred  by  lapse  of  time.  If  the 
latter,  the  result  must  be  otherwise.  No 
particular  expressions  are  necessary  to 
create  a  trust.  Any  language  clearly 
showing  the  settler's  intention  is  sufficient 
if  the  property  and  disposition  of  it  are 
definitely  stated.  Lewin,  Trusts,  55.  A 
person  in  the  legal  possession  of  money  or 
property  acknowledging  a  trust  with  the 
as.sentof  the  cestui  que  trust  becomes  from 
thattime  a  trustee  if  the  acknowledgment 
be  founded  on  a  valuable  consideration. 
His  antecedent  relation  to  the  subject, 
whatever  it  may  have  been,  no  longer  con- 
trols. 2  Story,  Eq.  Jur.,  §  972.  If  before  a 
declaration  of  trust  a  party  be  a  mere 
debtor,  a  subsequent  agreement  recogniz- 
ing the  fund  as  already  in  his  hands,  and 
stipulating  for  its  investment  on  the  cred- 
itor's account,  will  have  the  effect  to  cre- 
ate a  trust.  Day  v.  Roth,  18  N.  Y.  448.  It 
is  essential  that  the  letter,  interpreted  in 
the  light  of  surrounding  circumstances, 
must  show  an  intention  on  the  part  of  the 
uncle  to  become  a  trustee  before  he  will  be 
held  to  have  become  such;  but  in  an  effort 
to  ascertain  the  construction  which 
should  be  given  to  it  we  are  also  to  ob- 
serve the  rule  that  the  language  of  the 
promisor  is  to  be  interpreted  in  the  sense 
in  which  he  had  reason  to  suppose  it  was 
understood  by  the  promisee.  White  v. 
Hoyt,  73  N.  Y.  505,  511.  At  the  time  the 
uncle  wrote  the  letter  he  was  indebted  to 
ills  nephew  in  the  sum  of  $5,000,  and  pay- 
ment had  been  requested.  The  uncle,  rec- 
ognizing the  indebtedness,  wrote  the  neph- 
ew that  he  would  keep  the  money  until  he 
deemed  him  capal)le  of  taking  care  of  it. 
He  did  not  say,  "I  wiU  pay  you  at  some 
other  time,"  or  use  language  that  would 
indicate  that  the  relation  of  debtor  and 
creditor  would  continue.  On  the  con- 
trary, his  language  indicated  that  he  had 
set  apart  the  money  the  nephew  had 
"earned,  "  for  him,  so  that  when  he  should 
be  capable  of  taking  care  of  it  he  should 
receive  it  with  interest.  He  said:  "I  had 
the  money  in  the  bank  the  day  you  were 
21  years  old  that  I  intend  for  you,  and 
you  shaU  have  the  money  certain."  That 
he  had  set  apart  the  money  is  further  evi- 
denced by  the  next  sentence:  "Now,  Wil- 
lie, I  don't  intend  to  interfere  with  this 
money  in  any  way  until  I  think  you  are 
capable  of  taking  care  of  it."  Certainly 
the  uncle  must  have  intended  that  his 
nephew  should  understand  that  the  prom- 


DEFINED. 


223 


iwe  not  "to  iiitcifere  with  this  mone^'"  re- 
ferred to  tlie  money  in  tlie  bank,  which  he 
declared  was  not  only  there  when  the 
nephew  became  21  years  old.  but  was  in- 
tended for  him.  True,  he  did  not  use  the 
word  "trust,  "or  state  that  the  money 
was  deposited  in  the  name  of  William  E. 
.Story,  L'd,  or  in  his  own  name  in  trust  for 
liim,  but  the  lanjifuage  used  must  have 
been  intended  to  assure  the  nephew  that 
his  money  had  been  set  apart  for  him,  to 
be  kept  without  interference  until  he 
should  be  capable  of  taking  care  of  it,  for 
the  uncle  said  in  substance  and  in  effect: 
"This  money  you  have  earned  much  easier 
than  I  did.  •  •  •  You  are  quite  wel- 
come to.  I  had  it  in  the  bank  the  day  vou 
were  21  years  old,  and  don't  intend  to  in- 
terfere with   it  in   any  way   until   I   think 


you  are  capable  of  taking  care  of  It;  and 
the  sooner  that  time  comes  the  better  it 
will  please  me."  In  this  dechiration  there 
is  not  lacking  a  single  element  necessary 
for  the  creation  of  a  valid  trust,  and  to 
that  declaration  the  nephew  assented. 
The  learned  judge  who  wrote  the  opinion 
of  the  general  term  seems  to  have  taken 
the  view  tliat  the  trust  was  executed  dur- 
ing the  life-time  of  deferid;int's  testator  by 
payment  to  the  ne[)hevv,  but,  as  it  does 
not  appear  from  the  order  that  the  judg- 
ment waft  reversed  on  the  facts,  we  must 
assume  the  facts  to  be  as  found  by  the 
trial  court,  and  those  facts  support  its 
judgment.  The  order  appealed  from 
Khoiild  be  reversed,  and  the  judgment  of 
the  special  term  affirmed,  with  co.sts  pay- 
able out  of  the  estate.     All  concur. 


Is 


224 

/ 


CONSIDERATION. 


y 


A 


RANN  et  al.  v.  HUGHES.     \A  'n 
'  rk  (7  Term  R.  350,  note.)  I    \  H 

The  declai-ation  stated  that  on  the  11th  of 
June,  1764.  divers  disputes  had  arisen  be- 
tween the  plaintiffs'  testator  and  the  defend- 
ant's intestate,  which  they  referred  to  arbi- 
tration; that  the  arbitrator  awarded  that 
the  defendant's  intestate  should  pay  to  the 
plaintiffs'  testator  £983.  That  the  defend- 
ant's intestate  afterwards  died  possessed  of 
effects  sufficient  to  pay  that  sum;  that  ad- 
ministi-ation  was  granted  to  the  defendant; 
that  Mary  Hughes  died,  having  appointed 
the  plaintiffs  her  executors;  that  at  the  time 
of  her  death  the  said  sum  of  £983  was  un- 
paid, "by  reason  of  which  premises  the  de- 
fendant as  administratrix  became  liable  to 
pay  to  the  plaintiffs  as  executors  the  said 
sum,  and  being  so  liable  she  in  consideration 
thereof  undertook  and  promised  to  pay  &c." 
The  defendant  pleaded  non  assumpsit;  plene 
administravit;  and  plene  administravit,  ex- 
cept as  to  certain  goods  &c.  which  were  not 
sufficient  to  pay  an  outstanding  bond  debt 
of  the  intestate's  therein  set  forth  &c.  The 
replication  took  issue  on  all  these  pleas. 
Verdict  for  the  plaintiff  on  the  first  issue, 
and  for  the  defendant  on  the  two  last;  and 
on  the  first  a  general  judgment  was  entered 
in  B.  R.  against  the  defendant  de  bonis  pro- 
priis.  This  judgment  was  reversed  in  the 
exchequer-chamber;  and  a  writ  of  error 
was  afterwards  brought  in  the  house  of 
lords,  where  after  argument  the  following 
question  was  proposed  to  the  judges  by  the 
lord  chancellor,  "Whether  sufficient  matter 
appeared  upon  the  declaration  to  warrant 
after  verdict  the  judgment  against  the  de- 
fendant in  error  in  her  personal  capacity;" 
upon  which  the  Lord  Chief  Baron  Skynner 
delivered  the  opinion  ,of  the  judges  to  this 
effect— It  is  undoubtedly  true  that  every 
man  is  by  the  law  of  natxire  bound  to  fulfil 
his  engagements.  It  is  equally  true  that  the 
law  of  this  country  supplies  no  means,  nor 
affords  any  remedy,  to  compel  the  perform- 
ance of  an  agreement  made  without  suffi- 
cient consideration;  such  agreement  is  nu- 
dum pactum  ex  quo  non  oritur  actio,  and 
whatsoever  may  be  the  sense  of  this  maxim 
In  the  civil  law,  it  is  in  the  last-mentioned 
sense  only  that  it  is  to  be  imderstood  in  our 
law.  The  declaration  states  that  the  de- 
fendant being  indebted  as  administratrix 
promised  to  pay  when  requested,  and  the 
judgment  is  against  the  defendant  generally. 
The  being  indebted  is  of  itself  a  sufficient 
consideration  to  ground  a  promi.se,  but  the 
promise  must  be  coextensive  with  the  con- 
Eideration  unless  some  particular  considera- 
tion of  fact  can  be  found  here  to  warrant  the 
extension  of  it  against  the  defendant  in  her 
own  capacity.  If  a  person  indebted  in  one 
right  in  consideration  of  forbearance  for  a 
particular  time  promise  to  pay  in  another 
right,   this  convenience   will  be  a  sufficient 


consideration  to  warrant  an  action  against 
him  or  her  in  the  latter  right:  but  here  no 
sufficient  consideration  occurs  to  support  this 
demand  against  her  in  her  personal  capac- 
ity; for  she  derives  no  advantage  or  con- 
venience from  the  promise  here  made.  For 
if  I  promise  generally  to  pay  upon  request 
what  I  was  liable  to  pay  upon  request  in 
another  right,  I  derive  no  advantage  or  con- 
venience from  this  promise,  and  therefore 
there  is  not  sufficient  consideration  for  it 
But  it  is  said  that  if  this  promise  is  in  writ- 
ing that  takes  away  the  necessity  of  a  con- 
sideration and  obviates  the  objection  of  nu- 
dum pactum,  for  that  cannot  be  where  the 
promise  is  put  in  writing;  and  that  after 
verdict,  if  it  were  necessary  to  support  the 
promise  that  It  should  be  in  writing,  it  wiU 
after  verdict  be  presumed  that  it  was  in 
writing:  and  this  last  is  certainly  true;  but 
that  there  cannot  be  nudum  pactum  in  writ- 
ing, whatever  may  be  the  rule  of  the  civil 
law,  there  is  certainly  noue  such  in  the  law 
of  England.  His  lordship  observed  upon 
the  doctrine  of  nudum  pactum  delivered  by 
Mr.  J.  WUmot  in  the  case  of  PUlans  v.  Van 
Mierop  and  Hopkins,  3  Burrows,  1663,  that 
he  contradicted  himself,  and  was  also  con- 
tradicted by  Vinnius  in  his  Comment  on  Jus- 
tinian. 

All  contracts  are  by  the  laws  of  England 
distinguished  into  agreements  by  specialty, 
and  agreements  by  parol;  nor  is  there  any 
such  third  class  as  some  of  the  counsel  have 
endeavoured  to  maintain,  as  contracts  in 
writing.  If  they  be  merely  written  and  not 
specialties,  they  are  parol,  and  a  considera- 
tion must  be  proved.  But  it  is  said  that  the 
statute  of  frauds  has  taken  away  the  neces- 
sity of  any  consideration  in  this  case;  the 
statute  of  frauds  was  made  for  the  relief  of 
personal  representatives  and  others,  and 
did  not  intend  to  charge  them  further  than 
by  common  law  they  were  chargeable.  His 
lordship  here  read  those  sections  of  that 
statute  which  relate  to  the  present  subject. 
He  observed  that  the  words  were  merely 
negative,  and  that  executors  and  adminis- 
trators should  not  be  liable  out  of  their  own 
estates,  maless  the  agreement  upon  which 
the  action  was  brought  or  some  memoran- 
dum thereof  was  in  writing  and  signed  by 
the  party.  But  this  docs  not  prove  that  the 
agreement  was  still  not  liable  to  be  tried 
and  judged  of  as  all  other  agreements  mere- 
ly in  writing  are  by  the  common  law,  and 
does  not  prove  the  converse  of  the  proposi- 
tion that  when  in  writing  the  party  must  be 
at  all  events  liable.  He  here  observed  upon 
the  case  of  Pillans  v.  Van  Mierop  in  Bur- 
rows, and  the  cast  of  Losh  v.  Williamson, 
Mich.  16  Geo.  HI.  in  B.  R.;  and  so  far  as 
these  cases  went  on  the  doctrine  of  nudum 
pactum,  he  seemed  to  intimate  that  they 
were  erroneous.  He  said  that  all  his  broth- 
ers concurred  with  him  that  in  this  case 
there  was  not  a  sufficient  consideration   to 


NECESSITY. 


225 


support  this  demand  as  a  personal  demand 
afxainst  the  defendant,  and  that  its  being 
now  supposed  to  have  been  in  writing  malies 
no  diffL'rence.     The  consequence  of  which  is 

nOPK.SEL.  CAS.  CONT.  — 15 


that  the  question  put  to  ufl  must  be  answered 
in  the  negative. 

And  the  judgment  In  the  exchequer-chana- 
ber  was  aflBrmed. 


226 


COKSIDEKATION. 


HAIGH  et  al.  v.  BROOKS.* 

(10  AdoL  &  E.  309.) 

Trinity  Term.     June  6,  1S39. 

W.  W.  Follett,  for  plaintifiL  J.  Campbell, 
Atty.  Gen.,  contra. 

LORD  DENMAN,  C.  J.  Tliis  action  was 
brought  upon  an  assumpsit  to  see  certain  ae- 
ceplances  paid,  in  consideration  of  the  plain- 
tiffs giving  up  a  guarantee  of  £10,000,  due 
from  the  acceptor  to  the  plaintiffs.  Plea,  that 
the  guarantee  was  for  the  debt  of  another, 
and  that  there  was  no  writing  wherein  the 
consideration  appeared,  signed  by  the  defend- 
ant, and  so  the  giving  it  up  was  no  good  con- 
sideration for  the  promise.  Demurrer,  stat- 
ing for  cause  that  the  plea  is  bad,  because  the 
consideration  was  executed,  whether  the 
guarantee  were  binding  in  law  or  not  The 
form  of  the  guarantee  was  set  out  in  the  plea. 
"In  consideration  of  your  being  in  advance 
to  Messrs.  John  Lees  and  Sons,  in  the  sum  of 
£10,000,  for  the  purchase  of  cotton,  I  do  here- 
by give  you  my  guarantee  for  that  amo^mt, 
(say  £10,000,)  on  their  behalf.     John  Brooks." 

It  was  argued  for  the  defendant,  that  this 
guarantee  is  of  no  force,  because  the  fact  of. 
the  plaintiffs  being  already  in  advance  to 
Ijees  could  form  no  consideration  for  the  de- 
fendant's promise  to  guarantee  to  the  plain- 
tiffs the  payment  of  Lees'  acceptances.  In 
the  first  place,  this  is  by  no  means  clear. 
That  "being  in  advance"  must  necessarily 
mean  to  assert  that  he  was  in  advance  at 
the  time  of  giving  the  guarantee,  is  an  asser- 
tion open  to  argument.  It  may,  possibly, 
have  been   intended   as  prospective.    If   the 

1  Irrelevant  parts  omitted. 


phrase  had  been  "in  consideration  of  your 
becoming  in  advance,"  or,  "on  condition  of 
your  being  in  advance,"  such  would  have 
been  the  clear  import.  As  it  is,  nobody  can 
doubt  that  the  defendant  tooli  a  great  inter- 
est in  the  affairs  of  Messrs,  Lees,  or  believe 
that  the  plaintiffs  had  not  come  under  the 
advance  mentioned  at  the  defendant's  re- 
quest Here  is  then  sufficient  doubt  to  make 
it  worth  the  defendant's  while  to  possess  him- 
self of  the  guarantee;  and,  if  that  be  so,  we 
have  no  concern  with  the  adequacy  or  inade- 
quacy of  the  price  paid  or  promised  for  it. 

But  we  are  by  no  means  prepai*ed  to  say 
that  any  circumstances  short  of  the  imputa- 
tion of  fraud  in  fact,  could  entitle  us  to  hold 
that  a  party  was  not  bound  by  a  promise 
made  upon  any  consideration  which  could 
be  valuable;  while  of  its  being  so  the  promise 
by  which  it  was  obtained  from  the  holder  of 
it  must  always  afford  some  proof. 

Here,  whether  or  not  the  guarantee  could 
have  been  available  within  the  doctrine  of 
Wain  V.  Warlters,  5  East,  10,  the  plaintiffs 
were  induced  by  the  defendant's  promise  to 
part  with  something  which  they  might  have 
kept,  and  the  defendant  obtained  what  he  de- 
sired by  means  of  that  promise.  Both  being 
free  and  able  to  judge  for  themselves,  how 
can  the  defendant  be  justified  in  breaking 
this  promise,  by  discovering  afterwards  that 
the  thing  in  consideration  of  which  he  gave 
it  did  not  possess  that  value  which  he  sup- 
posed to  belong  to  it?  It  cannot  be  ascer- 
tained that  that  value  was  what  he  most  re- 
garded. He  may  have  had  other  objects  and 
motives;  and  of  their  weight  he  was  the  only 
judge.  We,  therefore,  think  the  plea  bad: 
and  the  demurrer  must  prevail 

Judgment  for  the  plaintiffs. 


ADEQUACY. 


227 


JUDY  V.  LOUDERMAN. 

(29  N.  E.  181,  48  Ohio  St  502.) 

Supreme  Coiirt  of  Ohio.      Nov.  17.  1S91. 

Error  to  circuit  court,  Fa\'fttto  county. 

Action  by  Ileury  .ludy  a^ainKt  Natlifui 
Loudernian,  executor  of  Henry  Louder- 
man,  deceuHed.  to  recover  on  a  written 
agreement  made  by  deceased.  I'lain tiff's 
demurrer  to  the  answer  beinp:  overruled, 
lie  brin{?8  error.     Reversed. 

'I'iie  other  facts  fully  aiipear  in  the  fol- 
lowinjr  statement  by  DICKMAN,  .1.  : 

The  orifrinal  action  was  commenced  by 
Henry  .ludj',  the  plaintiff  in  error,  aj^ainst 
the  defendant  in  error,  Nathan  Louder- 
man,  executor  of  the  last  will  and  testa- 
ment of  Henry  Louderman,  deceased. 
The  followinj.?is  aco[)y  of  the  petition  filed 
in  the  court  of  common  i)le.iH  of  Faj-ette 
county.  "Plaintiff  says:  On  the  .5th  day 
•  )f  October,  18S2,  he  was  the  owner  and 
holder  of  a  certain  promissory  note,  signed 
by  one  Jesse  Louderman,  for  the  sum  t)f 
$2G9.52,  dated  January  18,  1873,  due  six 
months  after  date,  with  eif:;ht  per  cent, 
interest  from  date.  On  said  ,">thdaj-of  Oc- 
tober,18S2,  he  turned  overand  surrendered 
to  said  Henry  Louderman,  then  in  full  life, 
said  promissory  note;  and  in  consideration 
therefor  said  Henry  Louderman  executed 
and  delivered  to  plaintiff  an  agreement  of 
which  the  following  is  a  copy,  viz. :  'New 
Holland,  O.,  Oct.  5, 18S2.  Inconsideration 
of  the  following  described  note  oS  my  son 
Jesse  Louderman,  being  turned  over  to 
me  by  Henry  Judy,  the  owner  and  holder 
thereof,  this  day,!  agree  to  pay  tcjthe  said 
Henry  Judy,  from  my  personal  estate  at 
my  decease,  the  sum  of  $209.52.  to  be  paid 
by  my  executor  or  administrator,  as  the 
case  may  be;  and  I  hereby  make  this  a 
charge  and  advancement  to  the  heiis  of 
ni3'  son,  the  said  Jesse  Lo.uderman.  The 
following  is  a  copy  of  said  note:  "$20!). 52. 
Six  months  after  date  I  promise  to  i)ay 
to  Henry  Judy  or  order  the  just  and  full 
sum  of  two  hundred  and  sixty-niiunioUars 
and  fifty-two  cents,  for  value  received  this 
18th  day  of  January,  A.  D.  ]s7;i,  bearing 
eight  per  cent,  interest  from  date.  Jkssk 
LouDEHMAN."  In  Witness  whercof  I  have 
hereunto  set  mv  hand  and  seal  this  5th 
day  of  October,  A.  D.  1SS2.  Hkmjy  Lou- 
derman, [Seal.]  Signed  and  sealed  in  our 
presence  this  5th  day  of  October,  lss2. 
Witness:  John  LornicuMAN.  Natha.v 
Louderman.'  Plaintiff  further  says  that 
the  said    Henry   Louderman   died   on    the 

day  of ,188—,  and  that  thesaid 

Nathan    Jjouderman  is  his  duly  appointed 

and  qualified  executor.     That  on  the ■ 

day  of ,  1SS5.  he  presented  to  the  said 

Nathan  Louderman,  as  such  executor,  the 
said  claim  of  this  plaintiff,  on  said  agree- 
ment of  Henry  Louderman  duly  certified 
as  required  by  law,  and  asked  to  have  the 
same  allowed  as  a  valid  claim  against 
the  estate  of  said  Henry  Loudernian,  de- 
ceased ;  but  the  said  Nathan  Louderman, 
as  executor,  refused  to  allow  the  same,  anil 
on  the  4th  day  of  April,  A.  D.  1SS5.  indorsed 
thereon  his  rejection  thereof.  There  is  due 
to  plaintiff  by  reason  of  the  premises,  from 
the  estate  of  said  Henry  Loucl(>rnian,  de- 
ceased, the  sum  of  ?L(;!).52.  with  interest  at 
six   per  cent,  from    April  4,  1885.     Plaintiff 


therefore  asks  Judgment  against  said  de- 
ft ndant  that  his  said  claim  be  allowed  and 
I)aid  out  of  the  estate  of  said  Henry  I^ou- 
dertnan,  deceased.  "  To  this  petition  there 
was  a  general  demurrer,  which  was  over- 
rulr'd. 

The  defendant  thereup(;n  filed  the  folbjw- 
ing  answer:  "And  now  comes  the  defend- 
ant, and,  answerinir  the  plaintiff's  petition, 
says:  Tliat  for  many  years  pri(jr  to  the 
date  of  said  pretended  written  obligalidu 
set  forth  in  the  petition  the  said  .Jesse 
Louderman  had  been  dead.  That  his  es- 
tate was  insolvent,  and  had,  long  befijre 
the  making  of  said  jjretended  agreement, 
been  fully  settled  ;  and  said  note  of  said 
.lesse  Loudernian  was  on  said  5th  of  Oc- 
tober. 1SS2,  and  for  years  before  had  been, 
wholly  worthless,  all  of  which  was  then 
fully  known  to  said  f)laintiff.  That  there 
was  no  ])erson  who  was  liable  to  be  or 
could  have  been  sued  thereon  or  against 
whom  a  judgment  could  have  been  ren- 
dered thereon,  which  plaintiff  then  well 
knew.  1  hat  said  pretended  written  olili- 
gation  w,i.->  not  an  instrument  required  by 
the  laws  of  Ohio  to  be  sealed.  That  the 
alleged  and  pretended  seal  attached  there- 
to was  simply  a  pen  scrawl,  which  the  de- 
fendant denies  was  a  seal,  or  that  the  said 
pretended  written  obligation  was  a  sealed 
instrument.  That  said  Henry  Louderman 
was  in  no  way  connected  with  or  liable 
in  an3'  way  ou  said  promissory  note  of 
said  Jesse  Louderman,  either  morally, 
legally,  or  equitably.  That  said  pretend- 
ed written  obligation  was  and  is  wholly 
without  consideration,  and  created  no  ob- 
ligation or  liabilitj'  on  said  Henry  Lou- 
derman or  his  estate.  The  defendant  de- 
nies any  indebtedness  or  liability  of  said 
estate  to  pay  the  same.  The  defendant, 
further  answering,  says:  That  there  is 
no  personal  property  of  said  estate  which 
can  be  applied  to  the  payment  of  said 
written  oliligation.  That  the  just  and 
legal  debts  of  said  estate  are  more  than 
all  the  personal  i)roperty.  That  all  the 
real  estate  of  deceased  was  specifically  de- 
vised, and  there  is  no  estate  or  property 
belonging  to  said  estate  with  which  to 
pay  said  written  obligation,  if  it  should  be 
held  to  be  a  valid  instrument.  Wherefore 
defendant  asks  to  go  hence  and  recover 
his  costs. " 

There  was  a  general  demurrer  to  this 
answer",  which  was  sustained,  and  the  de- 
fendant excepted.  The  defendant  having 
failed  to  make  any  amendment  to  his  an- 
swer, it  was  adjudged  that  the  plaintiff, 
Henry  .ludy,  recover  of  the  defendant  the 
sum  of  $278  and  costs,  to  be  levied  upon 
the  property  of  the  estate  coiiiing  into  his 
hands  as  such  executor.  Tliecircuit  court, 
on  petition  in  error,  held  that  the  court  of 
common  pleas  erred  in  sust.-iining  the  de- 
murrer to  the  defendant's  answer,  reversed 
the  judgment  of  that  court,  and  remanded 
the  cause  for  further  ])roceedings.  Tore- 
verse  the  judgment  of  the  circuit  court  the 
present  petition  in  error  is  filed. 

IJidy  S-  Putton,  for  plaintiff  in  error. 
iJi/ls  Gurdiicr,  for  defendant  in  error. 

DICKMAN,  J., (after  stating  the  facts.)  If 
there  was  no  actual  consideration  for  the 
obligation   executed   and   delivered  to  the 


228 


CONSIDERATION. 


plaintiff  iii  error,  it  was  competent  to 
prove  the  want  or  failure  of  such  consider- 
ation, uotwithstanding  a  "scrawl  seal" 
was  attached  to  the  instrument.  By  the 
act  of  February  24,  1S84,  (1  Curw.  Rev.  St. 
1:.'4,)  it  was  provided  "  that,  in  any  action 
founded  upon  any  specialty  or  written  con- 
tract for  the  payment  of  money  or  deliv- 
ery of  property,  the  defendant  by  special 
p'ea.  or  b3'  notice  attached  to  and  filed 
witii  the  R-eneral  issue,  may  allege  the 
want  or  failure  of  consideration  in  the 
whole  or  any  part  thereof."  This  act 
was  repealed' by  the  act  establishing  a 
Code  of  Civil  Procedure,  but  secticjn  9H  of 
the  Code,  which  is  continued  in  section 
5071  of  the  Revised  Statutes,  provided 
that  "the  defendant  may  set  forth  in  his 
answer  as  many  grounds  of  defense,  coun- 
ter-claim, and'  set-off  as  he  maj'  have, 
whether  they  be  such  as  have  been  hereto- 
foredenomiiiated  'legal'  or  '  eciuitable,'  or 
both."  As  against  a  strictly  legal  cause 
of  action,  a  defendant,  therefore,  may  now 
set  up  an  equitable  defense,  and  there- 
by not  only  bar  the  plaintiff's  action,  but 
obtain  the  proper  affirmative  equitable  re- 
lief connected  with  the  subject-matter. 
And  although  the  common  law,  in  requir- 
ing a  valuable  consideration  in  order  to 
render  an  agreement  valid  and  binding, 
declared,  in  its  strictness,  that  a  seal  was 
cunclusive  evidence  of  such  a  considera- 
tion, yet,  in  determining  the  rights  of  par- 
ties upon  equitable  principles,  a  seal  has 
been  divested  of  the  apparent  sacredness 
-uith  which  it  was  clothed  by  the  comuKm 
law;  and  equity,  looliing  rather  to  reality 
than  form,  does  not  permit  a  seal  to  sup- 
ply the  place  of  a  real  consideration,  and, 
notwithstanding  the  seal,  will  allow  the 
want  or  failure  of  such  consideration  to 
be  shown  in  the  enforcement  of  executory 
contracts  of  every  description.  In  Rich- 
ardson v.  Bates,  8  Ohio  St.  264,  it  was 
said  by  Sdtliff,  J.:  "Under  thestatute  of 
February  24,  1834,  allowing  the  failure,  or 
part  failure,  of  consideration  to  be  given 
in  evidence,  in  a  suit  upon  a  specialty,  the 
facts  stated  in  the  answer  would  have 
constituted  a  perfect  defense.  And  the 
provision  of  the  Code,  allowing  a  defend- 
ant to  set  forth  in  his  answer  equitable  as 
well  as  legal  grounds  of  defense,  permitted 
the  same  defense  to  be  made  in  this  case; 
and  therefore  the  failure  of  consideration, 
stated  in  the  answer,  constituted  a  good 
defense. " 

Conceding,  then,  that  it  was  competent 
to  setup  a  want  or  failure  of  ctjnsidera- 
tion  as  a  defense  to  the  original  action, 
The  decisive  question  in  the  case  before  us 
is  whether  the  written  obligation  entered 
into  by  Henry  Louderraan  was  wholly 
without  consideration,  or  was  not  found- 
ed upon  sufficient  consideration  to  sup- 
port the  plaintiff's  action.  It  is  alleged  in 
the  answer  that  for  many  years  prior  to 
the  date  of  the  written  obligation  de- 
scribed in  the  petition  .Jesse  Louderm.an 
had  been  dead  ;  that  his  estate  was  insolv- 
ent, and  long  before  the  making  of  the 
obligation  had  been  fully  settled ;  and 
that  the  note  of  .Jesse  Louderman  was,  on 
the  5th  day  of  October.  1SS2,  and  for  years 
before  had  been,  wholly  worthless, — all  of 
which,  it  is  alleged,  was  then  fully  known 


to  the  plaintiff.  It  is  evident,  however, 
that  the  father  did  not  treat  the  note  of 
his  son  as  without  value,  for  he  stipu- 
lated for  the  payment  to  the  plaintiff,  out 
of  his  personal  estate  at  his  decease,  of  a 
sum  equal  to  the  full  amount  called  for 
by  the  note.  The  motive  or  inducement 
operating  upon  the  father  seems  to  have 
been  so  controlling  that  he  was  deter- 
mined upon  paying  his  son's  outstanding 
note,  though  postponing  payment  until 
his  decease,  when  It  was  to  be  paid  out  of 
his  personal  estate,  and  the  sum  paid  to 
be  a  charge  and  advancement  to  the  son's 
heirs.  For  aught  that  appears,  there  may 
have  been  circumstances,  best  known  to 
the  father,  which  in  his  estimation  ren- 
dered his  possession  of  the  note  a  valuable 
acquisition.  And  the  manifest  wish  and 
design  of  the  father  to  acquire  the  owner- 
ship and  possession  of  the  note  obviously 
tended  to  enhance  the  value  of  the  instru- 
ment while  in  the  hands  of  the  plaintiff. 
It  cannot  well  be  said,  we  think,  that  the 
chose  in  action  surrendered  by  the  plain- 
tiff was  valueless,  or  was  inadequate  as  a 
consideratiou  for  the  execution  and  de- 
livery of  the  written  obligation,  the  ade- 
quacy or  inadequacy  of  consideration 
having  been  left  to  the  free  exercise  of 
the  judgment  of  the  contracting  parties. 

It  is  an  elementary  principle  that  the 
law  will  not  enter  into  an  inquiry  as  to 
the  adequacy  of  the  consideration,  but 
will  leave  the  parties  to  judge  of  that  for 
themselves.  The  reason  of  the  rule  is  suc- 
cinctly expressed  by  Alderson,  B.,  in 
Pilkington  v.  Scott,  15  Mees.  &  W.  657. 
"Before  the  decision  in  Hitchcock  v. 
Coker,"  6  Adol.  &  E.  440,  he  says,  "a  no- 
tion prevailed  that  theconsideration  must 
be  adequate  to  the  restraint.  That  was, 
in  truth,  the  law  making  the  bargain,  in- 
stead of  leaving  the  parties  to  make  it,  and 
seeing  only  that  it  is  a  reasonable  and 
proper  bargain."  It  is  considered  unwise 
to  interfere  with  the  facility  of  contract- 
ing, and  the  free  exercise  of  the  judgment 
and  will  of  the  parties,  by  not  allowing 
them  to  be  sole  judges  of  the  benefits  to 
be  derived  from  their  bargains.  "It  is, 
indeefl,  necessary  that  the  consideration 
should  be  of  some  value;  but  it  is  suffi- 
cient if  it  be  of  slight  value  only,  or  even 
if  it  be  such  as  could  be  valuable  to  the 
party  promising."  1  Chit.  Cont.  (Uth 
Amer.  Ed.)  20,  and  cases  cited.  When  a 
contract  is  founded  on  a  transfer  of  an  ar- 
ticle of  property,  the  authorities  are  nu- 
merous in  illustration  of  tliedoctrinethat, 
in  determining  adetjuacy  of  consideration, 
the  extent  of  benelit  derivable  from  it  is 
not  considered.  A  value,  however  small 
or  nominal,  if  given  or  stipulated  for  in 
good  faith,  is,  in  the  absence  of  fraud, 
sufficient  to  support  an  action  on  the  con- 
tract or  promise.  "Thus,  the  mere  sur- 
render and  delivery  of  a  letter  or  other 
written  document  which  the  promisee  has 
a  right  to  keep  and  retain  in  his  posses- 
sion is  a  sufficient  consideration  for  the 
promise,  although  the  possession  of  it 
may  turn  out  eventually  to  be  of  no  value 
in  a  pecuniary  point  of  view,  or  no  bene- 
fit may  have  resulted  to  the  one  party, 
nor  prejudice  to  the  other,  from  the  sur- 
render and   delivery  of   the  document.,"    1 


ADEQUACY. 


229 


Add.  Cont.  (Sth  Ed.)  C.  In  Hni;,'h  v. 
Brooks.  10  Ado).  &  i:.  :;():>,  ;;_'(),  {he  declara- 
tion In  assumpsit  Htalcd  that  tlio  defend- 
ant prcjmised  to  see  certain  bills  accepted 
by  L.  paid  at  maturity,  in  consideration 
that  the  i)laintilT.s,  at  ills  rccincKt,  woidd 
give  up  to  him  a  certain  j;iiai'anty  on  l)e- 
lialf  of  L.,  then  held  by  plaintiffs.  It  was 
averred  that  the  plaintiffs  ffave  up  the 
guaranty,  l)ut  that  the  defendant  did  not 
perform  his  promise.  There  was  a  plea 
tliat  tlie  j?uai-ii!ity  was  a  promise  to  an- 
swer for  the  dr  i)t  of  another,  and  that 
there  was  no  aKr('«ment  in  writing  where- 
in any  sufficient  consideration  was  stated, 
according  to  St.  2!)  Car.  II.  It  was  lield 
that  it  appeared  on  the  i)leadinji.s  tliat  the 
j»laint:ffs  had  delivered  something  to  the 
defendant,  on  the  faith  of  liis  promise, 
Avliicli  he  at  the  time  considered  valuable; 
and  tliis  being  so,  and  no  fraud  imf)uted, 
lie  could  not  afterwards  excuse  a  ijreach 
of  the  promise,  by  alleging  that  tlie  thing 
given  up  was  not  of  the  value  ho  luid  sup- 
posed. Lord  Drnaia-v,  C.  J.,  in  delivering 
the  judgment  of  the  court,  said  :  "  We  are 
Ity  no  means  prepared  to  say  that  an^-  cir- 
cumstances sliort  of  the  imputation  of 
fraud  in  fact  could  entitle  us  to  hold  tliat 
a  party  was  not  l)ound  by  a  promise  made 
upon  any  consideration  which  could  be 
valuable;  while  of  its  being  so.  the  prom- 
ise l)y  which  it  Avas  obtained  from  the 
holder  of  it  must  always  afford  some 
proof.  Here,  whether  or  not  the  guaran- 
ty could  have  been  available  witliin  the 
doctrjne  of  Wain  v.  Warlters,  5  Ea-^t,  10, 
tile  plaintiffs  were  induced  by  the  defend- 
ant's ijromise  to  part  witli  something 
which  they  might  have  kept,  and  the  de- 
fendant obtained  what  lie  desired  by 
means  of  that  promise.  Both  being  free 
and  ai)le  to  judge  for  themselves,  how  can 
the  defendant  be  jnstilied  in  breaking  this 
promise,  on  discovering  afterwards  that 
tlie  thing  in  consideration  of  which  he 
gave  it  did  not  possess  that  value  which 
lie  supposed  to  belong  to  it?  It  cannot  be 
ascertained  that  that  value  ^-as  what  he 
most  rej-arded.  He  ma\-  have  had  other 
objects  and  motives,  and  of  their  weight 
he  was  the  only  judge." 

As  alleged  in  tlie  original  petition,  and 
as  stated  in  the  written  obligation  upon 
whicli  the  action  is  founded,  tlie  consider- 
ation of  Henry  Louilerman's  executing 
and  delivering  the  oljJigation  was  the  sur- 
rendering and  turning  over  to  him  of  the 
note  of  his  son.  The  facts  constituting 
the  cause  of  action  were  admitted  by  the 
demurrer  to  the  petition;  and  in  the  an- 
swer thereto  subsequently  tiled  there  was 
no  denial  of  tlie  allegations  in  the  petition 
as  to  the  consideration  of  the  written 
ol)ligation.  The  answer,  in  the  nature  of 
a  confession  and  avoidance,  avers,  sub- 
stantially, that  the  note  of  Jesse  LoudcM'- 
man  was,  at  the  time  it  was  surrendered, 
and  for  years  before  had  been,  uncollect- 
ible; and  tliat  therefore   the  written    obli- 


I  gation  was  wholly  withoutconsifleratloD, 
and  created  n(j  valid  claim  against  Henr^' 
Louderman   or  his  estate.     If,  before  and 
at   the   time  the  note  was  surrendererl,  it 
was   not  collectible   out   of  Jesse  Louder- 
man's  estate,  it  would  notfollow— for  rea- 
sons before  assigned —that  the  written  ob- 
ligation was   necessarily  without   con-id- 
eraticju.     Henry  Louderman  received  fi-o in 
the  plaintiff  that  for  whirl)  he  contracted, 
and  (jbtained    that  whifli.  by  the  terms  (jf 
the   contract,    was   evidently    deemed    by 
the  contracting  parties  an  (djject  (jf  value. 
In  contemplation  of  law,  there  was,  in  our 
view,  no  want  or  failure  of  consideration 
for   the  written  obligation  of    Henry  Lou- 
derman.    It  is  alleged  in  the  answerof  the 
defendant  "that    the  just   and  legal  debts 
of  said   estate   of   Henry    Loiulerman  are 
more   than    all   the     i)ersonal    pro[)erty, " 
and  "that   all    the  real  estate  of   deceased 
was  specifically  devised."     Henry  Louder- 
man, by   his  written  oldigation,  made  tlie 
claim  f)f  Henry  Judy  a  debt  against  his  es- 
tate.    It    was    to    be  paid    out  of   ids  per- 
sonal  estate   at  his  decease,  by  his  execu 
tor   or   administrator,  as    the   case  miglit 
be.       What      was     his     personal    estate? 
Not,  as  contended,  that  which    would    re- 
main  after  the  payment  of   his  debts,  and 
out   of  which    a  distributive   share  would 
ffo   to   the  heirs  of  Jesse  Louderman,  but 
the   body    of   his   personal  proi)erty  exist- 
ing at  the  time  of   his  death.     The  person- 
al   estate   is  the  regular  and  primary  fund 
for  the  payment  of   deljts.  and  this  will  be 
first   applied    until   exhausted.     And,    "as 
soon    as   the  executor   or    administrator 
shall  ascertain  that  the  personal  estate  in 
his   liands    will   be  insuflicient   to    jiay  all 
tlie  debts  of    the  deceased, "   it  is  made  his 
duty,  by  statute,  to   apply  to  the  probate 
court   or   the  court   of  common  pleas  for 
authority   to   sell   the   real   estate   of   the 
deceased.     Section    ()1:5(;,  Kev.    St.     Where, 
for  a  valuable  consideration,  one  promises 
to  pay  a  debt  out  of  his  personal  estate  at 
his   decease,  without   a  siiecific  limitation 
to    that   estate   alone,   if,  at    his   decease, 
the   personal   estate  is  insufficient  to  jiay 
the  debt,  the  creditor  will  not  beiirecluded 
from    res(jrting   to   the   real  estate  of   the 
debtor,    if     any   there   be.      Otherwise     it 
might  be  in  the  power  of  the  deli  tor.  in  his 
life-time,  to  convert  his    personal  into  real 
estate,    and    tlius    evade    his    obligations 
by  sim[)ly  changing  the  form  of  his  jirop- 
erty.     Under   his    written    cbligaliou,   the 
personal  i)roperty    of   Henry    I^ouderman 
was  made  the  primary  fund  for  the  pay- 
ment  of   the   plaintiff's   claim;  but   if.   at 
his  death,  his  just  and  legal  debts  exceeded 
all   his   personal   property,  the  residue  of 
his    estate,    if   any,  was  not   thereby  dis- 
ciiarg(>(l  from    the  payment  of   his  debt  to 
the   plaintiff.     'I'he   demurrer   to     the   an- 
swer was  rightly  sustained,  and  the  judg- 
ment   of    the  circuit    court    should    l)e  re- 
versed,  and  that  of   the  court  of  common 
pleas  affirmed.    Judgment  accordingly. 


2o0   ( 


CONSIDERATION. 


SCHXELL  T.  NELL 

(17  Ind.  29.) 

Supreme  Court  of  Indiana.     Nov.  25,  1S61. 

Appeal  from  court  of  common  pleas,  Marion 
county. 

James  Morrison  and  C.  A.  Ray,  for  appel- 
lant. N.  B,  Taylor  and  A.  Seidensticker,  for 
appellee. 

PERKINS,  J.  Action  by  .7.  B.  Nell  against 
Zacliarias  Schnell,  upon  the  following  instru- 
ment: 

"This  agreement,  entered  into  this  13th 
day  of  February,  laoG,  between  Zach. 
SchneU,  of  Indianapolis,  Marion  county, 
state  of  Indiana,  as  party  of  the  first  part, 
and  J.  B.  Nell,  of  the  same  place,  Wendelin 
Lorenz,  of  Stilesrille,  Hendricks  coimty, 
state  of  Indiana,  and  Donata  Lorenz,  of 
Frickingor,  Grand  Duchy  of  Baden,  Ger- 
many, as  parties  of  the  second  part,  witness- 
eth:  The  said  Zacharias  Schnell  agrees* as 
follows:  Whereas  his  wife,  Theresa  Schnell, 
now  deceased,  has  made  a  last  will  and  tes- 
tament in  which,  among  other  provisions,  it 
was  ordained  that  every  one  of  the  above- 
named  second  parties,  should  receive  the  sum 
of  .?20<};  and  whereas  the  said  provisions  of 
the  will  must  remain  a  nullity,  for  the  reason 
Ihat  no  property,  real  or  personal,  was  in 
tiie  possession  of  the  said  Theresa  Schnell, 
deceased,  in  her  own  name,  at  the  time  of 
her  death,  and  all  property  held  by  Zach- 
arias and  Theresa  Schnell  jointly,  therefore 
reverts  to  her  husband;  and  whereas  the 
said  Theresa  Schnell  has  also  been  a  duti- 
ful and  loving  wife  to  the  said  Zach.  Schnell, 
and  has  materially  aided  him  in  the  acquisi- 
tion of  all  property,  real  and  personal,  now 
possessed  by  him;  for,  and  in  consideration 
of  all  this,  and  the  love  and  respect  he  bears 
to  his  wife;  and,  furthermore,  in  considera- 
tion of  one  cent,  received  by  him  of  the  sec- 
ond parties,  he,  the  said  Zach.  Schnell, 
agrees  to  pay  the  above  named  sums  of  mon- 
ey to  the  parties  of  the  second  part,  to  wit: 
S200  to  the  said  J.  B.  Nell;  $200  to  the  said 
Wondelin  Lorenz;  and  .?2(X)  to  the  said  Do- 
nata Lorenz,  in  the  following  installments, 
viz.,  $200  in  one  year  from  the  date  of  these 
presents;  .?200  in  two  years;  and  $200  in 
three  years;  to  be  divided  between  the  par- 
ties in  equal  portions  of  $GG%  each  year,  or 
as  they  may  agree,  till  each  one  has  received 
his  full  sum  of  $200.  And  the  said  parties 
of  the  second  part,  for,  and  in  consideration 
of  this,  agree  to  pay  the  above  named  sum 
of  money  (one  cent),  and  to  deliver  up  to 
said  Schnell,  and  abstain  from  collecting  any 
real  or  supposed  claims  upon  him  or  his  es- 
tate, arising  from  the  said  last  will  and  tes- 
tament of  the  said  Theresa  Schnell,  deceased. 
In  witness  whereof,  the  said  parties  have, 
on  this  13th  day  of  February,  18.5G,  set  here- 
unto    their     hands     and     seals.    Zacharias 


B.  Nell.     [Seal.]     Wen. 


Schnell.     [Seal.]     J. 
Lorenz.     [Seal.]" 

The  complaint  contained  no  averment  of  a 
consideration  for  the  instinimcnt,  outside  of 
those  expressed  in  it;  and  did  not  aver  that 
the  one  cent  agreed  to  be  paid,  had  been 
Ijaid  or  tendered. 

A  demurrer  to  the  complaint  was  over- 
ruled. 

The  defendant  answered,  that  the  instru- 
ment sued  on  was  given  for  no  consideration 
whatever. 

He  further  answered,  that  it  was  given  for 
no  consideration,  because  his  said  wife, 
Theresa,  at  the  time  she  made  the  will  men- 
tioned, and  at  the  time  of  her  death,  owned, 
neither  separately,  nor  jointly  with  her  hus- 
band, or  any  one  else  (except  so  far  as  the 
law  gave  her  an  interest  in  her  husband's 
property),  any  property,  real  or  personal,  etc. 

The  will  is  copied  into  the  record,  but  need 
not  be  into  this  opinion. 

The  court  sustained  a  demurrer  to  these 
answers,  evidently  on  the  ground  that  they 
were  regarded  as  contradicting  the  instru- 
ment sued  on,  which  particularly  set  out  the 
considerations  upon  which  it  was  executed. 
But  the  instrument  is  latently  ambiguous  on 
this  point     See  Ind.  Dig.  p.  110. 

The  case  turned  below,  and  must  turn 
here,  upon  the  question  whether  the  instru- 
ment sued  on  does  express  a  consideration 
stifficient  to  give  it  legal  obligaRon,  as  against 
Zacharias  Schnell.  It  specifies  three  dis-. 
tinct  considerations  for  his  promise  to  pay 
$000: 

(1)  A  promise,  on  the  part  of  the  plaintiffs, 
to  pay  him  one  cent. 

(2)  The  love  and  affection  he  bore  his  de- 
ceased wife,  and  the  fact  that  she  had  done 
her  part,  as  his  wife,  in  the  acquisition  of 
the  property. 

(3)  The  fact  that  she  had  expressed  her  de- 
sire, in  the  form  of  an  inoperative  will,  that 
the  persons  named  therein  should  have  the 
sums  of  money  specified. 

The  consideration  of  one  cent  will  not  sup- 
port the  promise  of  Schnell.  It  is  true,  that  as 
a  general  proposition,  inadequacy  of  consider- 
ation will  not  vitiate  an  agreement  Baker 
V.  Roberts,  14  Ind.  552.  But  this  doctrine 
does  not  apply  to  a  mere  exchange  of  sums 
of  money,  of  coin,  whose  value  is  exactly 
fixed,  Tjjit  tn  thQ-^-vrVinri£0  of_Somcllung_of, 
in  itself,  indoteri'lioate  value,  for  mmiev^  or, 
perhaps,  for  other  thing  of  indeterminate 
value.  In  this  case,  liad  the  one  cent  men- 
tioned been  some  particular  one  cent  a  fam- 
ily piece,  or  ancient,  remarkable  coin,  pos- 
sessing an  indeterminate  value,  extrinsic 
from  its  simple  money  value,  a  different  view 
might  bo  taken.  As  it  is,  the  mere  promise  to 
pay  six  hundred  dnllai's  for  one  cent,  even 
had  the  jwrtion  of  tliat  cent  due  from  the 
plaintiff  been  tendered,  is  an  unconscionable 
contract  void,  at  first  blush,  upon  its  face,  if 
it  be  regarded  as  an  earnest  one.     Hardesty 


ADEQUACY. 


231 


V.  Smith,  3  Ind.  39.  The  consideration  of  one 
cent  Is,  plainly,  In  this  case,  merely  nominal, 
and  Intended  to  be  so.  As  the  will  and  tes- 
tament of  Schnell's  wife  imposed  no  legal  ob- 
ligation upon  him  to  discharge  her  bequests 
out  of  his  property,  and  as  she  had  none  of 
her  own,  his  promise  to  discharge  them  was 
not  legally  binding  upon  him,  on  that  ground. 
A  moral  consideration,  only,  will  not  supixirt 
a  promise.  Ind.  Dig.  p.  13.  And  for  the 
same  reason,  a  valid  consideration  for  his 
promise  cannot  be  found  in  the  fact  of  a  com- 
promise of  a  disputed  claim;  for  where  such 
claim  Is  legally  groundless,  a  promise  upon  a 
compromise  of  it,  or  of  a  suit  upon  it,  is  not 
legally  binding.  Spahr  v.  HoUingshead,  8 
Blackf.  415.  There  was  no  mistake  of  law  or 
fact  in  this  case,  as  the  agreement  admits 
the  will  inoperative  and  void.  The  promise 
was  simply  one  to  make  a  gift  The  past 
services  of  his  wife,  and  the  love  and  affec- 
tion he  had  borne  her,  are  objectionable  as 
legal  considerations  for  Schnell's  promise,  on 
two  grounds:     (D  They  are  past  considera- 


tions, thd.  Dig.  p.  13.  (2)  The  fact  that 
Schnell  loved  his  wife,  and  that  she  had  been 
industrious,  constituted  no  consideration  for 
his  promise  to  pay  J.  B.  Nell  and  the  Lorenzes 
a  sum  of  money.  Whether,  if  his  wife,  in  her 
lifetime,  had  made  a  bargain  with  Schnell, 
that,  in  con-sideration  of  his  promising  to  pay, 
after  her  death,  to  the  person  named,  a  sum 
of  money,  she  would  be  industrious,  and 
worthy  of  his  affection,  such  a  promise  would 
have  been  valid  and  consistent  with  public 
policy,  we  need  not  decide.  Nor  is  the  fact 
that  Schnell  now  venerates  the  memory  of  his 
deceased  wife,  a  legal  consideration  for  a 
promise  to  pay  any  third  person  money. 

The  instrument  sued  on.  Interpreted  in  the 
light  of  the  facts  alleged  hi  the  second  para- 
graph of  the  answer,  will  not  support  an  ac- 
tion. The  demurrer  to  the  anfswer  should 
have  been  ovenoiled.  See  Stevenson  v.  Dru- 
ley,  4  Ind.  5ia 

PER  CURIAM.  The  Judgment  is  reversed, 
with  costs.    Cause  remanded,  etc 


282 


CONSIDERATION. 


COLEMAN  T.  EYRE. 

(45  N.  Y.  380 

CoTirt  of  Appeals  of  New  York.     Feb.  21,  1871. 

W.  M.  Macfai-land,  for  appellants.  John 
H.  Reynolds,  for  respondents, 

RAPALLO,  J.  The  plaintiff  was  interest- 
ed to  the  extent  of  one-fourth  in  the  profits 
or  losses  of  a  shipment  of  coffee  undertaken 
by  him  jointly  with  other  parties.  After  the 
adventure  had  been  begun,  and  before  the 
coffee  had  reached  its  port  of  destination,  it 
was  mutually  agreed  between  the  plaintiff 
and  the  defendant  that  the  latter  should  have 
one-half  interest  in  the  plaintiff's  one-fourth 
interest  in  the  adventure.  The  speculation 
resulted  in  a  loss,  and  this  action  was  brought 
to  recover  one-half  of  the  plaintiff's  propor- 
tion of  such  loss.  It  is  now  claimed  on  the 
part  of  the  defendant  that  no  valid  contract 
was  made  between  him  and  the  plaintiff; 
that  inasmuch  as  the  plaintiff  had  embarked 
in  the  speculation  before  and  without  refer- 
ence to  any  arrangement  with  the  defendant, 
and  the  defendant  had  not  done  or  con- 
tributed any  thing  to  aid  in  the  joint  enter- 
prise, there  was  no  partnership,  and  no  con- 
sideration for  the  undertaking  of  the  plaintiff 
to  give  him  one- half  of  the  profits;  that  there- 
fore the  defendant  could  not  have  enforced 
payment  of  half  the  profits,  if  the  adventure 
had  been  successful,  and  consequently  no 
agreement  on  Ms  part  to  contribute  to  the  loss 
can  be  implied. 

This  argument  assumes  that  the  agreement 
was  simply  that  the  defendant  should  have 
one-ba.Jf  of  the  profits,  which  the  plaintiff 
might  make  out  of  the  adventure,  in  case  it 
should  prove  suecessfuL  But  such  was  not  the 
agreeraent  proved.  The  agreement  was  that 
the  flefenda.nt  should  share  with  the  plaintiff 
in  the  adventure,  and  it  seems  to  havp  been 
clearly  understood  tJiat  he  should  participnhe 
tn  the  result,  whether  it  should  prove  a  prufit 


or  a  loss.  That  It  might  result  in  a  loss  was 
contemplated  by  the  parties.  There  is  evi- 
dence in  the  case  that  the  possibility  of  tlat 
event  was  the  subject  of  conversation  be- 
tween them  at  the  time  of  making  the  con- 
tract; tliat  the  hope  was  then  expressed  that 
the  plaintiff  would  not  be  compelled  to  call 
upon  the  defendant  to  contribute  to  a  loss; 
and  that  afterwards,  when  they  did  caU  upon 
him  to  contribute,  he  did  not  dispute  his  lia- 
bility, but  sought  to  reduce  the  amount  by 
claiming  a  portion  of  the  i^aintiff's  commis- 
sions. 

The  evidence  fully  justified  a  ficnding  that 
in  consideration  of  the  agreement  by  the 
plaintiffs  to  account  to  the  defendant  for  half 
the  profits  in  case  of  success,  the  defendant 
undertook  to  bear  half  the  loss  in  the  con- 
trary event;  and  the  intendment  is  that  the 
referee  did  so  find.  Indeed,  .such  is  a  propar 
construction  of  the  actual  finding.  It  is  a 
clear  case  of  mutual  promises;  and  the  obli- 
gation of  each  party  was  a  good  considera- 
tion for  that  of  the  other.  Briggs  v.  TfQot- 
son,  8  Johns.  304. 

The  evidence  was  conflicting  as  to  whether 
the  defendant  was  to  share  in  the  commis- 
sions. The  referee  found  in  the  plaintiffs' 
favor  on  that  point,  and  the  court  below,  at 
general  term,  refused  to  interfere  with  that 
finding.     We  cannot  disturb  it. 

The  agreement  was  not  within  the  statute 
of  frauds.  It  was  not  an  agreement  for  the 
sale  of  any  personal  property  or  chose  iji 
action,  but  an  executory  agreement,  whereby 
one  party  undertook  to  bear  one  port  of  a 
possible  loss  in  consideration  of  a  share  of  an 
expected  profit. 

The  judgment  of  reversal  and  order  grant- 
ing a  new  trial  should  be  revised,  and  the 
judgment  for  the  plaintiffs  entered  on  the  re- 
port of  the  referee  should  be  affinned,  with 
costs. 

All  concur. 

Order  of  general  term  reversed,  and  judg- 
ment for  the  plaintiffs  affirmed. 


^ 


< 


MUTUAL  PROMISES. 


233 


SEWARD  et  al.  v.  MITCHELL.. 

/  (1  Cold.  87.) 

Supreme  Court  of  Tennessee.    Nov.  Term,  1859. 

T.  J.  E'reeman,  for  plaintiffs  lu  error.  M. 
R.  Hill,  for  defendant  in  error. 

CARUTHERS,  J.  On  the  IGth  Oct.  IS.jG, 
Mitchell  sold  to  Seward  &  Scales,  for  the 
consideration  of  ?8,596.50,  a  tract  of  laud  in 
the  county  of  Gibson,  described  in  a  deed  of 
that  date,  by  metes  and  bounds,  "containing 
521  acres,  being  a  part  of  a  5000-acre  tract 
granted  to  George  Dougherty,  and  bounded 
as  follows,"  etc. 

The  title  is  warranted  with  the  usual  cov- 
enants, but  nothing  more  said  about  the 
grants  than  what  is  above  recited. 

Some  time  after  the  deed  was  made,  the 
parties,  differing  as  to  the  quantity  of  land 
embraced  in  the  tract,  made  an  agreement, 
that  it  should  be  surveyed  by  Gillespie,  and 
if  there  were  more  than  five  hundred  and 
twenty-one  acres,  the  vendee  should  pay  for 
the  excess  at  the  rate  of  $1G.J50  per  acre, 
that  being  the  price  at  which  the  sale  was 
made,  and  if  less,  then  the  vendor  should 
pay  for  the  deficiency,  at  the  same  rate.  It 
turned  out  that  there  was  an  excess  of  fiity- 
seven  acn>-<.  and  the  tract  embraced  in  the 
deed  was  five  hundred  and  seventy -eight 
acres,  instead  of  five  hundred  and  twenty- 
one,  as  estimated  In  the  sale.  For  this  ex- 
cess, the  present  suit  was  brought,  and  re- 
covery had,  for  ?1,079. 

It  is  objected  here,  that  the  court  below 
erred  in  refusing  to  charge,  as  requested, 
that  the  agreement  sued  upon  was  void  for 
want  of  a  writing,  and  because  there  was 
no  considei*ation  for  the  promise. 

1.  The  contract,  or  promise  sued  upon,  is 
not  for  the  sale  of  land,  so  as  to  require  a 
writing,  under  the  statute  of  frauds. 

The  sale  had  already  been  reduced  to  writ- 
ing. This  was  a  subsequent  collateral  agree- 
ment in  relation  to  the  price,  which  was 
binding  by  parol  and  to  which  the  statute 
can  have  no  application  whatever.  This  is 
too  plain  for  argument. 

2.  There  is  more  plausibility  in  the  second 
objection,  that  there  was  no  sufficient  con- 


sideration for  the  promise.  But  this  Is  also 
untenable.  The  argument  Is  that  the  deed 
embraced  the  whole  tract,  and  passed  a  per- 
fect title  to  the  extent  of  the  boundaries, 
and  consequently  there  was  nothing  passing 
as  a  consideration  for  the  new  promise  that 
the  party  did  not  own  before  by  a  perfect 
legal  right. 

It  is  true  that  if  the  sale  was  by  the  tract 
and  not  by  the  acre,  as  appears  from  the 
deed,  and  no  stipulations  as  to  quantity,  that 
the  title  was  good  for  the  whole  and  covered 
the  excess.  But,  if  the  sale  was  not  in 
gross,  but  by  the  acre,  and  the  recitation  In 
the  deed  would  not  be  conclusive  in  a  court 
of  equity  on  that  point,  if  the  fact  could  be 
shown  to  be  otherwise,  then  there  would  bo 
mutual  remedies  for  an  excess  or  deficiency 
in  proper  cases,  as  we  held  in  Miller  v. 
Bents,  4  Snoed,  and  a  more  recent  case; 
but,  independent  of  that,  and  taking  it  to 
have  been  purely  a  sale  in  gross,  and  both 
parties  desiring  to  act  justly,  and  being  of 
different  opinions  as  to  the  quantity,  mutual- 
ly agreed  to  abide  by  an  accurate  survey  to 
ascertain  which  was  bound  to  pay,  and  re- 
cover from  the  other,  and  what  amount. 
We  see  no  good  reason  in  law  or  morals, 
why  such  an  agreement  should  not  be  bind- 
ing upon  them.  The  case  of  Howe  v.  O'Mal- 
ley,  1  Murph.  L.  &  Eq.  R.  287,  is  precisely  in , 
\  point  The  court  there  held  that  a  promise 
I  to  refund  in  case  of  deficiency,  is  a  good 
^consideration  for  a  promise  to  pay  for  any 
iexcess  over  what  is  called  for  in  the  deed. 
That  such  mutual  promises  are  sufficient 
considerations  for  each  other. 
I  The  case  of  Smith  v.  Ware,  13  Johns.  259, 
which  is  supposed  to  conflict  with  this,  is 
entirely  different;  "there  was  no  mutuahty," 
because  the  promise  sued  upon  was  to  pay 
for  the  deficiency,  without  any  obligation  on 
the  other  party  to  pay  for  an  excess,  if  any 
there  had  been. 

The  principle  of  the  North  Carolina  case, 
commends  itself  to  our  approbation,  because 
of  its  equity  and  justice. 

Without  further  citation  of  authorities,  we 
are  satisfied  to  hold  that  the  promise  in  this 
case  was  binding  upon  the  defendant,  as  his 
honor  charged,  and  therefore  affirm  the  judg- 
ment 


i; 


k^ 


234 


CONSIDERATION. 


PRESBYTERIAN   CHURCH   v.   COOPER 
et  al.  /) 

(20  N.  E.  352,  112  N.  Y.  517.)       y 

Court  of  Appeals  of  New  York.     March  5,  1SS9 

Appeal  from  supreme  com't,  general  term 
Third  department 

Action  by  the  Presbyterian  Church  of  Al- 
bany ajjainst  Thomas  C.  Cooper  and  another, 
administrators  of  Thomas  P.  Crooli,  deceased, 
on  a  subscription  made  by  the  decedent  to- 
wards paying  ofE  a  mortgage  debt  owing  by 
the  plaintiff.  .Judgment  was  given  for  de- 
fendants, and  plaintiff  appeals. 

Matthew  Hale,  for  appellant  Walter  E. 
Ward,  for  resjKjndents. 

ANDREWS,  J.  It  is,  we  think,  an  insuper- 
able objection  to  the  maintenance  of  this  ac- 
tion that  there  was  no  valid  consideration  to 
uphold  the  subscription  of  the  defendants' 
intestate.  It  is  of  course  unquestionable  tJia't 
no  action  can  be  maintained  to  enforce  a 
gratuitous  promise,  however  worthy  the  ob- 
ject intended  to  be  promoted.  The  perform- 
ance of  such  a  promise  rests  wholly  on  the 
will  of  the  person  making  it  He  can  refuse 
to  perform,  and  his  legal  right  to  do  so  cannot 
be  disputed,  although  his  refusal  may  dis- 
appoint reasonable  expectations,  or  may  not 
be  justified  in  the  forum  of  conscience. 

By  the  terms  of  the  subscription  paper  the 
subscribers  promise  and  agree  to  and  with 
the  trustees  of  the  First  Presbyterian  Church 
of  Albany  to  pay  to  said  trustees  within  three 
years  from  its  date  the  sums  severally  sub- 
scribed by  them,  for  the  purpose  of  paying 
ofC  "the  mortgage  debt  of  $45,000  on  the 
church  edifice,"  upon  the  condition  that  the 
whole  sum  shall  be  subscribed  or  paid  in  with- 
in one  year.  It  recites  a  consideration,  viz.: 
"In  consideration  of  one  dollar  to  each  of  us 
(subscribers)  in  hand  paid,  and  the  agreement 
of  each  other  in  this  contract  contained."  It  was 
shown  that  the  one  dollar  recited  to  have  been 
paid  was  not  in  fact  paid,  and  thefactthat 
the  promi.se  of  g^ch  guljgcribcj^yas'lwSfl^!!!]^ 
reaTT^~of''anS^  reliance  uponsimjiar  .pi'QrQ- 
Ises^ljy  "tKe*'^rEers,  constitutes  no  copsiclora- 
tion~  as  between   tn||^ca2oratijaa-''ior  whose 


Benefit  Jthe  promise  was~'made..and.the  promis- 
5rs.  The  TecitaT^o'f  a  cwTSIfleration  paid  does 
not  preclude  the  promisor  from  disputing  the 
fact  in  a  case  like  this,  nor  does  the  stiite- 
ment  of  a  particular  consideration,  which  on 
its  face  is  insufficient  to  support  a  promise, 
give  it  any  validity,  although  the  fact  recited 
may  be  true.  It  has  sometimes  been  suppos- 
ed that  when  several  persons  promise  to  con- 
tribute to  a  common  object  desired  by  all, 
the  promise  of  each  may  be  a  good  considera- 
tion for  the  promise  of  others,  and  this  al- 
though the  object  in  view  is  one  in  which  the 
promisors  have  no  pecuniary  or  legal  inter- 
est, and  the  performance  of  the  promise  would 
not  in  a  legal  sense  be  beneficial  to  the 
promisors  entering  into  the  engagement  This 
seems  to  have  been   the  view   of  the  chan- 


cellor, as  expressed  In  the  Hamilton  CoUege 
Case,  when  it  was  before  the  court  of  errors, 
(2  Denio,  417;)  and  dicta  of  the  judges  will 
be  found  to  the  same  efl'ect  in  other  cases. 
Trustees  v.  Stetson,  5  Pick.  508;  Watkins  v. 
Eames,  9  Cush.  537.  But  the  doctiine  of  the 
chancellor,  as  we  understand,  was  repudiated 
when  the  Hamilton  College  Case  came  before 
this  court,  (1  N.  Y.  581,)  as  have  been  also 
the  dicta  in  the  Massachusetts  cases,  by  the 
court  in  that  state,  in  the  recent  case  of 
Church  V.  Kendall,  121  Mass.  528.  The  doc- 
trine seems  to  us  unsound  in  principle.  It 
proceeds  on  the  assumption  that  a  stranger 
both  to  the  coasideration  and  the  promise, 
and  whose  only  relation  to  the  transaction  is 
that  of  donee  of  an  executory  gift,  may  sue 
to  enforce  the  payment  of  the  gratuity  for 
the  reason  that  there  has  been  a  breach  of 
contract  between  the  several  promisors,  and 
a  failure  to  carry  out,  as  between  themselves, 
their  mutual  engagement.  It  is  in  no  proper 
sense  a  case  of  mutual  promises  as  between 
the  plaintiff  and  defendant  If  any  action 
would  lie  at  all,  it  would  be  one  between  the 
promisors  for  breach  of  contract. 

In  the  disposition,   therefore,  of  this  case, 
we  must  reject  the  consideration  recited   in 
the  subscription  paper  as  groimd  for  support- 
ing the  promise  of  the  defendants'  Intestate, 
—the    money   consideration,— because    it    had 
no  basis  in  fact,  aiW  TIi^"mutual  promise  be- 
'  tw^^t-n^tbe""  subscnbers,   because^__as_.to__Jbeir 
promises  there  isnoprivify'of  conjHHlbetween 
■thii  IjUiluLlli   iiuiPthe   promisorsT    Some  con- 
sirlfcrilLibU  mUfelL  Lhyiefure  be'tound  other  than 
that  expressly  stated  in  the  subscription  paper 
in   order  to  sustain  the  action.     It  is  urged 
that  a  consideration  may  be  found  in  the  ef- 
forts of  the  trustees  of  the  plaintiff  during  the 
year,  and  the   time  and   labor  expended  by 
them  during  tliat  time,  to  secure  subscriptions 
in  order  to  fulfill  the-  condition  upon  which 
the    liability    of   the     subscribers    depended. 
There  is  no  doubt  that  labor  and  services  ren- 
dered by  one  party  at  the  request  of  another 
would  constitute  a  good  consideration  for  a 
promise  made  by  the   latter  to  the   former, 
based   on  the   rendition  of  the  service.    But 
the    pLaintiff    encounters    the    difficulty    that 
there  is  no  evidence,  express  or  implied,  on 
tlie  face  of  the  subsa-iption  paper,  nor  any 
evidence  outside  of  it,  thgUJie^corporation  or 
its_trustcef!  di^,  or_unde'rtook^td  35^  ghyfSTng 
npnii   th.Q^JnYilation   or   request  of  IBe^sub- 
scribers.    IsfoTlOTjere "  aTfy^evidPnce'thlTE'  the 
tnisieos'  of   the   plaintiff,    as    representatives 
of   the   corporation,    in   fact   did  anything    in 
their  corporate  capacity,  or  otherwise  than  as 
individuals  interested  in  promoting  the  gen- 
eral olijcct  in  view.     Leaving  out  of  the  sub- 
scription  paper  the  affirmative  statement  of 
the  consideration,   (which  for  reasons  stated 
may  be  rejected,)  It  stands  as  a  naked  prom- 
ise of  the   subscribers    to    pay    the    several 
amounts  subscribed  by  them  for  the  purpose 
of  paying  the  mortgage  on  the  church  prop- 
erty, upon  a  condition  precedent  limiting  their 


MUTUAL  PROMISES. 


ZX 


liability.  Neither  the  church  nor  the  trustees 
promLse  to  do  anything,  nor  are  they  request- 
er] to  do  anything,  nor  can  such  a  request  be 
imi)lied.  It  was  held  in  the  Hamilton  College 
Case,  1  N.  Y.  581,  that  no  such  request  could 
be  implied  from  the  terms  of  the  suljscripUon 
In  that  case,  In  which  the  ground  for  such 
an  implication  was,  to  say  the  least,  as  strong 
as  in  this  case.  It  may  be  assumed  from  tlie 
fact  that  the  subscriptions  were  to  be  paid 
to  the  trustees  of  the  church  for  the  purpose 
of  paying  the  mortgage  that  it  was  under- 
stood that  the  trustees  were  to  make  the 
payment  out  of  the  moneys  received.  Rut 
the  duty  to  make  such  payment  in  case  tJiey 
accepted  the  money,  would  arise  out  of  their 
duty  as  trustees.  This  duty  would  arise  up- 
on the  receipt  of  the  money,  although  they 
iiad  no  antecedent  knowledge  of  the  subscrip- 
tion. They  did  not  assume  even  this  obliga- 
tion by  the  terms  of  the  subscription,  and  the 
fact  that  the  trustees  applied  money  paid  on 
subscriptions  upon  the  mortgage  debt  did  not 
constitute  a  consideration  for  the  promise  of 
the  defendants'  Intestate.  We  are  unable  to 
distinguish  this  case  in  principle  from  the 
Hamilton  College  Case,  1  N.  Y.  5S1.  There 
is  nothing  that  can  be  urged  to  sustain  this 
subscription  that  could  not  with  equal  force 
have  been  urged  to  sustain  the  subscription 
in  that  case.  In  both  the  promise  was  to  the 
trustees  of  the  respective  corpoi'ations.  In 
each  case  the  defendant  had  paid  part  of  his 
subscription,  and  resisted  the  balance.  In  both 
part  of  the  subscription  had  been  collected 
and  applied  by  the  trustees  to  the  purpose 
specified.  In  the  Hamilton  College  Case, 
(which  in  that  respect  is  imlike  the  present 
one,)  it  appeared  that  the  trustees  had  incur- 
red expense  in  employing  agents  to  procure 
subscriptions  to  make  up  the  required  amount, 
and  it  was  shown  also  that  professors  had  been 
employed  upon  the  strength  of  the  fund  sub- 
scribed. The  Hamilton  College  Case  is  a  con- 
trolling authority  In  this  case.  It  has  not  been 
overruled,  and  has  been  frequently  cited  with 


appnjval  in  the  courts  of  this  and  other  states. 

The  cases  of  Barnes  v.  Ferine,  12  N.  Y.  IS, 
and  Roberts  v.  Cobb,  103  N.  Y.  GOO,  9  N.  E. 
GOO,  are  not  in  conflict  with  the  decision  in 
the  Hamilton  College  Case.  There  is,  we  sup- 
pose, no  doubt  that  a  subscription  invalid  at 
the  time  for  want  of  consideration  may  be 
made  vaUd  and  binding  by  a  con.sideration 
arismg  subsequently  between  the  subscribers 
and  the  church  or  corporation  for  whose  bene- 
fit it  is  made.  Both  of  the  cases  cited,  as  we 
undorst;ind  them,  were  supported  on  this  prin- 
ciple. There  was,  as  was  held  by  the  court 
in  each  of  these  cases,  a  subsequent  recjuest 
by  the  subscriber  to  the  promisee  to  go  on  and 
render  service,  or  incur  liabilities,  on  the  faith 
of  the  subscription,  which  request  was  com- 
plied with,  and  services  were  rendered  or  Ija- 
bihties  incurred  pursuant  thereto.  It  was  as 
if  the  request  was  made  at  the  very  time  of 
the  subscription,  followed  by  performance  of 
tlie  request  by  the  promisor.  Judge  Allen,  in 
his  opinion  in  Barnes  v.  Ferine,  said  "the  re- 
quest and  promise  were  to  every  legal  eCLect 
simultaneous;"  and  he  expressly  disclaims 
any  intention  to  interfere  with  the  decision  in 
the  Hamilton  College  Case. 

In  the  present  case  it  was  shown  that  indi- 
vidual trustees  were  active  in  procuring  sub- 
scriptions. But,  as  has  been  said,  they  acted 
as  individuals,  and  not  in  their  official  ca- 
pacity. They  were  deeply  interested,  as  was 
;Mr.  Crook,  in  the  success  of  the  effr,rt  to  pay 
the  debt  on  the  church,  and  they  acted  in  uni- 
son. But  what  the  trustees  did  was  not 
prompted  by  any  request  from  Mr.  Crook. 
They  were  all  co-laborers  in  promoting  a  com- 
mon object.  We  can  but  regret  that  the  in- 
tention of  the  intestate  in  respect  to  a  mat- 
ter in  which  he  was  deeply  interested,  and 
whose  interest  was  manifested  up  to  the  very 
time  of  his  death,  is  to  be  tliwarted  by  the 
conclusion  we  have  reached;  but  we  think 
there  is  no  alternative,  and  that  the  Judgment 
must  be  affirmed. 

AU  concur. 


CONSIDERATION. 


KEEP  et  al.  v.  GOODRICH. 
(12  Johns.  397.) 


Supreme  Court  of  New  York.     Oct.,  1815. 


Th^i  was  an  action  of  assumpsit.  The  decla- 
i-ation  contained  three  counts.  The  first  stat- 
ed, that  certain  differences  having  arisen  be- 
tween the  plaintiffs,  as  executors  of  Nathan 
Hale,  deceased,  and  the  defendant,  concern- 
ing a  promissory  note,  made  by  the  defendant 
to  their  testator,  dated  the  7th  day  of  Feb- 
ruary, 1797,  by  which  the  defendant  promised 
to  pay  him.  for  valui?  received,  fG9  3s.  8d. 
lavful  money,  on  demand,  with  lawful  inter- 
est, at  sir  per  eftnt-  in  certain  liquidated  se- 
curities given  by  the  treasurer  of  Connecti- 
cut; and  that  to  put  an  end  to  such  differ- 
ences, the  parties,  heretofore,  to  wit,  &c.,  "re- 
Bpectivelv  submitted  themselves  to  the  award 
of  John  Elmore,  to  be  made  between  them, 
of  and  concerning  the  said  differences;  and 
iri  consideration  thereof,  and  that  the  plain- 
tiffs, at  the  special  instance  and  request  of  the 
defendant,  hiid,  then  and 'there,  undertaken  j 
and  j^romised  the  defendant  to  perform  and 
fulfil  thf-'  awa\-d  of  the  said  John  Elmore,  to 
be  mad?,  &c  of  and  concerning  the  said  dif- 
ference?, in  aH  thingi?  on  their  part  to  be 
perfonned  aad  fulfilled,  he,  the  defendant 
undffrtooli.  &e.  to  perform  and  fulfil  the  said 
award,  in  all  tilings,"  &•_•.  The  plaintiffs 
averred  that  Earaore,  having  taken  upon  him- 
self the  biQtfcen  of  the  arbitrament,  did,  en 
the  15th  of  Mfl.y,  1814,  at,  &c,  make  his  award 
in  writing,  &c.,  and  thereby  awarded,  that 
the  defendant  shculd  pay  the  said  plaintiffs., 
fts  ((ixecutors  aforesaid,  the  snm  of  391  dollars 
aiid  31  centE,  in  fuU  satisfaction  of  their 
cluiia  Oil  the  sj-.id  note,  of  which  said  award, 
th^  Pif.:fA  «el€Gdani.,  afterwards,  to  wit,  &c.,  had 
notice;  Jind  although  often  requested,  «S:c.  to 
pa7  tW  said  tmm,  &c.,  according  to  the  tenor 
and  eiftct  of  tee  said  Kward,  and  of  his  prom- 
ise, &(.:;  yet,  not  regarding,  &c.,  he  did  not 
pay,  &ic.  The  second  count  was  on  an  insimnl 
cornptitassent  The  third  count  was  also  on 
an  insimul  computassent,  with  the  plaintiffs, 
as  executors,  &c 

The  defendant  pleaded  the  general  issue, 
with  notice  of  set-off. 

At  the  trial,  the  plaintiffs  give  in  evidence 
a  letter  of  the  defendant,  dated  Albany,  Au- 
gust 19th,  1811,  addressed  to  John  Elmore, 
In  which,  speaking  of  the  claim  of  the  plain- 
tiff.s,  and  alleging  that  he  owed  nothing,  he 
says:  "But  I  have  agreed  for  you  to  say  what 
I  shall  do  in  this  case,  and  hold  myself  obli- 
gated accordingly,"  &c.  On  the  23d  of  No- 
vember, 1811,  the  defendant  again  wrote  to 
Elmore  on  the  same  subject,  and  promised 
to  send  him  some  papers  relative  to  his  pay- 
ments, &c. 

On  the  8th  of  January,  1814,  he  again  wrote 
to  Elmore,  and,  after  mentioning  that  he  had 
been  called  on  again  by  the  plaintiffs,  about 
the  business,  he  says:  "I  still  wish  you  to 
make  up  your  mind  on  this  business,  as  I  am 


willing  to  agree  to  your  decision,  and  abide 
your  judgment." 

The  defendant,  on  the  8th  of  January,  1814, 
wrote  to  ELmore  as  follows:  "I  wrote  you 
some  time  since,  concerning  Squire  Hale  and 
myself.  I  wish  you  to  make  up  your  mind 
according  to  what  you  have  understood,  as 
you  have  had  more  knowledge  than  any  other 
person  about  my  business.  I  think  I  made  a 
kind  of  statement  to  you.  I  am  called  upon 
by  Mr.  Keep,  and  have  renewed  a  line  to 
j-ou  on  the  matter;  and  I  wish  you  to  look  in- 
to the  business,  and  give  your  opinion,  for  a 
full  settlement  of  the  business,"  &c.  "N.  B. 
I  am  willing  to  have  the  note  matter  settled 
on  your  opinion." 

On  the  28th  of  January,  1814,  Elmore,  who 
lived  at  Canaan,  in  the  state  of  Connecticut, 
wrote  to  the  defendant,  at  Albany,  acknowl- 
edging the  receipt  of  Jiis  letter  of  the  8th  of 
Januai-y,  saying  he  should  have  no  objection 
to  determine  what  was  right  in  the  matter, 
if  they  (the  plaintiffs)  would  agi-ee  to  it,  after 
having  the  circmnstances  stated  to  him  again, 
as  they  were  somewhat  out  of  his  mind. 
"But  they  will  not  agree  to  abide  my  judg- 
ment; for  J.  Hale  (one  of  the  plaintiffs)  told 
me,  when  he  called  on  me,  some  time  since, 
for  my  opinion  in  the  matter,  that  you  was 
bound  to  abide  my  judgment,  but  he  was  not, 
unless  he  liked  it.  I  then  told  him,  I  would 
not  determine  it,  unless  he  was  bound  also. 
If  they  will  agree  with  you,  to  refer  their 
claim  to  me,  and  give  me  a  statement  of 
the  fact,  I  will  determine  the  question  be- 
tween you." 

Elmore  testified,  that  he  had  not  seen  the 
defendant  for  some  time  previous  to  the  19th 
of  August,  1811,  nor  since,  until  after  he  made 
his  award;  and  that  the  defendant  had  never 
appeared  before  him,  nor  submitted  the  mat- 
ter in  controversy  to  him,  otherwise  than  as 
is  contained  in  the  above  letters.  That  after 
writing  the  letter  to  the  defendant,  of  the 
2Sth  of  January,  1814,  one  of  the  plaintiffs, 
who  resided  at  Goshen,  in  Connecticut,  called 
on  him,  and  agreed  that  they  would  be  bound, 
and  abide  by  his  award.  No  notice  of  the 
time  and  place  where  he  would  meet,  to 
make  up  an  award,  was  given  by  him  to  the 
defendant;  nor  did  he  inform  the  defendant, 
that  he  had  taken  upon  himself  to  decide  be- 
tween the  parties;  nor  that  the  plaintiffs  had 
agreed  to  abide  by  his  decision;  nor  was 
the  defendant  present  when  he  undertook  to 
make  up  his  decision. 

The  plaintiffs  produced  an  award  in  writ- 
ing, dated  Canaan,  May  15th,  1814,  which, 
after  reciting  that  the  plaintiffs,  as  execu- 
tors, &c.  and  the  defendant,  had  submitted 
the  controversy  subsisting  between  them, 
relative  to  a  promissory  note,  &c.,  and  that, 
"having  heard  the  parties,  and  taken  the 
case  into  consideration,"  he  was  of  opinion 
that  there  was  due  to  the  plaintiffs,  as  ex- 
ecutors, &c.,  on  the  said  note,  391  dollars 
and  31  cents;  and.  therefore,  he  awarded, 
that  the  defendant  should  pay  to  the  plain- 


MUTUAL  PROMISES. 


237 


tiffs  the  said  sum,  In  full  satisfaction  for 
their  claim  on  the  said  note. 

The  judge  charged  the  jury,  that,  in  his 
opinion,  there  was  sufHcient  evidence  of  a 
submission,  on  the  part  of  the  defendant,  of 
the  matter  in  difference  between  the  plain- 
tiffs and  defendant;  and  that,  without  re- 
garding the  matter  as  a  submission  to  El- 
more, he  might  be  considered  as  having  been 
constituted  the  agent  of  the  defendant,  to 
adjust  and  ascertain  the  amount  duo  on  the 
note.  The  jui-y  found  a  verdict  for  the  plain- 
tiffs, for  417  dollars  and  50  cents. 

A  motion  was  made  to  set  aside  the  ver- 
dict, and  for  a  new  trial. 

Mr.  Parker,  for  the  motion,  H.  Bleecker, 
opposed. 

SPENCER,  J.  It  is  very  clear,  that  El- 
more did  not  act  as  the  private  agent  of  the 
defendant,  in  adjusting  the  claim  made  on 
him  by  the  plaintiffs.  He  made  a  formal 
award  between  the  parties,  and  refused  to 
act,  unless  the  plaintiffs  agreed  to  be  boimd 
also.  The  count  on  an  insimul  computassent 
cannot  be  maintained. 

The  real  question  is,  whether  the  defend- 
ant is  bound  by  the  award,  it  appearing 
clearly  in  evidence,  that  the  plaintiffs  re- 
fused to  be  concluded  by  it,  up  to  the  2Sth  of 
.January,  1S14.  Subsequent  to  that  time,  the 
plaintiffs  agreed  to  be  bound  by  the  award; 
but  the  defendant's  agreement  to  submit  to 
Elmore,  and  to  be  bound  by  his  decision, 
was  on,  or  anterior  to,  the  Sth  of  January, 
1814;  so  that  there  was  no  point  of  time 
when  both  parties  bound  themselves,  by 
agreement  with  each  other,  to  submit  their 
controversy  to  Elmore,  and  to  be  bound  by 
his  awai'd. 

In  Livingston  v.  Rogers,  1  Caines,  583,  it 
was  decided,  that  in  assumpsit  on  mutual 
promises,  the  declaration  must  allege  that 
they  were  concurrent.  In  that  case,  the 
promise  was  stated,  "and  that  in  considera- 
tion the  plaintiffs  had,  at  the  defendant's 
request,  promised  to  perform  his  part;  the 
defendant,  afterwards,  to  wit,  the  same  day, 
promised,"  &c.  The  court  were  of  opinion 
that  the  judgment  ought  to  be  arrested;  but 
there  being  a  good  count,  and  a  motion  to 


amend,  leave  was  given  for  that  pu. -pose,  on 
payment  of  all  the  costs. 

The  only  consideration,  in  this  case,  for 
the  defendant's  promise,  is  the  plaintiffs' 
promise;  and  It  is  alleged,  in  both  counts 
on  the  award,  that  the  defendant's  promise 
was  made  in  consideration  of  the  plaintiffs' 
promise,  and  both  promises  are  laid  as  con- 
current acts;  and  we  have  seen,  that  if  the 
promises  were  not  alleged  to  have  been 
made  concurrently,  it  would  have  been  good 
ground  for  arresting  the  judgment.  It  is  a 
necessary  consequence,  that  the  proof  should 
support  this  allegation  in  the  declaration, 
and  show  that,  in  point  of  fact,  the  promises 
were  considerations  reciprocally  for  the  par- 
ties. Here  the  proof  negatives  the  fact,  that 
the  consideration  of  the  defendant's  promise 
to  submit  and  abide  by  the  award  of  Elmore, 
was,  that  the  plaintiffs  had,  at  the  same 
time,  made  the  like  promise;  for  it  clearly 
appears  that  the  plaintiffs  refused  to  submit 
and  be  bound  by  Elmore's  award,  long  after 
the  defendant  professed  a  willingness  to 
make  the  submission. 

In  Tucker  v.  Wo*^)ds,  12  Johns.  190,  we  recog- 
nized the  principle  that,  in  contracts  where 
the  promise  of  one  party  is  the  consideration 
for  the  promise  of  the  other,  the  promise 
must  be  concurrent  and  obligatory  upon  both 
at  the  same  time;  and,  in  addition  to  the 
case  in  Caines,  1  Chit.  PI.  297,  and  3  Term 
R.  G.o3,  were  cited,  which  fully  warrant  the 
position.  The  same  doctrine  is  contained  in 
Paine  v.  Cave,  3  Term  R,  148,  and  in  King- 
ston V.  Phelps,  Peake,  N.  P.  227.  The  plain- 
tiff' proved  that  the  defendant  consented  to 
be  bound  by  an  award  to  be  made  on  a  snb- 
mi.ssion  by  other  underwriters  on  the  same 
policy,  but  the  witness  proved  no  agreement 
on  the  part  of  the  plaintiff  to  be  bound  by 
the  award.  Lord  Kenyon  held,  that  there 
was  no  mutuality,  and,  therefore,  the  de- 
fendant's agreement  was  a  mere  nudum 
pactum.  It  is  correctly  stated  by  Kent,  J., 
in  Livingston  v.  Rogers,  that  Hobart  (SS) 
observes,  that  the  promises  must  be  at  one 
instant;  for,  else,  they  wiE  be  both  nuda 
pacta. 

There  must  be  a  new  trial,  with  costs  to 
abide  the  event  of  the  suit 

New  trial  granted. 


CONSLDERATION. 


y       L'AMOREUX  T.  GOULD. 

(7  N.  y.  349.) 
Court  of  Appeals  of  New  York.  1852. 
The  defendant  in  this  action  was  an  en- 
dorser upon  five  promissory  notes  made  by 
J.  W.,  amounting  in  the  aggi-egate  to  $1,140. 
Two  of  them,  amounting  to  $490,  had  be- 
come payable  before  May  2G,  1S41,  and  the 
remaining  three  were  payable  after  that  day. 
The  defendant  held  as  trustee  a  judgment 
against  Woodward  given  to  secure  certain 
creditore,  and  among  them  the  plaintiff  as 
endorser  of  the  notes.  Upon  that  day  an 
agreement  in  writing  was  entered  into  be- 
tween the  defendant  and  plaintiff  of  which 
the  following  is  a  copy: 

"James  L'Amoreux,  Esq.,  being  an  endors- 
er on  several  notes  drawn  by  J.  W.,  some  of 
which  have  become  due,  and  on  some  of 
them  prosecutions  have  been  commenced, 
and  thie  subscriber  having  a  judgment  ren- 
dered in  his  faVor  against  the  said  J.  W.  en- 
tered in  the  supreme  court  for  securing  cer- 
tain creditors  agreeably  to  a  certain  decla- 
ration of  trust  in  writing  in  which  the  en- 
dorsers on  the  defendant's  paper  are  in- 
cluded in  the  first  class  of  creditors  and  in 
which  it  is  declared  that  such  creditors  shall 
be  first  paid:  Now  in  consideration  of  the 
premises  and  in  consideration  that  the  said 
.James  L'Amoreux  shall  advance  and  pay 
the  sum  of  one  thousand  dollars  towards 
satisfying  or  in  part  satisfying  the  notes  on 
which  he  is  holden  as  endorser  as  aforesaid, 
and  shall  exhibit  to  the  said  Charles  D. 
Gould  the  evidence  of  such  payment;  the 
said  Charles  hereby  agrees  with  the  said 
James,  that  within  one  year  from  this  date 
he  will  cause  to  be  raised  under  the  said 
judgment  given  as  aforesaid  the  said  sum  of 
one  thousand  dollars  with  interest,  and  will 
pay  the  same  over  to  the  said  James  in  sat- 
isfaction of  the  money  so  to  be  advanced 
towards  satisfying  said  endorsements. 

"Charles  D.  Gould. 

"Dated  August  2G,  1841." 

The  plaintiff  subsequently  paid  the  five 
notes  and  exhibited  them  to  the  defendant, 
at  the  same  time  teUiug  him  that  he  did  it 
in  compliance  with  the  agreement,  and  the 
defendant  replied  that  it  was  all  right.  The 
defendant  refusing  to  comply  with  the  terms 
of  the  agreement  an  action  of  assumpsit  was 
brought  thereon  in  September,  1842.  The 
cause  was  tried  by  a  referee,  who  found  for 
the  plaintiff  the  amount  due  by  the  terms  of 
the  agreement,  upon  which  a  judgment  was 
entered  in  November,  1848.  The  defendant 
appealed  therefrom. 

J.  C.  Spencer,  for  appellant.  N.  Hill,  Jr., 
for  respondent 

EDMONDS,  J.  (after  disposing  of  some  ob- 
jections arising  upon  the  pleadings  which 
were  cured  by  the  finding  by  the  referee). 
The  only  question  to  be  determined,   there- 


fore, is,  whether  there  was  such  a  want  of 
mutuality  between  the  parties  that  there 
was  in  fact  no  cause  of  action. 

The  proposition  is  stated  by  Chitty  as 
broadly  as  the  defendant's  counsel  claims  it, 
that  if  the  one  party  never  was  bound  on  his 
part  to  do  the  act  which  forms  the  con- 
sideration for  the  promise  of  the  other,  the 
agreement  is  void  for  want  of  mutuality 
(Chit.  Cont.  15);  but  the  proposition  is  too 
broadly  stated.  It  is  confined  to  those  cases 
where  the  want  of  mutuality  would  leave 
one  party  without  a  valid  or  available  con- 
sideration for  his  promise.  Arnold  v.  Mayor 
of  Poole,  4  Man.  &  G.  860.  For  there  are 
many  valid  contracts  not  mutually  binding 
at  the  time  when  made;  as  where  A.  says 
to  B.,  if  you  will  furnish  goods  to  C.  I  wiU 
pay  for  them,  B.  is  not  bound  to  furnish 
them,  but  if  he  does  he  may  recover  on  the 
promise.  2  Saund.  137h;  Morton  v.  Burn, 
7  Adol.  &  E.  19;  Kennaway  v.  Treleavan, 
5  Mees.  &  W.  498.  And  the  question  in  this 
case  is  not  whether  the  plaintiff  was  bound 
to  pay  the  $1,000,  but  whether,  if  he  did  pay 
it,  the  defendant  was  without  any  valid  or 
available  consideration  for  his  promise.  The 
agreement  is,  that  if  the  plaintiff  will  pay 
$1,000  on  notes  on  which  he  is  holden  as  in- 
dorser,  etc.  Now  I  am  not  very  clear  wheth- 
er this  means  on  notes  on  which  he  was  ab- 
solutely fixed  and  liable  as  indorser  by 
means  of  due  protest,  or  those  on  which  he 
was  merely  liable  to  be,  in  case  of  non-pay- 
ment by  the  drawer.  The  pleading  do  not 
help  us  out  of  the  difliculty  at  all,  but  the 
evidence  shows  that  three  of  the  five  notes 
were  not  due  at  the  time  the  agreement  was 
made,  and  the  agreement  recites  that  he 
was  indorser  on  several  notes  some  of  which 
had  become  due,  etc.  Those  notes  which 
had  become  due  at  that  time  and  on  which 
alone  the  plaintiff  could  then  have  become 
"holden"  by  due  protest,  did  not  amount  to 
one-half  of  the  $1,000  that  he  was  to  pay, 
while  all  of  the  five  notes  which  he  had  in- 
dorsed amounted  to  more  than  $1,000.  I 
should  infer  that  the  parties  meant  by  this 
equivocal  expression  to  refer  to  the  fact  of 
his  indorsement  only,  and  not  to  the  fact  of 
his  being  fixed  as  indorser.  This  is  a  ma- 
terial consideration,  because  if  the  plaintiff 
was  to  pay  the  $1,000  merely  upon  notes  up- 
on which  he  was  finally  fixed  and  "holden" 
by  due  protest,  he  would  do  nothing  more  by 
paying  that  sum  than  merely  discharge  an 
obligation  which  he  was  bound  to  perform, 
and  that  would  form  no  consideration  for  the 
defendant's  promise. 

But  if  on  the  other  hand  he  voluntarily  paid 
the  money,  without  reference  to  his  being  fix- 
ed as  indorser,  and  in  fact  waived  the  va- 
rious acts  of  demand  and  protest  which  were 
neces.sary  to  fix  him  as  indorser,  he  thus  as- 
sumed a  liability  and  performed  an  act  detri- 
mental to  himself,  which  would  furnish  a 
good  consideration  for  the  promise.     And  in- 


MUTUAL  PROMISES. 


239 


ferring  as  I  do  from  the  facts  proved  on  the 
trial  and  from  the  language  of  the  agreement 
that  the  parties  meant  all  Uie  notes,  as  weU 
those  not  due  as  those  due  and  protested,  I 
have  no  difficulty  in  finding  a  sufficient  con- 
sideration to  support  the  promise,  in  the  fact 
of  the  plaintiff's  having  paid  the  $1,000  and 


thus  enlarged  his  liability  beyond  what  It  was 
when  the  agreement  was  made. 

This  disposes  of  the  only  point  not  cured  by 
the  finding,  and  I  am  of  opinion  the  Judgment 
ought  to  be  affirmed. 

All  the  judges  concurred. 

Judgment  affirmed. 


''240 


CONSIDEKATION. 


DAVIE  et  al.  t.  LUMBERMAN'S  MIN.  CO. 

(53  N.  W.  625,  93  Mich.  491.) 
Supreme   Court   of   Michigan.     Nov.   IS,    1S92. 

Error  to  circiiit  cotirt,  Menominee  county; 
John  W.  Stone,  Judge. 

Action  by  Josiah  Davie  and  another 
against  the  Lumberman's  Mining  Company 
for  breach  of  contract  From  a  judgment 
for  plaintiffs,  defendant  appeals.     Reversed. 

Ball  &,  Hanscom.  (B.  J.  Brown,  of  counsel,) 
for  appellant.  R.  C.  Flannigan,  (F.  O.  Clark, 
of  coiinsel,)  for  appellees. 

DURAND,    J       On    October    7,    1889,    the 
plaintiffs,    who    were    practical    miners,    en- 
tered into  a  verbal  agreement  with  the  de- 
fendant  company,    through   its  mining   cap- 
tain, to  go  to  work  in   what  is   called   the 
"Cave  Pit,"  and   were  to   receive  $1.50  per 
ton  for  all  the  ore  they  produced,  as  long  as 
they  could  make  it  pay.     The  plaintiffs  prac- 
tically agree  that  the  mining  captain,  with 
whom  the  contract  was  made,  said  to  them 
that  he  would  give  $1.50  a  ton  for  all  the 
ore  they  could  produce  anywhere  in  the  pit, 
to  which  they  responded,  "All  right;   we  will 
take  the  contract,   and  work  it  as  long  as 
we  can  make  it  pay."     The  plaintiffs  were 
to  put   in  skip   roads   for  hoisting   the  ore, 
and  were  to  put  it  in  position  for  hoisting, 
and  the  defendant  was  to  furnish  the  hoist- 
ing machinery  and  do  the  hoisting.     Acting 
tinder  this  contract,   the  plaintiffs   went  to 
work  in  the  pit.     They  leveled  off  a  place, 
and   put  down  some  plank  platform  to  pile 
ore  upon,  and  sorted  out  some  ore  from  the 
loose  rock,  and  took  some  ore  also  out  of  a 
seam  in  the  foot  wall  of  the  pit,  and  placed 
it  on  these  platforms.     On  the  morning  of 
the  third  day  after  they  began  to  work,  the 
captain    of    the    defendant    company    went 
down,  and  found  the  plaintiffs  digging  into 
the  foot  wall  of  the  pit,  upon  which  he  or- 
dered them  to  quit  mining  at  that  point.     A 
controversy  then  arose  between  him  and  the 
plaintiffs  in  reference  to  where  they  had  a 
right  to  dig,  and  as  to   the  extent  of  their 
right,  which  ended  by  the  plaintiffs  quitting 
the  work.     The  plaintiffs  contend  that  they 
had  a  right  to  mine  at  any  point  they  chose, 
and  that  they  had  a  right  to  dig  into  and 
through  the  foot  wall,  and  that  they  had  a 
right,  under  their  contract,  to  mine  all  ore 
w^hich  might  be  newly  discovered  by  them 
after  digging  through  the  walls  of  the  pit, 
and  that  they  were  not  confined  to  such  ore 
as  they  might  find  within  the  pit,  as  it  had 
already  been  opened  and  worked.     The  de- 
fendant contends  that,  even  if  the  contract 
is  a  valid  one,  it  merely  had   reference   to 
such  ore  as  might  be  found  within  the  pit  as 
it  had  been  opened  and  worked,  and  that  it 
gave  them  no  right  to  dig  or  break  through 
the   walls   of  the  pit,  and   mine   ore   found 
outside  of  the  walls;   that  it  was  essentially 
what  is  known  among  miners  as  a  "scram- 


ming contract,"   which  is  one   that  confers: 
the  right  to  mine  and  gather  such  ore  as  may 
be  left  within  the  limits  of  a  mine  or  pit  as 
it  has  been  opened  and  mined  before;   that 
nothing  beyond  that  was  ever  thought  of, 
and  that  the  act  of  the  plaintiffs  in  breaking 
through  the  walls  of  the  pit,  and  mining  in 
a  newly-discovered  vein  of  ore,  was  never 
contemplated   by   the   parties;    and   that   it 
wotild  greatly  endanger  the  property  of  the 
defendant,  as  well  as  the  lives  of  the  miners, 
by  rendering  it  likely  to  cave,  as  had  hap- 
pened before,  and  for  which  reason  it  is  al- 
leged this  pit  was  named  "Cave  Pit;"  and 
the  defendant  insists  that  the  plaintiffs  were 
stopped  from  digging  in  the  foot  walls  for 
the  reasons  stated,  while  the  plaintiffs  con- 
tend that  the  real  reason  was  that  the  de- 
fendant thought  they  would  make  too  much 
money  if  allowed  to  mine  in  the  rich  vein 
of    newly-discovered    ore    beyond    the    foot 
wall.     The  plaintiffs  also  contend  that  the 
term  employed  in  the  contract,  "as  long  as 
we  can  make  it  pay,"  has  a  special  signifi- 
cation among  miners,  and  means  as  long  as 
they  cotild  make  "company  account"  wages, 
being  such  wages  as  the  company  was  then 
paying  by  the  day  for  such  work;   and  they 
introduced  some   testimony,   against   the   de- 
fendant's objection,  tending  to  prove  this  to 
be  so,  while  the  defendant  denies  that  this  is 
so,  and  contends  that  the  term  has  no  spe- 
cial signification.    The  plaintiffs  also  contend 
that  they  had  discovered  a  body  of  ore  which 
amounted  to  at  least  17,000  tons,  and  that, 
if  they  had  been  allowed  to  mine  it,— as  tney 
claim  they  had  a  right  to  do  under  the  con- 
tract referred  to,— they  would  have  realized  a 
profit  of  $22,000;    while   the  defendant  con- 
tends   that    this    is    not   true,   and    that    the 
dangers  and  contingencies  were  so  great  that 
no  estimate  of  profits  could  be  made  which 
would  be  at  all  reliable,  or  upon  which  the 
jury  could  mtelligently  act  in  attempting  to 
decide   upon   what   the   damages   should   be. 
The  questions  of  fact  were  all  fairly  submit- 
ted to  the  jury,  who  found  a  verdict  of  $1,000 
for  the  plaintiffs,   and  a  judgment  for  that 
amount  was  thereupon  rendered  in  their  fa- 
vor.    The  defendant  claims  error. 

The  questions  we  are  called  upon  to  consid- 
er all  relate  to  and  depend  upon  the  two 
main  propositions  in  the  case,  which  are 
whether  or  not  the  contract  is  of  such  a  char- 
acter as  to  entitle  the  plaintiffs  to  damages 
for  its  breach,  and,  if  it  is,  then  whether  or 
not  the  profits  which  the  plaintiffs  claim  they 
would  have  made  if  they  had  been  allowed  to 
proceed  to  mine  the  ore,  as  long  as  they  could 
make  it  pay,  are  not  so  speculative,  uncertain, 
and  contingent  as  to  make  it  improper  to  per- 
mit the  jury  to  pass  upon  them  in  deciding 
upon  the  damages  to  which  the  plaintiffs  are 
entitled.  We  have  sought  in  vain  for  a  valic 
reason  to  sustain  the  plaintiffs  in  their  conten- 
tion in  this  case,  but  we  cannot  do  so.  Wc 
do  not  think  the  contract  is  of  such  a  char- 
acter as  to  be  enforceable  as  an   executory 


MUTUAL  PROMISES. 


J41 


contract.  The  aprreement  was  simply  tbat 
the  plaintiffs  would  work  at  miniuj,'  the  ore 
in  "Cave  Pit"  for  $1.50  per  ton  as  long  as 
they  could  make  it  pay.  No  limitations 
were  put  upon  their  methods,  or  how  or  in 
what  manner  they  should  conduct  the  work 
in  order  to  make  It  pay,  nor  does  it  give  the 
defendant  any  voice  in  deciding  upon  whether 
or  not  the  plaintifis  could  make  it  pay,  nor 
does  it  place  the  subject  of  the  contract  upon 
any  certain  basis  upon  which  a  jui-y  can  law- 
fully and  justly  arrive  at  a  fair  rule  of  dam- 
ages in  ease  of  its  violation.  Under  this  con- 
tract, the  plaintiffs  must  be  presumed  to  be 
the  sole  judges  of  whether  or  not  it  would  pay 
them  to  do  the  work,  and  of  how  long  they 
should  continue  it.  Neither  do  we  think  that 
the  clause,  "as  long  as  they  could  make  it 
pay,"  has  any  special  signification  in  this 
case.  It  Is  not  in  any  sense  ambiguous,  and 
can  have  no  different  meaning  when  applied 
to  mining  than  it  has  in  any  mechanical  or 
agricultural  employment.  It  is  a  term  used 
daily  In  all  the  different  entei^p rises  and  occu- 
pations In  which  men  are  engaged,  and  its 
scope  is  so  weU  understood  that  no  evidence 
Is  necessary  to  show  what  it  is,  or  that  it 
means  anything  different  in  one  case  than  in 
another.  "When  a  party  agrees  to  sell  arti- 
cles of  merchandise,  or  deliver  the  produc- 
tions of  his  labor  to  another  at  a  certain  price 
as  long  as  he  can  make  it  pay,  every  one  must 
clearly  understand  that  the  term  is  dependent 
on  conditions  over  which  the  promisee  has  no 
control,  and,  in  so  far  as  any  one  has  tlie 
power  to  make  the  term  effective,  it  is  lodged 
solely  In  the  promisor,  who  by  judicious  pur- 
chases or  skillful  manipulations  of  labor  may 
be  able  to  make  a  transaction  pay  when  a 
more  careless,  negligent,  or  improvident  per- 
son would  be  unable  to  do  so.  This  serious 
element  of  uncertainty  destroys  all  mutuality 
in  the  contract,  and  gives  tlie  promisor  full 
power  to  say  when  a  further  execution  of 
the  contract  will  not  be  advantageous,  be- 
cause he  cannot  make  it  pay.  Contracts  can- 
not arise  where  there  is  no  mutuality,  nor  can 
they  arise  from  the  action  of  one  party  alone 

HOPK.SEL.CAS.CONT. — 16 


where  the  other  has  no  power  to  prevent  his 
action.  The  uncertainty  of  the  term,  "as  long 
as  we  can  make  it  pay,"  employed  iu  this 
contract,  is  illustrated  iu  the  case  of  Cummer 
V.  Butts,  40  Mich.  3122.  In  that  case  the  con- 
tract stipuhited  that  on  CO  days'  notice  it 
might  be  canceled  by  either  party  for  "good 
cause."  One  of  the  parties  terminated  the 
contract,  whereupon  the  other  party,  who  in- 
sisted that  no  "good  cause"  for  his  dismiss- 
al existed,  brought  suit  to  recover  for  the 
pro  (its  he  would  have  made  If  the  arrange- 
ment had  not  been  interrupted.  Mr.  Justice 
Graves,  in  an  opinion  concurred  in  by  the 
entire  court,  says:  "The  difficulty  is  inher- 
ent. It  exists  in  tlie  terms  adopted  by  the 
parties.  The  requirement  of  'good  cause,'  as 
something  on  which  the  right  to  revoke  by 
one  or  the  other  should  depend,  is,  as  here  In- 
troduced, too  vague  to  be  fairly  intelligible. 
The  phrase  in  such  connection,  as  to  parties 
and  subject-matter,  has  no  such  distinct  sense 
as  to  furnish  a  common  and  intelligible  cri- 
terion for  the  parties,  or  any  determinate 
sense  whatever.  It  is  lmi)ossfble  to  say  that 
the  wills  of  the  parties  concurred,  and  that 
each  meant  exactly  what  the  other  did,  or 
even  to  say  what  either  meant.  The  case  is 
one  where  the  parties  have  failed  to  express 
themselves  in  terms  capable  of  being  reduced 
to  lawful  certainty  by  judicial  effort."  The 
same  general  iTile  is  laid  down  in  cases  cited 
in  Am.  &  Eng.  Enc.  Daw,  844,  845.  and  notes; 
Blanchard  v.  Railroad  Co.,  31  Mich.  43;  Cas- 
well V.  Gibbs,  33  Mich.  331;  Wilkinson  v. 
Heavenrich,  58  Mich.  574,  26  N.  W.  139.  Un- 
der this  view  of  the  law,  we  must  hold  that 
the  plaintiffs  cannot  recover  under  this  con- 
tract for  any  prospective  profits  which  they 
might  have  made  if  they  had  been  allowed  to 
complete  it,  and  the  jury  should  have  been 
so  instructed.  As  this  disposes  of  the  case  in 
favor  of  the  defendant,  it  is  unnecessary  to 
discuss  the  question  of  dajnages,  or  any  other 
question  raised  by  the  record.  It  follows  that 
the  judgment  must  be  reversed,  with  wists  of 
this  court,  and  a  new  trial  granted.  The  oth- 
er justices  concurred. 


242 


CONSIDERATION. 


k>' 


?  COOK  et  al.  v.  WRIGHT.     A/ ^ 

(1  Best  &  S.  559.)  ^^1 

Court  of  Queen's  Bench,     July  9,  1861. 


Declaration  by  plaintiffs,  as  payees,  against 
the  defendant,  as  maker  of  two  promissory 
notes,  dated  the  7th  February,  1856.  The 
first  coimt  was  upon  a  note  for  £10  10s.,  pay- 
able twelve  months  after  date;  the  second 
was  upon  a  note  for  £11,  payable  twenty-four 
months  after  date.  There  was  also  a  count 
upon  an  account  stated.     Claim,  £50. 

First  plea  to  the  whole  declaration:  That 
after  the  passing  and  coming  into  operation 
of  the  'Whitechapel  improvement  act,  1853, 
and  after  the  passing  and  coming  into  opera- 
tion of  the  Metropolis  local  management  act, 
1855,  the  defendant  made  the  several  prom- 
issory notes  in  the  said  first  and  second 
counts  mentioned  at  the  request  of  the  plain- 
tiffs, and  that,  at  the  time  of  making  the 
said  promissory  notes,  the  plaintiffs  asserted 
and  represented  to  the  defendant,  and  the 
defendant  believed  such  assertion  and  rep- 
resentation to  be  true,  that  there  was  then 
due  and  owing,  and  payable  from  him,  the 
defendant,  as  the  owner  of  certain  lands  and 
buildings  in  certain  streets  called  "FiBch 
Street,"  '"John  Street"  and  "Dawson's  Place," 
situate  within  the  parish  of  St.  Mary,  White- 
chapel, to  the  trustees  of  the  parish  of  St. 
Mary,  Whitechapel,  under  the  provisions  of 
the  Whitechapel  improvement  act,  1853,  di- 
vers large  sums  of  money  in  respect  of  paving 
the  streets  fronting,  adjoining  and  abutting 
on  such  lands  and  buildings.  And  the  de- 
fendant says  that,  at  the  time  of  making  the 
said  promissory  notes  no  sum  of  money  what- 
soever was  due  or  owing  or  payable  from  the 
defendant  as  such  owner  to  the  said  trustees, 
nor  was  the  defendant  such  owner  as  afore- 
said, and  that  there  never  was  any  consider- 
ation or  value  for  the  defendant  making  the 
said  promissory  notes  in  the  first  and  sec- 
ond counts  mentioned,  or  either  of  them,  or 
for  his  paying  the  same,  or  any  part  there- 
of; and  the  plaintiffs  never  were,  nor  was 
any  person,  ever  a  holder  of  the  said  notes, 
or  either  of  them,  for  value  or  consideration; 
and  that  the  account  stated,  in  the  declara- 
tion mentioned,  was  stated  of  and  concerning 
the  matters  and  things  in  this  plea  mentioned, 
and  was  not  stated  of  or  concerning  any  other 
matter  or  thing  whatsoever. 

Second  plea,  to  the  first  and  second  counts: 
That  the  defendant  was  induced  to  make,  and 
did  make,  the  promissory  notes  in  those 
counts  mentioned,  and  each  of  them,  by  the 
fraud,  covin,  and  misrepresentation  of  the 
plaintiffs  and  others  in  collusion  with  them. 

On  the  trial,  before  Wightman,  J.,  at  the 
sittings  in  London,  during  Easter  term,  1800, 
it  appeared  that  the  plaintiffs  were  four  of 
the  commissioners  or  trustees  acting  under 
and  incorporated  by  section  27  of  the  White- 
chapel improvement  act,  1853  (16  &  17  Vict. 
c.  cxli.);  and  the  action  was  brought  to  re- 
cover the  amount  of  the  two  notes  mentioned 


in  the  declaration.  The  evidence  as  to  w'uit 
took  place  at  the  time  of  the  giving  of  the 
notes  was  as  follows:  Mitchell,  the  clerk  to 
the  trustees,  said  that,  certain  parts  of  the 
district  not  being  in  repair  in  1854,  notices 
to  do  repairs  were  sent  or  left  addressed  to 
the  owners;  and  in  October,  18.55,  he  wrote 
a  letter  to  the  defendant  demanding  £70  for  • 
expenses  incurred  by  the  trustees  in  doing 
paving  works  in  front  of  houses,  of  which  the 
defendant  was  the  owner  or  occupier,  situate 
in  and  abutting  on  public  highways  within 
the  district  of  the  Whitechapel  improvement  • 
act  The  defendant  complained  that  the 
works  done  by  the  trustees  had  seriously  in- 
jured the  property,  and  that  the  tenants  were 
dissatisfied,  and  requested  him  to  get  an 
abatement  made.  He  informed  the  defend- 
ant that  the  trustees  assented,  and  the  bal- 
ance to  be  paid  by  the  defendant  was  agreed 
to  at  £30.  The  defendant  then  requested 
time,  and  time  was  given,  upon  condition  that 
he  paid  interest;  and  three  promissory  notes 
were  given  by  the  defendant,  the  first  of 
which  was  paid  by  him  under  protest.  The 
defendant  was  called,  and  stated  that  Mrs. 
Bennett  was  owner  of  the  three  houses  in 
question,  and  that  he  was  tenant  of  one  of 
them  at  a  rack  rent  under  her,  and  collected 
the  rents  of  the  others  for  her;  that  he  paid 
the  paving  rate  of  the  house  which  he  occu- 
pied, and  the  paving  rates  of  the  other  houses 
he  paid  for  Mrs.  Bennett  and  in  her  name; 
that,  upon  receiving  the  notice  of  October, 
1855,  he  went  before  the  board  of  trustees  and 
told  them  that  he  was  not  th*?  owner  of  the 
property,  and  shewed  them  Mrs.  Bennett's 
receipts  for  the  rent.  They  replied  that,  as 
he  paid  the  rates,  they  considered  he  was  the 
owner  within  the  meaning  of  the  Whitechapel 
improvement  act,  1853,  and,  if  he  did  not  give 
notes,  they  would  sei"ve  him  as  they  had  serv- 
ed Goble,  which  was  by  levying  an  execution 
on  him;  that  there  was  another  case  in  which 
the  question  of  the  liability  of  the  inhabitant^ 
was  to  be  tried,  and,  if  decided  against  the 
trustees,  he  should  not  be  called  on  to  pay. 
When  the  first  note  became  due  he  complain- 
ed to  Mitchell  that  the  trustees  had  not  car- 
ried out  their  promise  to  try  one  of  the  cases. 
Mitchell  said  that,  as  the  defendant  had  sign- 
ed the  notes,  he  must  pay  them,  and  that  the 
promised  trial  should  take  place.  Thereupon 
the  defendant  paid  the  first  note.  The^e- 
fendant  was  afterwards  ^told  by  Mrs.  Bennett 
"thilt  tie  wiis-oot  the  owner  within'''lhe  migJi- 

Tng   of   tl^p    n/>t,~"nnfi    liP   thprpnpnn    wpnt   tO   a 

board  meeting  of  the  trustees  and  told  them 
that  he  would  not  pay  the  other  notes.  It 
was  contended  for  the  defendant  that  the 
notes  were  given  without  consideration,  the 
defendant  not  being  an  "owner"  within  sec- 
tion 7  of  the  Whitechapel  improvement  act. 
The  jury,  in  answer  to  the  qiiestions  put  to 
them  by  the  learned  judge,  found  that  the 
defendant  told  Mitclifll  or  the  board,  before 
he  gave  the  notes,  tliat  he  was  not  the  own- 
er;   that  the  defendant  mentioned,  before  he 


FORBEAUANCE. 


243 


gave  the  notes,  that  Mrs.  Bennett  was  the 
owner;  and  that  Mitchell,  or  some  member 
of  the  board,  told  the  defendant,  in  the  board- 
room, that,  unless  he  gave  the  notes,  he  would 
be  served  as  Goble  had  been.  The  verdict 
was  thereupon  entered  for  the  defendant, 
leave  being  reserved  to  move  to  enter  a  ver- 
dict for  the  plaintiffs.  In  the  same  term 
(May  4). 

Montagu  Chambers  obtained  a  rule  to  shew 
cause  accordingly,  on  the  ground  that  tlie  evi- 
dence did  not  prove  want  of  consideration  for 
giving  the  notes,  and  that,  upon  the  evidence, 
the  plaintiffs  were  entitled  to  a  verdict. 

This  rule  wtis  argued  in  this  term,  May  23d, 
before  COCKBURN,  C.  J.,  and  WIGIITMAN, 
CROMPTON,  and  BLACKBURN,  JJ. 

Mr.  Shoe,  Serjt.,  and  Mr.  Barnard,  shewed 
cause.  There  was  no  consideration  for  the 
notes.  The  defendant  signed  them  upon  the 
representation  by  the  trustees  that  they  con- 
sidered him  the  owner  of  the  houses  because 
he  collected  the  rents,  and  was  liable  to  pay 
the  rates.  But  the  defendant  was  not  the  own- 
er withm  section  7  of  St.  16  &  17  Vict  c 
cxli.,  by  which  "the  word  'owner,'  used  with 
reference  to  any  lands  or  buikhngs  in  respect 
of  which  any  work  is  required  to  be  done,  or 
any  rate  to  be  paid  under  this  act,  shall  mean 
the  person  for  the  time  bemg  entitled  to  re- 
ceive, or  who,  if  such  lands  or  buildings  were 
let  to  a  tenant  at  rack  rent,  would  be  entitled 
to  receive,  the  rack  rent  from  the  occupier 
thereof." 

The  existence  of  disputes  and  controversies 
between  a  plaintiff  and  defendant,  as  to  wheth- 
er the  defendant  is  indebted  to  the  plaintiff, 
is  not  a  sufficient  consideration  for  a  promise; 
there  must  be  a  debt  in  existence.  Edwards 
V.  Baugh,  11  Mees.  &  W.  U41.  These  notes 
were  not  given  for  the  debt  of  another  pai'ty: 
the  trustees  did  not  profess  to  take  them  in 
payment  of  the  rates  due  from  Mrs.  Bennett 
[CROMPTON,  J.  Suppose  money  had  been 
paid  by  the  defendant  could  he  have  recover- 
ed it  back?  The  maxim  "Quod  lieri  non  debet 
factum  valet"  seems  to  apply.  WIG  HTM  AN, 
J.,  referred  to  Southall  v.  Rigg  and  Formau  v. 
Wright,  11  C.  B.  481.]  In  Addison  on  Con- 
tracts, p.  15  (4th  Ed.),  It  is  said:  "So  if  the 
consideration  prove  to  be  a  nullity,  the  prom- 
ise founded  upon  it  is  void,  as  if  the  con- 
sideration be  the  forbearance  of  a  suit  when 
there  is  no  cause  of  action  *  •  *  or  a  prom- 
ise to  pay  a  debt  which  never  had  an  existence 
In  point  of  law." 

Mr.  Hanuen,  in  support  of  the  rule.  1.  The 
plea  was  not  proved.  The  defendant  did  not 
believe  the  representation  of  the  trustees  that 
he  was  hable  as  owner  of  the  houses  under 
the  provisions  of  the  Whitochapel  improve- 
ment act,  lSo3. 

2.  The  plea  is  not  good.  In  Edwards  v. 
Baugh,  11  Mees.  &  W.  041,  the  defendant 
might  have  been  imposed  upon  as  to  their  be- 
ing a  debt  due  from  him  to  the  plaintiff,  but 
in  this  case  there  is  no  statement  tliat  the  de- 
fendant yielded  to  the  assertion  that  he  was 


owner  of  the  houses;  it  amounts  to  no  more 
than  that  he  thought  it  doubtful  whether  he 
was  liable.  [CROMPTON,  J.  Did  the  trus- 
tees put  themselves  in  a  worse  position  by  tak- 
ing the  notes?  Might  they  not  the  next  day 
have  said,  "We  have  mistaken  our  position," 
and  have  returned  the  notes?]  No.  In  Baker 
V.  Walker,n4  Mees.  &  W.  4aj,  Parke.  B.,  said 
(page  4G7),  "If  I  give  a  promissory  note  for  the 
debt  of  a  third  person,  I  am  bound  to  pay  it 
when  due."  [CROMPTON,  J.  The  defendant 
gave  the  note  in  discliargo  of  his  own  liabihty. 
He  took  the  debt  upon  himself,  whosesoever 
it  was,  if  the  trustees  would  give  him  time.] 
The  defendant  signed  the  notes  because  the 
trustees  threatened  to  sue  him,  not  because  he 
believed  himself  to  be  liable;  and  he  obtained 
time  for  payment  of  the  d(;bt  of  a  third  person, 
which  is  a  sufhciont  consideration  for  giving 
the  notes.  Sowerby  v.  Butcher,  2  Cromp.  & 
M.  308.  Suppose  the  trustees  had  sued  .Mrs. 
Bennett  for  the  rates,  she  might  have  pleaded 
that  the  trustees  had  taken  notes  for  the 
amount  from  her  agent.  The  notes  were  giv- 
en for  the  debt  claimed  to  be  due  in  respect  of 
a  particular  property.  [COCKBURN,  C.  J. 
The  difficulty  which  I  feel  is  that  I  do  not  see 
in  what  character  the  defendant  acted  when 
he  gave  the  notes.  WIGHTMAN,  J.  By 
section  11  of  St  16  &  17  Vict  c.  cxli.,  the  pro- 
visions of  the  "Towns  Improvement  Clauses 
Act  1S47"  (10  &  11  Vict  c  34.)  are  incor- 
porated with  the  first  mentioned  act,  "with  re- 
spect to  the  paving  and  maintaining  the 
streets,  except  sections  54  and  55;  and  provid- 
ed that  section  53  shall  extend  to  such  streets 
only  as  shall  be  public  highways  at  the  time 
of  the  passing  of  this  act,  and  that  the  ex- 
penses incurred  under  the  last  mentioned  sec- 
tion shall  be  repaid  by  the  owners  of  the 
lands  therein  mentioned,  and  shall  be  recov- 
erable from  the  owners  or  occupiers  in  the 
same  manner  as  is  provided  with  respect  to 
the  recovery  of  expenses  imder  the  provisions 
for  insuring  the  execution  of  works  required 
to  be  done  by  the  owners  and  occupiers  of 
lands."] 
Cur.  adv.  vult 

BLACKBURN,  J.  (.Tuly  9th)  delivered  the 
judgment  of  COCKBURN.  C.  J.,  WIGHT- 
MAN,  J.,  and  himself;  CROMPTON,  J.,  hav- 
ing left  the  court  before  the  argument  was 
concluded. 

In  this  case  it  appeared  on  the  trial  that 
the  defendant  was  agent  for  a  Mrs.  Bennett, 
who  was  nonresident  owner  of  houses  in  a 
district  subject  to  a  local  act.  Works  had 
been  done  in  the  adjoining  street  by  the 
commissioners  for  executing  the  act,  the  ex- 
penses of  which,  under  the  provisions  of 
their  act  they  charged  on  the  owners  of  the 
adjoining  houses.  Notice  had  boon  given  to 
the  defendant,  as  if  he  had  himself  been 
owner  of  tlie  houses,  calling  on  him  to  pay 
the  proportion  chargeable  in  respect  of  them. 
He  attended  at  a  board  meeting  of  the  com- 
missioners, and  objected  both  to  the  amount 


241 


CONSIDERATION. 


and  nature  of  the  charge,  and  also  stated 
that  he  was  not  the  owner  of  the  houses, 
and  that  Mrs.  Bennett  was.  He  was  told 
that,  if  he  did  not  pay,  he  would  be  treated 
as  one  Goble  had  been.  It  appeared  that 
Goble  had  refused  to  pay  a  sum  charged 
against  him  as  owner  of  some  houses,  and 
the  commissioners  had  taken  legal  proceed- 
ings against  him,  and  he  had  then  submitted 
and  paid,  with  costs.  In  the  result  it  was 
agreed  between  the  commissioners  and  the 
defendant  that  the  amount  charged  upon 
liim  should  be  reduced,  and  that  time  should 
be  given  to  pay  it  in  three  instalments.  He 
gave  three  promissory  notes  for  the  three 
instalments.  The  first  was  duly  honoured; 
the  others  were  not,  and  were  the  subject 
of  the  present  action.  At  the  trial  it  ap- 
peared that  the  defendant  was  not  in  fact 
owner  of  the  houses.  As  agent  for  the  own- 
er he  was  not  personally  liable  under  the  act. 
In  point  of  law,  therefore,  the  commission- 
ers were  not  entitled  to  claim  the  money 
fiom  him;  but  no  case  of  deceit  was  alleged 
against  them.  It  must  be  taken  that  the 
commissioners  honestly  believed  that  the 
defendant  was  per5onalLy~liabl£;>_aad_really 
intended  to  take  legal  proceedings  against 
him,  as  they  hacTcTone  against  GobTe^  The 
defendant,  accoramg  to"  his  own  evidence, 
never  believed  that  he  was  liable  in  law,  but 
signed  the  notes  in  order  to  avoid  being  sued 
as  Goble  was.  Under  these  circiunstances  the 
substantial  question  reserved  (irrespective 
of  the  form  of  the  plea)  was  whether  there 
was  any  consideration  for  the  notes.  We 
are  of  opinion  that  there  was. 

There  is  no  doubt  that  a  bill  or  note  given 
in  consideration  of  what  is  supposed  to  be 
a  debt  is  without  consideration  if  it  appears 
that  there  was  a  mistake  in  fact  as  to  the 
existence  of  the  debt  (Bell  v.  Gardiner,  4 
Man.  &  G.  11),  and,  according  to  the  cases 
of  Southall  V.  Rigg  and  Forman  v.  .Wright, 
11  C.  B.  481,  the  law  is  the  same  if  the  bill 
or  note  is  given  in  consequence  of  a  mistake 
of  law  as  to  the  existence  of  the  debt.  But 
here  there  was  no  mistake  on  the  part  of  the 
defendant,  either  of  law  or  fact.  What  he 
did  was  not  merely  the  making  an  erroneous 
account  stated,  or  promising  to  pay  a  debt 
for  which  he  mistakingly  believed  himself 
liable.  It  appeared  on  the  evidence  that  he 
believed  himself  not  to  be  liable;  but  he 
knew  that  the  plaintiffs  thought  him  liable, 
and  would  sue  him  if  he  did  not  pay,  and  in 
order  to  avoid  the  expense  and  trouble  of  le- 
gal proceedings  against  himself  he  agreed 
to  a  compromise;  and  the  question  is  wheth- 
er a  person  who  has  given  a  note  as  a  com- 
promise of  a  claim  honestly  made  on  him, 
and  which  but  for  that  compromise  would 
have  been  at  once  brought  to  a  legal  deci- 
sion, can  resist  the  payment  of  the  note  on 
the  ground  that  the  original  claim  thus  com- 
promised might  have  been  successfully  re- 
sisted. 
If  the  suit  had  been  actually  commenced, 


the  point  would  have  been  concluded  by  au- 
thority. In  Longridge  v.  Darville,  5  Bam.  & 
Aid.  117,  it  was  held  that  the  compromise  of 
a  suit  instituted  to  try  a  doubtful  question 
of  law  was  a  sufficient  consideration  for  a 
promise.  In  Atlee  v.  Backhouse,  3  Mees.  & 
W.  633,  where  the  plaintiff's  goods  had  been 
seized  by  the  excise,  and  he  had  afterwards 
entered  into  an  agreement  with  the  commis- 
sioners of  excise  that  all  proceedings  should 
be  terminated,  the  goods  delivered  up  to 
the  plaintiff,  and  a  sum  of  money  paid  by 
him  to  the  commissioners,  Parke,  B.,  rests 
his  judgment  (page  G50)  on  the  ground  that 
this  agreement  of  compromise  honestly  made 
was  for  consideration,  and  binding.  In 
Cooper  v.  Parker,  15  0.  B.  822,  the  court  of 
exchequer  chamber  held  that  the  withdraw- 
al of  an  untrue  defence  of  infancy  Ln  a  suit, 
with  payment  of  costs,  was  a  sufficient  con- 
sideration for  a  promise  to  accept  a  smaller 
sum  in  satisfaction  of  a  larger. 

In  these  cases,  however,  litigation  had  been 
actually  commenced;  and  it  was  argued  be- 
fore us  that  this  made  a  difference  in  point 
of  law,  and  that  though,  where  a  plaintiff 
has  actually  issued  a  writ  against  a  defend- 
ant, a  compromise  honestly  made  is  binding, 
yet  the  same  compromise,  if  made  before  the 
writ  actually  issues,  though  the  litigation  is 
impending,  is  void.  Edwards  v.  Baugh,  11 
Mees.  &  W.  641,  was  relied  upon  as  an  au- 
thority for  this  proposition.  But  in  that 
case  Lord  Abinger  expressly  bases  his  judg- 
ment (pages  645,  646)  on  the  assumption  that 
the  declaration  did  not,  either  expressly  or 
impliedly,  shew  that  a  reasonable  doubt  ex- 
isted between  the  paities.  It  may  be  doubt- 
ful whether  the  declaration  in  that  case 
ought  not  to  have  been  construed  as  dis- 
closing a  compromise  of  a  real  bona  fide 
claim,  but  it  does  not  appear  to  have  been 
so  consti-ued  by  the  court.  We  agree  that, 
unless  there  was  a  reasonable  claim  on  the 
one  side,  which  it  was  bona  fide  intended  to 
pursue,  there  would  be  no  gi-ound  for  a  com- 
promise; but  we  cannot  agree  that  (except 
as  a  test  of  the  reality  of  the  claim  in  fact) 
the  issuing  of  a  writ  is  essential  to  the  valid- 
ity of  the  compromise.  The  position  of  the 
parties  must  necessarily  be  altered  in  everj- 
case  of  compromise,  so  that,  if  the  question 
is  afterwards  opened  up,  they  cannot  be 
replaced  as  they  were  before  the  compro- 
mise. The  plaintiff  may  be  in  a  less  favour- 
able position  for  renewing  his  litigation;  he 
must  be  at  an  additional  trouble  and  expense 
in  again  getting  up  his  case,  and  he  may 
no  longer  be  able  to  produce  the  evidence 
which  would  have  proved  it  originally.  Be- 
sides, though  he  may  not  in  point  of  law  be 
bound  to  refrain  from  enforcing  his  rights 
against  third  persons  during  the  continu- 
ance of  the  compromise,  to  which  they  are 
not  parties,  yet  practically  the  effect  of  the 
compromise  must  be  to  prevent  his  doing  so. 
For  instance,  in  the  present  case,  there  can. 
be  no  doubt  that  the  practical  effect  of  the 


FORBEARANCE. 


245 


■compromise  must  have  been  to  induce  the 
commissioners  to  refrain  from  taliing  pro- 
ceedings against  Mrs.  Bennett,  the  real  own- 
er of  the  houses,  while  the  notes  given  by 
the  defendant,  her  agent,  were  running; 
though  the  compromise  might  have  afforded 
no  ground  of  defence  had  such  proceedings 
been  resorted  to.  It  Is  this  detriment  to  the 
party  consenting  to  a  compiomise  arising 
from  the  necessary  alteration  in  his  posi- 
tion which,  ill  my  opinion,  forms  the  reai 
consideration   for  the  promise,  and  not  the 


technical  and  almost  illusory  consideration 
arising  from  the  extra  costs  of  litigation. 
The  real  consideration  therefore  depends, 
not  on  the  actual  commencement  of  a  suit, 
but  on  the  reality  of  the  claim  made  and 
the  bona  fides  of  the  compromise. 

In  the  present  case  we  think  that  there 
was  sudicient  consideration  for  the  notes  Id 
the  compromise  made  as  it  was. 

The  rule  to  enter  a  verdict  for  the  plaintiff 
must  bC'  made  absolute. 

Rule  absolute. 


CONSIDERATION. 


RECTOR,  ETC.,  OF  ST.  MARK'S  CHURCH 
V.  TEED. 

(24  N.  E.  1014,  120  N.  Y.  583.) 

Court  of  Appeals  of  New  York,  Second  Divi- 
sion.    June  24,  1890. 

Appeal  from  an  order  of  the  seneral 
term  of  the  supreme  court,  in  the  second 
judicial  department,  reversing  a  judgment 
entered  upon  the  decision  of  the  court  at 
special  term. 

Action  on  a  written  instrument  where- 
by the  defendant  promised  to  pay  to  the 
plaintiff,  a  religious  corporation,  the  sum 
of  $500.  The  answer  alleged  tliat  said 
promise  to  pay  was  made  without  any 
consideration, — good,  valuable,  or  other- 
wise,— and  that  it  is  of  no  force  or  effect. 
Upon  the  trial  it  appeared  that  on  Febru- 
ary 1,  1S7.5,  one  Lewis  T.  Wright  died, 
leaving  a  last  will  and  testament,  which 
in  due  time  was  presented  for  probate  to 
the  surrogate  of  the  proper  county  by  the 
defendant,  who  was  the  executor  na»ned 
therein.  Objections  to  the  probate  of  the 
will  were  filed  by  Thomas  Wright,  the 
only  brother,  heir  at  law,  and  next  of  kin 
of  the  decedent.  On  the  14th  of  April,  1875, 
while  the  issue  was  on  trial,  the  defendant, 
desiring  that  the  contest  should  be  with- 
drawn, made  an  arrangement  with  Thom- 
as Wright,  whereby  the  latter  agreed  to 
withdraw  his  opposition  to  the  probate 
of  the  will,  provided  the  former  would  pay 
the  plaintiff  the  sum  of  f 500  "in  the  man- 
ner, at  the  time,  on  the  conditions,  and 
for  the  purpose  expressed  in  the  undertak- 
ing or  obligation  hereinafter  set  forth." 
The  defendant  agreed  to  and  accepted 
said  terms  of  compromise,  and  thereupon, 
executed  and  delivered  the  following  in- 
strument, viz.:  "For  value  received,  I 
hereby  promise  to  pay  to  Saint  Mark's 
Church,  New  Castle,  Westchester  county, 
the  sum  of  five  hundred  dollars.  It  is  un- 
derstood that  said  church  will  appropri- 
ate the  interest  of  said,  money  to  the  im- 
provi-mcnt,  adf)rnment,  and  care-taking  of 
the  church-yard  of  said  church;  but  the 
payment  thereof  shall  not  be  exacted  till 
the  decease  of  Thomas  Wi*ight.  It  is  fur- 
ther understood  that,  upon  the  execution 
and  delivery,  by  the  residuary  legatees 
named  in  the  will  of  Lewis  Wright,  of  a 
written  agreement  or  a  sufficient  promise 
to  bind  them,  instead  of  the  undersigned, 
to  the  above,  then  this  writing  shall  be 
destroyed,  or  delivered  to  the  undersigned. 
CriAS.  G.  Teed.  In  presence  of  Lewis  C. 
Pratt.  Dated  April  14th,  1875.  "  In  con- 
sideration of  the  execution  and  delivery  ol 
this  agreement  by  the  defendant,  said 
Thomas  Wright  withdrew  his  objections 
to  the  probate  of  the  will,  which  was  im- 
mediately admitted  to  probate;  and  let- 
ters testamentary  were  issued  to  the  de- 
fendant thereon.  Neither  the  plaintiff  nor 
the  defendant  had  any  interest  in  the  es- 
tate of  said  decedent,  either  through  the 
will  or  otherwise,  but  one  ground  of  ob- 
jection to  the  probate  was  that  the  tes- 
tator had  agreed  to  leave  .fSOO  to  the 
plaintiff.  The  legatees  were  relatives  ol 
the  defendant,  and  on  their  account  he  de- 
sired that  the  contest  should  be  aban- 
doned.    Said   instrument  was  duly  deliv- 


ered to  the  plaintiff,  and  it  has  ever  since 
been  the  lawful  ow^ner  and  holder  thereof. 
Thomas  Wright  died  September  20,  1882; 
and  said  agreement  has  never  been  com- 
plied with  by  the  residuary  legatees,  nor 
performed  by  the  defendant.  The  trial 
judge,  after  finding  the  foregoing  facts,  in 
substance,  found  as  a  conclusion  of  law 
that  the  complaint  should  be  dismissed 
with  costs. 

William  H.  Robertson,  for  appellant. 
Walter  Edwards,  for  respondent. 

VANN,  J.  The  question  presented  for  de- 
cision by  this  appeal  is  whether  the  instru- 
ment upon  which  the  action  was  brought 
is  supported  by  a  consideration  that  the 
law  recognizes  as  sufficient.  "A  valuable 
consideration,  in  the  sense'  of  the  law,  may 
consist  either  in  some  right,  interest, 
profit,  or  benefit  accruing  to  one  part^',  or 
some  forbearance,  detriment,  loss,  or  re- 
sponsibility given,  suffered,  or  undertaken 
bv  the  other."  3  Amer.  &  Eug.  Enc.  Law, 
831;  Currie  V.  Misa,  L.  R.  10  Exch.  162; 
Chit.  Cont.  (9th  Amer.  Ed.)  29;  2  Kent, 
Comm.  405.  It  is  not  essential  that  the 
person  to  whom  the  consideration  moves 
should  be  benefited,  provided  the  person 
from  whom  it  moves  is,  in  a  legal  sense, 
injured.  The  injury  may  consist  of  a  com- 
promise of  a  disputed  claim,  or  forbearance 
to  exercise  a  legal  right;  the  alteration  in 
position  being  regarded  as  a  detriment 
that  forms  a  consideration,  independent 
of  the  actual  value  of  the  right  forborne. 
Thomas  Wright,  as  the  sole  heir  at  law 
and  next  of  kin  of  the  decedent,  would 
have  inherited  the  entire  estate  if  he  had 
succeeded  in  his  effort  to  defeat  the  pro- 
bate of  the  will.  He  was,  therefore,  "par- 
ticularly interested  in  setting  aside  the 
will,"  within  the  meaning  of  that  phrase 
as  used  in  the  case  of  Seaman  v.  Seaman, 
12  Wend.  3Sl,  which  we  regard  as  analo- 
gous to  this,  and  which  has  been  repeatedly 
followed.  Palmer  v.  North,  35  Barb.  293; 
Bedell  v.  Bedell,  3  Hun,  583;  Hall  v.  Rich- 
ardson, 22  Hun,  447. 

It  will  be  presumed  that  the  testator 
left  assets  of  some  value,  as  the  evidence 
tended  to  show  that  there  was  property, 
although  not  enough  to  pay  the  legacies, 
and  the  trial  court  mentioned  "the  prop- 
erty" and  "the  estate"  of  Lewis  T.  Wright 
in  the  findings.  Moreover,  as  the  agree- 
ment recites  a  consideration,  the  burden  of 
proof  was  on  the  defendant  to  show  that 
there  was  none;  and,  if  that  depended  up- 
on the  allegation  that  the  testator  left  no 
property,  the  burden  extended  to  proof  of 
that  proposition  also.  The  withdrawal 
of  the  objections  to  tlie  probateof  tlievvill, 
therefore,  at  the  special  request  of  the  de- 
fendant, was  the  forbearance  of  a  legal 
right,  and  constituted  a  consideration 
sufficient  to  support  a  promise  b^'  him, 
even  if  he  was  to  receive  no  benefit  what- 
ever. "  Whether  he  would  have  succeeded 
in  the  litigation,"  as  was  said  in  the  Sea- 
man Case,  "is  not  the  test.  *  *  *  It  is 
enough  that  he  yielded  to  his  adversaries 
the  right  he  possessed  to  contest  the  will. 
That  he  has  done,  and  the  compromise  it- 
self proves  prima  facie  an  acknowledg- 
ment by  the  defendants  that  there  was 
color  for  his   objections."    Page  381.     The 


FORBEARANCE. 


247 


/ 


court  will  not  ask  "wliich  party  would 
have  succeeded;"  for  that  would  involve 
the  trial  of  the  issue  that  was  conipro- 
niisod,  and  the  object  of  the  law  in  en- 
couragin{;:.coniproniis('H  would  thus  be  de- 
feated. The  couKideration  did  not  rest 
up(jn  any  advaiit;ij;e  to  the  defendant,  but 
upon  the  abandonnientby  Thomas  \\rij::ht 
of  his  position  as  a  contestant.  By  dis- 
continuing his  effort  to  overthrow  the 
will,  he  relinquished  a  right  secured  to 
him  by  law,  and  lost  his  chance  of  inherit- 
ing the  estate.  He  did  this  at  the  request 
of  the  defendant,  who  promised  to  pay  for 
it.  If  the  form  of  the  pronuse  had  been  to 
pay  directly  to  Thomas  Wright, no  reasou 
is  perceived  why  it  could  not  have  been  en- 
forced. As  the  arrangement  was  made 
with  him,  and  the  consideration  was  fur- 
nished by  him,  the  fact  that  the  money 
was  made  payable  bj'  his  direction  to  the 
plaintiff  does  not  render  the  promise  void. 
The  plaintiff  became  his  appointee,  and 
upon  receiving  from  him  the  written  agree- 
ment, or  evidence  of  the  promise,  it  became 
his  donee;  and  thus  privity  was  estab- 
lished between  the  parties  to  the  action. 
This  is  not  the  case  of  amerestranger  who 
attempts  to  intervene,  and  claim  the  ben- 
efit of  a  contract  to  which  he  is  not  a  par- 
ty, as  in  many  of  the  authorities  relied  on 
by  the  appellant,  because  the  promise  was 
made  directly  to  the  plaintiff,  and  there 
was  a  dear  intention  on  the  part  of  the 


person  furnishing  the  consideration  to  se- 
cure a  benefit  to  the  plaintiff.  If  the  sum 
in  question  had  been  made  payable  to 
Thomas  Wright,  he  could  have  given  the 
claim  to  the  plaintiff,  whose  title  would 
thus  have  been  jjerfect;  and  why  could  he 
not  make  the  gift  by  causing  tiie  iironiise 
to  be  made  directly  to  the  plaintiff?  The 
intention  (jf  the  parties  should  not  be  de- 
feated l)y  releasing  the  defendant  from  his 
promise,  after  he  had  received  the  consid- 
eration therefor,  simjily  on  account  of  the 
form  of  the  transaction,  which  violates 
no  statute,  nor  any  rule  of  jtublic  policy. 

If  A.  sells  a  horse  to  II.  for  .$100,  and  B. 
gives  in  payment  therefor  a  note  for  that 
amount  drawn  payable  to  C.  at  A.'s  re- 
quest, and  A.  delivers  the  note  to  C,  the 
latter  can  enforce  it  against  the  maker. 
The  case  supposed  differs  in  no  essential 
particular  from  that  under  consideration. 
As  recently  held  by  this  court,  after  a  care- 
ful review  of  the  authorities,  a  part3'  for 
whose  benefit  a  promise  is  made  may  sue 
in  assumpsit  thereon  even  if  the  considera- 
tion therefor  arose  between  the  promisor 
and  a  third  person.  Todd  v.  Weber,  95  N. 
Y.  181,  194.  Without  elaborating  our  rea- 
sons, we  think  that  the  order  appealed 
from  should  be  aflirmed,  and  that  judg- 
ment absolute  should  be  rendered  against 
the  defendant,  with  costs.  .Ml  comur,  ex- 
cept PoTTKR,  J.,  dissenting,  and  ILaigut, 
J.,  absent. 


24i 


COiJSIDEllATION. 


W 


7 


y 


llV;^ 


Vi 


McKINLBY  V.  WATKINS^ 

(13  111.  140.) 

Supreme   Court   of  Illinois.    Dec,   1851. 

This  action  was  commenced  by  Watkius 
against  McKinley  before  a  justice  of  the 
peace.  Watkins  failed  to  recover  on  the  trial 
before  the  justice,  and  took  an  appeal  to  the 
circuit  court  At  the  April  term,  ISol,  of  the 
Logan  circuit  court,  the  cause  was  tried  be- 
fore Davis,  J.,  and  a  jury,  and  resulted  in  a 
verdict  and  judgment  for  Watkins,  and  Mc- 
Kinley brought  the  cause  to  this  court  by  writ 
of  error. 

Watkins  and  McKinley  had  traded  horses 
in  lSi5.  Afterwards  they  had  some  dispute 
about  the  trade,  and  Watkins  threatened  to 
sue  imless  McKinley  would  give  him  a  horse, 
or  the  worth  of  the  horse  which  McKinley 
had  got  from  Watkins,  the  horse  which  Wat- 
kins had  received  in  exchange  having  died. 
McKinley  promised  that,  if  Watkins  would 
not  sue,  he  would  give  him  fifty  dollars,  or  a 
horse  worth  that  sum.  Upon  this  promise 
Watkins  brought  ■  his  ^action  against  McKin- 
ley. 

W.  H.  Hemdon,  for  plaintiff  in  eiror.  T. 
L.  Harris,  for  defendant  in  error. 


TRUMBULL,  J.  This  was  an  action  orig- 
inally commenced  before  a  justice  of  the 
peace,  and  taken  by  appeal  to  the  circuit 
court,  where  the  plaintiff  had  judgment  for 
fifty  dollars  and  costs. 

The  evidence  showed  that  the  parties  had 
traded  horses;  that,  a  month  or  two  after  the 
trade,  the  horse  which  plaintiff  got,  died,  and 
that  he  was  unsound  when  the  trade  took 
place.  There  was  no  evidence  of  any  false 
representations,  or  warranty  on  the  part  of 
the  defendant  in  making  the  trade.  After 
the  death  of  the  horse  the  plaintiff  informed 
the  defendant  of  the  fact,  and  alleged  that 
he  was  diseased  at  the  time  of  the  trade, 
whereupon  the  defendant  promised  to  pay 
the  plaintiff  fifty  dollars,  or  let  him  have  a 
fifty-dollar  horse,  if  he  would  not  sue. 

This  action  was  brought  to  recover  the  fifty 
dollars.  On  the  trial  the  circuit  court  in- 
structed the  jury  as  follows: 

"If  the  jm-y  believe  from  the  evidence  that 
there  was  a  horse  trade  between  Watkins 
and  McKinley,  out  of  which  a  difficulty  had 
grown,  and  that  Watkins  was  threatening  to 
sue  McKinley,  and  not  deceiving  him  by  any 
misrepresentations,  and  that  McKinley,  rath- 
er than  be  sued,  promised  Watkins  that  he 
would  pay  him  fifty  dollars,  then  said  prom- 
ise is  binding;  and  this  regardless  of  the 
question  as  to  whether  McKinley  would  or 
would  not  have  been  liable  in  the  suit  which 
Watkins    was   threatening    to   bring   against 


the  propriety  of  this  instruction,  and  in  one 
point  of  view  it  is  cleai-ly  erroneous.  It  as- 
sumes that  the  defendant  would  be  bound  by 
his  promise,  whether  assented  to  by  the 
plaintiff  or  not.  Unless  the  plaintiff  were 
bound  on  his  part  not  to  do  the  act  which 
formed  the  consideration  of  the  promise  of 
the  defendant,  the  agreement  was  void  for 
want  of  mutuality.  The  promise  of  defend- 
ant to  pay  fifty  dollars  if  plaintiff  would  not 
sue  him  was  incomplete  tiU  accepted  by  the 
plaintiff.    Chit.  Cont.  13. 

/  A  mere  offer  not  assented  to  constitutes  no\ 
contract,  for  there  must  be  not  only  a  pro-  \ 
[posal,  but  an  acceptance  thereof.  Story,  J 
\Cont.  §§  377,  378.  ^ 

The  instruction  in  other  respects  is  very 
nearly,  if  not  quite,  correct.  It  assumes  that, 
in  order  to  support  the  promise,  there  must 
have  been  a  horse  trade  between  the  parties, 
out  of  which  a  difficulty  had  arisen,  and  that 
the  plaintiff  was  threatening  to  sue  the  de- 
fendant, and  not  deceiving  him  by  any  mis- 
representations. If  by  this  is  to  be  under- 
stood that  the  plaintiff  must  in  good  faith 
have  supposed  that  he  had  a  jgood  cause  of 
action  against  the_f^pff^nnnnt^  jawing  out  of 
TE5  huistj-  Lfade,  the  ir|?}tmct^on  is  stricOy 
prgper.  it~  is  immaterial  whether  the  plam- 
tiff  could  have  recovered  in  such  action  or 
not  If  he  honestly  supposed  that  he  had  a 
good  cause  of  action,  the  compromise  of  such 
right  was  a  sufficient  consideration  to  uphold 
a  contract  fairly  entered  into  between  the 
parties,  irrespective  of  the  question  as  to  who 
was  in  the  right  It  has  often  been  decided 
that  the  compromise  of  a  doubtful  right  is 
a  sufficient  consideration  for  a  promise;  and 
it  is  immaterial  on  whose  side  the  right  ulti- 
mately turns  out  to  be,  as  it  must  always  be 
on  one  side  or  the  other,  because  there  can 
be  but  one  good  right  to  the  same  thing.  Tay- 
lor V.  Patrick,  1  Bibb,  168;  Russell  v.  Cook, 
3  Hill,  504;  Moore  v.  Fitzwater,  2  Rand.  442; 
O'Keson  v.  Barclay,  2  Penn.  R.  531. 

If  the  plaintiff'  was  threatening  to  sue  on 
a  claim  which  he  knew  was  wholly  unfound- 
ed, and  which  he  was  setting  l  ^j  as  a  mere 
pretense  to  extort  money  from  the  defendant, 
a  contract  foimded  on  a  promise  not  to  sue 
in  such  a  case  would  be  utterly  void.  In  or- 
der to  support  the  promise  there  must  be 
such  a  claim  as  to  lay  a  reasonable  ground 
for  the  defendant's  making  the  promise,  and 
then  it  is  immaterial  on  which  side  the  right 
may  ultimately  prove  to  be.  Edwards  v. 
Baugh,  11  Mees.  &  W.  641;  Perkins  v.  Gay, 
3  Serg.  &  R.  331. 

The  judgment  of  the  circuit  court  is  re- 
versed, and  the  cause  remanded.  Judgment 
reversed. 


him."    The  only  question  in  the  case  is  as  to         TREAT,  a  J.,  dissented. 


FORBEARANCE. 


249 


RUE  V.  MEIRS  et  al. 


aa  Atl.  369,  43  N.  J.  Eq.  377.) 


Court  of  Chancery  of  New  Jersey.     Feb.  7, 
18S8. 

Bill  to  enforce  performance  of  contract 
On  hearing  on  demurrer. 

William  H.  Vredenburgh,  for  demurrant, 
Frank  P.  McDermott,  for  complainant. 

VAN  FLEET,  V.  C.  The  complainant  sues 
In  a  dual  capacity— in  her  own  right,  as  well 
as  in  that  which  she  holds  as  the  administra- 
trix of  her  deceased  brother,  Natlianiel  S. 
Rue,  Jr.  The  foundation  of  her  action  is  a 
contract  made  by  her  fathei",  Robert  C.  Rue. 
with  the  defendants,  .John  G.  Meirs  and  Sa- 
rah E.  Davis,  and  which  was  reduced  to 
writing  and  signed  by  her  father  and  the  de- 
fendants, and  which  reads  as  follows:  "This 
agreement,  made  the  twenty-seventh  of  Sep- 
tember, 1S75,  by  and  between  Sarah  E.  Da- 
vis and  John  G.  Meirs,  of  Cream  Ridge,  coun- 
ty of  Monmouth,  state  of  New  Jersey,  of  the 
first  part,  and  Robert  C.  Rue,  of  the  same 
place,  as  the  representative  of  his  children, 
L.  M.  Rue  and  N.  S.  Rue,  Junior,  of  the  sec- 
ond part;  witnesseth,  in  consideration  of  the 
covenants  on  the  part  of  the,  party  of  the 
first  part  hereinafter  contained,  doth  cove- 
nant and  agree  with  the  party  of  the  second 
part,  Robert  C.  Rue,  that  we,  Sarah  E.  Da- 
vis and  John  G.  Meirs,  of  the  first  part,  do 
agree  to  pay  the  sum  of  $4,0r>C  co  li.  C.  Rue, 
ns  the  representative  of  his  children,  L.  M. 
Rue  and  N.  S.  Rue,  Junior,  provided  R.  C. 
Rue  makes  no  objection  to  the  proof  of  the 
will  and  the  settlement  of  the  estate  of  Lu- 
cretia  S.  Meirs,  deceased,  so  far  as  said  will 
has  reference  to  said  children."  The  com- 
plainant's bill  alleges  that  this  contract  grew 
out  of  a  threatened  contest  over  a  paper  pur- 
porting to  be  the  will  of  Lucretia  S.  Meirs, 
deceased.  Mrs.  Meirs  was  the  motlier  of  the 
defendants,  and  the  grandmother  of  the  com- 
plainant and  her  brother,  being  the  children 
of  a  deceau^ju  daughter  of  Mrs.  Meirs.  Mrs. 
Meirs  died  on  the  ninth  of  September,  1875. 
By  her  will  she  made  an  unequal  distribution 
of  her  property,  giving  the  defendants  much 
more  than  two-thirds.  The  complainant  and 
her  brother  wore  both  infants  at  the  time  of 
their  grandmother's  death.  Their  father  was 
present  at  the  reading  of  her  will,  and  imme- 
diately after  he  knew  its  contents  expressed 
his  dissatisfaction  with  its  provisions,  and 
protested  against  its  admission  to  probate. 
The  bill  says  that  the  defendants,  recognizing 
the  unequal  distribution  which  the  testatrix 
liad  made  of  her  property,  and  the  grounds 
which  existed  for  contesting  her  will,  they,  to 
induce  Robert  C.  Rue  to  forbear  from  con- 
testing the  will  on  behalf  of  his  children, 
made  the  promise  contained  in  the  contract. 
The  bill  further  says  that  the  will  of  Mrs. 
Meirs  was,  three  days  after  the  contract  was 
signed,  admitted  to  probate,  without  contest. 


and  that  since  then  her  estate  has  been  set- 
tled, and  her  property  distributed,  in  accord- 
ance with  the  terms  of  her  will,  witliout  ob- 
jection on  the  part  of  Robert  C.  Rue  or  his 
children,  but  with  their  acquiescence.  But 
the  $4,000  have  not  been  paid,  and  this  ac- 
tion is  brought  to  compel  payment. 

The  defendant  Meirs  demurs.  He  disputes 
the  validity  of  the  contract.  He  says  that  he 
and  his  sister  got  nothing  for  their  promise 
to  pay  the  $4,000.  This  contention  attempts, 
as  it  seems  to  me,  to  deny  what  is  manifestly 
undeniable.  The  right  of  Robert  C.  Rue  to 
file  a  caveat,  as  the  next  friend  of  his  chil- 
dren, against  the  probate  of  Mrs.  Meirs'  will, 
stands,  I  think,  free  from  the  least  doubt. 
While  an  infant  is  incapable  of  maintaining 
a  suit  or  other  legal  proceeding  in  his  own 
name,  for  the  protection  of  his  rights,  there 
can  be  no  doubt  that  he  is  entitled  to  the 
benefit  of  every  remedy  recognized  by  our 
system  of  jurisprudence,  and  to  which  an 
adult  of  full  capacity  may  resort,  the  only 
difference  being  that  an  infant  must  proceed 
in  the  name  of  an  adult,  as  his  next  friend, 
while  an  adult  may  proceed  in  his  own  name. 
And  this  is  so  because  an  infant,  by  reason 
of  the  immaturity  of  his  mind,  is  incapable  of 
judging  when  and  under  what  circumstancvs 
he  should  seek  judicial  protection  or  re- 
dress, and  the  courts  have  therefore  adopt- 
ed, as  a  rule  of  practice  for  the  protection  of 
infants  as  well  as  themselves,  that  no  suit  or 
proceeding  in  behalf  of  an  infant  shall  be 
entertained,  unless  instituted  by  a  person 
competent  to  judge  whether  such  step  is  nf  c- 
essary  or  proper  for  the  due  protection  of 
the  infant's  rights.  While  any  person  of  full 
age  and  sound  mind  is  competent  to  become 
the  next  friend  of  an  infant,  his  nearest  rela- 
tive is  usually  preferred.  A  father,  being 
the  natural  guardian  of  his  infant  child,  has 
a  vested  right,  as  it  has  been  called,  to  act 
as  the  next  friend  of  his  child  in  a  litigation 
involving  the  child's  rights,  if  the  father's  in- 
terests are  not  hostile  to  those  of  his  child, 
and  he  has  been  guilty  of  no  default  or  neg- 
lect. This  right  is  regarded  as  so  superior 
by  the  English  courts  that  it  has  been  de- 
clared that  the  father  has  a  right,  even 
where  another  person  has  instituted  a  suit  in 
behalf  of  his  infant  child,  and  prosecuted  it 
to  decree,  to  have  such  other  person  dis- 
placed, after  decree  pronounced,  and  himself 
substituted  as  next  friend.  Woolf  v.  Pem- 
berton,  G  Ch.  Div.  19.  It  would  seem,  then, 
to  be  entirely  clear  that  the  defendants,  l\v 
removing  the  opposition  which  Robert  C.  Rue 
intended  to  make  on  behalf  of  his  children  to 
the  probate  of  the  will,  and  which  he  had 
an  unquestionable  riglit  to  make,  reheved 
themselves,  from  the  only  substantial  danger 
which  existed,  and  that  instead  of  its  being 
true  that  they  got  nothing  for  tueir  promise 
to  pay  $4,000.  it  is  a  fact  standing  free  from 
all  dispute  that  they  have  received  every- 
thing which  the  contract  stipulated  that  they 
should  receive.     The  thing  that  the  defend- 


250 


CONSIDERATION. 


ants  were  bargaining  for  was  tbat  the  paper 
which  their  mother  left  as  the  testamentary 
disposition  of  her  property  should  be  proved 
as  her  will,  without  objection,  and  that  their 
mother's  property  should  be  divided  and  dis- 
tributed as  her  will  directed.  The  will  was 
proved  without  objection,  and  the  property 
has  been  divided  and  distributed  as  the  will 
directed.  The  contract,  therefore,  so  far  as 
the  defendants  were  entitled  to  anything  un- 
^oj-JX    hns  been  P-\]]Y  pQj-frtrmi^  ''^— 

The  question  whether  a  promise  to  forbear 
suit  to   enforce  a  disputed   claim  or   right, 
where  the  claim  or  right  is  honestly  assert- 
ed, under  a  behef  that  it  is  substantial,  al- 
though it  is  in  fact  wholly  unfounded,  is  suf- 
ficient, as  a  consideration  to  support  a  prom- 
ise to  pay  money,  has  recently  been  put  at 
rest  in  this  state  by  a  decision  of  the  su- 
preme court.     That  court  said  in  Grandin  v. 
Grandin,  49  N.  J.  Law,  508,  9  Atl.  756:  "The 
compromise  of  a  disputed  claim,  made  bona 
fide,  is  a  good  consideration  for  a.  promise, 
whether  the  claim  be  in  suit  or  litigation  has 
not  been  actually  commenced,  even  though  it 
should  ultimately  appear  that  the  claim  was 
wholly  unfounded,— the  detriment  to  the  par- 
ty consenting  to  a  compromise,  arising  from 
the  alteration  in  his  position,  forms  the  real 
consideration    which    gives  validity   to    the 
promise.     The  only  elements  necessary  to  a 
valid  agreement  of  compromise  are  the  real- 
ity of.  the  claim  made,  and  the  bona  fides  of 
the  compromise."    And  what  I  understand  is 
meant  by  the    phrase,   "the    reality   of  the 
claim  made,"  is  that  the  claimant  shall  assert 
his  claim  in  good  faith,  believing  that  it  is 
real,  or,  in  the  language  of  Lord  Justice  Cot- 
ton, in  Miles  v.  Estate  Co.,  32  Ch.  Div.  2G6: 
"A  claim  is  honest  if  the  claimant  does  not 
know  that  his  claim  is  unsubstantial,  or  if 
he  does  not  know  the  facts  which  show  that 
his  claim  is  a  bad  one."     The  court,  in  decid- 
ing Grandin  ,v.  Grandin,  adopted  the  princi- 
ple estabhshed  by  the  court  of  queen's  bench 
in  Cook  V.  Wright,  1  Best  &  S.  559.     That 
case  was    heard    by   Cockburn,   C.  J.,   and 
Blackburn  and  Wightman,  JJ.     The  material 
facts,  as  stated  in  the  opinion  of  Mr.  Justice 
Blackburn,  were:    "The  defendant  was  agent 
for  a  Mrs.  Bennett,  who  was  a  non-resident 
owner  of  houses  in  a  district  subject  to  a  lo- 
cal act.     Work  had  been  done  in  the  adjoin- 
ing street  by  the  commissioners  for  executing 
the  act,  the  expenses  for  which,  under  the 
provisions  of  the  act,  they  charged  on  the 
owners  of  the  adjoining  houses.     Notice  had 
been  given  to  the  defendant,  as  if  he  had 
himself  been  the  owner  of  the  houses,  calling 
on  him  to  pay  the  proportion  chargeable  in 
respect  to  them.     He  attended  at  a  board 
meeting  of  the  commissioners,  afid  objected 
both  to  the  amount  and  nature  of  the  charge, 
and  also  stated  that  he  was  not  the  owner  of 
the  houses,  and  that  Mrs.  Bennett  was.    He 
was  told  that  if  he  did  not  pay  he  would  be 
treated  as  one  Goble  had  been.     It  appeared 
that  Goble  had  refused  to  pay  a  sum  char- 


ged against  him  as  the  owner  of  some  hous- 
es,  and  the  commissioners  had  taken   legal 
proceedings  against   him,   and  he   had   then 
submitted  and  paid  with  costs.     In  the  re- 
sult it  was  agreed  between  the  commissioners 
and  the  defendant  that  the  amount  charged 
upon  him  should  be  reduced,  and  that  time 
should  be  given  to  pay   it  in   three  install- 
ments.    The  defendant  gave  three  promissory 
notes  for  the   three    installments;    the    lirst 
was  duly  honored,  the  others  were  not,  and 
were  the  subject  of  the  present  action.     At 
the  trial  it  appeared  that  the  defendant  was 
not  the  owner  of  the  houses.     As  agent  for 
the  owner  he  was  not  personally  liable  under 
the  act.     In  point  of  law,  therefore,  the  com- 
missioners  were   not   entitled  to   claim   the 
money  from  him,  but  no  case  of  deceit  was 
alleged  against  them.     It  must  be  taken  that 
the  commissioners  honestly  believed  that  the 
defendant  was  personally  liable,  and  really 
intended   to  take  legal  proceedings  against 
him,  as  they  had  done  against  Goble.     The 
defendant,   according  to   his  own  evidence, 
never  believed  that  he  was  liable  in  law,  but 
signed  the  notes  in  order  to  avoid  being  sued 
as  Goble  was."     The  court  decided  that  the 
notes  sued  on  were  supported  by  a  good  con- 
sideration, and  this  ruling  was  put  distinct- 
ly on  the  ground  that  the  defendant,  by  giv- 
ing the  notes,  had  induced  the  plaintiffs  to 
alter  their  position,  by  refraining  from  do- 
ing what  they  might  have  done  if  the  notes 
had  not  been  given.     The  court  say:  "There 
can  be  no  doubt  that  the  practical  effect  of 
the  compromise  must  have  been  to  induce  the 
commissioners  to   refrain  from   taking   pro- 
ceedings against  Mrs.  Bennett,  the  real  own- 
er of  the  houses,  while  the  notes  given  by 
the    defendant,   her   agent,    were    running; 
though  the  compromise  might  have  afforded 
no  ground  of  defense  had  such  proceedings 
been  resorted  to.     It  is  this  detriment  to  the 
party   consenting  to  a   compromise,   arising 
from   the  necessary  alteration   in   his   posi- 
tion, which,  in  our  opinion,  forms  the  real 
consideration  for  the  promise,  and  not  the 
technical  and  almost  illusory  consideration 
arising  from  the  extra  costs  of  the  litigation. 
The    real    consideration,    therefore,    depends, 
not  on  the  actual  commencement  of  a  suit, 
but  on  the  reality  of  the  claim  made,  and  the 
bona  fides  of  the  compromise." 

The  same  doctrine  was  subsequently  de- 
clared in  Callishcr  v.  Bischoffheim,  L.  R.  5  Q. 
B.  449.  The  court,  speaking  by  Cockburn,  C. 
J.,  there  said:  "The  authorities  clearly  estab- 
lish that,  if  an  agreement  is  made  to  compro- 
mise a  disputed  claim,  forbearance  to  sue  in 
respect  of  that  claim  is  a  good  consideration; 
and  whether  proceedings  to  enforce  the  dis- 
puted claim  have  or  have  not  been  instituted 
makes  no  difference.  *  *  *  Every  day  a 
compromise  is  effected  on  the  ground  that 
the  party  making  it  has  a  chance  of  succeed- 
ing in  it,  (in  enforcing  his  claim  or  right  by 
suit;)  and  if  he  bona  fide  believes  he  has  a 
I  fair    chance    of    success,    he    has    reasonable- 


FOKBEARANCE. 


251 


ground  for  suing,  and  his  forbearance  to  sue 
will  constitute  a  good  consideration.  When 
such  a  person  forbears  to  sue,  he  gives  up 
what  he  believes  to  be  a  right  of  action,  and 
the  other  party  gets  an  advantage,  and  in- 
stead of  being  annoyed  with  an  action,  he 
escapes  from  the  vexation  incident  to  it." 
Applying  these  principles  to  the  contract  on 
trial,  its  validity,  in  point  of  consideration,  is 
put  beyond  dispute.  In  cases  of  this  class.  If 
the  contract  has  been  fairly  made,  no  inquiry 
will  be  made  as  to  the  adequacy  of  its  con- 
sideration. CJrandin  v.  Grandin,  supra.  By 
the  terms  of  this  contract,  it  will  be  observed 
that  the  advantages  were  all  with  the  defend- 
ants. They  were  not  bound  to  pay  until  the 
other  contracting  party  had  performed  his 
part  of  the  contract,  and  they  had  received 
everything  under  the  contract  which  they 
were  entitled  to  receive.  Stated  in  sub- 
stance, the  contract  is  this:  The  defendants 
agreed  to  pay  Robert  C.  Rue  $4,000,  for  his 
children,  provided  he  make  no  objix-tion,  on 
behalf  of  his  children,  to  the  proof  of  Mrs. 
Meirs'  will,  and  the  division  and  distribution 
of  her  estate  according  to  the  terms  of  her 
will.  The  $4,000  are  not  payable  until  the 
will  has  been  proved  and  fully  executed,— un- 
til the  opposing  or  hostile  right,  which  the 
defendants  feared,  was  actually  extinguished. 
The  defendants  have  now  received  everything 
which  they  were  entitled  to  receive  under  the 
contract,  and  for  which  they  agreed  to  pay 
the  $4,000,  and  I  think  they  are,  therefore, 
bound  in  law  and  conscience  to  abide  by  their 
contract,  and  nay  the  $4,000. 


The  defendant  also  raises  a  question  of  ju- 
risdiction. He  denies  the  power  of  this  court 
to  give  the  complainant  the  relief  she  asks. 
This  objection  raises  a  question  which,  in 
view  of  the  peculiar  condition  of  facts  which 
the  case  presents,  seems  to  me  to  be  one 
about  which  strong  diversity  of  opinion  may 
exist,  and  I  must  confess  that  the  conclusion 
which  I  have  reached  concerning  it  is  not  one 
which  I  express  without  doubt.  The  draughts- 
man of  the  bill  has  attempted  to  lay  a  foun- 
dation for  equity  cognizance,  by  asking  for  a 
reformation  of  the  contract.  The  contract,  it 
will  be  observed,  says  that  "in  consideration 
of  the  covenants  on  the  part  of  the  party  of 
the  first  part,  hereinafter  contained,  doth  cov- 
enant and  agree  with  the  party  of  the  second 
part,  Robert  C.  Rue.  that  we,  Sarah  E.  Davis 
and  .Tohn  G.  ^leirs.  do  agree  to  pay  the  sum 
of  $4,000  to  R.  C.  R.,"  etc.  The  words  "par- 
t>'  of  the  first  part"  are  used  where  it  is  man- 
ifest the  words  "party  of  the  second  part" 
were  intended  to  be  used.  And  it  is  also 
obvious  that  the  words  "party  of  the  first 
part"  should  have  been  inserted  between  the 
words  "hereinafter  contained"  and  the  words 
"doth  covenant,"  In  order  to  make  the  con- 
tract express,  in  formal  words,  the  meaning 
of  the  parties.  But  these  mistakes  are  pal- 
pable, and  do  not  create  the  slightest  obscu- 
rity as  to  the  meaning  of  the  contract,  nor 
prevent  it  from  being  so  constnied  as  to  give 


full  effect  to  the  real  intention  of  the  parties. 
It  is  a  rule  of  construction,  of  universal  ap- 
plication, that  a  contract,  notwithstanding 
mistakes,  shall,  if  the  meaning  of  the  parties 
can  be  clearly  discerned,  be  construed  as  near 
the  minds  and  apparent  intents  of  the  parties 
as  It  possibly  may  be,  and  the  law  will  per- 
mit. Sis.son  V.  Donnelly,  36  N.  J.  Law,  482. 
The  subsequent  parts  of  this  contract  exprt-ss 
the  intention  of  the  parties  In  language  so 
clear,  simple,  and  explicit  that  it  must,  in  its 
present  form,  be  understood  and  construed 
just  exactly  as  it  would  be  after  It  was  re- 
formed. Where  that  is  the  case,  reformation 
can  accomplish  nothing;  Indeed,  there  is 
nothing  to  reform,  for  the  contract,  with  tlie 
mistake  in  It,  is  to  be  construed  and  carried 
into  effect  just  as  if  it  was  entirely  free  from 
mistake.  A  mistake  which  is  harmless,  and 
does  no  injury,  needs  no  correction.  This 
court  cannot  take  jurisdiction  on  the  ground 
that  the  contract  sued  on  needs  reformation. 
This  suit  is  brought  to  enforce  a  money  de- 
mand, founded  on  a  simple  contract.  If  that 
was  all  there  was  of  it,  there  would  not  be 
the  least  pretense  of  jurisdiction  in  this  court. 
And  so,  if  the  contract  consisted  of  a  promise 
by  the  defendants  to  pay  money  to  the  com- 
plainant and  her  brother,  for  a  consideration 
moving  from  their  father  to  the  defendants, 
there  can  be  no  doubt  that  an  action  at  law 
might  be  maintained  on  it;  for  it  is  settled 
that,  in  cases  of  simple  contract,  if  one  person 
makes  a  promise  to  another  for  the  benefit  of 
a  third,  the  third  may  maintain  an  action  at 
|..law  on  it,  though  the  consideration  does  not 
move  from  him.  It  is  otherwise  when  the 
contract  is  under  seal.  Joslin  v.  Car  Spring 
Co.,  30  N.  J.  Law,  141.  But  this  contract 
was  made  by  a  person  acting  as  trustee  for 
the  benefit  of  his  cestuis  que  trust  A  fa- 
ther, as  the  natural  guardian  of  }iis  two  infant 
children,  agrees  to  waive  his  right,  as  the 
person  having  the  first  and  best  right  to  act 
as  the  next  friend  of  his  children,  to  contest 
the  validity  of  a  will  by  legal  proceedings,  on 
condition  that,  if  no  contest  is  made  and  the 
will  is  admitted  to  probate,  and  the  testatrix's 
property  is  distributed  as  the  will  directs,  the 
persons  taking  the  largest  benefit  imder  the 
will  will  pay  a  certain  sum  of  money,  not  to 
the  children,  but  to  the  father  for  his  chil- 
dren. Now,  in  such  a  transaction,  the  father, 
from  the  beginning  to  the  end,  is  acting  in  a 
capacity  of  pure  tnist.  It  is  true,  he  is  a  si'lf- 
constituted  trustee,  but  he  assumes  that  char- 
acter under  circumstances  when  the  common 
instinct  of  our  nature  made  it  his  duty  to  do 
.so,  and  when,  if  he  had  not  done  so,  he  would 
have  allowed  what  he  believed  to  be  an  un- 
conscientious advantage  to  be  taken  of  his 
children.  The  fact  that  the  contract  was 
made  by  a  person  acting  as  a  trustee,  for  the 
benefit  of  his  infant  cestuis  que  trust,  may 
not  be  decisive  on  the  question  of  jurisdic- 
tion, but  it  shows  that  the  contract  belongs 
to  a  class  of  transactions  over  which  this 
court  exercises  a  very  extensive  jurisdiction. 


252 


CONSIDERATION. 


I  t>iink  there  is  reason  to  doubt  whether  the 
children  could  maintain  an  action  at  law  on 
this  contract  in  their  own  names.  No  prom- 
ise is  made  to  them;  on  the  contrai-y,  the 
promise  is  to  their  father,  the  language  of  the 
contract  being:  *'We  do  agree  to  pay  the  sum 
of  ?4.000  to  R.  C.  Rue,  as  the  representative 
of  his  two  children."  But  if  the  children 
could  have  maintained  an  action  at  law  in 
their  own  names,  it  would  be  necessary  now, 
as  one  of  them  is  dead,  that  two  actions 
should  be  brought,— one  in  the  name  of  the 
suiTiving  child,  and  the  other  in  the  name  of 
the  administratrix  of  the  deceased  child. 
There  may,  perhaps,  be  less  doubt  about  the 
right  of  the  father  to  maintain  an  action  at 
law  in  his  name  for  the  use  of  his  children. 
I  think  such  action  would  be  maintainable. 
The  cases  at  law,  however,  upon  this  subject 
are  at  variance.  Judge  Story,  in  his  com- 
mentaries on  Equity  Jurisprudence,  calls  at- 
tention to  the  fact  that  the  cases  at  law  on 
this  subject  are  not  uniform,  and  that  the 
law  in  consequence  is  somewhat  uncertain, 
and  then  adds:  "But,  be  this  as  it  may,  it  is 
certain  that  a  remedy  would  lie  in  equity, 
under  like  circumstances,  as  a  matter  of  trust; 
for  it  is  laid  down  in  a  work  of  veiy  high 
authority.  'If  a  man  gives  goods  or  chattels 
to  another,  upon  a  trust  to  deliver  them  to  a 
stranger,  chancery  will  oblige  him  to  it.' "  2 
Stoi-y,  Eq.  Jur.  §  1041.  And  I  suppose  it 
would  necessarily  follow  that,  where  a  prom- 
ise was  made  to  one  as  a  trustee  for  another, 
upon  a  sufficient  consideration,  that  chancery 
would  oblige  the  promisor  to  perform  his 
promise  at  the  suit  of  the  cestui  que  trust, 
especially  in  a  case  where  the  consideration 
for  his  promise  consisted  in  the  extinguish- 
ment of  a  right  belonging  to  the  cestui  que 
trust 

But  another  fact  and  the  one  which  I  think 
possesses  the  greatest  force,  remains  to  be 
mentioned.  The  bill  alleges  that,  subsequent 
to  the  making  of  the  contract  sued  on,  the 
defendants,  Meirs  and  Davis,  made  an  agree- 
ment apportioning  the  $4,000  between  them- 
selves, by  which  it  was  agreed  that  Meirs 
should  pay  $3,000,  and  Mrs.  Davis  the  re- 
maining $1,000,  and  that,  in  pursuance  of  such 
apportionment,  Mrs.  Davis,  on  the  twenty- 
third  day  of  May,  1877,  paid  Robert  C.  Rue, 
who  was  then  the  duly-appointed  guardian  of 
the  complainant  and  her  brother,  her  quota 
of  the  $4,000.  There  can  be  no  doubt,  I 
think,  that  the  making  of  this  agreement,  and 
its  subsequent  execution  by  Mrs.  Davis, 
raised  an  equity  in  her  favor  as  against  her 


co-defendant,  and  also  against  the  complain- 
ant, to  be  exonerated  from  all  liability  for  the 
$3,000,  provided  the  money  could  be  collected 
of  Meirs.  He  is  the  person  who  is  unques- 
tionably primarily  liable  as  between  Mrs. 
Davis  and  himself,  and  should,  therefore,  in 
justice,  in  the  fii'st  instance,  be  compelled  to 
bear  it  alone,  together  with  all  the  legal  ex- 
penses attending  its  enforcement.  Mrs.  Da- 
vis' right  to  exemption  from  primary  liability 
was  known  to  the  complainant  at  the  time 
she  brought  her  suit.  I  think  she  was  under 
a  clear  equitable  obligation  to  respect  that 
right,  and  the  only  way  open  to  her  to  ef- 
fectually protect  Mrs.  Davis'  right  in  this  re- 
gard, was  to  bring  her  suit  in  this  court. 
Here  a  decree  may  be  made  which  will  give 
]\Irs.  Davis  the  full  benefit  of  any  equity  aris- 
ing to  her  out  of  the  agreement  of  apportion- 
ment, and  at  the  same  time  preserve  to  the 
complainant  any  rights  which  may  exist  in 
her  favor  against  Mrs.  Davis,  in  the  event 
that  the  whole  of  the  sum  due  cannot  be  col- 
lected of  the  person  who  is  primarily  liable. 
If  the  complainant  had  sued  at  law,  her  suit 
would  have  been  an  open  declaration  that  she 
intended  to  violate  Mrs.  Davis'  right  to  be 
exempt  from  primary  liability,  for,  if  she  re- 
covered at  all  in  such  suit,  her  recovery  would 
have  been  against  both  defendants  as  princi- 
pals, each  being  adjudged  liable  for  the  whole 
amount  of  the  recovery.  An  attempt  by  the 
complainant,  with  full  knowledge  of  Mrs. 
Davis'  equity,  to  place  Mrs.  Davis  in  the  sit- 
xiation  in  which  she  would  stand  by  a  judg- 
ment at  law  against  her,  under  which  the 
whole  of  this  debt  might  be  made  out  of  her 
property,  might,  under  some  circumstances, 
be  so  strongly  indicative  of  a  fraudulent  pur- 
pose on  the  part  of  the  complainant  as  to 
justify  this  court  in  interfering  by  injimction. 
Equity  will,  in  cases  of  this  class,  take  Juris- 
diction whenever  it  is  necessary  to  compel 
the  person  primarily  liable  to  perform  an  ob- 
vious duty,  and  thus  relieve  another  person 
standing  in  the  position  of  his  surety  from  a 
needless  burden,  and  also  to  prevent  circuity 
of  action.  Irich  v.  Black,  17  N.  J.  Eq.  189. 
For  these  reasons  I  think  this  court  should 
retain  jurisdiction  of  this  cause. 

This  suit,  in  its  present  condition,  is  defect- 
ive in  parties.  Robert  C.  Rue,  the  person 
with  whom  the  contract  on  which  the  suit  is 
founded  was  made,  is  not  a  party.  His  omis- 
sion is  made  a  ground  of  objection  by  the 
demurrant.  He  is  a  necessary  party,  and 
this  gi'ound  of  demurrer  must  be  sustained. 
The  others  must  be  overruled. 


h' 


b 


NATURAL 

0"^ 


AFFECTION. 


253 


FINK  V.  COX. 

(18  Johns.  145.) 

Supreme  Court  of  New  York.     Aug.,  1820. 

This  was  an  action  of  assumpsit  bruuglit  to 
recover  the  amount  of  a  promissoiy  note, 
given  by  the  testator,  Alexander  Fink,  to  his 
son,  the  plaintiff.  The  note,  which  was  prov- 
ed by  the  subscribing  witness,  was  as  follows: 
"New-York,  30lh  July,  ISIG.  Sixty  days  aft- 
er date,  I  promise  to  pay  John  L.  Fink,  or 
order,  one  thousand  dollars,  value  received. 

Alexander    X    Fink."     The   testator,   at   the 

mark 

time  he  gave  the  note  to  the  plaintiff,  de- 
clared that  he  gave  it  to  him  absolutely,  and 
observed  that  the  plaintiff  was  not  so  wealthy 
as  his  brother;  and  that  the  plaintiff  and  his 
brother  had  had  a  controversy  about  a  stall, 
&c.,  which  were  the  reasons  for  his  giving  thb 
note  to  the  plaintiff.  There  was  no  actual 
consideration  for  the  note;  and  the  wiinoss 
understood  it  to  be  a  gift  from  the  testator 
to  his  son. 

The  defendant  gave  in  evidence  the  will 
of  the  testator,  by  which  he  devised  all  his 
personal  estate  to  his  sons,  including  the 
plaintiff,  in  equal  proportions;  and  after  a  de- 
vise to  his  daughter  of  a  house  and  lot,  the 
residue  of  his  real  estate  was  given  to  his 
executors  in  trust,  to  sell  the  same,  and  di- 
vide the  proceeds  equally  among  his  children. 
The  defendant  also  gave  in  evidence  the  plain- 
tiff's answer  to  a  bill  in  chancery,  for  a  dis- 
covery filed  by  the  executor,  in  which  he  stated 
that  the  note  was  freely  given  to  him  by 
the  testator,  and  was  founded  ou  the  consid- 
eration of  natural  love  and  affection. 

The  cause  was  tried  at  the  New-York  slt- 
Uugs,  in  June,  1818.  when  a  verdict  was  found 
for  the  plaintiff,  for  $1,129  and  30  cents,  sub- 
ject to  the  opinion  of  the  court,  on  a  case  con- 
taining the  above  facts. 

Mr.  Van  Wyck,  for  plaintiff.  Mr.  Slosson, 
contra. 

SPENCER,  C.  J.  The  question  in  this  case 
is,  whether  there  is  a  sufhcient  consideration 
for  the  note  on  which  this  suit  is  founded.  It 
appears  from  the  declaration  of  the  testator 
when  the  note  was  given,  that  he  intended  it 
as  an  absolute  gift  to  his  son,  the  plaintiff; 
alleging  that  the  plaintiff  was  not  so  wealthy 
as  his  brotlier.'?,  that  he  had  met  with  losses, 
and  that  he  and  his  brothers  had  had  a  contro- 
versy about  a  stall.    Such  were  the  reasons 


assigned  for  his  glvhag  the  note  to  the  plain- 
tiff. 

There  can  be  no  doubt  that  a  considera- 
tion is  necessary  to  uphold  the  promi.se,  and 
that  it  is  competent  for  the  defendant  to  show 
that  there  was  no  consideration.  Schoou- 
maker  v.  Roosa,  17  Johns.  301.  The  only  con- 
sideration pretended,  is  that  of  natiu-al  love 
and  affection  from  a  father  to  a  child;  and 
if  that  is  a  sufficient  consideration,  the  plain- 
tiff is  entitled  to  recover,  otherwise  not. 

It  is  conceded,  that  the  gift,  in  this  case,  is 
not  a  donatio  causa  mortis,  and  cannot  be 
supported  on  that  ground.  In  Pearson  v. 
I'earson,  7  Johns.  2G,  the  question  was,  wheth- 
er the  gift  of  a  note  signed  by  the  defendant 
to  the  plaintiff  was  such  a  vested  gift,  though 
without  consideration,  as  to  be  valid  in  law; 
we  held  that  it  was  not,  and  that  a  parol 
promise  to  pay  money,  as  a  gift,  was  no  more 
a  ground  of  action,  than  a  promise  to  deliver 
a  chattel  as  a  gift;  and  we  referred  to  the 
case  of  Noble  v.  Smith,  2  Johns.  52,  where 
the  question  underwent  a  full  discussion  and 
consideration.  The  case  of  Grangiac  v.  Ar- 
den,  10  Johns.  293,  was  decided  on  the  prin- 
ciple, that  the  gift  of  the  ticket  had  been  com- 
pleted by  delivery  of  possession,  and  is  in  per- 
fect accordance  with  the  former  cases. 

It  has  been  sti'ongly  insisted,  that  the  note 
in  the  present  case,  although  intended  as  a 
gift,  can  be  enforced  on  the  consideration  of 
blood.  It  is,  undoubtedly,  a  fair  presumption 
that  the  testator's  inducement  to  give  the  note 
sprang  from  parental  regard.  The  considera- 
tion of  blood,  or  natural  love  and  affection, 
is  sufficient  in  a  deed,  against  all  persons  but 
creditors  and  bona  fide  purchasers;  and  yet 
there  is  no  case  where  a  personal  action  has 
been  founded  on  an  exj^gutory  contract^  where 
a  considergtion  was  necessary,  in  which  the 
considerati9]a-a£Jjlood,  or  natural  lovg  and  af^ 
has  beenn? 


fejsUo^  has  been  "held  sufficient  In  such^^ 
case,  the  considerattOH  filTlSt  n"e  a  valuable 
one,  for  the  benefit  of  the  promisor,  or  to  the 
trouble,  loss,  or  prejudice  of  the  promisee. 
The  note  here  manifested  a  mere  intention  to 
give  the  one  thousand  dollars.  It  was  ex- 
ecutory, and  the  promisor  had  a  locus  pceni- 
tentice.  It  was  an  engagement  to  give,  and 
not  a  gift.  None  of  the  cases  cited  by  the 
plaintiff's  counsel  maintain  the  position,  that 
because  a  parent,  from  love  and  natural  af- 
fection, engages  to  give  his  son  money,  or  a 
chattel,  that  such  a  promise  can  be  enforced 
at  law. 
Judgment  for  the  defendant. 


254 


^ 


V 


MILLS   T.   WYMAN. 
(3  Pick.  207.) 


•  CONSIDERATION 


Supreme   Judicial   Court   of    Massachusetts. 
Worcester.     Oct.  Term,  1825. 

This  was  an  action  of  assumpsit  brought 
to  recover  a  compensation  for  the  board, 
nui-sing,  &c.,  of  Levi  Wyman.  son  of  the  de- 
fendant, from  the  5th  to  the  20th  of  Febru- 
aiy,  1S21.  The  plaintiff  then  lived  at  Hart- 
ford, in  Connecticut;  the  defendant,  at 
Shrewsbury,  in  this  county.  Levi  Wyman, 
at  tlie  time  when  the  services  were  rendered, 
was  about  25  years  of  age,  and  had  long 
ceased  to  be  a  member  of  his  father's  fam- 
ily. He  was  on  his  return  from  a  voyage 
at  sea.  and  being  suddenly  taken  sick  at  Hart- 
ford, and  being  poor  and  in  distress,  was  re- 
lieved by  the  plaintiff  in  the  manner  and  to 
the  extent  above  stated.  On  the  24th  of 
February,  after  all  the  expenses  had  been 
incurred,  the  defendant  wrote  a  letter  to  the 
plaintiff,  promising  to  pay  him  such  expen- 
ses. There  was  no  consideration  for  this 
promise,  except  what  grew  out  of  the  rela- 
tion which  subsisted  between  Levi  Wyman 
and  the  defendant,  and  Howe,  J.,  before 
whom  the  cause  was  tried  in  the  court  of 
common  pleas,  thinking  this  not  sufficient 
to  support  the  action,  directed  a  nonsuit. 
To  this  direction  the  plaintiff  filed  exceptions. 

J.  Davis  and  Mr.  Allen,  in  support  of  the 
exceptions.     Mr.  Brigham,  for  defendant 

PARIvER,  C.  J.  General  rules  of  law  es- 
tablished for  the  protection  and  security  of 
honest  and  fair-minded  men,  who  may  in- 
considerately make  promises  without  any 
equivalent,  will  sometimes  screen  men  of  a 
different  character  from  engagements  which 
they  are  bound  in  foro  conscientise  to  per- 
form. This  is  a  defect  inherent  in  all  human 
systems  of  legislation.  The  rule  that  a  mere 
verbal  promise,  without  any  consideration, 
cannot  be  enforced  by  action,  is  universal 
in  its  application,  and  cannot  be  departed 
from  to  suit  particular  cases  in  which  a  re- 
fusal to  perform  such  a  promise  may  be  dis- 
graceful. 

The  promise  declared  on  in  this  case  ap- 
pears to  have  been  made  without  any  legal 
consideration.  The  kindness  and  services 
towards  the  sick  son  of  the  defendant  were 
not  bestowed  at  his  request.  The  son  was 
in  no  respect  under  the  care  of  the  defend- 
ant. He  was  twenty-five  years  old,  and  had 
long  left  his  father's  family.  On  his  return 
from  a  foreign  country,  he  fell  sick  among 
strangers,  and  the  plaintiff  acted  the  part  of 
the  good  Samaritan,  giving  him  shelter  and 
comfort  until  he  died.  The  defendant,  his 
father,  on  being  informed  of  this  event,  in- 
fluenced by  a  transient  feeling  of  gratitude, 
promises  in  writing  to  pay  the  plaintiff  for 
the  expenses  he  had  incurred.  But  he  has 
determined  to  break  this  promise,  and  is  will- 


ing to  have  his  case  appear  on  record  as  a 
strong  example  of  particular  injustice  some- 
times necessarily  resulting  from  the  oi)era- 
tion  of  general  nales. 

It  is  said  a  moral  obligation  is  a  sufficient 
consideration  to  support  an  express  promise; 
and  some  authorities  lay  down  the  i-ule  thus 
broadly;    but  upon  examination  of  the  cases 
we  are  satisfied  that  the  universality  of  the 
i-ule  cannot  be  supported,  and  that  there  must 
have  been  some  preexisting  obligation,  which 
has  become  inoperative  by  positive  law,  to  form 
a  basis  for  an  effective  promise.     The  cases 
of  debts  barred  by  the  statute  of  limitations, 
of  debts  incurred  by  infants,  of  debts  of  bank- 
rupts,   are   generally    put    for   illustration    of 
the  rule.     Express  promises  founded  on  such 
preexisting  equitable  obligations  may  be  en- 
forced;   there    is    a    good    consideration    for 
them;    they   merely    remove   an    impediment 
created  by  law  to  the  recovery  of  debts  hon- 
estly  due,  but   which   public   policy   protects 
the  debtors  from  being  compelled  to  pay.     In 
all  these  cases  there   was  originally  a  quid 
pro  quo;    and  according  to  the  principles  of 
natural  justice  the  party  receiving  ought  to 
pay;    but   the   legislature   has   said   he   shall 
not  be  coerced;  then  comes  the  promise  to  pay 
the  debt  that  is  barred,  the  promise  of  the  man 
to  pay  the  debt  of  the  infant,  of  the  discharged 
banki-upt  to  restore  to  his  creditor  what  by 
the  law  he  had  lost.     In  all  these  cases  there 
is  a  moral  obligation  founded  upon  an  ante- 
cedent valuable  consideration.     These  prom- 
ises   therefore    have    a    sound    legal    basis. 
They  are  not  promises  to  pay  something  for 
nothing;    not    naked    pacts;    but    the    volun- 
tary  revival  or  creation  of  obligation   which 
before  existed  in  natural  law,  but  which  had 
been  dispensed  with,   not  for  the  benefit  of 
the  party  obliged  solely,  but  pnncipally  for 
the  public  convenience.     If  moral  obligation, 
in  its  fullest  sense,  is  a  good  substratum  for 
an  express  promise,  it  is  not  easy  to  perceive 
why  it  is  not  equally  good  to  support  an  im- 
plied   promise.     What   a    man   ought   to   do, 
generally  he  ought  to  be  made  to  do,  whether 
he  promise  or  refuse.     But  the  law  of  soci- 
ety has  left  most  of  such  obligations  to  the 
interior  forum,  as  the  tribunal  of  conscience 
has  been  aptly  called.     Is  there  not  a  moral 
obligation  upon  every   son  who   has  become 
aflluent  by  means  of  the  education  and  advan- 
tages bestowed  upon  him  by   his  father,   to 
relieve   that   father   from    pecuniary   embar- 
rassment, to  promote  his  comfort  and  happi- 
ness, and  even  to  share  with  him  his  riches, 
if  thereby  he  will  be  made  happy?     And  yet 
such  a  son  may,  with  impunity,  leave  such 
a  father  in  any  degree  of  penury  above  that 
which   will  expose  the  community  in  which 
he  dwells,  to  the  danger  of  being  obliged  to 
preserve  him  from  absolute  want     Is  not  a 
wealthy  father  under  strong  moral  obligation 
to  advance  the  interest  of  an  obedient,  well 
disposed  son,  to  fuinish  him  with  the  means 
of  acquiring  and  maintaining  a  becoming  rank 


MORAL  OBLIGATION. 


255 


In  life,  to  rescue  him  from  the  horrors  of  debt 
incurred  by  misfortune?  Yet  the  law  will 
uphold  him  in  any  degree  of  parsimony, 
short  of  that  which  would  reduce  his  son  to 
the  necessity  of  seeking  public  charity. 

Without  doubt  there  are  great  interests  of 
society  which  justify  withholding  the  coer- 
cive arm  of  the  law  from  those  duties  of  im- 
perfect obligation,  as  they  are  called;  imper- 
fect, not  because  they  are  less  binding  upon 
the  conscience  than  those  which  are  called 
perfect,  but  because  the  wisdom  of  the  social 
law  does  not  impose  sanctions  upon  them. 

A  deliberate  promise,  in  writing,  made  free- 
ly and  without  any  mistake,  one  which  may 
lead  tlie  party  to  whom  it  is  made  into  con- 
tracts and  expenses,  cannot  be  broken  with- 
out a  violation  of  moral  duty.  But  if  there 
was  nothing  paid  or  promised  for  it,  the  law, 
perhaps  wisely,  leaves  the  execution  of  it  to 
the  conscience  of  him  who  makes  it.  It  is 
only  when  the  party  making  the  promise 
gains  something,  or  he  to  whom  it  is  made 
loses  something,  that  the  law  gives  the  prom- 
ise validity.  And  in  the  case  of  the  promise 
of  the  adult  to  pay  the  debt  of  the  infant,  of 
the  debtor  discharged  by  the  statute  of  lim- 
itations or  bankruptcy,  the  principle  is  pre- 
sei-ved  by  looking  back  to  the  origin  of  the 
transaction,  where  an  equivalent  is  to  be 
found.  An  exact  equivalent  is  not  required 
by  the  law;  for  there  being  a  consideration, 
the  parties  are  left  to  estimate  its  value: 
though  here  the  courts  of  equity  will  step 
in  to  relieve  from  gross  inadequacy  between 
the  consideration  and   the  promise. 

These  principles  are  deduced  fi*om  the  gen- 
eral current  of  decided  cases  upon  the  sub- 
ject, as  well  as  from  the  known  maxims  of 
the  common  law.     The  general  position,  that 

1  moral  obligation  is  a  sufficient  consideration 
for  an  express  promise,  is  to  be  limited  in  its 
application,  to  cases  where  at  some  time  or 
other  a  good  or  valuable  consideration  has 
existed. 

~  A  legal  obligation  is  always  a  sufficient 
consideration  to  support  either  an  express  or 
an  implied  promise;  such  as  an  infant's  debt 
for  necessaries,  or  a  father's  promise  to  pay 
for  the  support  and  education  of  his  minor 
children.  But  when  the  child  shall  have  at- 
tained to  manhood,  and  shall  have  become 
his  own  agent  in  the  world's  business,  the 
debts  he  incurs,  whatever  may  be  their  na- 
ture, create  no  obligation  upon  the  father; 
and    It    seems    to    follow,    that    his    promise 


founded  upon  such  a  debt  has  no  legally 
binding   force. 

The  cases  of  instruments  under  seal  and  cer- 
tain mercantile  contracts,  In  which  consider- 
ations need  not  be  proved,  do  not  contradict 
the  principles  above  suggested.  The  first 
import  a  consideration  in  themselves,  and  the 
second  belong  to  a  branch  of  the  mercantile 
law,  which  has  found  it  necessary  to  disre- 
gard the  point  of  consideration  in  respect  to 
instruments  negotiable  in  their  nature  and 
essential  to  the  interests  of  commerce. 

Insteal  of  citing  a  multiplicity  of  cases  to 
support  the  positions  I  have  taken,  I  will 
only  refer  to  a  veiT  able  review  of  all  the 
cases  in  the  note  In  3  Bos.  &  P.  249.  The 
opinions  of  the  judges  had  been  variant  for  a 
long  course  of  years  upon  this  subject,  but 
there  seems  to  be  no  case  in  which  it  was 
nakedly  decided,  that  a  promise  to  pay  the 
debt  of  a  son  of  full  age,  not  living  with  his 
father,  though  the  debt  were  Incurred  by 
sickness  which  ended  in  the  death  of  the  son, 
without  a  previous  request  by  the  father 
proved  or  presumed,  could  be  enforced  by 
action. 

It  has  been  attempted  to  show  a  legal  obli- 
gation on  the  part  of  the  defendant  by  vir- 
tue of  our  statute,  which  compels  lineal  kin- 
dred in  the  ascending  or  descending  line  to 
support  such  of  their  poor  relations  as  are 
likely  to  become  chargeable  to  the  town 
where  they  have  their  settlement.  But  it  is 
a  sufficient  answer  to  this  position,  that  such 
legal  obligation  does  not  exist  except  in  the 
very  cases  provided  for  in  the  statute,  and 
never  until  the  party  charged  has  been  ad- 
judged to  be  of  sufficient  ability  thereto.  We 
do  not  know  from  the  report  any  of  the  facts 
which  are  necessary  to  create  such  an  obliga- 
tion. Whether  the  deceased  had  a  legal  set- 
tlement in  this  commonwealth  at  the  time 
of  his  death,  whether  he  was  likely  to  be- 
come chargeable  had  he  lived,  whether  the 
defendant  was  of  sufficient  ability,  are  essen- 
tial facts  to  be  adjudicated  by  the  court  to 
which  is  given  jurisdiction  on  this  subject 
The  legal  liability  does  not  arise  until  these 
facts  have  all  been  ascertained  by  judgment 
after  hearing  the  party  intended  to  be 
charged. 

For  the  foregoing  reasons  we  are  all  of 
opinion  th.nt  the  nonsuit  directed  by  the  court 
of  common  pleas  was  right,  and  that  judg- 
ment be  entered  thereon  for  costs  for  the 
defendant 


256, 


CONSIDERATION. 


STEVENS  V.  COON, 
a  Pin.  356.) 


Supreme  Oourt  of  Wisconsin. 
1843. 


July  Term, 


EiTor  to  district  court,  JefEerson  county. 

Coon  brought  an  action  of  assumpsit 
against  Stevens  in  the  Jefferson  county  dis- 
ti-ict  court  upon  a  wTitten  contract,  by  which 
Stevens  bound  himself  that  a  certain  eighth 
of  a  section  of  land  which  Coon  was  about 
to  enter  should  sell  by  a  given  day  for  $200 
or  more,  and  Coon  agreed  to  give  Stevens 
one-half  of  all  the  land  should  sell  for  over 
$200. 

On  the  trial  in  the  court  below.  Coon,  the 
plaintiff,  proved  the  entry  of  the  land,  and 
introduced  evidence  to  prove  that  the  land, 
at  the  time  specified  in  the  contract,  was 
worth  about  $1.25  per  acre. 

Upon  this  testimony,  the  defendant  moved 
the  court  to  instruct  the  jury  as  in  case  of 
a  nonsuit,  for  the  following  reasons: 

"(1)  Because  the  said  supposed  contract 
was  a  nudum  pactum,  by  which  the  defend- 
ant received  nc  bonePt  and  the  plaintiff  no 
Injury. 

"(2)  Becausd  the  supposed  contract  as- 
sumes to  bind  the  defendant  to  perform  an 
impossibility. 

"(3)  Because  said  writing  discloses  a  gam- 
bling contract,  if  any." 

Tlie  court  overruled  the  motion  and  re- 
fused the  insti-uction  asked  for,  and  the  jury 
returned  a  verdict  in  favor  of  the  plaintiff 
for  $116.50,  upon  which  the  court  rendered 
judgment. 

David  Brighauv,  for  plaintiff  in  error.  Ed- 
ward V.  Whiton,  for  defendant  in  error. 

DUNN,  C.  J.  Error  is  brought  in  this  case 
to  reverse  a  judgment  of  the  district  court 
of  Jefferson  county. 

Coon,  plaintiff  bel-^sv,  brought  his  action 
of  assumpsit  against  Stevens,  defendant  be- 
low, to  recover  damages  on  a  liability  grow- 
ing out  of  a  contract,  which  is  in  the  words, 
etc.,  following,  viz.: 

"Astor,  March  23,  1839.  In  consideration 
of  C.  J.  Coon  entering  the  west  half  of  the 
north-west  quarter  of  section  35,  in  town.  13, 
range  13,  I  bind  myself  that  the  said  eighty 
acres  of  land  shall  sell,  on  or  before  the  1st 
October  next,  for  two  hundred  dollars  or 
more,  and  the  said  Coon  agrees  to  give  me 
one-half  of  the  amount  over  *wo  hundred 
dollars  said  land  may  sell  for  in  considera- 
tion  of  my   warranty.    Hamilton    Stevens." 


to    the    above    contnict.     C.    J, 


"I    agi'ee 
Coon." 

At  the  August  term  of  the  said  Jefferson 
county  district  court,  in  the  year  1840,  the 
said  defendant  Stevens  pleaded  the  general 
issue,  which  was  joined  by  the  said  plaintiff 
Coon,  and  after  several  continuances  the 
case  was  tried  at  the  October  term,  1842. 
On  the  trial,  the  above  contract,  and  the  re- 
ceiver's receipt  to  said  plaintiff  Coon  for  the 
purchase-money  for  said  tract  of  land  de- 
scribed in  said  contract,  were  read  in  evi- 
dence to  the  jury;  and  Abraham  Vander- 
pool,  a  witness,  testified  "that  he  had  visit- 
ed that  part  of  the  country  where  the  land 
lies,  specified  in  said  writing,  and  was  upon 
the  same,  as  he  has  no  doubt,  and  estimated 
the  present  value  of  the  same  at  $1.50  per 
acre,  and  that  in  October,  1839,  it  might  be 
worth  $1.25  an  acre."  Upon  this  evidence 
and  testimony  the  plaintiff  rested  his  case. 

Under  the  construction  put  on  the  contract 
read  in  evidence  the  jui-y  found  for  the  plain- 
tiff $116.50  in  damages,  and  judgment  was 
entered  thereon.  There  is  manifest  error  in 
this  decision  of  the  court.  From  an  inspec- 
tion of  the  contract  it  is  obvious  that  it  is 
not  such  an  one  as  is  obligatory  on  either 
party.  There  is  no  reciprocity  of  benefit, 
and  it  binds  the  defendant  below  to  the  per- 
formance of  a  legal  impossibility,  so  palpa- 
ble to  the  contracting  parties  that  it  could 
not  have  been  seriously  intended  by  the  par- 
ties as  obligatory  on  either.  The  undertak- 
ing of  the  defendant  below  is  "that  plain- 
tiff's tract  of  land  shall  sell  for  a  certain 
sum  by  a  given  day."  Is  it  not  legally  im- 
possible for  him  to  perform  this  undertak- 
ing? Certainly  no  man  can  in  legal  contem- 
plation force  the  sale  of  another's  property 
by  a  given  day,  or  by  any  day,  as  of  his  own 
act.  The  plaintiff  was  well  apprised  of  the 
deficiency  of  his  contract  on  the  trial,  as  the 
testimony  of  his  witness  was  entirely  apart 
from  the  contract  sued  on,  and  was  directed 
in  part  to  a  different  contract,  and  such  an 
one  as  the  law  would  have  recognized.  If 
tUe  contract  had  been  that  the  tract  of  land 
would  be  worth  $200  by  a  given  day,  then  it 
could  have  been  recovered  on,  if  it  did  not 
rise  to  that  value  in  the  time.  1  Comyn, 
Cont.  14,  16,  18;  Comyn,  Dig.  Tit.  "Agree- 
ment"; 1  Poth.  Obi.  71;  6  Pet.  Abr.  218;  2 
Sand.  137.  The  district  court  should  not 
have  entered  judgment  on  the  finding  of  the 
jury  in  this  case.  The  construction  of  the 
contract  by  the  district  court  was  eiToneous. 

Judgment  reversed,  with  costs. 


DOING  WHAT  OXE  IS  BOUND  TO   DO. 


^>' 


STILK  V.  MYRICK. 
(2  Comp.  317.) 


257 


Michaelmas  Term.     50  Geo.   III. 

This  was  an  action  tor  seaiuau's  wages,  on 
a  vojaj^e  from  London  to  the  Baltic  and 
back. 

By  the  ship's  articles,  executed  before  the 
couiniencemont  of  the  voyage,  the  plaiutifT 
was  to  be  paid  at  the  rate  of  £5  a  month; 
and  the  principal  question  in  the  cause  was, 
whether  he  was  entitled  to  a  higher  rate  of 
wages.  In  the  course  of  the  voyage,  two  of 
the  seamen  deserted,  and  the  captain,  having 
in  vain  attempted  to  supply  their  places  at 
Cronstadt,  there  entered  into  an  agi'eement 
with  the  rest  of  the  crew,  that  they  should 
have  the  wages  of  the  two  who  had  deserted 
equally  divided  among  them,  if  he  could  not 
procure  two  other  hands  at  Gottenburgh. 
This  was  found  impossible;  and  the  ship  was 
worked  back  to  London  by  the  plaintiff  and 
eight  more  of  the  original  crew,  with  whom 
the  agreement  had  been  made  at  Cronstadt. 

Mr.  Garrow,  for  defendant.  Insisted,  that 
this  agreement  was  contrary  to  public  policy, 
and  utterly  void.  Ln  West-India  voyages, 
crews  are  often  thinned  greatly  by  death  and 
desertion;  and  if  a  promise  of  advanced  wa- 
ges were  valid,  exorbitant  claims  would  be 
set  up  on  all  such  occasions.  This  ground 
was  strongly  taken  by  Lord  Kenyon,  in  Har- 
ris v.  Watson,  Peak,  72,  where  that  learned 
judge  held,  that  no  action  would  lie  at  the 
suit  of  a  sailor  on  a  promise  of  the  captain 
to  pay  him  extra  wages,  in  consideration  of 
his  doing  more  than  the  ordinary  share  of 
duty  in  navigating  the  ship;  and  his  lordship 
said,  that  If  such  a  promise  could  be  en- 
forced, sailors  would  in  many  cases  suffer  a 
vessel  to  sink  unless  the  captain  wotild  ac- 
cede to  any  extravagant  demand  they  might 
■^hink  proper  to  mnke. 

The  Attorney-General,  contra,  distinguished 

HOPK.SEL.r-AS.CONT.— 17 


this  case  from  Harris  v.  Watson,  as  the 
agreement  here  was  made  on  shore,  when 
there  was  no  danger  or  pres.siug  emergency, 
and  when  the  captain  could  not  be  supposed 
to  be  under  any  con.'^traint  or  apprehension. 
The  mariners  were  not  to  be  permitted  on 
any  sudden  danger  to  force  concessions  from 
the  captain;  but  why  should  they  be  de- 
prived of  the  compon.sation  he  voluntarily  of- 
fers them  in  perfect  security  for  their  extra 
labour  during  the  remainder  of  the  voyage? 

LORD  ELLENBOROUGH.  I  think  Har- 
ris V.  Watson  (Peak,  72)  was  rightly  decided; 
but  I  doubt  whether  the  ground  of  public 
policy,  upon  which  Lord  Kenyon  is  stated  to 
have  proceeded,  be  the  true  principle  on 
which  the  decision  is  to  be  supported.  Here, 
I  say,  the  agreement  is  void  for  want  of  con- 
sideration. There  was  no  consideration  for 
the  ulterior  pay  promised  to  the  mariners  who 
remained  with  the  ship.  Before  they  sailed 
from  London  they  had  undertaken  to  do  all 
they  could  under  all  the  emergencies  of  the 
voyage.  They  had  sold  all  their  services  till 
the  voyage  should  be  completed.  If  they  had 
been  at  liberty  to  quit  the  vessel  at  Cronstadt, 
the  case  would  have  been  quite  different;  or 
If  the  captain  had  capriciously  discharged 
the  two  men  who  were  wanting,  the  others 
might  not  have  been  compelled  to  take  the 
whole  duty  upon  themselves,  and  their  agree- 
ing to  do  so  might  have  been  a  sufficient  con- 
sideration for  the  promise  of  an  advance  of 
wages.  But  the  desertion  of  a  part  of  the 
crew  is  to  be  considered  an  emergency  of  the 
voyage  as  much  as  their  death,  and  those 
who  remain  are  bound  by  the  terms  of  their 
original  contract  to  exert  themselves  to  the 
utmost  to  bring  the  ship  in  safety  to  her  des- 
tined port  Therefore,  without  looking  to  the 
policy  of  this  agroement,  I  think  it  is  void  for 
want  of  consideration,  and  that  the  plaintiff 
can  only  recover  at  the  rate  of  £5  a  month. 

Verdict  accordingly. 


CONSIDERATION. 


MUNROE  V.  PERKINS. 

(9  Pick.  298.) 

Supreme  Judicial  Ck)urt  of  Massachusetts.     Suf- 
folk and  Nantucket     March,  1S30. 

Indebitatus  assumpsit  for  work  done,  mate- 
rials found,  money  paid,  &c.  brought  against 
the  defendant  jointly  with  William  Payne, 
who  died  after  the  action  was  commenced. 

At  the  trial  before  the  chief  justice  it  ap- 
peared, that  in  1821  the  plaintiff  was  employ- 
ed by  Perkins  and  Payne  to  build  a  hotel  at 
Nahant,  which  was  begun  in  that  year  and 
finished  in  1823. 

The  general  defence  was,  that  there  was 
a  special  contract,  and  that  the  work  had 
been  paid  for  according  to  the  terms  of  that 
contract 

For  the  purposes  of  this  case  it  was  admit- 
ted, that  the  amoimt  of  exi)enditures  made 
and  incun-ed  by  the  plaintiff  in  and  about  the 
work,  exceeded  the  amount  of  the  payments 
made  to  him. 

It  appeared  that  In  1821,  a  number  of  per- 
sons associated  themselves  for  the  purpose 
of  erecting  a  hotel  at  Nahant  and  subscribed 
certain  sums  of  money  therefor;  that  Perkins 
and  Payne  were  subscribers  and  were  the 
agents  of  the  association,  which  was  to  be 
incorporated  as  soon  as  possible,  and  which 
was  incorporated  accordingly  in  February, 
1822. 

The  defendant  offered  in  evidence  an  agree- 
ment imder  seal,  dated  October  24,  1821, 
wherein  the  plaintiff  engages  to  build  the  ho- 
tel according  to  a  certain  drawing  and  de- 
scription, and  the  defendant  and  Payne,  in 
behalf  of  their  associates,  agree  to  pay  the 
plaintiff  therefor  14,500  dollars  as  the  work 
advances. 

T.  W.  Sumner,  a  witness  called  by  the  de- 
fendant, testified  that  the  work  was  executed 
upon  the  basis  of  the  drawing  and  description 
referred  to  in  the  sealed  contract;  that  there 
were  some  deviations,  consisting  of  additional 
ffork;  that  this  was  considered  as  extra  work, 
not  included  in  the  contract,  and  was  paid 
for  separately  according  to  its  full  cost  and 
value. 

To  prove  a  waiver  of  the  special  contract, 
the  plaintiff  introdnced  several  witnesses.  J. 
Alley  testified,  that  in  1825  he  said  to  the  de- 
fendant, it  was  a  pity  Munroe  had  under- 
taken to  build  the  hotel;  to  which  the  de- 
fendant replied,  that  Munroe  would  not  lose 
any  thing  by  it  and  that  they  had  agreed  to 
pay  him  for  every  minute's  work  and  for  all 
he  had  purchased.  J.  Mudge  testified,  that 
in  the  spring  of  1823  the  plaintiff  was  in- 
debted to  the  Lynn  bank  on  a  note  for  1100 
dollars,  which  he  wished  to  have  renewed, 
but  that  the  directors  were  not  satisfied  of  his 
solvency;  that  in  April  of  that  year,  the  plain- 
tiff came  to  the  bank  with  Payne,  who  said 
he  was  the  agent  who  attended  to  the  busi- 
ness of  the  Nahant  hotel  in  the  absence  of 
Perkins,  who  had  gone  to  Europe;  that  he 
wanted  to  get  from  the  bank  some  indulgence 


towards  the  plaintiff;  that  the  corporation 
would  leave  the  plaintiff  as  good  as  they 
found  him;  they  would  pay  Munroe  for  aU  he 
should  lay  out;  that  Munroe  should  not  stop 
for  want  of  funds;  that  he  (Payne)  knew  Per- 
kins's mind  upon  the  subject;  that  the  bills 
would  be  paid,  and  the  plaintiff  should  not 
suffer.  W.  Johnscn  testified,  that  on  the 
strength  of  this  representation  of  Payne,  the 
bank  renewed  the  plaintiff's  paper.  W.  Babb 
testified,  that  in  May,  1822,  the  defendant 
asked  the  plaintiff  how  he  got  on;  that  the 
plaintiff  said  poorly  enough;  that  the  defend- 
ant told  him  he  must  persevere;  the  plaintiff 
said  he  could  not  without  means;  and  the  de- 
fendant repeated,  you  must  persevere,  and  add- 
ed, you  shall  not  suffer,  we  shall  leave  you  as 
we  found  you. 

The  defendant  objected  to  this  evidence, 
that  it  was  insufficient  in  law  to  set  aside 
the  special  contract;  that  it  did  not  amount 
to  a  waiver  of  the  original  contract,  but  so 
far  as  it  proved  any  thing,  it  was  evidence  of 
a  new  express  promise,  which  was  without 
consideration  and  from  which  no  implied  as- 
sumpsit could  be  raised.  Also,  that  the  con- 
versation with  Perkins  at  one  time  and  with 
Payne  at  another,  were  not  joint  promises 
and  created  no  joint  cause  of  action,  but  that 
the  liability,  if  there  was  any,  was  several. 

A  verdict  was  taken  by  consent,  subject  to 
the  opinion  of  the  court 

S.  Hubbard  and  F.  Dexter,  for  defendant 
Ward,  contra. 

PER  CURIAM.  The  verdict  of  the  jury  has 
established  the  fact,  if  the  evidence  was  le- 
gally sufficient,  that  the  defendant,  together 
with  Payne,  made  the  promise  declared  on. 
The  defence  set  up  was,  that  the  work  was 
done  and  the  materials  were  furnished  on  a 
special  contract  under  seal,  made  by  the  de- 
fendant and  Payne  on  behalf  of  themselves 
and  other  subscribers  to  the  hotel;  and  such  a 
contract  was  produced  in  evidence.  The  main 
question  is,  whether,  there  being  this  contract 
under  seal,  for  a  stipulated  sum,  an  action  lies 
on  a  general  assumpsit  for  the  amount  which 
the  building  actually  cost;  which  is  more  than 
the  sum  specified  in  the  contract  It  is  said 
on  the  part  of  the  plaintiff,  that  having  made 
a  losing  bargain  and  being  unwilling  and  una- 
ble to  go  on  with  the  work,  Perkins  and 
Payne  assured  him  that  he  should  not  suffer; 
and  that  the  work  was  carried  on  and  finish- 
ed upon  their  engagement  and  promise  that 
he  should  have  a  reasonable  compensation, 
without  regard  to  the  special  contract  This 
engagement  is  to  be  considered  as  proved. 
If  by  law  it  was  admissible  to  show  a  waiver 
of  a  special  contract 

It  is  objected,  that  as  the  evidence  was 
parol,  it  is  insufficient  in  law  to  defeat  or 
avoid  the  special  contract;  and  many  author- 
ities have  been  cited,  to  show  that  a  sealed 
contract  cannot  be  avoided  or  waived  but  by 
an  instrument  of  a  like  nature;  or  generally, 
that  a  contract  under  seal  cannot  be  avoided 


DOING  WHAT  ONE  IS  BOUND  TO  DO. 


259 


or  altered  or  explained  by  parol  evidence. 
That  this  is  the  general  doctrine  of  the  law 
cannot  be  disputed.  It  seems  to  have  emanat- 
ed from  the  common  maxim,  "Unumquodque 
dissolvitur  eo  ligamine  quo  ligatur."  IJut  lilce 
other  maxims,  this  has  received  qualiflcatiuns, 
and  indeed  was  never  true  to  the  letter,  for 
at  all  times,  a  bond,  covenant  or  other  sealed 
instrument  might  be  defeated  by  parol  evi- 
dence of  payment,  accord  and  satisfaction, 
&c. 

It  is  a  general  principle,  that  where  there 
is  an  agreement  in  writing.  It  merges  all  pre- 
vious conversations  and  parol  agreements; 
but  there  are  many  eases  in  which  a  new 
parol  contract  has  been  admitted  to  be  proved. 
And  though  when  the  suit  is  upon  the  writ- 
ten contract  itself,  it  has  been  held  that  parol 
evidence  should  not  be  received,  yet  when  the 
suit  has  been  brought  on  the  ground  of  a  new 
subsequent  agreement  not  in  writing,  parol 
evidence  has  been  adsDitted. 

In  Ratcliff  v.  Pemberton,  1  Esp.  35,  Lord 
Kenyon  decided,  that  to  an  action  of  cove- 
nant on  a  charter-party,  for  the  demurrage 
which  was  stipulated  In  it,  the  defendant 
might  plead  that  the  covenantee,  who  was 
the  master  and  owner  of  the  ship,  verbally 
permitted  the  delay,  and  agreed  not  to  exact 
any  demurrage,  but  waived  all  claim  to  it 
He  laid  down  a  similar  rule  in  Thresh  v. 
Rake,  Id.  53;  where  however  the  contract 
does  not  appear  to  have  been  under  seal. 

In  2  Term  R.  483,  there  were  articles  of 
partnership,  containing  a  covenant  to  account 
at  certain  times;  and  upon  a  balance  being 
struck,  the  defendant  promised  to  pay  the 
amount  of  the  balance;  and  it  was  held  that 
assumpsit  would  lie  upon  this  promise. 

The  case  of  Lattimore  v.  Hareen,  14  Johns. 
330,  comes  nearer  the  case  at  bar.  There  the 
plaintiffs  had  agreed  to  perform  certain  work 
for  a  stipulated  sum  of  money,  under  a  pen- 
alty. After  they  had  entered  upon  the  per- 
formance of  it,  they  determined  to  leave  off, 
and  the  defendant,  by  parol,  released  them 
from  their  covenant,  and  promised  them,  if 
they  would  complete  the  work,  that  he  would 
pay  them  by  the  day.  The  court  hold,  that 
if  the  plaintiffs  chose  to  incur  the  penalty, 
they  had  a  right  to  do  so,  and  that  the  new 
contract  was  binding  on  the  defendant 

In  Dearborn  v.  Cross,  7  Cow.  48,  it  is  held, 
that  a  bond  or  other  specialty  may  be  dis- 
charged or  released  by  a  parol  agreement  be- 
tween the  parties,  especially  where  the  parol 
agreement  is  executed;  and  the  case  of  Latti- 
more V.  Harsen  is  there  cited  and  relied  on. 


There  are  other  decisions  of  like  nature  In 
the  same  court;  as  Fleming  v.  Gilbert,  3 
Jolms.  358;  Keating  v.  Price,  1  Johns,  ("as. 
22;  Edwin  v.  .Saund.-rs,  1  Cow.  250.  In  Bal- 
lard V.  Walker,  3  Johns.  Cas.  64,  it  was  held 
that  the  lap.se  of  time  between  the  making  of 
the  contract  and  the  attempt  to  enforce  it 
was  a  waiver;  which  is  going  further  than 
is  necessary  in  the  case  before  us,  for  here 
there  is  an  express  waiver. 

In  Le  Fevre  v.  Le  Fevre,  4  Serg.  &  R.  241, 
parol  evidence  was  admitted  to  prove  an 
alteration  of  the  course  of  an  aqueduct  es- 
tablished by  deed.  In  regard  to  the  objection, 
that  this  evidence  was  in  direct  contradiction 
to  the  deed,  Duncan,  J.  remarks,  that  "the  evi- 
dence was  not  offered  for  that  purpose,  but 
to  show  a  substitution  of  another  spot  If 
this  had  not  been  carried  into  effect  the  evi- 
dence would  not  have  been  admissible;  but 
where  the  situation  of  the  parties  is  altered, 
by  acting  upon  the  new  agreement  the  evi- 
dence is  proper;  for  a  partj'  may  be  admitted 
to  prove  by  parol  evidence,  that  after  signing 
a  written  agreement  the  parties  made  a 
verbal  agreement,  varying  the  former,  pro- 
vided their  variations  have  been  acted  upon, 
and  the  original  agreement  can  no  longer  be 
enforced  without  a  fraud  on  one  party." 

The  distinction  taken  in  the  argument  be- 
tween contracts  in  writing  merely  and  con- 
tracts under  seal,  appears  by  these  author- 
ities not  to  be  important  as  it  respects  the 
point  under  consideration,  and  justice  requir- 
ed in  the  present  case,  that  the  parol  evidence 
should  be  received. 

It  was  said  that  the  promise  of  Payne  can- 
not affect  Perkins,  and  vice  versa.  But  as 
they  were  joint  actors,  and  as  when  one  ar-ted 
in  the  absence  of  the  other,  it  was  always 
with  a  joint  view  to  the  same  object  tliey 
cannot  be  separated,  but  must  be  considered 
as  joint  promisors. 

The  parol  promise,  it  is  contended,  was 
without  consideration.  This  depends  entirely 
on  the  question,  whether  the  first  contract 
was  waived.  The  plaintiff  having  refused  to 
perform  tliat  contract  as  he  might  do,  sub- 
jecting himself  to  such  damages  as  the  other 
parties  might  show  they  were  entitled  to  re- 
cover, he  afterward  went  on  upon  the  faith 
of  the  new  promise  and  finished  the  work. 
This  was  a  suflicient  consideration.  If  Payne 
and  Perlcins  were  willing  to  accept  his  re- 
linquishment of  the  old  contract  and  proceed 
on  a  new  agreement  the  law,  we  think,  would 
not  prevent  It 

Motion  for  new  trial  overruled. 


260 


COiHSIDEKATIOX. 


^ 


iW 


{p  VANDERBILT  v.  SCHREYER- xJ 

(91  N.  Y.  392.) 
Court  of  Appeals  of  New  York.    March  6,  1S83. 

The  material  facts  are  stated  in  the  opin- 
ion. 

T.  M.  Tyng,  for  appellant.  John  L.  Lind- 
say, for  respondent. 

RUGER,  C.  J.  This  was  an  action  to  fore- 
close .1  mortgrage  for  $5,000  given  September 
5,  1873.  by  one  James  Dunseith  and  wife  to 
John  Schreyer,  and  by  him  assigned  to  the 
plaintiff  or.  the  5th  day  of  May,  1S74. 

Schreyer  was  made  a  party  defendant,  and 
it  was  sought  to  chai'ge  him  with  the  pay- 
ment of  any  deficiency  that  might  arise  upon 
a  sale  of  the  mortgaged  premises,  upon  the 
ground  that  he  had  guaranteed  the  payment 
of  the  mortgage  debt. 

Schreyer  answered,  and  after  admitting  the 
assignment  and  the  guaranty  of  payment  al- 
leged by  way  of  defense,  that  on  the  2d  day 
of  February,  1874,  the  plaintiff  entered  into 
a  contract  with  George  Gebhardt  and  Mat- 
thew L.  Ritchie  for  the  erection  by  him  of 
certain  buildings  for  them  upon  certain  lots 
in  the  city  of  New  York,  for  which  he  was 
to  receive  !?S,175.  to  be  paid  as  follows: 
"When  the  said  houses  are  topped  out,  a  pay- 
ment of  $5,000  by  assignment  of  a  bond  and 
mortgage  held  by  John  Schreyer  on  the  prop- 
erty of  Anna  Maria  Schreyer,  No.  350  West 
Forty-Second  street,  New  York  City,"  and 
the  balance,  amounting  to  $3,175,  when  the 
houses  should  be  fully  completed.  Vander- 
bilt  commenced  performance  of  his  contract 
and  continued  until  he  became  entitled  to 
the  assignment  of  the  $5,000  mortgage. 
Schreyer  thereupon  offered  to  assign  it  to  the 
plaintiff,  but  the  latter  refused  to  accept  an 
assignment  unless  Schreyer  would  also  guar- 
antee payment.  The  defendant  refused  to  do 
this,  and  Vanderbilt  then  suspended  work 
upon  the  buildings  for  about  two  months. 
The  defendant  then  under  protest,  and  be- 
lieving, as  he  alleges,  that  he  was  acting  un- 
der compulsion,  executed  the  assignment 
with  the  guaranty  in  question.  The  plaintiff 
then  completed  his  contract  and  received  the 
balance  of  the  consideration.  The  answer 
further  states  "that  it  was  neither  under 
said  contract  or  otherwise  made  a  condition 
of  the  plaintiff's  accepting  the  assignment  of 
said  mortgage  that  this  defendant  or  any 
other  person  should  guarantee  the  payment 
thereof,"  and  further  "that  no  consideration 
ever  passed  to  him  or  his  principals  for  such 
guaranty  and  the  same  was  and  is  null  and 
void." 

Upon  the  trial  of  the  action  at  special  term 
the  plaintiff  produced  and  proved  the  mort- 
gage in  question,  and  also  an  assignment 
from  defendant  to  plaintiff  in  the  usual  form, 
but  containing  the  following  clause:  "And  I 
hereby  guarantee  the  payment  of  said  bond 
and  mortgage  for  $5,000  and  interest  from 


May  5,  1874,  by  due  foreclosure  and  sale." 
The  assignment  and  guaranty  were  sealed 
and  executed  in  the  presence  of  a  subscrib- 
ing witness.  The  plaintiff  thereupon  rested, 
and  the  defendant  offered  to  prove  in  sub- 
stance the  facts  alleged  in  his  answer,  which 
offer  was  objected  to  and  excluded  upon  the 
ground  that  such  answer  did  not  set  up  facta 
constituting  a  defense.  The  defen,'lnnt  ex- 
cepted to  such  ruling.  The  court  thereupon 
held  that  said  guaranty  was  absolute  and 
ordered  judgment  against  Schreyer  for  the 
deficiency  which  had  previously  been  ascer- 
tained by  a  sale  of  the  premises.  An  appeal 
was  taken  to  the  general  term,  which  re- 
versed the  judgment  and  directed  a  dismiss- 
al of  the  complaint  upon  the  ground  that 
Schreyer  was  improperlj^  made  a  defendant, 
because  the  guaranty-  in  question  was  in  ef- 
fect a  guaranty  of  collection  only,  and  that 
no  right  of  action  arose  thereon  until  after 
the  amount  of  the  deficiency  had  been  asce;- 
tained  by  a  judicial  sale  of  the  mortgaged 

premises.     ^-yv-yw\)  _^ 

~  TT'e  dfffSr^Tn  our~T!onciusion  from  tnat 
reached  by  both  of  the  courts  below. 

The  guaranty  in  question  is  not  an  abso- 
lute guaranty  for  the  payment  of  the  mort- 
gage, but  a  guaranty  that  it  shall  be  paid  in 
a  particular  manner.  In  construing  it  we 
must  give  effect  not  only  to  the  entire  in- 
strument, but  also  to  all  of  its  language. 
This  requires  us  to  give  some  effect  to  the 
words,  "by  due  foreclosure  and  sale,"  and 
they  can  perform  no  other  office  in  the  con- 
nection in  which  they  are  used  than  to  qual- 
ify and  limit  the  operation  of  the  preceding 
words,  "I  hereby  guai-antee  the  payment  of 
said  bond  and  mortgage."  We  must  conclude 
that  the  parties  put  these  words  into  their 
contract  for  some  purpose;  and  the  only  pur- 
pose they  can  be  made  to  serve  is  to  make 
the  guaranty  a  conditional  instead  of  an  abso- 
lute one.  A  covenant  quite  similar  to  this 
was  held  in  the  case  of  Mabaiwe  Bank  v. 
Culver,  30  N.  Y.  313,  to  be  a  covenant  to  pay 
any  deficiency  existing  after  a  foreclosure 
and  sale. 

But  we  suppose  it  to  be  immaterial  wheth- 
er this  guaranty  be  called  a  guaranty  of  pay- 
ment or  of  collection,  for  in  either  event  the 
plaintiff  was  entitled  to  make  Schreyer  a 
party  defendant  in  the  foreclosure  action  and 
demand  and  recover  a  judgment  against  him 
therein  for  any  deficiency  which  might  arise 
on  a  sale  of  the  mortgaged  premises. 

The  principles  applicable  to  the  prosecu- 
tion of  actions  against  guarantors  of  the  col- 
lection of  promissoi-y  notes  and  other  securi- 
ties do  not  apply  to  actions  for  the  foreclo- 
sure of  mortgages.  In  the  latter  the  persons 
who  may  be  made  parties  therein  are  point- 
ed out  by  statute,  and  include  all  who  are 
under  obligation  to  pay  the  mortgage  debt, 
or  any  part  thereof,  whether  such  obligation 
be  absolute  or  conditional. 

This  action  was  commenced,  and  tried,  pri- 
or to  the  adoption  of  section  1627  of  the  Code 


DOING  WUAT  ONE  IS  BOUND  TO  DO. 


261 


of  Civil  Procedure.  It  must  therefore  be  gov- 
erned by  the  provisions  of  tiie  Revised  Stat- 
utes. The  sections  applicable  are  the  follow- 
ing: 2  Rev.  St.(lsl  Ed.;  lUl,  §  154,  reads: 
"If  the  mortgage  debt  be  secured  by  the  ob- 
ligation or  other  evidence  of  debt  hereafter 
executed,  of  any  other  person  Ijcside  the  mort- 
gagor, the  complainant  may  make  such  per- 
son a  party  to  the  bill,  and  the  court  may  de- 
cree payment  of  the  balance  of  such  debt  re- 
maining unsai'stied  after  a  sale  of  the  mort- 
gaged premises,  as  well  against  such  other 
pei*son  as  the  mortgagor,  and  may  enforce 
such  decree  as  in  other  cases."  Section  153, 
Id.,  reads:  "After  such  bill  [bill  for  foreclo- 
sure] shall  be  hied  while  the  same  is  pend- 
ing, and  after  a  decree  rendered  thereon,  no 
proceedings  whatever  shall  be  had  at  law  for 
the  recovery  of  the  debt  secured  by  the  mort- 
gage or  any  part  thereof  unless  authorized 
by  the  court  of  chancery." 

These  provisions  of  the  statute  remained 
without  material  changes,  so  far  as  the  ques- 
tion under  discussion  is  concerned,  until  the 
adoption  in  ISSO  of  the  last  portion  of  the 
Code  of  Civil  Procedure.  The  scheme  of 
these  provisions  was  stated  by  this  court 
in  Society  v.  Stevens,  G3  N.  Y.  341,  to  be 
to  prevent  oppressive  litigation  by  the  multi- 
plication of  actions  against  the  several  per- 
sons who  might  be  liable  for  the  same  mort- 
gage debt,  and  to  require  all  of  the  parties 
interested  in  its  payment  to  be  wrought  into 
the  same  suit  and  thus  settle  their  respective 
liabilities  in  one  comprehensive  action.  Pre- 
vious to  the  enactment  of  section  1627  of 
the  Code  of  Civil  I'rocedure  it  was  the  set- 
tled practice  of  courts  of  equity  to  bring 
all  parties  who  were  in  any  waj-  liable  for 
the  payment  of  the  mortgage  debt,  or  any 
part  thereof,  and  whether  liable  upon  an  ab- 
solute or  conditional  undertaking,  into  the 
same  foreclosure  action  and  decree  payment 
of  any  deficiency  arising  on  a  sale  of  the 
mortgaged  premises,  against  any  of  the  par- 
ties appearing  to  be  liable  therefor,  accord- 
ing to  the  nature  and  circumstances  of  such 
liability.  The  principle  that  such  person, 
whether  liable  conditionally  or  absolutely, 
may  be  sued  and  made  liable  for  any  defi- 
ciency in  an  action  to  foreclose  the  mort- 
gage is  laid  down  in  the  works  on  chancery 
practice  and  sustained  by  numerous  eases. 
See  2  Hoff.  Ch,  Prac.  14l',  142;  2  Barb.  Ch. 
Pi"ac.  175,  170;  Leonard  v.  Morris,  9  Paige, 
90;  Suydam  v.  Bartle,  Id.  294;  Curtis  v.  Ty- 
ler. Id.  432;  Griffith  v.  Robertson,  15  Hun, 
344;  Scofleld  v.  Doscher,  72  N.  Y.  491.  Oth- 
er actions  of  a  similar  nature  are  provided 
for  In  our  stitute,  as  in  the  case  of  proceed- 
ings in  equity  against  insolvent  corporations 
to  reach  stockholders  and  trustees  who  may 
be  contingently  liable  for  the  payment  of  the 
debts  of  such  corporations.  These  trustees 
and  stockholders  are  chargeable  with  a  con- 
ditional liability  in  the  action  brought  to  dis- 
solve the  corporation.  Of  course,  where  the 
liability  of  a  person  to  pay  a  mortgage  debt 


depends  upon  some  extrinsic  event  which 
cannot  be  determined  in  the  prosecution  of 
the  foreclosure  suit,  he  could  not  be  made  a 
party  to  such  an  action  and  charged  with  a 
deficiency,  because  by  the  terms  of  his  con- 
tract, his  liability  would  not  commence  until 
the  happening  of  the  event  contracted  for, 
and  that  might  be  wholly  disconnected  with 
the  process  of  foreclosure. 

Such  was  the  case  of  Coal  Co.  v.  Blake,  85 
N.  Y.  220,  where  the  party  guaranteed  to 
pay  the  mortgage  debt,  provided  another 
party  upon  demand  did  not  do  so.  There  a 
demand  was  held  necessary  before  suit 
brought.  The  serious  consequences  of  neg- 
lecting to  include  as  parties  all  persons  liable 
for  the  payment  of  the  mortgage  debt  in  a 
foreclosure  thereof  are  illustrated  in  the  case 
of  Society  v.  Stevens,  already  cited.  It  was 
there  held  that  upon  an  application  for  leave 
to  prosecute  an  action  at  law  against  parties 
liable  for  the  payment  of  the  mortgage  debt, 
the  granting  of  the  permission  rested  in  the 
discretion  of  the  court,  whether  the  applica- 
tion was  made  during  the  pendency  of  the 
foreclosure  suit  or  after  it  had  terminated; 
and  that  in  the  exercise  of  a  wise  discretion 
the  court  had  the  power  to  deny  such  per- 
mission, even  when  the  claim  had  not  been 
prosecuted  in  the  foreclosure  suit  The  order 
of  the  court  below  granting  leave  to  prose- 
cute such  an  action  was  reversed,  upon  the 
I  ground  that  it  had  decUned  to  exercise  its  un- 
doubted discretionary  power. 

That  an  action  at  law  either  during  the 
pendency  or  after  the  termination  of  a  fore- 
closure suit  cannot  be  maintained  by  the 
holder  of  a  mortgage  against  a  person  liable 
for  the  payment  or  collection  of  the  mort- 
gage debt,  without  leave  of  the  court  duly 
obtained,  has  frequently  been  held  in  this 
state.  Pattison  v.  Powers,  4  Paige,  549; 
Comstock  V.  Drohan,  71  N.  Y.  9;  Scofield  v. 
Doscher,  supra.  It  follows  from  tliese  au- 
thorities that  the  plaintiff  was  not  only  jus- 
tified in  making  Schreyer  a  defendant  in  this 
action,  and  asking  judgment  for  a  deficiency 
against  him,  even  though  his  guaranty  was 
one  of  collection  merely,  but  that  it  would 
have  been  hazardous  to  his  security  if  he  had 
oflijtted  to  do  so. ^- 

A  more  serious  question  however  arises  un- 
der the  exception  taken  to  the  rulings  of  the 
special  term  excluding  the  evidence  offered 
by  the  defendant  to  prove  the  facts  stated  in 
his  answer,  showing  that  the  guaranty  was 
without  consideration. 

In  considering  this  question  the  allegations 
in  the  answer  must  be  assumed  to  be  true, 
and  that  the  defendant  would  have  proved 
them  if  he  had  not  been  precluded  by  the 
rulings  of  the  court  from  doing  so.  The  an- 
swer, while  perhaps  inartificially  drawn,  cer- 
tainly alleged  all  of  the  facts  necessary  to 
show  that  neither  Gebhardt  and  Ritchie,  nor 
the  plaintiflf,  had  received  any  consideration 
for  the  guaranty  in  question.  This  he  should 
have  been  allowed  to  prove.     The  production 


2G2 


CONSIDERATION. 


of  the  assignment  in  evidence,  purporting  to 
be  executed  "for  value  received,"  and  being 
under  seal  was  prima  facie  evidence  only  of 
a  valuable  consideration.  It  was  not  conclu- 
sive and  could  be  disproved  if  it  was  in  the 
defendant's  power  to  do  so.  3  Rev.  St.  (Gth 
Ed.)  672,  §  124;  Boolistaver  v.  Jayne,  60  N. 
Y.  146;  Anthony  v.  Harrison,  14  Hun,  198, 
affirmed  in  this  court,  74  N.  Y.  613. 

The  incorporation  of  this  guaranty  into  the 
assignment  for  which  there  was  a  considera- 
tion does  not  affect  the  question.  It  was 
not  essential  to  the  assignment  and  was,  so 
far  as  its  legal  effect  was  concerned,  a  sepa- 
rate instrument,  and  must  be  supported  upon 
a  sufficient  consideration  or  treated  as  nu- 
dum pactum. 

It  is  quite  clear  that  the  plaintiff  had  no 
right  to  demand  this  guaranty  by  the  terms 
of  his  original  contract  with  Gebhardt  and 
Ritchie.  That  was  satisfied  by  a  mere  nail- 
ed transfer  of  his  interest  in  the  mortgage. 

It  was  held  in  Van  Eps  v.  Schenectady,  12 
Johns.  436,  that  an  agreement  to  execute  a 
deed  of  lands  was  satisfied  by  the  execution 
of  a  deed,  without  warranty  or  covenants. 
So  it  has  been  held  that  a  party  has  no  right 
to  impose  any  conditions  to  the  performance 
of  a  contract,  except  those  contained  in  the 
contract  itself-  Furnace  Co.  v.  French,  34 
How.  rrac.  94.  It  being  clear  that  Vander- 
bilt  had  no  legal  right  to  require,  as  a  condi- 
tion to  the  fulfillment  of  his  contract,  the 
performance  of  an  act  not  required  by  the 
contract,  it  is  difficult  to  see  what  benefit  he 
has  bestowed  or  what  inconvenience  he  has 
suffered  in  return  for  the  undertaliing  as- 
smned  by  the  defendant.  He  promises  to 
do  only  that  which  he  was  before  legally 
bound  to  perform.  Even  though  it  lay  in 
his  power  to  refuse  to  perform  his  contract, 
he  could  do  this  only  upon  paying  the  other 
party  the  damages  occasioned  by  his  non- 
[jerformance,  and  that  in  contemplation  of 
law  would  be  equivalent  to  performance.  He 
liad  no  legal  or  moral  right  to  refuse  to  per- 
form the  obligation  of  the  contract  into 
which  he  had  upon  a  good  consideration  vol- 
untarily entered. 

There  is  no  evidence  In  support  of  a  claim 
that  this  guaranty  was  given  as  a  compro- 
mise of  any  dispute  arising  with  reference  to 
the  obligations  of  the  plaintiff  under  his  con- 
tract with  Gebhardt  and  Ritchie.  The  case 
is  not,  therefore,  brought  within  the  cases  in 
which  a  promise  has  been  upheld  on  the  the- 
ory that  it  was  made  in  settlement  of  a  con- 
troversy over  disputed  claims.  The  authori- 
ties seem  quite  uniformly  to  show  the  inade- 
quacy of  the  consideration  alleged  for  the 
guaranty  in  question.  In  Geer  v.  Archer,  2 
Barb.  420,  the  defendant  visited  the  plaintiff 
to  pay  her  an  installment  upon  a  mortgage 
given  by  him  a  few  weeks  before  on  a  pur- 
chase of  land.  She  complained  that  she  had 
not  received  the  fair  value  of  her  land  upon 
such  purchase.  The  defendant  offered  to 
give  her  his  note  for  $200  to  satisfy  her  com- 


plaints. She  replied  that  she  would  be  sat- 
isfied with  that,  whereupon  the  note  in  ques- 
tion was  given.  It  was  held  that  this  note 
was  void  for  want  of  consideration.  So, 
where  land  was  sold  and  described  in  the 
deed  as  containing  a  certain  quantity,  and  a 
deficiency  was  afterward  discovered,  it  was 
held  that  there  was  no  obligation  on  the 
grantor  to  compensate  the  grantee  for  such 
deficiency,  and  a  promise  to  pay  the  same 
was  without  consideration.  Smith  v.  Ware, 
13  Johns.  257;    Ehle  v.  Judson,  24  Wend.  97. 

Pollock  states  the  rule  as  follows:  That 
"neither  the  promise  to  do  a  thing,  nor  the 
actual  doing  of  it,  will  be  a  good  considera- 
tion if  it  is  a  thing  which  the  party  is  bound 
to  do  by  the  general  law,  or  by  a  subsisting 
contract  with  the  other  party."  Pol.  Cont 
161;  Crosby  v.  Wood,  6  N.  Y.  369;  Deacon 
V.  Gridley,  15  C.  B.  295.  "Nor  is  the  per- 
formance of  that  which  the  party  was  un- 
der a  previous  valid,  legal  obligation  to  do  a 
sufficient  consideration  for  a  new  contract." 
2  Pars.  Cont  437.  When  certain  sailors  had 
signed  articles  to  complete  a  voyage,  but  at 
an  intermediate  port  refused  to  go  on,  and 
the  captain  thereupon  promised  to  pay  them 
increased  wages,  it  was  held  that  the  prom- 
ise was  without  consideration.  Bartlett  v. 
Wyman,  14  Johns.  200.  A  firm  having  a  con- 
tract to  build  a  railroad  found  the  contract 
unprofitable,  whereupon  the  railroad  compa- 
ny promised,  if  they  would  go  on  and  com- 
plete the  contract,  they  would  repay  to  the 
contractors  aU  of  the  obligations  which  they 
had  or  would  incur  in  consequence  of  their 
completion  of  the  work.  Held  no  considera- 
tion. Ayres  v.  Railroad  Co.,  52  Iowa,  47S,  3 
N.  W.  522. 

When  a  mortgagor,  as  a  condition  to  the 
payment  of  his  mortgage,  exacted  from  the 
mortgagee  an  obligation  that  he  would  pro- 
cure the  cancellation  of  a  certain  outstand- 
ing bond  executed  by  the  mortgagor,  or  pay 
him  the  sum  of  $100,  said  bond  being  given 
to  indemnify  against  some  apparent  incum- 
brance, it  was  held,  that  it  not  being  shown 
that  there  was  any  incumbrance  existing 
against  the  land,  the  obligation  was  without 
consideration.  Conover  v.  Stillwell,  34  N.  J. 
Law,  54.  When  the  plaintiff  agreed  to  en- 
ter the  military  service  of  the  United  States 
to  the  credit  of  the  town  of  Tobin  for  $100, 
and  on  arriving  at  the  place  of  enlistment, 
being  offered  an  advanced  price  by  others, 
refused  to  perform  unless  they  would  pay 
him  $250  additional,  held,  that  an  obligation 
to  pay  him  the  additional  amount  was  void 
for  want  of  consideration.  Reynolds  v.  Nu- 
gent, 25  Ind.  328.  A  sailor  signed  articles  for 
a  voyage  to  Melbourne  and  home  at  three 
pounds  per  month ;  several  of  the  crew  de- 
serted at  Melbourne.  The  captain,  to  in- 
duce plaintiff  to  remain,  signed  fresh  arti- 
cles for  six  pounds  per  month;  Held,  no 
consideration  for  the  promise.  Harris  v. 
Carter,  3  El.  &  Bl.  559;  to  same  effect  Stilk 
V.  Myrick,  2  Camp.  317.     When  defendants 


DOING  WHAT  ONE  IS  BOUND  TO  DO. 


263 


gave  plaiutiff's  notes  to  provide  funds  to 
take  up  obligation,  which  plaintiff  had  pre- 
viously contracted  to  pay,  held  no  considera- 
tion. MalUilieu  v.  Hodgson,  IG  Adol.  &  I'J. 
(N.  S.)  CS9.  A  promist!  to  pay  an  attorney 
additional  compensiition  to  attend  as  a  wit- 
ness, after  he  has  been  duly  subpoenaed,  is 
without  consideration.  The  attorney  did 
nothing  except  what  he  was  legally  bound  to 
do.     Smithett  v.  Blythe,  1  Barn.  &  Adol.  51-i, 

It  would  doubtless  be  competent  for  par- 
ties to  cancel  an  existing  contract  and  nialie 
a  new  one  to  complete  the  same  work  at  a 
different  rate  of  compensation,  but  it  seems 
that  it  would  be  esseutial  to  its  validity  uiat 
there  should  be  a  valid  cancellation  of  the 
original  contract.  Such  was  the  case  of  Lat- 
timore  v.  Harsen,  14  Johns.  330. 

It  necessarily  follows  fi'om  these  authori- 
ties that  the  plaintiff  had  no  right  to  impose, 
as  a  condition  to  the  performance  of  his  con- 
tract, that  the  payment  of  said  mortgage 
should  be  guaranteed.  Although  the  defond- 
niit  wns  not  a  part}*  to  tlio  original  contract 
and  the  consideration  and  contract  between 
him,  Gebhardt  and  Ritchie  does  not  appear. 


yet  we  must  assume  that  he  acted  at  the  re- 
quest of  Gebhardt  and  Ritchie,  and  was  re- 
quired only  by  such  contract  to  execute  such 
an  assignment  as  Gebliardt  and  liitchie  had 
contracted  to  give.  The  answer,  at  all 
events,  sets  up  that  he  received  no  consider- 
ation from  any  one  for  the  guaranty  sued 
upon. 

The  answer  also  alleges  that  the  sole  con- 
sideration received  for  this  guaranty  was  the 
performance  by  the  plaintiff  of  his  contract 
with  Gebhardt  and  Ritchie. 

We  think  this  answer  sets  forth  a  defense 
to  the  action,  and  inasmuch  as  the  defend- 
ant has  been  erroneously  deprived  of  the  op- 
portimity  of  proving  it,  if  in  his  power  to  do 
so,  that  a  new  trial  shovdd  be  ordered. 

The  judgment  therefore  of  the  general  term 
dismissing  the  complaint  should  be  reversed, 
and  its  order  reversing  the  judgment  ordered 
against  the  defendant  at  circuit  affirmed,  and 
a  new  trial  ordered,  with  costs  to  abide  the 
event 

All  concur,  except  ANDREWS  and  DAN- 
FORTH,  JJ.,  not  voting. 

Judgment  accordingly. 


CONSIDERATION. 


WHEELER  T.  WHEELER- 
(11  Vt.  60.) 

Supreme  Court  of  Vermont     Chittenden.    Jan. 

1839. 

This  was  an  action  of  assump.nt  on  an  insi- 
ntrl  coniputasset  for  $557,05.  The  defendant 
filed  the  following  plea,  in  bar:  That  before 
the  2'Jth  daj-  of  May,  1^33,  when  the  accouut- 
ing.  on  which  the  plaintiff  declared  was  had, 
Bundrv  dealinirs  had  occurred  between  the 
plaiiil'iff  and  this  defendant,  the  charges  of 
which,  on  the  part  of  the  said  Reuben,  came 
down  to  the  year  ISoO  and  uo  later,  and  re- 
mained unliquidated,  and  that  after  that  time, 
in  consequence  of  certain  losses  by  fire,  this  de- 
fendant became  insolvent  and  was  unable  to 
pav  the  full  amount  of  his  debts,  and,  by  rea- 
son thereof,  a  negotiation  was  entered  into  be- 
tween this  defendant  and  his  creditors,  iuclud- 
inir  the  said  Reuben,  for  a  partial  payment  of 
their  claims,  and  on  the  30th  May,  1831,  it  was 
asreed  bv  and  between  this  defendant  and  his 
said  creditors,  including  said  Reuben,  that  this 
defendant  should  pay  them  the  one  half  of 
their  claims,  in  the  following  manner:  one 
fourth  on  or  before  the  first  day  of  June,  1833, 
and  one  fourth  part  more  on  or  before  the  first 
day  of  June,  1835,  without  interest;  and  that 
thev,  the  said  creditors,  would  accept  the  same 
in  satisfaction  of  their  said  claims,  and,  in  con- 
sideration that  the  defendant  promised  the 
plaintiff  to  pay  him  in  manner  and  form  as 
above,  the  said  Reuben  promised  the  defendant 
to  accept  the  same,  in  full  satisfaction  of  hi? 
said  claims;  and  the  defendant  avers,  that  the 
saia  accounting  on  the  said  20th  May,  1833.  was 
for  the  mere  purpose  of  ascertaining  the  amount 
of  the  claim  of  said  Reuben,  on  which  said  ip. 
stalments  were  to  be  paid,  and  that  in  pursu- 
ance of  said  contract,  this  defendant,  on  the 
same  20th  May,  1833,  paid  the  plaintiff  the  one 
fourth  port  of"  his  said  claim,  which  said  Reuben 
then  and  there  accepted,  and  on  the  29th  day 
of  May,  183-5,  the  defendant  paid  plaintiff  the 
other  fourth  part  of  said  claim,  which  plaintiff 
accepted,  and  that  the  same  were  accept- 
ed and  received  in  pursuance  of  -said  *61 
oo?.tract,  and  in  full  satisfaction  and  dis- 
charge of  his  said  claim,  and  that  said  accoant- 
ing  is  the  identical  claim  mentioned  in  sakl 
agreement,  all  which  defendant  is  ready  to  veri- 
fy—wherefore, &c.  To  this  plea  there  was  a 
general  demurrer  and  joinder.  Tho  county 
court  rendered  judgment  for  plaintiff,  and  the 
defendant  excepted. 

Maeck  &  Smalley,  foi-  plaintifi.     C.  Adams, 
for  defendant. 

COLLAMER,  J.  It  Is  not  every  agreement, 
however  deliberately  made,  by  persons  capable 
to  contract,  which  the  law  will  enforce;  nor  is 
it  true  that  the  courts  of  common  law  have 
ever  taken  their  suitors  under  guardianship  to 
set  aside  contracts,  merely  befause  imprudently 
made.  There  is  one  ingredi'jnt  always  neces- 
sary, that  is,  a  legal  and  sufficient  considera- 
tion. Without  this,  contracts,  executed  or  ex- 
ecutory, are  always  disregarded  by  courts,  un- 
less thereby  innocent  third  persons  would  be 
injured  or"  defrauded.  The  performance  of 
that,  to  which  a  man  is  already  under  obliga- 
tion, can  never  constitute  a  consideration  for 
any  contract  by  the  other  party.  The  promise 
by  a  debtor  to  pay  a  debt,  which  he  is  then 
under  legal  obligation  to  pay,  creates  no  new 
dutj'  and  can  sustain  no  action,  nor  constitute 
the  consideration  of  a  promise  by  the  other 


party.  The  payment  of  a  debt,  by  a  man  then 
bound  to  pay,  creates  no  legal  obligation  on  the 
other  party,  nor  constitutes  a  consideration  for 
any  new  promise  by  him.  These  prin- 
ciples, in  various  *form8  of  practical  ap-  *67 
plication,  have  always  been  regarded  by 
the  courts;  nor  can  any  adjudged  case  be  found 
where  they  have  been  violated.  It  is  on  this 
principle  that  it  was  early,  and  has  been  uni- 
formlv.  holden  that  a  payment  of  part  of  a 
debt,  by  the  debtor,  when  the  whole  is  due,  is 
not  and  cannot,  by  possibility,  be  a  legal  con- 
sideniiion  for  a  contract,  on  the  part  of  the 
creditor,  to  receive  it  in  fuU  satisfaction  of  the 
whole  debt.  The  payment  of  a  debt,  or  any 
part  of  a  debt,  before  it  is  due,  is  what  the 
debtor  is  not  under  any  legal  obligation  to  do, 
and  therefore  is  a  legal  consideration  for  aeon- 
tract  by  the  creditor,  which  contract  may  be  to 
release  or  cancel  his  debt,  as  well  as  any  other 
contract.  So,  too,  the  delivery  of  a  collateral 
article,  for  a  debt  due  in  money,  is  what  the 
debtor  is  under  no  obligation  to  do,  and  there- 
fore maybe  a  legal  consideration  foracontract 
by  the  creditor  to  receive  it  in  full  satisfaction, 
as  well  as  for  any  other  promise  he  might  make. 

This  has  been  so  often  decided,  as  appears 
even  by  the  authorities  cited  by  the  defendant, 
that  it  is  entirely  unnecessary  to  repeat  them. 

It  is,  however,  insisted  by  the  defendant,  that 
there  are  decisions,  cited  by  him.  that  contra- 
dict or  overrule  this  principle.  This  however, 
on  examination,  will  be  found  incorrect.  Those 
cases  which,  at  first  view,  seem  to  favor  such 
a  position,  may  be  arranged  under  these  heads: 

First.  If  a  debtor,  by  agreement,  delivers  to 
his  creditors  or  to  a  trustee  for  them,  debts,  ef- 
fects or  any  collateral  property,  whether  it  be 
the  whole  or  part  of  what  he  has,  and  it  be  re- 
ceived in  satisfaction,  it  is  a  good  defence. 
This  is  like  delivering  collateral  property  to  a 
single  creditor  on  a  sole  debt.  It  is  doing  what 
the  debtor  is  not  under  legal  obligation  to  do. 
and  it  may  be  the  legal  consideration  for  a  con- 
tract of  dkcharge  or  any  other  contract  by  the 
other  party.  This  disposes  of  several  decis- 
ions. 

Serend.  If  a  debtor  contracts  with  one  or  all 
of  his  creditors  to  procure  a  friend  to  secure  or 
pay,  out  of  his  own  means,  part,  in  satisfaction 
of  a  whole  debt,  and  it  is  done,  such  creditor 
can  never  recover  more,  even  of  the  debtor 
himself.  It  would  be  a  fraud  on  the  third 
'68  person  who  paid  for  *tlie  entire  release; 
and  the  debtor  did  what  he  was  not  un- 
der a  legal  obligation  to  do.  in  procuring  the 
act  of  the  third  person,  which  was  a  legal  con- 
sideration for  the  promise  on  the  other  part. 
This  disposes  of  another  class  of  decisions,  re- 
lied on  by  the  defendant. 

Third.  If  a  composition  deed  has  been  en- 
tered into  by  a  body  of  creditors  and  their 
debtor,  by  which  they  agree  to  receive,  and  do 
receive,  in  money  or  effects,  from  the  debtor, 
or  in  securities  from  his  friends,  a  part  for  the 
whole  debts,  there,  no  one  who  agreed  to  the 
composition  can  collect  a  balance,  because  it 
would  operate  a  fraud  on  the  other  creditors 
who  stipulate  for  a  mutuality  and  have  released 
their  debts.  The  deed  being  a  specialty  under 
seal,  is  a  technical  release.  Such  are  a  large 
class  of  the  defendant's  cases. 

Fourth.  If  any  creditor,  professes  to  enter 
into  a  composition  deed  with  others  on  terms  of 
mutuality,  and  so  induces  them  to  release, 
when  he  in  fact  secretly  takes  security  for 
more;  all  such  securities,  by  whomsoever  giv- 
en, are  void,  being  in  bad  faith  and  a  fraud  up- 
on others.  This  is,  however,  only  so,  when 
others  have  actually  released  their  debts.     This 


DOING  WHAT  ONE  IS  BOUND  TO  DO. 


265 


disposes  of  all  the  remainder  of  the  defendant's 
cases,  cited  in  authority. 

In  the  present  case,  the  defendant  did  not 
deliver  to  the  plaintiff  or  to  his  creditors,  or  to 
any  trustee  for  them,  his  debts  or  ell'ecls,  or 
any  part  thereof,  lie  did  not  procure  any 
third  ])erson  to  give  security  or  to  pay  any 
thing.  No  composition  deed  has  been  signed 
by  any  one.  Nothing  has  been  paid  to  any 
creditor,  nor  any  release  bj'  them  signed,  and 
the\'  may  collect  their  whole  debts.  For  the 
plaintiff  to  recover  his  just  debt  can  therefore 
operate  no  fraud  on  any  creditor  or  any  third 
person.  This  plea  stands  upon  the  simple  ques- 
tion, whether  the  payment,  by  a  debtor,  of  apart 
of  adebt.when  he  is  bound  to  pay  the  whole, can 
be  a  legal  consideration  for  a  promise,  on  the 
part  of  the  creditor,  to  receive  it  in  full  satis- 
faction. That  such  could  not  be  the  case  an- 
ciently is  certain,  and  is  fully  conceded  by  the 
defendant's  counsel.     Let  us  see  the  language 

of  the  courts  in  some  of  the  most  modern 
*6P      cases,  where  the  subject  has  *becn  fully 

revised  and  considered.  In  Fitch  v.  Sut- 
ton, 5  East's  Rep.  230,  where  the  defendant  had 
compounded  with  his  creditors,  and  paid  all, 
including  the  plaintiff,  ten  shillings  in  the 
pound,  and  the  plaintiff  had  given  therefor  his 
receipt  in  full,  Lord  EUenborough  says,  "it  can- 


not be  pretended  that  a  receipt  of  part  only, 
though  expressed  to  be  in  full  of  all  demands, 
must  have  the  same  operation  as  a  release.  It 
is  impossible  to  contend,  that  acceptance  of 
seventeen  pounds  ten  shillings  is  an  extin- 
guishment of  a  debt  of  tifty  pounds.  There 
must  be  consideration  for  the  relinquishment 
of  the  residue;  something  collateral,  to  show  a 
possibility  of  advantage  to  the  party  relinquish- 
ing his  further  claim,  otherwise  the  agreement 
is  niulum  pactum.  "  And,  he  says,  the  doctrine 
ot  Pinnel's  case,  5  Coke,  117,  has  never  been 
shaken. 

In  the  more  modern  case  of  Lewis  v,  Jones, 
4  B.  &  C.  50(5,  where  the  creditor  had  agreed  to 
receive  five  shillings  on  the  pound  for  his  debt, 
upon  having  the  note  of  the  debtor's  father 
therefor,  and  which  he  received,  Holroyd,  J, 
says,  "an  acceptance  of  a  smaller  sum  cannot 
be  pleaded  in  satisfaction  of  a  larger.  In  point 
of  law,  something  further  is  nece.-,sary  to  pro- 
duce that  effect.  But,  I  think,  when  the  plain- 
tiff in  this  case  accepted  the  father's  note,  as  a 
security  for  the  payment  of  the  composition 
money,  the  agreement  did  operate  as  a  satis- 
faction, "  Indeed,  the  distinctions,  before  men- 
tioned, are  recognized  in  all  the  caics  and  not 
one  is  found  to  sustain  this  plea. 

Judgment  affirmed. 


266 


CONSIDERATION. 


y 


(V^     JAFFRAY  et  al.  v.  DAVIS  et  aL     yl   | 


(26  N.  E.  351,  124  N.  Y.  164.)     \  I 


CJourt  of  Appeals  of  New  York.  Second  DiTi- 
sicn.     Jan.  14.  1891. 

Appeal  from  .supreme  court,  general 
term,  first  department. 

John  W.  Little  and  O.  F.  Wisner, for  ap- 
pellants.    Isaac  L.  Miller, for  respondents. 

POTIER,  J.  The  facts  found  by  the 
trial  court  In  this  case  were  agreed  upon. 
They  are  simple,  and  present  a  familiar 
question  of  law.  The  facts  are  that  de- 
fendants were  owing  plaintiffs,  on  the  8th 
day  of  December,  18sG,  for  goods  sold  be- 
tween that  date  and  the  May  previous,  at 
an  agreed  i)riee,  the  sura  of  $7,714.37,  and 
that,  on  the  27th  of  the  same  December, 
the  defendants  delivered  to  the  plaintiffs 
their  three  promissory  notes,  amounting, 
in  the  aggregate,  to  $3,462.24,  secured 
by  a  chattel  mortgage  on  the  stock,  fixt- 
ures, and  other  property  of  defendants, 
located  in  East  Saginaw,  Mich.,  which 
said  notes  and  chattel  mortgage  were  re- 
ceived by  plaintiffs,  under  an  agreement 
to  accept  same,  in  full  satisfaction  and 
discharge  of  said  indebtedness;  that  said 
notea  have  all  been  paid,  and  said  mort- 
gage discharjred  of  record.  The  question 
of  law  arising  from  these  facts,  and  pre- 
sented to  this  court  for  its  determination, 
is  whether  such  agreement,  with  full  per- 
formance, constitutes  a  bar  to  this  action, 
which  was  brought  after  such  perform- 
ance to  recover  the  balance  of  such  indebt- 
edness over  the  sum  so  secured  and  paid. 

One  of  the  elements  embraced  in  the 
question  presented  upon  this  appeal  is, 
viz.,  whether  the  pajnnent  of  a  sum  less 
than  the  amount  of  a  liquidated  debt, 
under  an  agreement  to  accept  the  same  in 
satisfaction  of  such  debt,  forms  a  bar  to 
the  recovery  of  the  balance  of  the  debt. 
This  single  question  was  presented  to  the 
English  court  in  1602,  when  it  was  re- 
solved, if  not  decided,  in  Pinnel's  Case,  5 
Coke,  117,  "that  payment  of  a  lesser  sura 
on  the  day  in  satisfaction  of  a  greater 
tannot  be  any  satisfaction  for  the  whole,  *• 
and  that  this  is  so,  although  it  was 
agreed  that  such  payment  should  satisfy 
the  whole.  This  simple  question  has 
since  arisen  in  the  English  courts,  and 
in  the  courts  of  this  country,  in  almost 
numberless  instances,  and  has  received 
the  same  solution,  notwithstanding  the 
courts,  while  so  ruling,  have  rarely  failed 
uiion  any  recurrence  of  the  question  to 
criticise  and  condemn  its  reasonableness, 
justice,  fairness,  or  honesty.  No  respect- 
able authority  that  I  have  been  able  to 
find  has.  after  such  unanimous  disapprov- 
al by  all  the  courts,  held  otherwise  than 
was  held  in  Pinnel  Case,  supra,  and  Cum- 
ber V.  Wane,  1  Strange,  426;  Foakes  v. 
Beer,  L.  R.  9  App.  Cas.  605;  Goddard  v. 
O'Brien.  (Q.  B.  Div.)  21  Amer.  Law  Reg. 
6.37,  and  notes.  The  steadfast  adhesion 
to  this  doctrine  by  the  courts,  in  spite  of 
the  current  of  condemnation  by  the  indi- 
vidual judges  of  the  court,  and  in  the  face 
of  the  demands  and  conveniences  of  a 
much  greater  business,  and   more  exten- 


sive mercantile  dealings  and  operations, 
demonstrate  the  force  of  the  doctrine  of 
sture  decisis.  But  the  doctrine  of  sture 
decisis  is  further  illustrated  by  the  course 
of  judicial  decisionsupon  this  subject;  for, 
while  the  courts  still  hold  to  the  doctrine 
of  the  Pinnel  and  Cumber- Wane  Cases,  su- 
pra, they  have  seemed  to  seize  with  avidi- 
ty upon  any  consideration  to  support  the 
agreement  to  accept  the  lesser  sum  in  sat- 
isfaction of  the  larger,  or,  in  other  words, 
to  extract,  if  possible,  from  the  circum- 
stances of  each  case,  a  consideration  for 
the  new  agreement,  and  to  substitute  the 
new  agreement  in  place  of  the  old,  and 
thus  to  form  a  defense  to  the  action 
brought  upon  the  old  agreement.  It  will 
serve  the  purpose  of  illustrating  the  adhe- 
sion of  the  court  to  settled  law,  and  at  the 
same  time  enable  us,  perhaps  more  satis- 
factorily, to  decide  whether  there  was  a 
good  consideration  to  support  the  agree- 
ment in  this  case, to  refer  to  (the  consider- 
ation in)  a  few  of  the  numerous  cases 
which  the  courts  have  held  to  be  sufficient 
to  supi)ort  the  new  agreement.  Lord 
Bl-vckrurn  said,  in  his  opinion  in  Foakes 
V.  Beer,  supra,  and  while  maintaining  the 
doctrine,  "that  a  lesser  sum  cannot  be  a 
satisfaction  of  a  greater  sum,"  "but  the 
gift  of  a  horse,  hawk,  or  robe,  etc.,  in  sat- 
isfaction, is  good,"  quii.c  regardless  of  the 
amount  of  the  debt;  and  it  was  further 
said  by  him,  in  the  same  opinion,  "  that 
payment  and  acceptance  of  a  parcel  before 
the  day  of  payment  of  a  larger  sum  would 
be  a  good  satisfaction  in  regard  to  the 
circumstance  of  time;"  "and  so,  if  1  am 
bound  in  twenty  pounds  to  pay  you  ten 
pounds  at  Westminster  and  you  request 
me  to  pay  you  five  pounds  at  the  day,  at 
York,  and  you  will  accept  it  in  full  satis- 
faction for  the  whole  ten  pounds,  is  it  a 
good  satisfaction?"  It  was  held  in  God- 
dard V.  O'Brien,  9  Q.  B.  Div.  37:  "A.,  being 
indebted  to  B.  in  12.^  pounds  7s.  and  9d.  for 
goods  sold  and  delivered,  gave  B.  a  check 
(negotiable,  I  suppose)  for  100  pounds, 
payable  on  demand,  which  B.  accepted  in 
satisfaction, — was  a  good  satisfaction." 
HuDDLESTON,  B.,  in  Goddard  v.  O'Brien, 
supra,  approved  the  language  of  the  opin^ 
ion  in  Sibree  v.  Tripp,  15  Mees.  &  W.  26: 
"That  a  negotiable  security  may  operate, 
if  so  given  and  taken,  in  satisfaction  of  a 
debt  of  a  greater  amount:  the  circum- 
stance of  negotiability  making  it  in  fact  a 
different  thing,  and  more  advantageous, 
than  the  original  debt,  which  was  not  ne- 
gotiable." It  was  held  in  Bull  v.  Bull,  43 
(?onn.  4.55:  "  And,  aUhougii  the  claim  is  a 
money  demajid,  liquidated,  and  not  doubt- 
ful, and  it  cannot  be  satisfied  with  a 
smaller  sum  of  money,  yet,  if  any  other 
personal  property  is  received  in  satisfac- 
tion, it  will  be  good,  no  matter  what  the 
value."  And  it  was  held,  in  Cumber  v. 
Wane,  supra,  that  a  creditor  can  never 
bind  himself  by  simple  agreement  to  ac- 
cept a  smaller  sum  in  lieu  of  an  ascertained 
debt  of  a  larger  amount,  such  agreement 
being  nudum  pactum,  but,  if  there  be  any 
benefit,  or  even  any  legal  po.ssibility  of  bene- 
fit, to  the  creditor  thrown  in,  that  addi- 
tional weight  will  turn  the  scale,  and  ren- 
der the  consideration  sufficient  to  support 
the  agreement.     It  was  held  in  Le  Page  v. 


DOING  WHAT  ONE  IS  BOUND  TO  DO. 


2G7 


McCrea,  1  Wend.  10 1,  uiul  in  Boyd  v. 
Hitchcock,  20  Johns.  7(J,  tliat  "Kivinj?  fur- 
tlior  Rocurity  for  part  of  a  doht,  or  other 
Kpcurity,  tlioiish  for  a  loss  nam  than  tlie 
debt,  and  acceptance  of  it  in  full  of  all  de- 
mands, make  a  valid  accord  and  satisfac- 
ti(jn  ; "  that,  "  if  a  debtor  j^ives  his  creditor 
a  note  indorsed  by  a  third  party  for  a  less 
Kiun  tlian  the  debt,  (no  matter  how  much 
less,)  but  in  full  satisfaction  of  the  rlebt, 
and  it  is  received  as  such,  the  transaction 
constitutes  a  good  accord  and  satisfac- 
tion." Varney  v.  Conery,  (Me.)  1  Atl.  Hep. 
6S;3.  And  so  it  has  been  held  "  vi-here.  by 
mode  or  time  of  part  payment,  difft-rent 
tlian  tiiat  i)rovided  for  in  the  contract,  a 
uew  bfiH'titisorniay  bcconfeired,  or  a  bur- 
tlen  imposed,  a  new  consideration  arises 
on  t  of  the  transaction,  and  gives  validity  to 
the  agreement  of  the  creditor."  Rose  v. 
Hall,  L'6  Conn.  392.  And  so  "payment  of 
less  than  the  whole  debt,  if  made  before  it 
Is  due,  or  at  a  different  place  from  that 
stipulated,  if  received  in  full, is  a  good  sat- 
isfaction." .lones  V.  P.ullitt,  2  Litt.  (Kv.) 
4');  liicketts  v.  Hall,  2  Bush,  249;  Smith  v. 
Brown,  3  Hawks.  ,5S0;  Jones  v.  Perkins, 
29  Mi.ss.  139;  Schweider  v.  Lang,  29  Minn. 
254,  12  N.  W.  Rep.  33.  In  Watson  v.  P:ili- 
ott,  57  N.  H.  511-513,  it  was  held:  "It  is 
enough  that  something  substantial  which 
one  party  is  not  bound  by  law  to  do  is 
done  by  him,  or  something  whicli  he  has  a 
right  to  do  ho  abstains  from  doing,  at  the 
request  of  the  other  party,  is  held  a  good 
satisfaction. " 

It  has  been  held  in  a  n amber  of  cases 
that,  if  a  note  be  surrendered  by  the  payee 
to  the  maker,  the  whole  claim  is  dis- 
charged and  no  action  can  afterwards  be 
maintained  on  such  instrument  for  the  un- 
paid balance.  Ellsworth  v.  Fogg,  35  Vt. 
355;  Kent  v.  Reynolds,  S  Hun,  559.  It  has 
been  held  that  a  partial  payment  made  to 
another,  though  at  the  creditor's  instance 
and  request,  is  a  good  discharge  of  the 
whole  debt.  Harper  v.  Graham,  20  Ohio, 
106.  "The  reason  of  the  rule  is  that  the 
debtor  in  such  case  has  done  something- 
more  than  he  was  originally  bound  to  do, 
or,  at  least,  something  different.  It  may 
be  more,  or  it  may  be  less,  as  a  matter  of 
fact."  It  was  held  by  the  supreme  court 
of  Pcnnsvlvania  in  Bank  v.  Huston.  11 
Wkly.  Notes  Cas.  3S9,  (February  13,  1SS2:) 
The  decided  advantage  which  a  creditor 
acquires  by  the  receipt  of  a  negotiable 
note  for  a  part  of  his  debt,  as  by  the  in- 
creased facilities  of  recovering  upon  it,  the 
presumption  of  a  consideration  for  it,  the 
ease  of  disposing  of  it  in  market,  etc.,  was 
held  to  furnish  ample  reason  why  it  should 
be  a  valid  discharge  of  a  larger  account  or 
open  claim  unnegotiable.  It  has  been  held 
that  a  payment  in  advance  of  the  time,  if 
agreed  to,  is  a  full  satisfaction  for  a  larger 
claim  not  yet  due.  Brooks  v.  White,  2 
Mete. ( Mass. )2S3;  Bowker  v.  Childs.3  Allen, 
434.  In  some  states,  notably  Maine  and 
Georgia,  the  legislature,  in  order  to  avoid 
the  harshness  of  the  rule  under  consid- 
eration, have,  by  statute,  changed  the 
law  upon  that  subject,  by  providing:  "No 
action  can  be  maintained  upon  a  demand 
which  has  been  canceled  by  the  receipt  of 
any  sum  of  money  less  than  the  amount 
legally  due  thereon,  or  for  any  good   and 


vaiualjle  consideration,  however  small." 
Citing  Weymouth  v.  Babcock,  42  Me.  42. 
And  so  in  Gray  v.  Barton,  55  N.  Y.  08, 
where  a  debt  of  $S20  upon  book-account 
was  satisfied  by  the  payment  of  one  dollar 
by  calling  the  balance  a  "gift,  "though  the 
balance  was  n<jt  deli voreij,  except  l)y  fic- 
tion, and  the  receii)twas  in  the  usual  form, 
and  was  silent  upon  the  subject  of  a  gift, 
and  this  case  was  f(dlowed  and  referr.-d 
to  in  Ferry  v.  Stephens,  00  N.  Y.  .".21.  So 
it  was  held  in  Mitchell  v.  Wheaton,40Conn. 
"15,  that  the  debtor's  agreement  to  pay, 
and  the  payment  of  Sf  150,  with  the  costs  of 
the  suit,  upon  a  liquidated  debt  of  ri?299, 
satisfied  the  principal  debt.  These  cases 
show  in  a  striking  manner  the  extreme  in- 
genuity and  assiduity  which  the  courts 
have  exercised  to  avoid  the  operation  of 
the  "rigid  and  rather  unreasonable  rule  of 
the  'old  law,' "as  it  is  characterized  in 
Johnston  v.  F>rannan,5  Johns.  208-272;  or 
as  it  is  called  in  Kellogg  v.  Richards,  14 
Wend.  110,  "technical  and  nejt  very  well 
supported  by  reason;"  or,  as  maybe  more 
practically  stated,  a  rule  that  "a  bar  of 
gold  worth  $100  will  discharge  a  debt  ot 
$500,  while  400  gold  dollars  in  current  coin 
will  not."  SeenotetoGoddard  v.  O'Brien, 
supra,  in  21  Airer.  Law  Reg.  640.  041. 

The  state  of  the  law  upon  this  subject, 
under  the  modification  of  later  decisions, 
both  in  England  and  in  this  ci)uiitry, 
would  seem  to  be  asoxpressed  in  Goddard 
v.  O'Brien,  supra:  "The  doctrine  in  Cum- 
ber v.  Wane,  is  no  doubt  very  much  quali- 
fied bySibree  v.  Tripp,  and  I  cannot  find  it 
better  stated  than  in  1  Smith,  Lead.  Cas. 
(7th  Ed.).595:  'Thegeneraldoctrinein Cum- 
ber V.  Wane,  and  thereason  of  all  theexcep- 
tions  and  distinctions  which  have  been  in- 
grafted on  it,  may  perhaps  be  summed  up  as 
follows,  viz. :  That  a  creditor  cannot  bind 
himself  by  a  simjjle  agreement  to  accept  a 
smaller  sum  in  lieu  of  an  ascertained  debt 
of  largeramount.such  an  agreement  being 
jindnm  pnctuni.  But, if  there  be  any  bene- 
fit, or  even  any  legal  possibility  of  benefit, 
to  the  creditor  thrown  in,  that  additional 
weight  will  turn  the  scale,  ami  render  the 
consideration  sufficient  to  support  the 
agreement.'  "  Bull  v.  Bull,  43  (?onn.  455; 
Fisher  v.  May,  2  Bibb,  449;  Reed  v.  Bnrt- 
lett,19  Pick.  273;  Bank  v.  Geary,  5  Pet.  99- 
114;  Le  Page  v.  McCrea,  1  Wend.  164; 
Boyd  V.  Hitchcock.  20  Johns.  70;  Brooks 
V.White,  2  Mete.  (Mass.)  2S3;  Jones  v.  Per- 
kins, 29  Miss.  139-141;  Hall  v.  Smith,  15 
Iowa,  584;  Babcock  v.  Hawkins,  23  Vt. 
501. 

In  the  case  at  bar.  the  defendants  gave 
their  promissory  notes  upon  time  for  one- 
half  the  debt  they  owed  plaintiff,  and  also 
gave  plaintiff  a  chattel  mortgage  on  the 
stock,  fixtures,  and  other  personal  proper- 
ty of  the  defendants,  under  an  agreement 
with  plaintiff  to  accept  the  same  in  full 
satisfaction  and  discharge  of  said  indebt- 
edness. Defendants  paid  the  notes  as  they 
became  due.  and  plaintiff  then  discharged 
the  mortgage.  Under  the  cases  above 
cited,  and  upon  iirincii)le,  this  new  agree- 
ment was  sujiporttHl  l)y  a  sufficient  con- 
sideration to  make  it  a  valid  agreement, 
and  tliis  agreement  was,  by  the  parties, 
substituted  in  place  of  the  former.  The 
consiileration   of   the  uew  agreement  was 


26S 


CONSIDE  RATION. 


that  the  plaintiff,  in  place  of  an  open 
book-account  for  goods  «old,  got  the  de- 
fcTidants'  promissory  notes,  probably  ne- 
gotiable in  form,  signed  by  defendants, 
tiius  savina:  the  plaintiff  perhaps  trouble 
or  expense  of  proving  their  account,  and 
got  security  upon  all  the  defendants' 
personal  property  for  the  payment  of 
the  sum  specified  in  the  notes,  where  be- 
fore they  had  no  security.  It  was  some 
trouble 'at  least,  and  perhaps  some  ex- 
ipense,  to  the  defendants  to  execute  and 
\deliver  the  security,  and  they  deprived 
:hemselves  of  the  legal  ownership,  or  of 
Luy  exemptions,  or  the  power  of  dispos- 
ing of  this  property,  and  gave  the  plaintiff 
such  ownership,  as  against  the  defend- 
ants, and  the  claims  thereto  of  defend- 
ants' creditors,  if  there  were  any.  It 
seems  to  me,  upon  principle,  and  the  de- 
cisions of  this  state,  (save  perhaps  Keeler 
V.  .Salisbury,  33  N.  Y.  653,  and  Platts  v. 
Walrath,  Lalor,  Supp.  59,  which  I  will 
notice  further  on,)  and  of  quite  all  of  the 
oth<>r  states, the  transactions  between  the 
plaintiff  and  tlie  defendants  constitute  a 
bar  to  this  action.  All  that  is  necessary 
to  produce  satisfaction  of  the  former 
agreement  is  a  sufficient  consideration  to 
support  the  sul)stituted  agreement.  The 
doctrine  is  fully  sustained  in  the  opinion 
of  J  udge  Andrews, in  Allison  v.Abendroth, 
lOS  N.  Y.  470,  15  N.  E.  Rep.  606,  from  which 
I  quote:  "But  it  is  held  that,  where  there 
is  an  independent  consideration,  or  the 
creditor  receives  any  benefit,  or  is  put  in  a 
better  position,  or  one  from  which  there 
may  be  legal  possibility  of  benefit  to 
which  he  was  not  entitled,  except  for  the 
agreement,  then  the  agreement  is  not 
nudum  piictum,  and  the  doctrine  of  the 
common  law,  to  which  we  have  adverted, 
has  no  application."  Upon  this  distinc- 
tion the  cases  I'est,  which  hold  that  the 
acceptance  by  the  creditor  in  discharge  of 
the  debt  of  a  different  thing  from  that 
contracted  to  be  paid,  although  of  much 
less  pecuniary  value  or  amount,  is  a  good 
satisfaction,  as.  for  example,  a  negotiable 
instrument  binding  the  debtor  and  a  third 
person  for  a  smaller  sum.  Curlewis  v. 
Clark,  3  Exch.  375.  Following  the  same 
principle,  it  is  held  that,  when  the  debtor 
enters  into  a  new  contract  with  the  cred- 
itor to  do  something  which  he  was  not 
bound  to  do  by  the  original  contract,  the 
new  contract  is  a  good  accord  and  sati.s- 
faction,  if  so  agreed.  The  case  of  accept- 
ing the  sole  liabilitj'  of  one  of  two  joint 
det)tors  or  copartners,  in  satisfaction  of 
the  joint  or  copartnership  debt,  is  an  iilu.s- 
trati(jn.  This  is  held  to  be  a  good  satis- 
faction, because  the  sole  liability  of  one  of 
two  debtors  "maybe  more  beneficial  than 
the  joint  liability  of  both,  either  in  respect 
of  tlie  solvency  of  the  parties,  or  the  con- 
venience of  the  remedy."  Thompson  v. 
Percival,  5  Rarn.  &  Adol.  925.  In  perfect 
accord  with  this  principle  is  the  recent  case 
in  this  Court  of  Luddington  v.  Bell,77  N.  Y. 


13S,  in  which  it  was  held  that  the  accept- 
ance by  a  creditor  of  the  individual  note 
of  one'of  the  members  of  a  copartnership 
after  dissolution,  for  a  portion  of  the  co- 
pa  rtnfrship  debt,  was  a  good  considera  tion 
for  the  creditor's  agreement  to  discharge 
the  maker  from  further  liability.  Pardee 
V.  Wood,  8  Hun.  584;  Douglass  v.  White,  3 
Barb.  Ch.  621-624.  Notwithstanding  these 
later  and  decisive  authorities,  the  plaintiff 
contends  that  the  giving  of  the  defend- 
ants' notes,  with  the  chattel  mortgage  se- 
curity and  the  payment,  was  an  insuffi- 
cient consideration  to  support  the  new  or 
substituted  agreement,  and  cites,  as  au- 
thority for  such  contention,  the  cases  of 
Platts  V.  Walrath,  Lalor,  Supp.  .59,  and 
Keeler  v.  Salisbury,  33  N.  Y.  648.  Platts  v. 
Walrath  arose  in  justice  court,  and  the 
debt  in  controversy  was  put  forth  as  a 
set-off.  The  remarks  of  the  judge  in  the 
former  case  were  quite  obiter,  for  there 
were  various  subjects  in  dispute  upon  the 
trial,  and  from  which  the  justice  might 
have  reached  the  conclusion  that  he  did. 
The  judge,  in  the  opinion  relied  upon, 
says:  "Looking  at  the  loose  and  second- 
ary character  of  the  evidence  as  stated 
in  the  return,  it  was,  perhaps,  a  question 
of  fact  whether  any  mortgage  at  all  was 
given,  or  at  least,  whether,  if  given,  it  was 
not  in  terms  a  mere  collateral  security  for 
the  large  note.  "  "  Even  the  mortgage  was 
left  to  parol  proof.  Did  it  refer  to,  and 
profess  to  be  a  security  for,  the  note  of 
.11,500,  or  that  sum  less  the  fifty  dollars 
agreed  to  be  thrown  off?"  etc. 

There  is  so  much  confusion  and  uncer- 
tainty in  the  case  that  it  was  not  thought 
advisable  to  publish  the  case  in  the  regu- 
lar series  of  Reports.  The  case  of  Keeler 
v.  Salisbury,  supra,  is  not  to  be  regarded 
as  an  authority  upon  this  question,  or  as 
approving  the  case  of  Platts  v.  Walrath, 
supra.  In  the  case  of  Keeler  v.  Salisbury, 
the  debtor's  wife  had  joined  in  the  mort- 
gage given  by  her  husband,  the  debtor,  to 
effect  the  compromise,  thus  releasing  her 
inchoate  right  of  dower.  The  court  held 
that  fact  constituted  a  suflicient  consider- 
ation to  support  the  new  agreement, 
though  the  court,  in  the  course  of  the 
opinion,  remarked  that  it  had  been  held 
that  the  debtor's  mortgage  would  not  be 
sufficient,  and  referred  to  Platts  v.  Wal- 
rath. But  the  court  did  not  otherwise  in- 
dicate any  approval  of  that  case,  and 
there  was  no  occasion  to  do  so,  for,  as  be- 
fore stated,  the  court  put  its  decision  up- 
on the  fact  that  the  wife  had  joined  in  the 
mortgage.  In  view  of  the  peculiar  facts 
in  these  two  cases,  and  the  numerous  de- 
cisions of  this  and  other  courts  hereinbe- 
foi-e  referred  to,  I  do  not  regard  them  as 
authorities  against  the  defendants'  con- 
tention that  the  plaintiff's  action  for  the 
balance  of  the  original  debt  is  barred  by 
reason  of  the  accord  and  satisfaction,  and 
tlie  judgment  must  be  reversed,  with  costs. 

All  concur. 


{, 


)> 


EIILE  V.  JUDSON. 

(24  Wend.  97.) 

Supreme  Court  of  New   York.     May,  1840. 

This  was  an  action  of  assumpsit,  tried  at 
the  Madison  circuit  in  September,  1838,  before 
the  Hon.  Philo  Gridley,  one  of  the  circuit 
judges. 

The  action  was  by  the  plaintiff  as  the  hold- 
er of  a  note  payable  to  Elislia  Swift,  or  bear- 
er, for  the  sum  of  $100,  transferred  after  ma- 
turity. The  defence  set  up  was  want  of  con- 
sideration. The  defendant  had  been  in 
negotiation  with  one  James  Blatherwicli  for 
tlie  purchase  of  a  farm,  but  not  agreeing  as 
to  the  price  and  terms  of  payment,  abandoned 
the  negotiation.  Elisha  Swift  then  treated, 
with  Blalhorwick  for  the  purchase  of  the. 
farm  on  his  own  account,  and  induced  Blath^ 
erwick  to  agree  to  accept  from  him  a  less 
sum.  and  also  to  reduce  the  amount  of  the- 
cash  payment  to  be  made  on  the  conveyance, 
of  the  property.  Swift  told  Blatherwicli  that 
he  thought  he  should  take  the  farm.  The 
agreement,  however,  was  by  parol.  In^his 
state  of  JJifijaegotiation,  Judson,  the  defendant 

To^ve  up  his 
sent  to  his  becoming  the  pur- 
hich  Blathorwick  had 
The  latter  assent- 
would 


PAST  CONSIDERATIOX. 


269 


in   this  cause; 
irgaiuTa 


Chaser  u 

geifto  accept  from  him 
"eu  ib  tne  proposal,  provided  Judson 
give  him  his  note  for  $100,  to  pay  him  for  his 
time  and  troulile  in  negotiating  the  purchase. 
Judson  accordingly  gave  the  note  in  question, 
and  became  the  purchaser  of  the  farm.  Upon 
this  state  of  facts,  the  defendant  moved  for 
a  nonsuit,  which  was  denied  by  the  circuit 
judge,  who  held  that  this  was  the  case  of  an 
(executed  consideration,  the  payee  of  the  note 
liad  been  put  to  trouble,  and  had  by  his  ad- 
dress induced  Blatherwick  to  reduce  his  de- 
mands for  the  farm,  which  was  an  act  bene- 
ficial to  the  defendant,  upon  which  a  promise 
to  pay  could  be  sustained;  that  no  actual  re- 
(luest  from  Judson  to  Swift  to  render  tlie  serv- 
ices performed  was  necessary  to  be  shewn — 
that  the  law  would  imply  a  request.  The 
jury,  under  the  direction  of  the  judge,  found 
a  verdict  for  the  plaintiff,  which  the  defend- 
ant cow  moves  to  set  aside. 

J.  A.  Spencer,  for  plaintiff.  B.  Davis  Noxon, 
for  defendant. 

BRONSON,  J.  The  note  was  given  on  a 
past  or  executed  consideration.  It  was  to 
compensate  Swift  for  what  he  had  done  in 
negotiating  for  the  farm,  and  obtaining  the 
offer  of  better  terms  than  Blatherwick  had 
proposed  to  accept  when  the  defendant  Avas  in 
treaty  for  the  purchase.  I  am  unable  to  see 
how  this  makes  out  a  good  consideration  for 
the  promise.  Swift  had  not  acted  for  the  de- 
fendant, but  for  himself.  The  defendant  had 
relinquished  all  idea  of  purchasing  the  farm 
before  Swift  commenced  treating  for  it;  and 
Swift  neither  acted  at  the  defendant's  request, 
nor  with  any  view  to  his  benetit:  and  beyond 
this,   Swift  had  accomplished  nothing,   in  a 


legal  point  of  view.  If  a  verbal  contract  had 
been  completed,  it  would  have  been  void  under 
the  statute  of  frauds.  But  he  had  not  even 
made  a  void  contract,  if  such  an  expres.sion 
may  be  tolerated.  He  had  only  got  an  offer 
of  terms  from  Blatherwick,  and  had  told  liim 
he  thought  he  should  take  the  farm.  The 
owner  was  under  no  obligation,  not  even  hon- 
orary, to  sell  upon  tho.so  term.s,  or  to  give 
Swift  a  preference  over  any  other  person,  on 
whatever  terms  he  might  ultimately  conclude 
to  part  with  his  property. 

Services  voluntarily  rendered,  though  they 
may  be  beneficial  to  another,  impose  no  legal 
obligation  upon  the  party  benefited.  Bartholo- 
mew v.  Jackson,  20  Johns.  28.  The  serv- 
ices must  be  rendered  upon  request  (Dunbar 
V.  Williams,  10  Johns.  2.7J);  and  in  counting 
upon  a  past  consideration,  a  request  must,  in 
general,  be  alleged  (Comstock  v.  Smith,  7 
Johns.  87;  Parker  v.  Crane,  G  Wend.  647).  It 
it  not  necessary  that  there  should  be  direct 
evidence  of  a  request.  This,  like  most  other 
facts,  may  be  established  by  presumptive  evi- 
dence; and  the  beneficial  nature  of  the  serv- 
ices, though  not  enough  when  standing  alone, 
may  be  very  important  in  a  chain  of  circum- 
stances tending  to  establish  the  presumption. 
1  Saund.  2G4,  note  1;  Oatfleld  v.  Waring,  14 
Johns.  ISS.  See,  also.  Doty  v.  Wilson,  Id. 
378.  But  here  the  services  were  not  beneficial 
to  the  defendant;  and  besides,  we  see  that 
they  were  not  and  could  not  have  been  ren- 
dered upon  request.  Swift  was  not  acting  for 
the  defendant  in  the  negotiation  with  Blath- 
erwick, but  for  himself. 

We  are  referred  to  cases  where  it  has  been 
said  that  a  moral  obligation  is  a  sufficient 
consideration  to  support  an  express  promise. 
Stewart  v.  Eden,  2  Caines,  150;  Doty  v.  Wil- 
son, 14  Johns.  378;  Lee  v.  Muggeridge,  5 
Taunt.  37.  But  this  rule  must  be  taken  with 
some  quahfications.  The  moral  obligation  to 
pay  a  debt  barred  by  the  statute  of  limita- 
tions, or  an  insolvent's  discharge,  or  to  pay  a 
debt  contracted  during  infancy  or  coverture, 
and  the  like,  will  be  a  good  consideration  for 
an  express  promise.  But  a  merely  moral  or 
conscientious  obligation,  unconnected  with 
any  prior  legal  or  equitable  claim,  is  not 
enough.  3  Bos.  &  P.  240,  note;  Smith  v. 
Ware,  13  Johns.  257;  Lawes'  PI.  Assump.  54; 
10  Johns.  283,  note.  But  here  the  defendant 
was  under  no  obligation  of  any  kind  to  Swift. 
Nothing  had  been  done  at  his  request,  or  for 
his  benefit.  What  Swift  had  done  in  negotiat- 
ing for  the  farm  was  no  more  beneficial  to 
the  defendant,  than  it  was  to  every  other  man 
in  the  state  who  might  wish  to  buy  a  farm. 

The  plaintiff  has  often  failed  upon  an  ex- 
press promise,  in  much  stronger  cases  than 
this.  I  will  only  refer  to  two  or  three.  In 
Hunt  V.  Bate,  Dyer,  272.  the  plaintiff  had, 
witliout  request,  become  bail  for  the  defend- 
ant's servant  who  was  imprisoned,  to  the  end 
that  he  might  go  about  his  master's  business; 
and  the  defendant  afterwards  promised  to  in- 
demnify the  plaintiff.    After  verdict  upon  this 


270 


CONSIDERATION. 


promise,  the  judgment  was  arrested,  because, 
as  tlie  court  said,  "there  is  no  consideration 
wherefore  the  defendant  should  be  charged 
for  the  debt  of  liis  servant,  imless  the  master 
had  first  promised  to  discliarge  the  plaintiff 
before  the  enlargement  and  mainprize  made 
of  his  servant,  for  the  master  did  never  make 
request  to  the  plaintiff  for  his  servant  to  do  so 
much,  but  he  did  it  of  his  own  bead."  In 
Frot>r  V.  Hardenbergh,  5  Johns.  272,  the  plain- 


tiff had,  without  request,  made  valuable  Im- 
provements upon  the  defendant's  land,  ^nd 
the  defendant  afterwards  promised  to  pay 
for  those  improvements;  but  the  promise  was 
held  to  be  a  nudum  pactum,  and  judgment 
was  rendered  for  the  defendant.  The  case  of 
Smith  V.  Ware,  13  Johns.  257,  was  also  upon 
an  express  promise,  and  is  equally  decisive 
against  maintaining  IJiis  action. 
New  trial  granted. 


PAST  CONSIDERATION. 


271 


*V        POOL,  T.  HORNER  et  aL  1 

i/  ^  (20  Ati.  1036,  G4  Md.  131.)         ' 

Court  of  Appeals  of  Maryland.     Jane  24,  18S5. 

Appeal  from  Baltimore  city  court. 

Assumpsit  by  Henry  Pool  asainst  Albert 
N.  Horner  and  another,  executorw  of  Alex- 
ander H.  Horner.  Tliere  was  a  judgment 
for  defendants,  and  plaintiff  appeals. 

.\rgued  before  Alvey.  C.  J.,  and  Stone, 
MiLLEU,  Robinson,  Ritchie,  and  Bryan, 
JJ. 

Thomas  M.  Murray,  for  appellant.  IV. 
A.  Uummoud  and  J.  J.  Wade,  for  appel- 
lees. 

BRYAN,  J.  The  statement  filed  as  a  bill 
of  particulars  alleges  that  there  was  an 
agreement  between  the  plaintiff  below 
and  the  testator  of  defendants  that,  for 
certain  valuable  ..'onsider^^'""^  V^^  said 
testator  would  buy  a  house  and  lot  for 
plaintiff,  and  permit  him  to  occupy  it,  and, 
if  plaintiff  could  dhtain  a  larger  price  than 
the  said  testatbr  paid  for  it,  that  he  would 
pay  to  the  plaintiff  what  might  be  ob- 
tained for  it,  over  and  above  the  priceorig- 
inally  paid  for  it.  The  consideration  on 
the  part  of  the  plaintiff  was  that  he  fjave 
a  note  for  $150,  because  of  an  old  debt  for 
fl25  which  he  owed  the  testator,  and  that 
he  agreed  to  pay  him  annually  the  inter- 
est on  the  purchase  money  of  the  house 
and  lot,  and  all  taxes,  insurance,  and 
ground-rent  thereon,  and  agreed  to  keep 
the  house  in  good  repair.  The  plaintiff 
paid  the  note,  and  all  interest  due  on  it, 
and  performed  all  the  other  stipulations 
of  his  agreement.  The  house  and  lot  cost 
$],4G5,  and  were  sold,  at  the  desire  and  re- 
quest of  the  plaintiff,  for  the  sum  of  f  1,700 
by  the  testator,  who  received  the  purchase 
money,  and  thereupon  agreed  to  pay  the 
plaintiff  the  sum  of  $2o5,  and  afterwards, 
uy  various  occasions,  promised  to  pay  the 
same."  ine  coi>tracf  thus  alleged  was  i of 
Hie  (JUrchase  of  an  interest  in  land,  for  the 
sale  of  it  under  certain  circumstances,  and 
for  the  paj'ment  to  the  plaintiff  of  a  por- 
tion  of  the  price  received   bj'  the  owner. 

Being  by   Pnrnli    '^    ^/^rn^a     fnlly    «7itliir.     XliB 

iouriji  section  of  the  statute  of  frauds,  as 
m  ucfi  so  as  that  set  up  in  White  v.  Coombs, 
27  Md.  4S'J.  The  plaintiff  could  not  have 
maintained  an  action  on  this  contract 
while  it  was  executory,  but  the  testator's 


express  promise  to  pay,  after  it  was  exe- 
cuted, introduced  a  new  feature  into  the 
transaction.  It  is  stated,  in  the  notes  to 
Osborne  v.  Rogers,  1  Wms.  Saund.  l!04c,  as 
a  settled  rule,  "that  a  past  consider.ition 
Is  not  sullicient  to  support  a  subsequent 
promise,  unless  there  was  a  request  of  the 
party,  express  or  implied,  at  the  time  of 
performing  the  consideration;  but.  \\:lm:e 
liicrjeL^ssLUij.  an  exj^ress  rcqucst^at .tliejtlme. 
\t  wonldj^.Jn  MnT-ases.lje  sufligicut  to.bup- 
pdrl;  a  subsequent  promise."  This  doc- 
TiTTie  seems  to  have  been  held  uniformly 
ever  since  the  case  of  Lampleigb  v.  Brath- 
wait,  decided  in  the  reign  of  James  I.,  and 
reported  in  1  Smith,  Lead.  (as.  222.  The  \ 
case  is  thus  stated  :  The  defendant,  having  \ 
feloniously  slain  one  Patrick  Mahume,  re-  \ 
quired  the  plaintiff  to  endeavor  to  ob-  \ 
tain  a  pardon  for  him  from  the  king,  and  | 
the  plaintiff  journeyed  and  labored,  at  his  j 
own  charges,  and  by  every  means  in  hi.s  | 
power,  to  effect  the  desired  object,  and  the  i 
defendant  afterwards,  and  in  consideration  , 
of  the  premises,  promised  to  give  the  plain- 
tiff £100.  It  was  held  that,  although  the 
consideration  was  passed  and  gone  before 
the  promise  was  made,  yet,  inasmuch  as 
the  consideration  was  moved  by  the  pre- 
vious suit  or  reqnest  of  the  party,  the 
promise  was  binding,  and  capable  of  sus- 
taining an  action.  And,  in  another  case, 
the  plaintiff  brought  his  action  upon  a 
promise  made  by  the  defendant  to  pay  the 
plaintiff  £20,  in  con.sideration  that  the 
plaintiff,  at  the  instance  of  the  defendant, 
had  taken  to  wife  the  cousin  of  the  de- 
fendant. It  was  held  that  the  action  wag 
maiutainable,  alth(mgh  the  marriage  was 
executed  and  past  before  the  undertaking 
and  promise  were  made,  because  the 
marriage  ensued  at  the  request  of  the  de- 
fendant. Hunt  V.  Bate,  3  Dj-er,  272^.  So, 
it  seems  to  be  clear  that  the  payment  of 
the  note  for  $150  by  the  plaintiff,  at  the 
request  of  the  testator,  and  the  perform- 
ance of  the  other  considerations  by  him, 
are  sufficient  to  support  the  promise  made 
by  the  testator  to  pay  the  .5235.  Some  of 
the  testimony  offered  by  the  plaintiff  did 
not  conform  with  exactness  to  the  bill  of 
particulars;  but  the  greater  portion  of  it 
tended  to  prove  the  facts  therein  stated. 
It  was  error  in  the  court  to  exclude  the 
whole  of  it.  Carroll's  Lessee  v.  Manufact- 
uring Co.,  11  Md.  399.  Judgment  re- 
versed, and  new  trial  awarded. 


272 


CONSIDERATION. 


1   y  BOOTHE  V.  FITZPATRICK. 

V  (36  Vt.  6S1.) 

Snpreme    Court   of    Vermont.     Rutland. 
Term,  1864. 


1% 


\  V 


Feb. 


Book  account.  The  auditor  reported 
that  some  time  prior  to  the  last  o!  Au- 
gust, ISGO,  the  defendant's  bull  was  im- 
pounded bj'  one  Matthew  Fox  in  Chitten- 
den ;  that  said  bull  by  some  means  es- 
caped from  the  pound  and  got  into  the 
I)laintiff's  pasture  in  Pittsford,  about  the 
1st  of  September,  1860,  and  was  kept  by 
the  plaintiff  from  that  time  until  about 
the  20th  of  May  following,  when  the  de- 
fendant took  him  away.  Tlie  plaintiff  did 
not  know  who  was  owner  of  the  animal, 
when  it  came  into  his  pasture  as  above 
stated,  but  he  mtide  frequent  inquiries  in 
order  to  ascertain  its  owner.  In  the  lat- 
ter pari  of  November,  1S60,  the  plaintiff 
having  ascertained  that  the  defendant 
was  the  owner  of  said  bull,  sent  word  to 
the  defendant  that  he,  the  plaintiff,  had 
the  defendant's  bull;  butitdid  not  appear 
that  the  defendant  got  the  word  at  that 
time.  Some  time  after  this,  but  at  what 
time  did  not  dcfinitelj'  appear,  the  plain- 
tiff met  the  defendant  In  Pittsford,  and 
described  the  bull  in  his  possession  to  the 
defendant,  who  thereupon  said  it  was  his, 
and  that  he  would  pay  him,  (the  plain- 
tiff) for  keeping;  but  also  said  to  the 
plaintiff  that  Fox,  who  had  impounded 
the  bull,  should  pay  for  it.  Sometime  after 
the  interview  last  referred  to,  the  defend- 
ant went  to  the  plaintiff  in  Pittsford  and 
saw  the  bull,  told  the  plaintiff  that  it  was 
his,  and  that  he  would  pay  the  plaintiff 
for  keeping,  but  did  not  drive  him  away 
at  that  time.  The  plaintiff  kept  the  bull 
through  the  winter,  and  at  a  reasonable 
time  in  the  spring  turned  him  out  to  past- 
ure, when  becoming  troublesome,  the 
plaintiff  went  to  see  the  defendant  in  re- 
gard to  taking  him  away.  The  de- 
*682  fendant  on  this  occasion  *informed 
the  plaintiff  that  he  would  come  and 
take  him  away  the  next  day,  and  did,  and 
at  the  same  time  offered  the  plaintiff  his 
note  for  the  amount  charged  for  keeping. 
Tlie  plaintiff  did  not  accept  the  note,  but 
told  the  defendant  that  he  might  leavethe 
amount  with  one  Duncklee  for  the  plain- 
tiff, to  which  the  defendant  assented;  but 
the  defendant  did  not  leave  the  amount 
with  Duncklee,  and  the  plaintiff's  claim  for 
keeping  the  bull  remains  unpaid.  The 
amount  charged  was  reasonable,' and  no 
more  than  a  fair  compensation  for  the 
keeping. 

The  plaintiff  ascertained  who  the  owner 
of  the  animal  was,  but  at  what  time  did 
not  certainly  appear,  the  plaintiff  adver- 
tised said  bull  as  an  estray  by  posting  up 
three  notices  in  the  town  of  Pittsford, 
where  the  bull  was  taken  up;  but  no  no- 
tice was  published  in  a  newspaper,  al- 
though three  were  published  in  tiie  county, 
nor  was  any  copy  left  at  the  town  clci-k's 
ofhce.  Said  bull  was  worth,  when  taken 
up  and  advertised  as  above  stated,  the 
Bum  of  twelvedollars.  The  plaintiff  made 
no  entry  of  his  claim  on  his  book  of  ac- 
counts, nor  did  it  appear  that  the  plain- 
tiff kept  such  book. 

On    the    auditor's    report,—  the    court. 


March  Term,  1863,  Kellogg,  J.,  presiding, 
rendered  a  judgment  in  favor  of  the  plain- 
tiff.    Exceptions  by  the  defendant. 

Edpcrton  &  Paul,  for  the  plaintiff. 

Reuben  R.  Thrall,  for  the  defendant. 

PECK,  J.  Thedefendant'scounsel,  with- 
out distinction  between  the  part  of  the 
account  that  accrued  befoi-e  the  defend- 
ant's promise  to  pay,  and  that  which  ac- 
crued after,  insists  that  the  promise  was 
made  upon  a  past  consideration  and  not 
binding,  in  as  much  as  there  was  never 
any  previously  existing  legal  obligation. 
As  to  all  that  part  of  the  account  that  ac- 
crued after  the  defendant  made  his  first 
promise  to  pay  for  the  keeping,  the  plain- 
tiff's right  to  recover  is  clear,  as  the  sub- 
sequent keeping  must  be  taken  to  have 
been  upon  the  faith  of  that  promise. 
When  the  defendant  promised  to  take  the 
bull  away  and  jjay  for  the  keeping,  the 
parties  must  have  understood  that 
the  defendant  *was  to  pay  for  the  *683 
keeping  till  he  should  take  the  bull 
away.  As  to  the  prior  portion  of  the 
keeping,  the  promise  was  upon  a  past 
consideration,  and  the  question  is  wheth- 
er this  is  a  legal  objection  to  a  recovery. 
It  is  urged  that  without  an  express  prom- 
ise there  was  at  most  but  a  moral  obliga- 
tion, and  that  a  moral  obligation  is  not 
sufficient  to  give  a  legally  binding  force  to 
an  express  promise,  except  in  cases  where 
there  had  once  existed  a  legal  obligation, 
as  in  case  of  a  debt  barred  by  the  statute 
of  limitations  or  by  a  discharge  in  bank- 
ruptcy. This  is  so  said  in  some  reported 
cases,  but  no  case  is  cited  in  which  the 
question  involved  and  decided  establishes 
this  as  a  general  proposition.  That  it  is  not 
so,  is  evident  from  the  cases  in  which  it  is 
decided  that  a  minor  making  a  contract 
may  bind  himself  by  a  promise  made  after 
arriving  at  the  age  of  majority  without 
a  new  consideration.  In  such  case  there 
is  no  legal  obligation  previously  existing, 
and  yet  the  promise  is  binding.  The  same 
may  be  said  of  another  class  of  cases 
where  the  consideration  has  enured  to  the 
benefit  of  the  defendant,  but  without  any 
request  on  his  part,  in  which  it  is  held 
that  a  subsequent  promise  is  equivalent 
to  a  previous  request,  and  creates  a  legal 
liability,  where  none  existed  before  for 
want  of  a  request.  If  the  consideration, 
even  without  request,  moves  directly  from 
the  plaintiff  to  the  defendant  and  enures 
directly  to  the  defendant's  benefit,  the 
promise  is  binding,  though  made  upon  a 
past  consideration.  In  this  case  there 
was  such  consideration.  The  plaintiff 
parted  with  what  was  of  ralue  to  him, 
and  it  enured  directly  to  the  benefit  of  the 
defendant.  A  promise  upon  such  past 
consideration  is  binding.  This  principle 
is  fundamental  and  elementary,  and  is 
sustained  by  abundant  authority.  But 
for  the  defendant's  promise  the  plaintiff 
could  not  recover  for  want  of  a  request 
on  the  part  of  the  defendant,  as  one  can 
not  thus  be  made  debtor  without  his  as- 
sent. The  promise  of  the  defendant  obvi- 
ates this  objection,  it  l)eing  equivalent  to 
a  previous  request.  The  cases  cited  by 
the  defendant's  counsel  to  shoAV  tiiat  a 
moral   obligation  is  not  a  good   consider- 


PAST  CONSIDERATION. 


273 


ation  for  an  express  promise,  except  where 
there  bad  been  a  previous  lepal  oblij?a- 
tion,  are  not  in  conflict  with  tlioso  prin- 
ciples. It  Is  true  there  are  some  ex- 
•684  pressions  used  *by  judges  that 
taken  literally  without  reference  to 
the  case  then  under  consideration,  would 
seem  to  bo  irreconcilable  with  this  view. 
The  language  in  these  cases  must  be  un- 
derstood in  reference  to  the  cases  in  which 
the  language  is  used.  They  wore  cases 
where  the  defendant  had  received  no  con- 
elderatiou  beneficial  to  himself;  not  like 
this,  where  the  defendant  has  received  a 
valuable  pecuniary  heuefit  at  the  expense 
of  the  plaintiff. 

HOPK.  BBL.  CAS.  CONT.— 18 


There  would  be  another  objection  to  a 
recovery  in  this  case  in  the  absence  of  a 
promise  by  the  defendant,  arising  from 
the  provision  of  the  statute  prohibiting  a 
party  who  takes  up  an  estray,  from  re- 
covering for  keeping  in  case  he  neglects  to 
advertise  as  the  statute  requires.  But  it 
was  competent  for  the  defendant  to  waive 
this  objection,  as  he  has  done  by  an  ex- 
press promise  to  pay.  There  is  no  reason 
why  he  may  not  as  well  waive  this  de- 
fence by  a  promise  to  pay,  as  the  defence 
of  tlie  statute  of  limitations  or  the  de- 
fence of  infancy.  The  plaintiff  ia  entitled 
to  recover  his  whole  account. 

Judgment  affirmed. 


274  * 


CONSIDERATION. 


EAR1.E  V.  OLIVER,! 

(2  Exch.  71.) 

ourt  of  Exchequer  of  Pleas.    Feb.  7.  1848. 

Mr.  Maynard,  for  plaintiff.  Mr.  Atherton. 
contra, 

PARKE,  B.  This  case  was  very  folly  and 
ably  ar!?ued  before  my  Brothers  ALDERSON, 
ROLFE,  PLATT,  and  myself,  at  the  sittings 
after  last  Micliaelmas  term.  Two  questions 
arose.— the  first,  as  to  the  sufficiency  of  tbe 
first  count  on  general  demurrer;  the  second, 
whether  the  pleadings  to  the  second  coimt, 
which  was  money  paid,  disclosed  a  sufficient 
defence.  The  first  count  was,  in  substance, 
on  a  promise  in  writing  by  the  defendant  to 
the  plaintiff,  in  consideration  of  the  defend- 
ant's liability,  to  repay  the  plaintiff  a  debt 
which  he  had  contracted  with  a  banking  com- 
pany as  surety  for  the  defendant  before  the 
bankruptcy;  and  the  promise  was  made,  be- 
fore the  certificate,  to  repay  the  debt  when 
the  plaintiff  should  have  paid  it,  and  also  the 
interest  on  that  debt  from  the  time  it  should 
be  paid  by  the  plaintiff  to  the  time  of  repay- 
ing by  the  defendant.  There  was  a  plea 
stating  that  the  promise  was  before  certifi- 
cate, and  a  special  demurrer  to  the  plea,  on 
the  ground  that  it  merely  stated  what  was 
admitted  before  in  the  declaration.  That  is 
true,  and  the  consequence  is,  that  the  question 
is  simply  whether  the  first  count  is  good  on 
demurrer. 

So  far  as  relates  to  the  objection  that  the 
promise  was  made  before  the  certificate,  the 
case  of  Kirkpatrick  v.  Tattersall,  13  Mees.  & 
W.  766,  is  an  answer.  It  may  be  worth 
whUe  to  state  that  a  similar  point  had  been 
previously  decided  by  Lord  Chief  Justice 
Eyre  in  the  case  of  Roberts  v.  Morgan,  2 
Esp.  736. 

The  next  objection  was  that,  although  an 
existing  debt  which  would  be  barred  by  a 
certificate,  and  which  was  due  by  the  bank- 
rupt to  the  plaintiff,  was  a  good  consideration 
to  support  a  promise  to  pay  it,  a  mere  liabil- 
ity to  repay  the  plaintiff  when  he  should 
have  first  paid  the  debt  for  the  defendant 
was  not.  This  goes  a  step  further  than  the 
cases  above  cited,  but  seems  to  us  to  fall 
within  the  same  principle.  This  liability, 
like  the  debt,  would  be  discharged  by  the 
certificate;  and  it  seems  to  us  as  just  and 
reasonable  for  the  bankrupt,  after  the  fiat, 
to  waive  the  benefit  of  his  certificate  with 
respect  to  it,  as  it  is  to  waive  it  with  respect 
to  a  debt;  and,  if  the  debt  so  discharged  is  a 
good  consideration  for  a  promise  to  pay  it, 
the  liability  which  Is  discharged  in  the  same 
Tay  is  a  good  consideration  for  a  promise  to 
continue  liable. 

Two  further  objections  were  made,  on  the 
supposition  that  this  liability  is  to  be  put  on 
the  same  footing  as  a  debt,  and  is  a  good 

1  Irrelevant  parts  omitted. 


consideration:  First,  that  this  debt  or  linbll- 
Ity,  in  a  course  of  being  barred  by  a  certifi- 
cate, cannot  be  treated  as  the  executed  con- 
sideration for  a  promise  which  a  debt  or  lia- 
bility, not  barred  by  a  certificate,  would  not 
support,  and  that  by  the  course  of  moilern 
decisions,  beginning  with  the  case  of  Hopkins 
V.  Logan,  5  Mees.  &  W.  241,  and  ending  with 
Roscorla  v.  Thomas,  3  Q.  B.  234,  a  debt  canuot 
be  laid  as  an  executed  consideration  for  any 
promise  which  the  law  would  not  imply 
from  it;  and  that  a  promise  to  pay  whenever 
the  party  was  able  was  never  implied.  The 
second  was  that  a  promise  to  pay  interest 
could  not  be  supported  by  the  consideration, 
and  was  as  objectionable  as  if  the  promise 
had  been  to  do  any  collateral  thing.  We 
think  that  these  objections  ought  not  to  pre- 
vail. 

The  strict  rule  of  the  common  law  was  no 
doubt  departed  from  by  Lord  Mansfield  in 
Hawkes  v.  Sanders,  Cowp.  290,  and  Atkins 
V.  Hill,  Id.  2S8.  The  principle  of  the  rule 
laid  down  by  Lord  Mansfield  is  that  where 
the  consideration  was  originally  beneficial  to 
the  party  promising,  yet  if  he  be  protected 
from  liability  by  some  provision  of  the  statute 
or  common-law,  meant  for  his  advantage,  he 
may  renounce  the  benefit  of  that  law;  and  if 
he  promises  to  pay  the  debt,  which  is  only 
what  an  honest  man  ought  to  do,  he  is  then 
botmd  by  the  law  to  perform  it.  There  is  a 
very  able  note  to  the  case  of  "Wennall  v.  Ab- 
ney,  3  Bos.  &  P.  252,  explaining  this  at 
length.  The  instances  given  to  illustrate  the 
principle  are,  amongst  others,  the  case  of  a 
debt  barred  by  certificate  and  by  the  statute 
of  limitations;  and  the  rule  in  these  instances 
has  been  so  constantly  followed  that  there 
can  be  no  doubt  that  it  is  to  be  considered 
•  as  the  established  law.  Debts  so  barred  are 
unquestionably  a  sufficient  consideration  for 
every  promise,  absolute  or  unqualified,  quali- 
fied or  conditional,  to  pay  them.  Promises 
to  pay  a  debt  simply,  or  by  installments,  or 
when  the  party  is  able,  are  all  equally  sup- 
ported by  the  past  consideration;  and,  when 
the  debts  have  become  payable  instanter, 
may  be  given  in  evidence  in  the  ordinary 
declaration  in  indebitatus  assumpsit.  So. 
when  the  debt  is  not  already  barred  by  the 
statute,  a  promise  to  pay  the  creditor  will 
revive  it,  and  make  it  a  new  debt,  and  a 
promise  to  an  executor  to  pay  a  debt  due  to 
a  testator  creates  a  new  debt  to  him.  But 
it  does  not  follow  that,  though  a  promise  re- 
vives the  debt  in  such  cases,  any  of  those 
debts  will  be  sufficient  consideration  to  sup- 
port a  promise  to  do  a  collateral  thing,  as  to 
supply  goods,  or  perform  work  and  labour; 
and  .so  indeed  it  was  held  in  this  court  in  the 
case  of  Reeves  v.  Hearne,  1  Moes.  &  W.  323. 
In  such  case  it  is  but  an  accord  unexecuted, 
and  no  action  will  lie  for  not  executing  it. 

We  think,  therefore,  that  the  conditional 
promise  to  pay  the  debt  would  be  good  in 
this  case,  and  supported  by  the  original  con- 
sideration;  and  a  conditional  promise,  which. 


PAST  CONSIDERATION. 


275 


whon  nbsolute,  wiU  be  only  a  renewal  of  the 
original  liability,  and  to  the  same  extent,  is 
equally  good  and  supported  by  the  original 
consideration. 

The  next  objection  relau'.s   lo  the  interest. 
It  seems  to  us  to  bt>  supported  bv  the  same 


consideration  as  the  original  promise.  The 
proral.se  is  to  pay  the  debt  conditionally;  and, 
It  the  debt  be  unpaid,  that  the  defendant  wiU 
pay  Interest  for  It  We  are  of  opinion,  there- 
fore, that  the  first  count  Is  good. 


CAPACITY  OF  PARTIES. 


/ 


UNITED  STATES  v.  TINGEY. 

(5  Pet.  115.) 

Snpreme  Court  of  the  United  States.     Jan. 
Term.  1831. 


Atty.  Gen.  Berrien,  and  Dist.  Atty.  Swann, 
for  plaintiffs.    Coxe  &  Jones,  contra. 

STORY,  J.  This  is  a  writ  of  error  to  the 
circuit  court  of  the  District  of  Columbia,  sit- 
ting at  Washington.  The  original  action  was 
brought  by  the  United  States  upon  a  bond 
executed  by  Lewis  Deblois,  and  by  Thomas 
Tingey  and  others  as  his  sureties,  on  the  1st 
of  May,  1S12,  in  the  penal  sum  of  $10,000, 
upon  condition  that  if  Deblois  should  regu- 
larly account,  when  thereto  required,  for  all 
public  moneys  received  by  him,  from  time 
to  time,  and  for  all  public  property  com- 
mitted to  his  care,  with  such  person  or  per- 
sons, officer  or  officers  of  the  government  of 
the  United  States  as  should  be  duly  author- 
ized to  settle  and  adjust  his  accounts,  and 
sliould,  moreover,  pay  over,  as  might  be  di- 
rected, any  sum  or  sums  that  might  be  found 
due  to  the  United  States  upon  any  such  settle- 
ment or  settlements,  and  should  also  faith- 
fully discharge,  in  every  respect,  the  trust 
reposed  in  him,  then  the  obligation  to  be 
void,  &c.  In  point  of  fact,  Deblois  was  at 
the  time  a  purser  in  the  navy,  though  not 
so  stated  in  the  condition;  and  there  is  an 
indorsement  upon  the  bond,  which  is  averred 
in  one  of  the  counts  of  the  declaration  to 
have  been  contemporaneous  with  the  execu- 
tion of  the  bond,  which  recognizes  his  char- 
acter as  purser,  and  limits  his  responsibility 
as  such;  and  the  bond  was  unquestionably 
taken,  as  the  pleadings  show,  to  secure  his 
fidelity  in  office  as  purser. 

The  declaration  contains  two  counts:  one 
in  the  common  form  for  the  penalty  of  the 
bond;  and  a  second  setting  forth  the  bond, 
condition,  and  indorsement,  and  averring  the 
character  of  Deblois,  as  purser,  his  receipt 
of  public  moneys,  and  the  refusal  to  account, 
&c.,  in  the  usual  form. 

Several  pleas  were  pleaded,  upon  some  of 
which  issues  In  fact  were  joined.  To  the 
third,  fourth,  fifth,  sixth,  and  eighth  pleas,  the 
United  States  demurred,  and  judgment  up- 
on the  demurrers  was  given  for  the  defend- 
ant in  the  circuit  court;  and  the  object  of 
the  present  writ  of  error  Is  to  revise  that 
judgment. 

There  is  no  statute  of  the  United  States 
expressly  defining  the  duties  of  pursers  in 
the  navy.  What  those  duties  are,  except  so 
far  as  they  are  incidentally  disclosed  in  pub- 
lic laws,  cannot  be  judicially  known  to  this 
court.  If  they  are  regulated  by  the  usages 
and  customs  of  the  navy,  or  by  the  official 
orders  of  the  navy  department,  they  proper- 
ly constitute  matters  of  averment,  and 
should  be  spread  upon  the  pleadings.  It 
may  be  gathered,  however,  from  some  of  the 
public  acts  regulating  the  departments,  that 


a  purser,  or  as  the  real  name  originally  was, 
a  burser,  is  a  disbursing  officer,  and  liable 
to  account  to  the  government  as  such.  The 
act  of  the  3d  of  INlarch,  1809,  c.  95,  §  3  (2  Stat. 
530),  provided  that,  exclusively  of  the  pur- 
veyor of  public  supplies,  paymasters  of  the 
army,  pursers  of  the  navy,  &c.,  no  other  per- 
manent agents  should  be  appointed  either  for 
the  purpose  of  making  contracts,  or  for  the 
purchase  of  supplies,  or  for  the  disburse- 
ment in  any  other  manner  of  moneys  for  the 
use  of  the  military  establishment,  or  of  the 
navy  of  the  United  States;  but  such  as 
should  be  appointed  by  the  president  of  the 
United  States  with  the  advice  and  consent 
of  the  senate.  And  the  next  section  (sec- 
tion 4)  of  the  same  act  provided  that  every 
such  agent  and  every  purser  of  the  navy 
should  give  bond,  with  one  or  more  sureties, 
in  such  sums  as  the  president  of  the  United 
States  should  direct,  for  the  faithful  dis- 
charge of  the  trust  reposed  in  him;  and  that, 
whenever  practicable,  they  should  keep  the 
public  money  in  their  hands  In  some  incor- 
porated bank,  to  be  designated  by  the  presi- 
dent, and  should  make  monthly  returns  tO' 
the  treasury  of  the  moneys  received  and  ex- 
pended during  the  preceding  month,  and  of 
the  unexpended  balance  in  their  hands. 
This  act  abundantly  shows  that  pursers  are 
contemplated  as  disbursing  officers  and  re- 
ceivers of  public  money,  liable  to  account  to 
the  government  therefor.  The  act  of  the 
30th  of  March,  1812,  c.  47  (2  Stat.  699),  made 
some  alterations  in  the  existing  law,  and 
required  that  the  pursers  in  the  navy  should 
be  appointed  by  the  president,  by  and  with 
the  advice  and  consent  of  the  senate;  and 
that  from  and  after  the  1st  day  of  May  then 
next,  no  person  should  act  in  the  character 
of  purser  who  should  not  have  been  so  nom- 
inated and  appointed,  except  pursers  on  dis- 
tant service,  &c.;  and  that  every  purser,  be- 
fore entering  upon  the  duties  of  his  office, 
should  give  bond  with  two  or  more  sufficient 
sureties,  in  the  penalty  of  $10,000,  condition- 
ed faithfully  to  perform  all  the  duties  of 
purser  in  the  navy  of  the  United  States. 
This  act,  so  far  as  respects  pursers  giving 
bond,  and  the  imports  of  the  condition,  beings 
in  pari  materia,  operates  as  a  virtual  repeal 
of  the  former  act.  The  subsequent  legisla- 
tion of  congress  is  unimportant,  as  it  does 
not  apply  to  the  present  case. 

It  is  obvious  that  the  condition  of  the 
present  bond  is  not  in  the  terms  prescribed 
by  the  act  of  1812,  c.  47,  and  it  is  not  limited 
to  the  duties  or  disbursements  of  Deblois,  as 
purser,  but  creates  a  liability  for  all  moneys 
received  by  him,  and  for  all  public  property 
committed  to  his  care,  whether  officially  as 
purser,  or  otherwise. 

Upon  this  posture  of  the  case  a  question 
has  been  made  and  elaborately  argued  at  the 
bar,  how  far  a  bond  voluntarily  given  to  the 
United  States,  and  not  prescribed  by  law, 
is  a  valid  instrument,  binding  upon  the  par- 


THE   GOVERNMENT. 


277 


ties  In  point  of  law;  In  other  words,  wheth- 
er the  United  Slates  have,  in  their  political 
capacity,  a  right  to  enter  into  a  contract,  or 
to  take  a  bond  in  cases  not  previously  pro- 
vided for  by  some  law.  Upon  full  consider- 
ation of  this  subject,  we  are  of  opinion  that 
the  United  States  have  such  a  capacity  to 
enter  into  contracts.  It  is,  in  our  opinion, 
an  incident  to  the  general  rip:ht  of  sovereign- 
ty; and  the  United  States  being  a  body  poli- 
tic, may,  witliiu  the  sphere  of  the  constitu- 
tional powers  confided  to  it,  and  through 
the  instrumentality  of  the  proper  department 
to  which  those  powers  are  confided,  enter 
into  contracts  not  prohibited  by  law,  and 
appropriate  to  the  just  exercise  of  those 
powers.  This  principle  has  been  already  act- 
ed on  by  this  court,  in  the  case  of  Dugan  v. 
U.  S.,  3  Wheat.  172;  and  it  is  not  perceived 
that  there  lies  any  solid  objection  to  it.  To 
adopt  a  different  principle,  would  be  to  deny 
tlie  ordinary  rights  of  sovereignty,  not  mere- 
ly to  the  genenil  government,  but  even  to 
the  state  governments  within  the  proper 
sphere  of  their  own  powers,  unless  brought 
into  operation  by  express  legislation.  A  doc- 
trine, to  such  an  extent,  is  not  known  to  this 
court  as  ever  having  been  sanctioned  by  any 
judicial  tribunal. 

We  have  stated  the  general  principle  only, 
without  attempting  to  enumerate  the  limita- 
tions and  exceptions  which  may  arise  from 
tlie  distribution  of  powers  in  our  govern- 
ment, or  from  the  operation  of  other  pro- 
visions in  our  constitution  and  laws.  We 
confine  ourselves,  in  the  application  of  the 
principle,  to  the  facts  of  the  present  case, 
leaving  other  cases  to  be  disposed  of  as  they 
may  arise;  and  we  hold  that  a  voluntary 
bond,  taken  by  authority  of  the  proper  of- 
ficers of  the  treasurj-  department,  to  whom 
the  disbursement  of  public  moneys  is  Intrust- 
ed, to  secure  the  fidelity  in  official  duties 
of  a  receiver  or  an  agent  for  disbtirsery  of 
public  moneys,  is  a  binding  contract  between 
him  and  his  sureties  and  the  United  States. 
although  such  bond  may  not  be  prescribed 
or  required  by  any  positive  law.  The  right 
to  take  such  a  bond  is,  in  our  view,  an  in- 
cident to  the  duties  belonging  to  such  a  de- 
partment; and  the  United  States  having  a 
political  capacity  to  take  it,  we  see  no  objec- 
tion to  Its  validity  in  a  moral  or  a  legal 
view. 

Having  disposed  of  this  question,  which 
lies  at  the  very  threshold  of  the  cause,  and 
meets  us  upon  the  face  of  the  second  count 
In    the   declaration,    it    remains    to    consider  i 


whether  any  one  of  the  pleas  demurred,  to 
constitutes  a  good  bar  to  the  action. 

Without  adverting  to  others,  which  are 
open  to  serious  objections  on  account  of  the 
looseness  and  generality  of  their  texture,  we 
are  of  opinion  that  the  fifth  plea  is  a  com- 
plete answer  to  the  action.  That  plea,  after 
setting  forth  at  large  the  act  of  1812  respect- 
ing pursers,  proceeds  to  state  that,  before 
the  execution  of  the  bond,  the  navy  depart- 
ment di  1  cause  the  same  to  be  prepared  and 
transmitted  to  Deblois,  and  did  require  and 
demand  of  him  that  the  same,  with  the  con- 
dition, should  be  executed  by  him  with  suf- 
ficient sureties,  before  he  should  be  permit- 
ted to  remain  in  the  office  of  purser,  or  to 
receive  the  pay  and  emoluments  attached 
to  the  office  of  purser;  that  the  condition  of 
the  bond  is  variant  and  wholly  different 
from  the  condition  required  by  the  said  act 
of  congress,  and  varies  and  enlarges  the  du- 
ties and  responsibilities  of  Deblois  and  his 
sureties;  and  "that  the  same  was  under 
color  and  pretence  of  the  said  act  of  con- 
gi'ess,  and  under  color  of  office  required  and 
extorted  from  the  said  Deblois,  and  from  the 
defendant,  as  one  of  his  sureties,  against 
the  form,  force,  and  effect  of  the  said  stat- 
ute, by  the  then  secretary  of  the  navy." 

The  substance  of  this  plea  is  that  the  bond, 
with  the  above  condition,  variant  from  that 
prescribed  by  law  was  under  color  of  office 
extorted  from  Deblois  and  his  sureties,  con- 
trary to  the  statute,  by  the  then  secretary-  of 
the  navy,  as  the  condition  of  his  remaining 
in  the  office  of  purser,  and  receiving  its 
emoluments.  There  is  no  pretence,  then,  to 
say  that  it  was  a  bond  voluntarily  given, 
or  that  though  different  from  the  form  pre- 
scribed by  the  statute,  it  was  received  and 
executed  without  objection.  It  was  demand- 
ed of  the  party,  upon  the  peril  of  losing  his 
office;  it  was  extorted  under  color  of  office 
against  the  requisitions  of  the  statute.  It 
was  plainly,  then,  an  illegal  bond;  for  no  of- 
ficer of  the  government  has  a  right,  by  color 
of  his  office,  to  require  from  any  subordi- 
nate officer,  as  a  condition  of  holding  office, 
that  he  should  execute  a  bond  with  a  con- 
dition different  from  that  prescribed  by  law. 
That  would  be,  not  to  execute,  but  to  super- 
sede the  requisitions  of  law.  It  would  be 
very  different  where  such  a  bond  was  by 
mistake  or  otherwise  voluntarily  substituted 
by  the  parties  for  the  st.ntute  bond,  without 
any  coercion  or  extortion  by  color  of  office. 

The  judgment  of  the  circuit  court  Is  affirm- 
ed. 


CAPACITY  OF  PARTIES. 


v. 


'^ 


\ 


WHITNEY  et  aL  v 
(14   Mass. 


DUTCH 

457.) 


Supreme  Court  of  Massachusetts, 
March  Term,  1817. 


et  *1.  (^  V 

SuffolS.\ 


Assumpsit  on  a  promissory  note;  made  ay 
the  defendants  to  the  pLiintiEEs,  on  the  ISth 
of  December,  ISll,  for  847  dollars  76  cents. 

The  defendant  Dutch  was  defaxilted.  The 
defendant  Green  pleaded  1st.  The  general 
issue:  21y.  That  he  was  under  age  at  the 
time  when  the  note  was  made.— The  plain- 
tiffs replied,  that  after  he  came  of  age,  he 
agreed  to  and  confirmed  the  promise;  to 
which  he  rejoined,  that  he  did  not  so  agree; 
on  which  also  issue  was  joined. 

It  appeared  at  the  trial,  which  was  had  at 
the  last  November  term  in  this  county  before 
Jackson,  J„  that  Dutch  &  Green,  while  the 
latter  was  under  age,  had  agreed  to  be  part- 
ners, and  as  such,  had  often  dealt  with  the 
plaintiffs.  The  note  in  question  was  signed 
by  Dutch,  using  the  firm  and  style  of  the 
house  of  Dutch  &  Green,  at  a  time  when  the 
latter  was  under  age. 

In  March,  1816,  after  Green  arrived  at  full 
age,  the  plaintiffs  applied  to  him  for  payment 
of  the  note;  when  he  acknowledged  that  it 
was  due,  and  promised  that  on  his  return  to 
Eastport,  where  he  resided,  he  would  en- 
deavour to  procure  the  money  and  send  it  to 
the  plaintiffs:  saying  at  the  same  time  that 
it  was  hard  for  him  to  pay  it  twice;  he  al- 
leging, as  it  was  understood,  that  the  sup- 
posed partnerehip  had  been,  a  long  time  be- 
fore, dissolved;  and  that  Dutch  had  taken 
the  whole  stock,  and  agreed  to  pay  all  the 
debts  of  the  company. 

The  counsel  for  the  defendant  contended, 
that  the  implied  power  of  one  partner  to  bind 
the  other,  was  void  in  this  case;  as  Green 
was  a  minor  at  the  time  of  making  the  note, 
and  therefore  could  not  empower  any  agent 
or  attorney  to  bind  him  in  any  manner;  that 
the  note  was  therefore  void  as  to  him.  and 
not  merely  voidable;  and  so  the  supposed 
promise  could  not  be  confirmed  or  ratified  by 
the  subsequent  promise  or  agreement,  which 
was  proved,  as  above-mentioned. 

The  judge,  intending  to  reserve  the  ques- 
tion for  the  consideration  of  the  whole  com't, 
directed  a  verdict  for  the  plaintiffs  on  both 
Issues,  which  was  returned  accordingly. 

If  the  court  should  be  of  opinion  that  the 
defendant  Green  was,  under  these  circum- 
stances, liable  to  the  plaintiffs  for  the  amount 
due  on  this  note,  the  verdict  was  to  stand, 
and  judgment  entered  accordingly;  otherwise 
the  verdict  was  to  be  set  aside,  and  a  verdict 
entered  for  the  defendants. 

Mr.  Thurston,  for  plaintiffs.  Mr.  Leland, 
for  defendants. 

PARKER,  C.  J.  The  question  presented  to 
the  court  in  this  case,  and  which  has  been 
argued  is,  whether  the  issue  on  the  part  of 


the  plaintiffs  is  maintained  by  the  evidence 
reported. 

The  first  objection  taken  by  the  defend- 
ants' counsel  is,  that  no  express  promise  is 
proved,  after  the  coming  of  age  of  the  de- 
fendant—By the  authorities,  a  mere  acknowl- 
edgment of  the  debt,  such  as  would  take  a 
case  out  of  the  statute  of  limitations,  is  not 
a  ratification  of  a  contract  made  during  mi- 
nority. The  distinction  is  undoubtedly  well 
taken.  The  reason  is,  that  a  mere  acknowl- 
edgment avoids  the  presumption  of  payment, 
which  is  created  by  the  statute  of  limitations; 
whereas  the  contract  of  an  infant  may  al- 
ways, except  in  certain  cases  sufficiently 
known,  be  voided  by  him  by  plea,  whether 
he  acknowledges  the  debt  or  not:  and  some 
positive  act  or  declaration  on  his  part,  is 
necessarj'^  to  defeat  his  power  of  avoiding  it. 

But  the  terms  of  ratification  need  not  be 
such  as  to  import  a  direct  promise  to  pay. 
All  that  is  necessary  is,  that  he  expressly 
agrees  to  ratify  his  contract;  not  by  doubtful 
acts,  such  as  payment  of  a  part  of  the  money 
due,  or  the  interest;  but  by  words,  oral  or 
in  writing,  which  import  a  recognition  and  a 
confirmation  of  his  promise. 

In  thepresent  case,  the  defendant  acknowl- 
edged that  the  rnoney"  was  due,  when  called 
upon  to  pay  the  demand;  and  promised  that 
he  wouldljendeavour  to  procure  the  money 
upon  his  return  home,  and  senri  it  tn  the 
plaintiff.  This  was  sufficient  to  satisfy  the 
jury,  that  he  assented  to  and  ratified  the 
original  promise:  for  it  would  be  a  distortion 
of  language,  to  suppose  that  he  meant  only 
to  endeavour  to  persuade  Dutch,  to  pay  the 
money;  and  if  he  succeeded,  that  he,  Green, 
would  send  it  to  the  plaintiff. 

But  the  other  point  made  in  the  defence  is 
more  difficult,  and  presents  a  question  new 
to  us  all.  This  is,  that  the  note,  being  signed 
by  Dutch  for  Green,  was  void  in  regard  to 
Green;  because  he  was  not  capable  of  com- 
municating authority  to  Dutch,  to  contract 
for  him;  and  that  being  void,  it  is  not  the 
subject  of  a  subsequent  ratification. 

No  such  question  appears  to  have  occurred 
in  our  courts,  nor  in  those  of  England,  or  of 
the  neighbouring  states.  Partnerships  have 
not  been  uncommon  between  adults  and  in- 
fants; and  simple  contracts,  signed  by  one 
for  both,  undoubtedly  have  often  been  made. 

It  is  unfavourable  to  the  principle,  contend- 
ed for  by  the  counsel  for  Green,  that  no  such 
case  has  been  found:  for  this  silence  of  the 
books  authorizes  a  presumption,  that  no  dis- 
tinction has  been  recognized  between  acts  of 
this  kind  done  by  the  infant  himself,  and 
those  done  for  him  by  another.  We  must 
however  examine  the  principles,  by  which 
the  contracts  of  infants  are  governed;  and 
see  if,  by  any  analogy  to  settled  cases,  the 
present  defence  can  be  maintained. 

It  is  admitted  generally,  that  a-  contract 
made  by  an  infant,  although  not  for  neces- 
saries, Is  only  voidable:    and  that  an  express 


infa:nts. 


279 


adoption  of  It,  after  he  comes  of  age,  will 
make  It  valid  from  its  date.  Nor  does  the 
law  require  that  he  shall  be  sued,  as  upon 
the  uew  promise;  but  gives  life  aud  validity 
to  the  old  oue,  after  it  is  thus  assented  to. — 
But  it  is  urged,  that  this  doctrine  apphes  only 
to  those  contracts,  which  are  made  by  the  in- 
fant personally;  and  that  the  delegation  of 
power  by  him  to  another  of  full  age,  to  act 
lor  him,  is  utterly  void;  and  that  no  contract, 
made  in  virtue  of  such  delegation,  can  sub- 
sist, so  as  to  be  made  good  by  subsequent 
agreement  or  ratitication. 

If  we  coniine  ourselves  to  the  letter  of  the 
authorities,  it  would  seem  that  this  doctrine 
is  correct;  for  we  find  that,  in  the  distinc- 
tions made  in  the  books  between  the  void 
and  voidable  acts  of  an  infant,  a  power  of  at- 
torney is  generally  selected,  by  way  of  ex- 
ample, as  an  act  absolutely  void:  unless  it 
be  made  to  enable  the  attorney  to  do  some 
act  for  the  benefit  of  the  infant;  such  as  a 
power  of  attorney  to  receive  seizin,  In  order 
to  complete  his  title  to  an  estate. 

The  books  aie  not  very  clear  upon  this  sub- 
ject All  of  them  admit  a  distinction  between 
void  and  voidable  acts;  and  yet  disagree  with 
respect  to  the  acts  to  be  classed  vmder  either 
of  those  heads.  One  result  however,  in  which 
they  all  appear  to  agree,  is  stated  by  Lord 
Mansfield  in  the  case  of  Zouch  v.  Parsons.  3 
Burrows,  1794,  viz.  that  whenever  the  act 
done  may  be  for  the  benefit  of  the  infant,  it 
shall  not  be  considered  void:  but  that  he 
shall  have  his  election,  when  he  comes  of 
age,  to  aflirm  or  avoid  it;  and  this  Is  the  only 
clear  and  definite  proposition,  which  can  be 
extracted  from  the  authorities. 

The  application  of  this  principle  is  not  how- 
ever free  from  difliculty:  for  when  a  note  or 
other  simple  contract  is  made  by  an  infant 
himself,  it  may  be  made  good  by  his  assent, 
without  any  inquiry  whether  it  was  for  his 
benefit,  or  to  his  prejudice.  For  if  he  had  made 
a  bad  bargain  in  a  purchase  of  goods,  and 
given  his  promissory  note  for  the  price;  and 
when  he  came  of  age,  had  agreed  to  pay  the 
note,  he  would  be  bound  by  this  agreement, 
although  he  might  have  been  ruined  by  the 
purchase.  Perhaps  it  may  be  assumed  as  a 
principle,  that  all  simple  contracts  by  infants, 
which  are  not  founded  on  an  illegxil  consid- 
eration, are  strictly  not  void,  but  only  voida- 
ble; and  may  be  made  good  by  ratification. 
They  remain  a  legal  substratum  for  a  future 
assent,  untU  avoided  by  the  infant:  and  if, 
instead  of  avoiding,  he  confirm  them,  when 
he  has  a  legal  capacity  to  make  a  contract, 
they  are.  In  all  respects,  like  contracts  made 
by  adults. 

With  respect  to  contracts  under  seal  also, 
they  are  In  legal  force  as  contracts,  until  they 
are  avoided  by  plea.  Whether  they  can,  in 
all  cases,  as  It  is  clear  they  can  in  some, 
such  as  leases,  be  ratified,  so  as  to  prevent 
the  operation  of  a  plea  of  infancy,  except  by 
deed,  need  not  now  be  decided.    A  deed  of 


land,  by  an  infant  having  the  title,  would  un- 
doubtedly convey  a  seizin;  and  the  grantee 
would  hold  his  title  under  it  until  the  Infant, 
or  some  one  under  him,  should  by  entry  or 
action  avoid  it 

Perhaps  it  cannot  be  contended,  against  the 
current  of  authorities,  tliat  an  act  done  by 
another  for  an  infant,  which  act  must  neces- 
sai-ily  be  done  by  letter  of  attorney  under 
seal,  is  not  absolutely  void:  although  no  sat- 
isfactory reason  can  be  assigned  for  such  a 
position.  But  as  this  is  a  point  of  strict  law, 
somewhat  incongruous  with  the  general  rules 
affecting  the  contracts  of  infants;  It  is  not 
necessaiy  nor  reasonable  to  draw  inferences, 
which  may  be  repugnant  to  the  principles  of 
justice,  wiiich  ought  to  regulate  contracts  be- 
tween man  and  man. 

The  object  of  the  law,  in  disabling  infants 
from  binding  themselves,  is  to  prevent  them 
being  imposed  upon  and  injured  by  the  crafty 
and  designing.  This  object  is  in  no  degree 
fnistrated  by  giving  full  operation  to  their 
contracts,  If,  after  having  revised  them  at 
mature  age,  they  shall  voluntirily  and  delib- 
erately ratify  and  confirm  them.  It  is  enough, 
that  they  may  shake  off  promises  and  other 
contracts,  made  upon  valuable  consideration; 
If  they  see  fit  to  do  it,  when  called  upon  to 
perform  them.  To  give  them  still  anotlier 
opportunity  to  retract,  after  they  have  been 
induced,  by  love  of  justice,  and  a  sense  of 
reputation,  to  make  valid  what  was  before 
defective,  will  be  to  invite  them  to  break 
their  word  and  violate  their  engagements. 

If  it  be  true  that  all  simple  contracts,  made 
by  infants,  are  only  voidable,  the  inquiry,  in 
this  case  should  be,  whether  the  facts  stated 
furnish  an  exception  to  this  general  rule;  or 
whether  the  contract  now  sued  is  in  any 
sense  different  from  a  simple  contract 

The  only  ground  for  the  supposed  excep- 
tion is,  tliat  the  note  declared  on  was  not 
signed  by  the  infant  himself;  but  by  Dutch, 
claiming  authority  to  sign  his  name  as  a  co- 
partner. If  the  authority  required  a  letter  of 
attorney  under  seal,  the  exception  would  be 
supported  by  the  authorities,  which  have 
been  alluded  to. 

But  it  is  well  known  that  copartners  may, 
ana  generally  do  undertake  to  bind  each  otB- 


\r,  without  any  express  autnonty  wnalever. 
Ihdeed  the  authority  to  do  so,  results  from 
the  nature  and  legal  qualities  of  copartner- 
ship. And  without  any  such  union  of  inter- 
ests, one  man  may  have  authority  to  bind  an- 
other, by  note  or  bill  of  exchange,  by  oral,  or 
even  by  implied  authority.  The  case  of  a 
deed  therefore  Is  entirely  out  of  the  question: 
so  that  the  defendant  does  not  bring  himself 
within  the  letter  of  the  authorities;  and  cer- 
tainly not  within  the  reason,  on  which  they 
.are  founded.  Then  upon  principle,  what  dif- 
I  ference  can  there  be,  between  the  ratification 
\of  a  contract  made  by  the  Infant  himself,  and  I 
pne  made  by  another  acting  under  a  parole 
authority  from  him?    And  why  may  not  the 


2S0 


CAPACITY  OF  PARTIES. 


ratification  apply  to  the  authority,  as  weU  as 
to  the  contract  made  under  it? 

It  may  be  said,  that  minors  may  be  ex- 
posed, if  they  may  delegate  power  over  their 
property  or  credit  to  another.  But  they  will 
be  as  much  exposed,  by  the  power  to  make 
such  contracts  themselves;  and  more,  for  the 
person  delegated  will  generally  have  more 
experience  in  business  than  the  minor.  And 
it  is  a  sufficient  security  against  the  danger 
from  both  these  sources,  that  infants  cannot 


be  prejudiced:  for  the  contracts  are  In  neither 
case  binding,  unless,  when  arrived  at  legal 
competency,  they  voluntarily  and  deliberately 
give  effect  to  the  contract  so  made.  And  in 
such  case  justice  requires,  that  they  should 
be  compelled  to  perform  them. 

Upon  these  principles,  we  are  satisfied  with 
the  verdict  of  the  jury;  and  are  confident 
that  no  principles  of  law  or  justice  are  op- 
posed by  confirming  it 

Judgment  on  the  verdict. 


INFANTS. 


281 


/,\  BORDENTOWN   TP.    t.   WALLACE  et  aLi 
^   f\j\  (11  Atl.  207,  50  N.  J.  Law,  13.)     '  ''d^'3 

JSuijreme  Court  of  New  Jersey.     Nov.  16,  1887. 

On  demurrer  to  defendauts'  pleas. 

Tills  action  is  brousht  on  a  joint  and  sev- 
eral bond  given  by  the  defendants  to  the 
plaintiff,  in  the  penal  sum  of  $2,.j<X),  with  the 
condition  tliat,  if  the  defendants  "shall  pay  un- 
to the  said  the  inhabitants  of  the  township  of 
Bordentown,  or  to  its  suecessoi's  and  assigns, 
the  sum  of  two  and  a  half  dollars,  each  and 
every  week,  to  the  overseer  of  the  poor  for 
the  time  being  of  the  said  township  of  Bor- 
dentown, to  be  applied  to  and  for  the  sup- 
port of  a  certain  female  bastard  child,  of 
wlioni  William  Wallace,  one  of  the  parties 
hereby  boimd,  is  the  father,  for  and  during 
such  p(>riod  of  time  as  the  said  bastard  child 
shall  or  may  be  chargeable  to  the  said  town- 
ship, then  the  said  obligation  is  to  be  void, 
otherwise  to  be  and  remain  in  full  force  and 
virtue." 

The  declaration  Is  in  the  usual  form.  After 
praying  oyer,  and  setting  out  the  bond,  the 
defendants  plead  jointly  six  several  pleas: 
(1)  Non  est  factum.  (2)  Infancy  of  William 
Wallace.  (3)  Duress  of  imprisonment  of  Wil- 
liam Wallace.  (4)  Bond  given  before  and 
without  hearing  of  two  justices,  and  when 
held  before  one  justice  of  the  peace  untn  the 
bond  was  given.  (5)  Bond  given  to  comply 
with  order  of  filiation  when  no  notice  was 
given  of  such  order.  (6)  That  no  order  of 
filiation  was  made  by  two  justices  of  the 
peace,  according  to  law. 

The  plaintiff  joins  is.sne  on  the  first  plea, 
and  files  a  demurrer  to  each  of  the  five  suc- 
ceeding pleas. 

Hutchinson  &  Belden,  for  plaintiffs.  Gil- 
bert &  Atkinson,  for  defendants. 

SCUDDER,  J.  The  defense  of  the  infancy 
of  one  of  the  defendants  contained  in  the 
joint  plea  of  all  is  informal  and  bad.  Infancy 
is  a  personal  privilege  of  which  no  one  can 
take  advantage  but  himself.  Voorhees  v. 
Walt,  15  N.  J.  Law,  343;  Patterson  v.  Llppin- 
cott,  47  N.  J.  Law,  457,  1  Atl.  506. 

It  Is  also  a  nile  of  pleading  that  personal 
defenses,  as  coverture,  infancy,  etc.,  shall  be 
pleaded  separately;  that  only  when  the  de- 
fense is  In  its  nature  joint  may  several  de- 
fendants join  in  the  same  plea;  and  that 
where  a  plea  is  bad  in  part,  it  is  bad  in  toto; 
if,  therefore,  two  or  more  defendants  join  in 
a  plea  which  is  sufficient  but  for  one,  and  not 
for  the  other,  the  plea  is  bad  as  to  both.  1 
Chit.  PI.  565-507.  But  It  must  not  be  con- 
ceded that  in  a  proper  case,  under  our  statute 
for  the  maintenance  of  bastard  children,  the 
father  of  a  bastard  child  can  escape  his  obli- 


gation, or  liability  to  Indemnify  the  township 
or  municipal  body,  for  the  support  of  .such 
child,  if  it  become  chargeable,  by  a  plea  of 
infancy,  however  formally  it  may  be  pleaded. 
Co.  Litt.  172d,  gives  the  rule  of  an  infant's 
general  liability  as  follows:  "An  infant  may 
bind  himself  to  pay  for  his  necessary  meat, 
drink,  apparel,  necessary  physic,  and  such 
other  necessaries,  and  likewise  for  his  good 
teaching  or  instruction,  whereby  he  may 
profit  himself  afterwards;  but  if  he  bind  him- 
self in  an  obligation  or  other  writing  with  a 
penalty,  for  the  payment  of  any  of  these,  that 
obligation  shall  not  bind  him."  He  adds: 
"And  generally  whatsoever  an  infant  is 
bound  to  do  by  law,  the  same  shall  bind  him, 
albeit  he  doth  It  without  suit  at  law."  Lord 
Mansfield  quotes  and  applies  this  last  expre.s- 
sion  in  Zouch  v.  Parsons,  3  Burrows,  1794, 
and  adds:  "If  an  infant  does  a  right  act, 
which  he  ought  to  do,  which  he  was  com- 
pellable to  do,  it  shall  bind  him."  This  general 
principle  has  been  used  in  bastardy  cases  to 
bind  infants,  under  statutes  passed  to  pro- 
tect the  public  against  the  support  of  bastard 
children  that  may  become  chargeable.  People 
V.  Moores,  4  Denio,  518;  McCall  v.  Parker, 
13  Mete.  (Mass.)  372.  In  this  latter  case,  in 
an  action  on  a  bond  given  under  the  statute, 
for  appearance,  etc.,  it  was  decided  that  the 
infancy  of  the  accused  is  no  defense,  either 
for  him  or  his  suretj-.  Prof.  Parsons,  in  1 
Pars.  Cont  334,  says  that  there  is  no  principle 
of  law  that  binds  infants  when  they  enter 
into  contracts  which  owe  their  validity,  and 
the  means  of  their  enforcement,  to  statutes, 
because  in  all  statutes  containing  general 
words  there  is  an  implied  or  virtual  exception 
In  favor  of  persons  whose  liability  the  com- 
mon law  recognizes.  He  proceeds  to  Ulus- 
trato  this  position  by  referring  to  cases  where 
Infants  have  been  held  exempt  from  liabilitj- 
to  pay  calls  to  shares  in  incorporated  compa- 
nies, wherein  It  has  been  held  that  there  are 
implied  exceptions,  in  favor  of  infants,  in 
statutes  containing  general  words.  But  the 
wgrda-4a^urbasiaJdy_stjLtiita^  thn 

rppiitpd_fntJTPf  of  a  bri'itard  child  who  mnv  La 
soffle"cases  be  an  infant,  tn  crjyp  f\  hnnd  f^r 


secun^,  are  not  so  generaL  aa_tQ,p'^niDt  -in- 
"TaSts  from  its  operation.  They  are  fairly 
within  the  words  of  the  act,  and  its  pui-pose 
to  protect  the  public  against  those  who  would 
Impose  the  support  of  their  illegitimate  oCf- 
siiring  on  others.  Tyler  on  Infancy,  c.  9,  p. 
139,  cites  the  above  principle  of  liability  in 
its  application  to  bastardy  cases  with  ap- 
proval. 

This  second  plea  Is  defective  in  form,  bemg 
a  joint  plea  of  the  infancy  of  one  defendant; 
it  is  also  bad  In  substance,  as  in  proceedings 
under  the  bastardy  act  the  Infancy  of  the 
reputed  father  Is  no  defen.se  when  he  Is  le- 
gally chargeable  m  exoneration  of  the  public 


1  Irrelevant  parts  omitted. 


282 


i, 


",1 


CAPACITY  OF  PARTIES. 


RYDER  V.  WOMBWELL. 

(L.  R.  4  Exch.  32.) 

Court  of  Exchequer.    Dec.  3,  1S68, 


Appeal  from  the  decision  of  the  court  of 
exchequer  malviug  absolute  so  much  of  a  rule 
as  called  on  the  plaintiff  to  show  cause  why 
a  verdict  found  for  him  for  £40  lus.  should 
not  be  reduced  by  £15  15s.;  and  discharging 
the  residue  of  it,  which  called  upon  him  to 
show  cause  why  a  nonsuit  should  not  be  en- 
tered; or  a  new  ti'ial  had,  on  the  ground  of 
the  improper  rejection  of  evidence.  L.  R. 
3  Exch.  90. 

The  declaration  was  for  money  payable  for 
goods  sold  and  delivered.  Plea,  iufaucy;  rep- 
Ucation,  necessaries.     Issue  thereon. 

At  the  trial  before  Kelly,  C.  B.,  at  the  Lon- 
don sittings  after  Trinity  term,  1SG7,  it  ap- 
peared that  the  plaintiff  sought  to  recover 
for  the  following  (among  other)  articles  of 
jewelry  supplied  by  him  to  the  defendant, 
a  minor:  First,  a  pair  of  crystal,  ruby,  and 
diamond  solitaires,  £25;  and,  secondly,  a  sil- 
ver gilt  antique  chased  goblet,  engi'aved  with 
an  inscription,  £15  15s. 

The  defendant  was  the  younger  son  of  a  de- 
ceased baronet  of  large  property  in  Yorkshire, 
and  during  his  minority  had  an  income  of 
about  £500  per  annum,  and  on  attaining  his 
majority  he  came  into  £20,000.  He  had  no 
residence  of  his  own,  but  occasionally  stayed 
at  Limmer's  Hotel,  Bond  street,  London. 
His  home  was  his  mother's  house  in  London, 
and  Ms  brother's  in  Yorkshire,  at  each  of 
which  he  was  boarded  and  lodged  gratuitous- 
ly. He  pursued  no  trade  or  profession,  he 
moved  in  the  highest  society,  and  was  in  the 
liabit  of  riding  races  for  his  friends,  amongst 
others  for  the  Marquis  of  Hastings,  at  whose 
liouse  he  was  a  frequent  visitor,  and  for 
whom  the  goblet  was  intended,  as  the  plain- 
tiff knew  when  he  supplied  it,  as  a  present. 
The  solitaires  were  ornamental  studs  or  but- 
tons worn  by  gentlemen  as  fastenings  for 
the  wristbands  of  the  shirt.  They  were 
made  of  crystals  set  in  gold,'  and  ornamented 
with  diamonds  representing  a  horse-shoe  in 
which  the  nails  were  represented  by  rubies. 

Evidence  was  offered  on  the  part  of  the 
defendant  that  at  the  time  of  the  purchase 
of  the  solitaires  he  had  purchased  similar  ar- 
ticles of  jewelry  to  a  large  amount  from  other 
tradesmen,  which  rendered  any  further  sup- 
ply by  the  plaintiff  unnecessary;  but,  as  it 
was  proved  that  the  plaintiff  was  not  aware 
of  this  fact,  the  lord  chief  baron  rejected  the 
evidence. 

The  jury,  in  answer  to  the  questions  left 
to  them  by  the  learned  judge,  found  that 
the  solitaires  and  the  goblet  were  necessaries 
suitable  to  the  estate  and  condition  in  life 
of  the  defendant,  and  a  verdict  was  accord- 
ingly entered  for  the  plaintiff  for  £40  15s., 
being  the  price  of  the  solitaires  and  goblet, 
with  leave  to  move  to  enter  a  nonsuit  if  the 


court  should  be  of  opinion  that  there  was  no 
evidence  for  the  jury  that  either  article  was 
a  necessary;  or  to  reduce  the  damages  by 
the  price  either  of  the  solitaires  or  the  gob- 
let if  the  com-t  should  be  of  opinion  that  there 
was  evidence  for  the  jury  in  respect  of  one 
or  other  of  these  articles  only.  A  rule  nisi 
was  obtained  accordingly,  and  also  for  a 
new  trial,  on  the  ground  of  the  improper  re- 
jection of  the  evidence  offered  on  the  part  of 
the  defendant,  that  the  defendant  was,  at 
the  time  he  purchased  the  solitaires  of  the 
plaintiff,  supplied  already,  although  not  to 
the  knowledge  of  the  plaintiff,  with  similar 
articles.  This  rule  was  afterwards  made  ab- 
solute to  reduce  the  verdict  by  £15  15s.,  the 
price  of  the  goblet,  and  discharged  as  to  the 
residue;  the  majority  of  the  court  being  of 
opinion  that  the  verdict  of  the  jury  as  to  the 
solitaires  ought  not  to  be  disturbed,  and  that 
the  evidence  offered  to  prove  that  the  defend- 
ant, when  the  solitaires  were  supplied,  was 
already  sufficiently  supplied  with  articles  of 
a  similar  description,  was,  under  the  circum- 
stances,  properly    rejected. 

June  20,  18G8.  Mr.  Bulwer,  Q.  C,  (Mr. 
Mayd,  with  him),  for  defendant,  contended: 
Fii-st,  that  a  nonsuit  ought  to  be  entered,  as 
there  was  no  evidence  proper  to  be  left  to  the 
jury  that  the  solitaires  were  necessai'ies.  In. 
addition  to  the  cases  referred  to  in  the  court 
below,  he  cited  Rainsford  v.  Fenwick,  Carter, 
215;  Greene  v.  Chester,  2  Rolle,  144;  Ive  v. 
Chester,  Cro.  Jac.  560;  and  Wittingham  v. 
Hill,  Cro.  Jac.  494;— to  show  that  in  former 
times,  when  a  more  precise  and  accurate 
foi-m  of  pleading  prevailed,  the  facts  relied 
upon  as  showing  that  the  goods  supplied  were 
necessaries  were  stated  upon  the  record,  and 
the  court  were  enabled  to  give  judgment 
whether  in  point  of  law  the  replication  was 
sufficient.  But  when  it  was  established  (see 
Coke,  Ent.  "Debt,"  8,  p.  125,  and  Huggins  v. 
Wiseman,  Carth.  110)  that  the  plaintiff  might 
reply  in  the  general  form  now  in  use,  it  be- 
came necessary  that  the  facts  which  used 
formerly  to  be  stated  on  the  record  should  be 
found  by  a  jury,  and  then  the  court  had  to 
determine,  as  formerly,  whether  the  facts 
found  did,  in  point  of  law,  furnish  an  answer 
to  the  plea.  He  contended,  secondly,  that 
the  evidence  was  improperly  rejected;  and' 
on  this  point  referred  to  the  following  addi- 
tional authorities:  Story  v.  Perry,  4  Car.  & 
P.  526;  Cook  v.  Deaton,  3  Car.  &  P.  114; 
Ford  V.  Fothergill,  1  Esp.  211;  Steedman 
V.  Rose,  Car  &  M.  422;  Berrolles  v.  Ramsay, 
Holt,  N.  P.  77;  Brayshaw  v.  Eaton,  7  Scott, 
183 J  Foster  v.  Redgrave,  Queen's  Bench, 
Feb.  9,  1867;  Chit.  Cont.  (6th  Ed.)  pp.  136, 
137,  140;    Leake,  Cont.   p.  233. 

Popham  Pike  (Mr  Coleridge.  Q.  C,  with 
him),  for  the  plaintiff,  contended  that  the 
question  whether  the  solitaires  were  neces- 
saries was  rightly  left  to  the  jury,  and  that 
they  had  come  to  a  right  conclusion.  He 
cited.   In   addition   to   the   authorities   quoted 


INPANTS. 


283 


In  the  court  below,  Hands  v.  Slaney,  8  Term 
R.  578. 

With  regard  to  the  rejection  of  evidence, 
there  was  no  case  similar  to  the  present.  In 
all  of  those  cited  in  order  to  show  that  tlie 
evidence  was  adniissil)le,  though  not  brought 
to  the  plaiutifrs  knowledge,  there  were  pecul- 
iarities. Either  they  were  cases  of  husband 
and  wife,  or  else  of  minors,  in  respect  of 
whom  there  was  a  presumption  that  they 
were  already  supplied  with  all  necessaries 
by  reason  or  their  living  In  their  father's 
houses,  or  of  their  being  in  statu  pupiliari. 
Again,  in  many  of  the  cases  cited  tlie  trades- 
men had  peculiar  facilities  for  knowing  the 
actual  position  of  the  minor.  Putting  aside 
particular  and  exceptional  eases,  there  seem- 
ed to  bo  no  difference  between  a  minor  being 
actually  supplied  with  goods  similar  to  those 
for  the  price  of  which  he  was  being  sued, 
and  his  being  in  the  receipt  of  an  income  suf- 
(icient  to  buy  them  if  he  chose.  Yet  the 
amount  of  an  infant's  Income  had  been  held 
immaterial.  Brayshaw  v.  Eaton,  7  Scott, 
183.  Why  should  the  amount  of  his  income, 
when  he  had  turned  his  money  into  goods, 
be  material? 

Mr.   Bulwer,  Q.  C,   In   reply. 

Cur.  adv.  vult 

Argued  before  WILLES,  BYLES,  BLACK- 
BURN, MONTAGUE,  SMITH,  and  LUSH, 
JJ. 

WILLES,  .T.  In  this  case  the  pLaintiff  re- 
plied to  a  plea  of  infancy  that  the  goods  were 
necessaries  suitable  to  the  degree,  estate  and 
condition  of  the  defendant,  and  on  this  issue 
was  taiven.  On  the  trial  before  the  lord  chief 
baron  it  was  proved  that  the  degree,  estate 
and  oondition  of  the  defendant  ^va§__^^atEe 
was  tlii>  y(<iinLr(r  son  of  a  '^feceased  Jjaronet 
ofgood  fortune  and  fanuXv^^IEaLiliiring  h  i  s 
minonty  he  hadan  income  oJL_ab^L_£iSjO 
per  annum,  and  on  attalnTug  his  ma-towlv  he 
D|ecamo  enlitlocl  to  £20,00Q;  thathe  moved  in 
what  is  called  the  highest  society,  and  rode 
i-aces  for  a  friend,  the  Marquis  of  Hastings, 
at  whose  house  he  was  a  frequent  visitor. 
.\mongst  the  articles  supplied  by  the  plain- 
tiff upon  credit,  and  which,  according  to  his 
case  and  the  verdict  of  the  jury,  were  neces- 
saries for  an  infant  of  this  degree,  were  a 
silver-gilt  goblot  which  he  ordered  for  the 
purpose  of  making  a  present  to  the  ^Larquis  of 
Hastings,  price  fl.")  Ins.,  and  a  pair  of  soli- 
tiures  or  ornamental  studs  worn  as  the  fasten- 
ings of  the  wristl)auds  of  a  shirt,  which  it  is 
stated  In  the  case  were  made  of  crystals  set  in 
gold  and  ornamented  with  diamonds,  repre- 
senting a  horseshoe  in  which  the  nails  were 
rubies.  The  price  of  these  studs  or  solitaires 
was  £25.  No  evidence  was  given  of  anything 
peculiar  in  the  defendant's  station  rendering 
it  exceptionally  necessary  for  him  to  have 
such  articles. 

At  the  close  of  the  plaintiff's  case  the  de- 
fendant's counsel  offered  evidence  that  the  de- 
fendant waa  already  supplied  with  similar  ar- 


ticles of  jewelry  to  a  large  amount,  so  as  to 
render  any  further  supply  unnecessary,  but, 
it  being  admitted  that  the  plaintiff  was  not 
aware  of  this,  the  lord  chief  baron  rejected 
this  evidence. 

Leave  was  reserved  to  move  to  enter  a  non- 
suit or  reduce  the  damages,  and  the  question 
whether  these  two  articles  were,  under  the  cir- 
cumstances, necessaries,  was  left  to  the  jury, 
who  found  for  the  plaintiff  as  to  both  of  the  ar- 
ticles above  mentioned.  They  found  for  the 
defendant  as  to  some  other  articles,  which  it 
is  consequently  not  necessary  to  notice.  A 
nile  nisi  was  obtained  in  the  court  of  ex- 
chequer to  enter  a  nonsuit  or  reduce  the  ver- 
dict pursuant  to  the  leave  reserved,  or  for  a 
new  trial  on  the  ground  of  the  improper  re- 
jection of  evidence. 

The  rule  was  by  the  majority  of  the  court 
of  exchequer  made  absolute  to  reduce  the 
damages  to  £25,  the  value  of  the  studs,  thus 
deciding  that  there  was  no  evidence  on  which 
the  jury  could  find  that  it  was  necessary  for 
the  infant  to  buy  on  credit  a  goblet  for  the 
purpose  of  making  a  present,  but  that  there 
was  evidence  on  which  they  might  find  that 
it  was  necessary  for  him  to  buy  such  studs 
as  are  above  described,  and  the  rule  for  a 
new  trial  on  the  ground  of  the  rejection  of 
evidence  was  discharged.  Bramwell,  B.,  dis- 
sented from  this  judgment,  as  in  his  opinion 
there  was  no  evidence  to  go  to  the  jury;  and 
the  evidence  rejected  was  admissible. 

On  appeal,  therefore,  there  are  two  ques- 
tions raised  before  us:  First,  whether  there 
was  evidence  on  which  the  jury  might  prop- 
erly find  that  both  or  either  of  those  articles 
were  necessaries,  on  the  determination  of 
which  depends  whether  the  verdict  should 
be  restored  to  a  verdict  for  the  whole  amount 
of  £40  15s.,  or  stand  reduced  to  £2.5,  or  to  be 
altogether  set  aside  aud  a  nonsuit  entered. 
Secondly,  whether  the  evidence  offered  was 
admissible;  the  determination  of  which  only 
affects  the  question  whether  there  should  be 
a  new  trial  or  not. 

The  general  rule  of  law  Is  clearly  estab- 
lislied,  and  is  that  an  infant  Is  generally  in- 
capable of  binding  himself  by  a  contract.  To 
this  rule  there  is  an  exception  introduced,  noi 
for  the  benefit  of  the  tradesman  who  may 
:trust  the  infant,  but  for  that  of  the  infant 
himselE"  TBTs  exception  is  that  he  may  make 
a  contract  for  necessaries.  And  as  is  accu- 
rately stated  by  Parke,  B.,  in  Peters  v.  Flem- 
ing, G  Mees.  &  W.,  at  page  4G:  "From  the 
earliest  time  down  to  the  present  the  word 
'necessaries'  is  not  continod  in  its  strict  sense 
to  such  articles  as  were  necessary  to  the  sup- 
port of  life,  but  extended  to  articles  fit  to_ 
maintain  the  "particular  person  In  the  state, 
?fatlgn~a"nd"aggree  in' life  in  which^e  Js^  and 
thereTore  we  must  not  take  the  word  'neces- 
saries' In  its  unqualified  sense,  but  with  the 
qualification  above  pointed  out  Then  the 
question  in  this  case  is  whether  there  was 
any  evidence  to  go  to  the  jury  that  any  of 
these  articles  were  of  that  description."    In 


284 


CAPACITY  OF  PARTIES. 


the  present  case  the  first  question  is  whether 
there  was  any  evidence  to  go  to  the  jury  that 
either  of  the  above  articles  was  of  that  de- 
scription. Such  a  question  is  one  of  mixed 
law  and  fact;  in  so  far  as  it  is  a  question  of 
fact  it  must  be  determined  by  a  jury,  subject 
no  doubt  to  the  control  of  the  court,  who  may 
set  aside  the  vei"dict  and  submit  the  question 
to  the  decision  of  another  jury;  but  there  is 
in  every  case,  not  merely  in  those  arising  on 
a  plea  of  infancy,  a  preliminary  question 
which  is  one  of  law,  viz.  whether  there  is  any 
evidence  on  which  the  jury  could  properly  find 
the  question  for  the  partj'  on  whom  the  onus 
of  proof  lies.  If  there  is  not,  the  judge  ought 
to  withdraw  the  question  from  the  jury  and 
direct  a  nonsuit  if  the  onus  is  on  the  plaintiff, 
or  direct  a  verdict  for  the  plaintiff  if  the  onus 
is  on  the  defendant  It  was  formerly  consid- 
ered necessary  in  all  cases  to  leave  the  ques- 
tion to  the  jury  if  there  was  any  evidence, 
even  a  scintilla,  in  support  of  the  case;  but 
it  is  now  settled  that  the  question  for  the 
judge  (subject  of  course  to  review)  is,  as  is 
stated  by  Maule,  J.,  in  Jewell  v.  Parr,  13  C. 
B.,  at  page  916,  not  whether  there  is  literally 
no  evidence,  but  whether  there  is  none  that 
ought  reasonably  to  satisfy  the  jury  that  the 
fact  sought  to  be  proved  is  established.  In 
Toomey  v.  Railway  Co.,  3  C.  B.  (N.  S.)  at  page 
150,  Williams,  J.,  enunciates  the  same  idea 
thus:  "It  is  not  enough  to  say  that  there  was 
some  evidence.  •  *  *  A  scintilla  of  evidence 
*  *  *  clearly  would  not  justify  the  judge  in 
leaving  the  case  to  the  jury.  There  must  be 
evidence  on  which  they  might  reasonably  and 
properly  conclude  that  there  was  negligence," — 
the  fact  in  that  case  to  be  established.  And 
in  Wheelton  v.  Hardistj',  8  El.  &  Bl.,  at  page 
2C2,  in  the  considered  judgment  of  the  ma- 
jority of  the  court,  it  is  said,  "The  question 
is,  whether  the  proof  was  such  that  the  jury 
would  reasonably  come  to  the  conclusion" 
that  the  issue  was  proved.  "This,"  they  say, 
"is  now  settled  to  be  the  real  question  in  such 
cases  by  the  decision  in  the  exchequer  cham- 
ber, which  has,  in  our  opinion,  so  properly 
put  an  end  to  what  had  been  treated  as  the 
rule,  that  a  case  must  go  to  the  jury  if  there 
were  what  had  been  termed  a  scintilla  of  evi- 
dence." In  this  Lord  Campbell  agreed, 
though  differing  as  to  the  result.  See  8  El.  & 
BL,  at  page  2GG.  And  taking  that  as  the  prop- 
er test,  we  think  that  there  was  not  in  this 
case  evidence  on  which  the  jury  could  rea- 
sonably find  that  it  was  necessary  for  main- 
taining the  defendant  in  the  station  of  life 
in  which  he  moved,  either  that  he  should  give 
goblets  to  his  friends  or  wear  shirt-buttons 
composed  of  diamonds  and  rubies  costing 
£12  10s.,  a  piece. 

We  must  first  observe  that  the  question  in 
such  cases  is  not  whether  the  expenditure  is 
one  which  an  infant,  in  the  defendant's  posi- 
tion, could  not  properly  incur.  There  Is  no 
doubt  that  an  infant  may  buy  jewelry  or 
plate,  if  he  has  the  money  to  pay  and  pays  for 
It.    But  the  question  is  whether  it  is  so  nec- 


essary for  the  purpose  of  maintaining  himself 
in  his  station  that  he  should  have  these  ar- 
ticles, as  to  bring  them  within  the  exception 
under  which  an  infant  may  pledge  his  credit 
for  them  as  necessaries.  The  lord  chief  baron, 
in  his  judgment,  questions  whether  imder  any 
circumstances  it  is  competent  to  the  judge 
to  determine  as  a  matter  of  law,  whether  par- 
ticular articles  are  or  are  not  to  be  deemed 
necessaries  suitable  to  the  estate  and  condi- 
tion of  an  infant,  and  whether,  if  in  any  case 
the  judge  may  so  determine,  his  jurisdiction 
is  not  limited  to  those  cases  in  which  it  is 
clear  and  obvious  that  the  articles  In  question 
not  merely  are  not,  but  cannot  be,  necessaiies 
to  any  one  of  any  rank,  or  fortune,  or  condi- 
tion whatever?  This  is  an  important  prin- 
ciple, which,  if  correct,  fvdly  supports  the 
judgment  below;  but  we  cannot  assent  to  it 
We  quite  agree  that  the  judges  are  not  to  de- 
termine facts,  and  therefore  where  evidence 
is  given  as  to  any  facts  the  jury  must  deter- 
mine whether  they  believe  it  or  not.  But  the 
judges  do  know,  as  much  as  juries,  what  is 
the  usual  and  normal  state  of  things,  and  con- 
sequently whether  any  particular  article  is  of 
such  a  description  as  that  it  may  be  necessary 
under  such  usual  state  of  things.  If  a  state 
of  things  exists  (as  it  well  may)  so  new  or  so 
exceptional  that  the  judges  do  not  known  of 
it,  that  may  be  proved  as  a  fact,  and  then  it 
will  be  for  the  jury,  under^  proper  direction, 
to  decide  the  case.  But, 
if  we  were  to  say  that 
are  to  be  at  liberty^o 
a  necessary,  on  the  ground 
some  usage  of  society,  not 
and  not  known  to  the  court,  but  which  it  is 
suggested  that  the  jury  may  know,  we  should 
in  effect  say  that  the  question  for  the  jury 
was  whetheA^  was  shabby  in  the  defendant 
to  plead  infAl^. 

We  thinldP#  judges  must  determineji^eth- 
er  the  cas/e  is  such  as  to  cast  on  the  plaintiff 
the  onus  of  proving  that  the  articles  are  with- 
in the  exception,  and  then  whether  there  is 
any  sufficient  evidence  to  satisfy  that  onus. 
In  the  jijidgment  of  Bramwell,  B.,  in  the  court 
below,  many  instances  are  put  well  illustrat- 
ing the  necessity  of  such  a  rule.  It  is  enough 
for  the  decision  of  this  case  if  we  hold  that 
such  articles  as  are  here  described  are  not 
prima  facie  necessary  for  maintaining  a  yoimg 
man  in  any  station  of  life,  aniLJlia^  the  bur- 
then lay  on  the  plaintiff  to  give  evidence_cf 
something  peculiar  making  them  necessaries  in 
this  special  case,  and  that  he  has  given  no 
evidence  at  aH  to  that  effect.    ~ 

The  cases  will,  we  think,  be  foimd  to  be 
quite  consistent  with  this  view.  In  Peters  v. 
Fleming,  G  Mees.  &  W.  42,  the  court  took 
judicial  notice  that  it  was  prima  facie  not 
unreasonable  that  an  undergraduate  at  col- 
lege should  have  a  watch,  and  consequently 
a  watch  chain,  and  that  therefore  it  was  a 
question  for  a  jury  whether  the  watch  chain 
siipplied  on  credit  in  that  particular  case  was 
such  a  watch  chain  as  was  necessarj'  to  sup- 


as  a  fac 
ide^a  pr 
a^^Bec: 

iiHry 
o  fin  a 
lund  flat 
not  i^DVi 


ecms  to  us  that 
case  the  jury 

anything  to  be 
lat  there  may  be 

ved  in  evidence 


INFANTS. 


285 


port  himself  properly  In  his  degree.  In  lay- 
ing down  the  law  as  to  the  particular  case, 
Parke,  B.,  says,  6  Mees.  &  W.,  at  page  47: 
"All  such  articles  as  are  purely  oruamental 
are  to  be  rejected,  a.s  they  cannot  be  requisite 
for  any  one."  Possibly  there  may  be  excep- 
tional cases  in  which  things  purely  orna- 
mental may  be  necessary.  In  such  a  staTe 
of  things  as  we  believe  existed  at  the  close 
of  the  last  century  it  might  have  been  a  ques- 
tion for  a  jury  whether  it  was  not  necessary, 
for  the  purpose  of  maintaining  his  station, 
for  a  young  gentleman  moving  in  society  to 
purchase  wigs  and  hair  powder;  but,  as  a 
general  rule,  and  in  the  absence  of  some  evi- 
dence to  show  that  the  usages  of  society  re- 
quired the  use  of  such  things,  we  thinli,  the 
nlle  laid  down  in  Peters  v.  Fleming,  G  Mees. 
&.  W.,  at  page  47,  Is  correct.  It  was  ap- 
proved of  In  Wharton  v.  Mackinzio,  5  Q.  B. 
GOG,  where  Coleridge,  J.,  says,  at  page  612, 
that  in  some  cases  it  must  be  for  the  judge 
to  decide  the  question.  Where  evidence  is 
given,  as  he  observes,  of  exceptional  circum- 
stances, tlie  case  must  go  to  the  jury  with 
proper  directions,  but  in  the  absence  of  any 
explanation  the  court  will  decide.  So  In 
Brooker  v,  Scott.  11  Mees.  &  W.  G7,  Parke, 
B.,  during  the  course  of  the  argument,  says 
(11  Mees.  &  W.),  at  page  68:  "Prima  facie, 
these  articles  are  not  necessaries  under  the 
circumstances,  and  the  tradesmen  must  show 
them  to  be  so;"  and  In  giving  judgment  he 
says  (11  Mees.  &  W.),  at  page  69:  "If  there 
had  been  any  exphination  of  the  circumstan- 
ces under  which  they  were  supplied,  it  might 
possibly  have  varied  the  case,  but  no  expla- 
nation whatever  is  given  of  them;"  and  on 
that  ground  a  nonsuit  was  entered. 

No  doubt  there  are  many  cases  in  which  the 
court  have  held  that  such  evidence  had  been 
given,  and  that  the  case  could  not  be  with- 
drawn from  the  jury,  several  of  which  are 
cited  by  the  lord  chief  baron  in  his  judg- 
ment, but  none  in  which  it  is  laid  down  that 
tlie  court  Is  bound  to  consider  Itself  ignorant 
of  every  usage  of  mankind,  and  therefore 
bovmd.  In  the  absence  of  all  evidence  on  the 
subject,  to  take  the  opinion  of  a  jiuy  as  to 


whether  It  la  not  so  necessary  for  a  gentle- 
man to  wear  solitaires  of  this  description, 
that,  though  an  infant,  he  must  obtain  them 
on  credit  rather  than  go  without. 

There  is,  no  doubt,  a  possibility  in  all  ca.«os 
where  the  judges  have  to  determine  whether 
there  Is  evidence  on  which  the  jury  may  rea- 
sonably end  a  fact,  that  the  judges  may 
differ  in  opinion,  and  It  is  possible  tliat  the 
majority  may  be  wrong.  Indeed,  whenever  a 
decision  of  the  court  below  on  such  a  point 
Is  reversed,  the  majority  must  have  been  so 
either  in  the  court  above  or  the  c^mt  below. 
This  Is  an  inflrraity  which  must^nect  all 
tribunals.  But  in  the  present  case  we  do 
not  think  any  such  case  has  arisen,  for  wo 
do  not  understand  any  of  the  judges  to  pro- 
ceed on  the  ground  that  they  think  that,  in 
fact,  the  solitaires  of  this  expensive  character 
were  shirt  buttons  really  got  for  utility,  and 
that  the  degree  of  ornament  was  only  acci- 
dental, or  that  the  jurj-  were  not  wrong  If 
they  so  found,  but  on  the  ground  that  It  was 
not  a  question  for  the  court  at  all. 

Taking  this  view  of  the  law  and  facts.  It 
follows  that  the  judgment  should  be  reversed, 
and  a  nonsuit  entered.  It  becomes  therefore 
unnecessary  to  decide  whether  the  evidence 
tendered  was  properly  rejected  or  not.  That 
is  a  question  of  some  nicety,  and  the  author- 
ities are  by  no  j^his  imiform.  In  Bain- 
bridge  v.  Pickerii^^^JV.  BL  1.32.5,  the  court 
of  common  pleas  ^^«  to  have  acted  on  a 
principle  which  would  make  the  evidence 
admissible.  In  Brayshaw  v.  Eaton,  7  Scott. 
18,3,  Bosanquet,  J.,  treats  it  as  clearly  admis- 
sible, and  on  those  authorities  the  court  of 
queen's  bench  (then  consisting  of  Blackburn, 
J.,  and  Mellor,  J.)  acted  in  Poster  v.  Red- 
grave, supra.  There  Is  much  to  be  argued  In 
support  of  the  view  taken  by  the  majority  in 
the  court  below,  and  we  desire  not  to  be  un- 
derstood as  either  overruling  or  affirming  that 
decision.  If  ever  the  point  again  arises,  the 
court  before  which  it  comes  must  determine 
it  on  the  balance  of  authority  and  on  prin- 
ciple, without  being  fettered  by  a  decision  of 
this  court 

.Judgment  reversed,  and  a  nonsuit  entered. 


286 


l9 


"b 


,\ 


McKANNA  et  aL  v.  MERRY. 
(61  111.  177.) 
Supreme  Comt  of  Illinois.     Sept  Term,  1871. 
Appeal  from  circuit  court,  Jo  Daviess  coun- 
ty; William  Brown,  Judge. 

Louis  Shissler,  for  appellants.  Sheean  &, 
Weigley,  for  appellee. 

THORNTON,  J.  In  1S64,  Kate  Feehan, 
since  intermarried  with  McKanna,  accom- 
panied appellee  and  wife  on  a  trip  from  Illi- 
nois to  California,  by  water.  Her  passage 
money  was  paid  by  appellee.  Kate  was 
then  an  infant,  and  under  the  control  of  her 
guardian,  who  was  desirous  that  she  should 
attend  school  for  another  year,  and  disap- 
proved of  the  trip. 

The  only  proof  as  to  the  value  of  her  es- 
tate is  that  it  consisted  of  an  undivided  one- 
tnird  of  some  realty,  which,  after  her  mar- 
riage, and  a  few  years  after  the  advance- 
ment of  the  money,  was  sold  for  .$3250. 

There  is  no  proof  that  this  trip  was  neces- 
sary for  her  health,  or  that  it  subserved  any 
purpose  other  than  pleasure,  or  as  company 
for  the  wife  of  appellee. 

The  court  gave  for  appellee  the  following 
instruction: 

"^'hat  are  necessaries  depends  upon  the 
circumstances  of  the  case.  If  the  going  of 
defendant,  Kate,  to  California  was  prudent 
and  proper,  under  the  circumstances  proved, 
and  the  plaintiff  advanced  money  necessary 
to  take  her  there,  and  the  same  was  for  her 
benefit,  then  it  is  for  the  jury  to  determine 
whether  such  advances  of  money  were  for 
necessaries." 

There  is  no  positive  rule  by  means  of  which 
it  may  be  determined  what  are  and  what 
are  not  necessaries.  Whether  articles  are 
of  a  class  or  kind  for  which  infants  are 
liable,  or  whether  certain  subjects  of  expend- 
iture are  necessaries,  are  to  be  judged  of 
by  the  court.  Whether  they  come  within  the 
particular  class,  and  are  suitable  to  the  con- 
dition and  estate  of  the  infant,  is  to  be  de- 
termined by  the  jury  as  matter  of  fact.  For 
example,  suppose  this  trip  had  been  to  Eu- 
rope, involving.  In  time,  several  years,  and 
an  expenditure  of  thousands  of  dollars, 
vv'ould  any  court  hesitate  to  decide  that  the 
money    thus    advanced    did     not    constitute 


CAPACiTY  or  PARTIES. 


>^^\ 


necessaries?     Chit.    Cont.    141a,    note 


2;     1 
Bibb, 


Pars.   Cont   296;    Beeler  v.   Yoimg,   1 
.019;    1  Am.  Lead.  Cas.  248. 

The  court,  In  the  instruction,  merely  in- 
formed the  jury  that  if  the  trip  was  prudent 
and  proper,  and  that  the  money  was  for  her 
benefit,  then'  the  jury  must  determine  wheth- 
er such  advances  of  money  were  for  neces- 
saries. There  was  not  a  particle  of  proof  to 
enable  the  jury  to  determine  as  to  the  pro- 
priety or  impropriety,  the  prudence  or  im- 
prudence, of  the  trip,  or  that  the  advance- 
ment of  the  money  was  for  the  benefit  of  ap- 
pellant 


Even  If  there  had  been  such  proof,  the  in- 
struction was  wrong.  The  court  should  have 
defined  necessaries  in  some  manner.  Black- 
stone  defines  necessaries  to  be  "necessary 
meat,  drink,  apparel,  physic,"  and  says  that 
an  infant  may  bind  himself  to  pay  "for  his 
good  teaching  and  instruction,  whereby  he 
may  profit  hiinself  afterwards."  The  arti- 
cles furnished,  or  money  advanced,  must  be 
actually  necessary,  in  the  particular  case, 
for  use,  not  mere  omainent;  for  substantial 
good,  not  mere  pleasure;  and  must  belong 
to  the  class  which  the  law  generally  pro- 
nounces necessary  for  infants. 

The  courts  have  generally  excluded  from 
the  term  "necessaries"  horses,  saddles, 
bridles,  pistols,  liquors,  fiddles,  chronometers, 
etc.  It  has  been  held,  however,  that  if  rid- 
ing on  horseback  was  necessaiy  to  the  health 
of  the  infant,  the  rule  was  different. 

We  have  been  referred  to  no  case,  and, 
after  a  thorough  examination,  have  found 
none,  in  which  it  has  been  held  that  mon- 
eys advanced  for  traveling  expenses,  under 
the  circumstances  of  this  case,  were  neces- 
saries. 

The  court  should  have  instructed  the  j^ry 
as  to  the  classes  and  general  description  of 
articles  for  which  an  infant  is  bound  to  pay. 
Then  the  jury  must  determine  whether  they 
fall  within  any  of  the  classes,  and  whether 
they  are  actually  necessary  and  suitable  to 
the  estate  and  condition  of  the  infant 

It  may  be  proper  to  advert  to  another  prin- 
ciple. The  infant  had  a  guardian,  who  had 
charge  and  management  of  her  estate,  which 
consisted  entirely  of  realty.  It  was  the  duty 
of  the  guardian  to  superintend  the  educa- 
tion and  nurture  of  his  ward,  and  apply  to 
such  purpose,  first,  the  rents  and  profits  of 
the  estate,  and  next  the  interest  upon  the 
ward's  money.  This  is  the  positive  com- 
mand of  the  statute,  and  he  was  liable  upon 
his  bond  for  noncompliance.  He  was  the 
judge  of  what  were  necessaries  for  his  ward, 
if  he  acted  in  good  faith. 

A  third  party  had  no  right  to  intervene 
and  usurp  the  rights  and  duties  of  the  gnard- 
lian.  Even  if  the  money  paid  was,  in  some 
sense,  for  the  infant's  benefit,  and  the  trip 
was  prudent  and  proper,  yet,  if  the  guardian, 
in  good  faith,  and  in  the  exercise  of  a  wise 
discretion,  and  with  reference  to  the  best 
.  interests  of  his  ward,  supplied  her  wants  and 
1  contributed  means  suitable  to  her  age  and 
station  in  life,  and  in  view  of  her  estate, 
then  the  infant  would  not  be  liable  for  the 
money  as  necessaries.  Beeler  v.  Young,  sup- 
ra; Kline  v.  L'Amoureux,  2  Paige,  419;  Guth- 
rie V.  Murphy,  4  Watts,  80;  Wailing  v.  Tall, 
9  Johns.  141. 

We  express  no  opinion  as  to  the  weight  of 
the  evidence,  for  the  reason  that  there  must 
be  a  new  trial. 

The  judgment  Is  reversed  for  the  errors 
indicated,  and  the  cause  remanded. 

Judgment  reversed. 


p^ 


JOHNSON  T.  LINTjg.       j-)  [^j 
(6  Watts  &  S.  SO.)  1^1 

Supreme  Court  of  Pennsylvania.      Sept.,   1843. 

Error  to  cx)urt  of  common  pleas,  Washington 
county. 

Edward  L.  Lines  and  William  W.  Scott, 
trading  under  the  firm  of  Lines  &  Scott, 
against  David  Ecltert,  administrator  of  John 
Johnson. 

This  was  an  action  of  assumpsit.  The  dec- 
laration contained  the  common  money  counts, 
to  which  the  defendant  pleaded  that  the  in- 
testate was  an  infant  at  the  time  of  the  sxip- 
posed  promises;  and  the  plaintiffs  replied 
that  the  goods  provided  were  necessaries. 
The  intestate,  whose  infancy  was  admitted, 
contracted  a  debt  with  the  plaintiffs  for  goods 
sold  and  monies  advanced,  as  appeared  by 
their  account,  between  the  9th  October,  183G, 
and  the  30th  January,  1S38,  to  the  amount  of 
$1,003.27.  The  items  consisted  in  a  great 
measure  of  fancy  articles,  which  a  wasteful 
boy,  uncontrolled  by  his  parents  or  guardian, 
would  be  apt  to  purchase.  The  infant  had  a 
guardian;  but  it  did  not  appear  that  he  exer- 
cised any  care  or  control  over  him,  or  that  he 
liad  been  consulted  in  relation  to  his  dealings. 

The  defendant  asked  the  court  to  charge 
"that  the  plaintiffs  had  no  right  to  deal  with 
the  minor,  even  for  necessaries,  unless  the 
guardian  refused  to  furnish  him  with  them." 
The  court  charged  "that  the  plaintiffs  had  no 
right  to  deal  with  the  deceased  unless  by  the 
permission,  express  or  implied,  of  the  guard- 
ian; or  unless  the  guardian  refused  to  furnish 
necessaries  to  his  ward."  The  defend;int  also 
prayed  direction  "that  if  the  plalntiffis  were 
justified  in  dealing  with  him,  their  bill  is  so 
exorbitant  that  the  plaintiffs  themselves  could 
not  have  considered  them  necessaries,  and 
therefore  are  not  entitled  to  recover:"  to 
which  the  court  responded,  that  ''what  are 
necessaries  is  a  question  of  fact  mixed  with 
law.  It  is  to  be  decided  by  the  jury  under 
the  direction  of  the  court,  and  depends  on  the 
estate,  circumstances  and  pursuits  of  the  man. 
The  jury  will  probably  think  this  bill  ex- 
travagant, and  that  the  plaintiffs  could  not 
have  supposed  many  of  these  items  necessary. 
Some  of  them,  they  must  have  known,  were 
not  necessary.  The  plaintiffs  cannot  recover 
for  what  are  not  necessaries."  The  defendant 
excepted.  Verdict  and  judgment  for  the 
plaintiffs. 

Mr.  Marsh,  for  plaintiff  In  error,  cited  2 
Serg.  &  R.  44;  2  E.  C.  L.  GOO. 

Mr.  M'Keunon,  for  defendants  in  error,  cited 
7  Watts,  344;  3  Day,  37;  1  Bibb,  519;  7 
Watts,  237;  8  Term  R.  578;  1  Esp.  212;  3  E. 
C.  L.  33;  5  Esp.  152;  1  Maule  &  S.  737;  3 
Bac.  Abr.  593. 

GIBSON,  a  T,  The  case  of  the  plaintiffs 
below  is  poor  in  merits.  It  appears  that  they 
supplied    a    young    spendthrift    with    goods 


IXFAXT.S. 


287 


which  they  call  npcessarles,  but  which  ill  de* 
servo  the  name.  Their  account  mounts  up  to 
more  than  a  thousand  dollars,  comprising 
charges  for  many  articles  which  might  be 
ranked  with  necessaries  when  supplied  in 
reason;  but  not  at  the  rate  of  twelve  coats, 
sevcntoon  vests,  and  twenty-three  pantaloons, 
in  the  space  of  fifteen  months  and  twenty-one 
days;  to  say  nothing  of  three  Bowie  knives, 
sixteen  penknives,  eight  whips,  ten  whip-lash- 
es, thirty-nine  handkerchiefs,  and  five  canes, 
with  kid  gloves,  fur  caps,  chip  hats,  and  fan- 
cy bag.  to  match.  Such  a  bill  makes  one 
shudder.  Yet  the  jury  found  for  the  plaintiffs 
almost  their  whole  demand,  including  sums 
advanced  for  pocket-money,  and  to  pay  for 
keeping  the  minor's  horses,  which  no  one 
would  be  so  hardy  as  to  call  necessaries, 
ilow  they  could  reconcile  such  a  verdict  to 
the  dictates  of  conscience,  I  know  not.  They 
surely  could  not  complacently  look  upon  the 
ruin  of  their  own  sons,  brought  on  by  min- 
istering to  their  appetites,  and  stimulating 
them  with  the  means  of  gratification.  Every 
father  has  a  deeper  stake  in  these  matters 
than  the  public  mind  is  accustomed  to  sup- 
pose; and  it  intimately  concerns  the  cause  of 
morality  and  virtue,  that  the  rule  of  the  com- 
mon law  on  the  subject  be  strictly  enforced. 
The  minor  was  at  the  critical  time  of  life, 
when  habits  are  formed  which  make  or  mar 
the  man— which  fit  him  for  a  useful  life,  or 
send  him  to  an  untimely  grave;  and  public 
policy  demands  that  they  who  deal  with  such 
a  customer  should  do  so  at  their  peril.  This 
enormous  bill  was  run  up  at  one  store,  and 
what  other  debts  were  contracted  for  supplies 
elsewhere  we  know  not;  but  let  it  not  be 
imagined  that  the  infant's  transactions  with 
other  dealers  did  not  concern  the  plaintiffs. 
"With  a  view  to  quantity,  and  quantity  only," 
said  Baron  Alderson,  in  Burghart  v.  Anger- 
stein,  0  Car.  &  P.  700,  "you  may  look  at  the 
bills  of  the  other  tradesmen  by  whom  the  de- 
fendant was  also  supplied;  for  if  another 
tradesman  had  supplied  the  defendant  with 
ten  coats,  he  would  not  then  want  any  more, 
and  any  further  supply  would  be  unnecessary. 
If  a  minor  is  supplied,  no  matter  from  what 
quarter,  with  necessaries  suitable  to  his  es- 
tate and  degree,  a  tradesman  cannot  recover 
for  any  other  supply  made  to  the  minor  just 
after."  And  the  reason  for  it  is  a  plain  one. 
The  rule  of  law  is  that  no  one  may  deal  with 
a  minor.  The  exception  to  it  is  that  a  stran- 
ger may  supply  him  with  necessaries  proper 
for  him,  in  default  of  supply  by  any  one  else; 
but  his  Interference  with  what  Is  properly 
the  guardian's  business  must  rest  on  an  actual 
necessity,  of  which  he  must  judge,  in  a  meas- 
ure, at  his  peril.  In  Ford  v.  Fothergill.  1 
Esp.  211,  Peake.  N.  P.  299,  Lord  Kenyon 
ruled  it  to  be  incumbent  on  the  tradesman, 
before  trusting  to  an  appearance  of  necessity. 
to  inquire  whether  the  minor  is  provided  by  his 
parent  or  friends.  That  case  may  be  thought 
to   have   been   shaken    in    Dalton   v.    Gib,    5 


288 


CAPACITY  OF  PARTIES. 


r.ing.  N.  C.  19S.  in  which  it  was  held  that  in- 
quiiy  is  not  a  condition  precedent  to  recov- 
ery where  the  goods  seem  to  be   necessary 
from  the  outward  appearance  of  the  infant, 
though  the  mother  was  at  hand  and   might 
have   been  questioned;   but   in   Brayshaw  v. 
Eaton,  Id.  231,  this  was  explained  to  mean  1 
that,  as  such  an  Inquiry  is  the  tradesman's  i 
affair,  being  a  prudential  measure  for  his  own  I 
information,  the  omission  of  it  is  not  a  ground  , 
of  non-suit;  but  that  the  question  is,  on  the 
fact  put  in  issue  by  the  pleadings,  whether 
the  supply  was  actually  necessary.    It  is  the 
tradesman's  duty  to  know,  therefore,  not  only 
that  the  supphes  are  unexceptionable  in  quan- 
tity and  sort,  but  also  that  they  are  actually 
needed.    When   he  assumes  the  business   of 
the  guardian  for  purposes  of  present  relief, 
he  is  bound  to  execute  it  as  a  prudent  guard- 
ian would,  and  consequently,  to  make  himself 
acquainted  with   the  ward's   necessities  and 
circumstances.    The   credit   which  the   negli- 
gence   of   the    guardian    gives    to    the    ward, 
ceases  as  his  necessities  cease;  and,  as  noth- 
ing  further   is  requisite  when   these  are   re- 
lieved, the  exception  to  the  rule  is  at  an  end. 
In   this   case,   the   supply   of   articles   which 
were  proper  in  kind,  was  excessive  in  quan- 
tity.   I   impute  no  intentional  wrong  to  the 
plaintiffs,  for  they  dealt  with  the  intestate, 
as  others  may  have  done,  evidently  supposing 
him  to  be  sui  juris;  but  I  certainly  do  blame 
the  jury  for  finding  nearly  the  whole  demand, 
after  it  had  been  conceded  that  he  was  an  in- 
fant 

That  the  charge,  though  not  palpably  wrong 
in  the  abstract,  tended  to  mislead  in  its  ap- 
plication to  the  facts,  is  visible  in  the  verdict 
it  produced.  The  defendant  went  to  the  court 
for  direction  that  the  plaintiffs  could  not  law- 
fully deal  with  the  infant,  even  for  neces- 
saries, unless  the  guardian  had  refused  to 
furnish  them;  and  had,  for  response,  a  direc- 
tion that  "the  plaintiffs  had  no  right  to  deal 
with  the  deceased,  unless  by  the  permission, 
express  or  implied,  of  the  guardian;  or  un- 
less the  guardian  had  refused  to  furnish  nec- 
essaries for  his  ward."  Thi-s  very  significant 
addition  to  the  principle  assumed  in  the  pray- 
er was  meant  to  indicate  a  liberty  to  deal  by 
permission  beyond  the  bounds  of  necessaries, 
or  it  meant  nothing.  It  indicated  that  an  au- 
thority to  deal  with  a  minor  in  a  way  to 
charge  him  personally,  emanates  from  his 
guardian's  permission,  which  is  paramount, 
or  at  least  equal,  to  the  authority  so  to  deal 
with  him,  that  emanates  from  his  necessities. 
The  jury  would  naturally  so  understand  it. 
And  this  was  predicated  in  reference  to  the 
question  before  them,  whether  the  ward's 
estate  could  be  subjected  to  payment  for 
luxuries.  They  might  readily  understand, 
therefore,  that  the  guardian's  permission  to 
run  up  this  bill  would  charge  the  ward's  es- 
tate with  it,  independently  of  its  propriety. 
If  that  was  not  the  drift  of  the  direction,  it  is 
not  easy  to  see  why  anj'thing  was  said  about 


permission  at  all.  In  a  case  of  doubtful  pro- 
priety, I  can  readily  understand  how  the 
guardian's  sanction,  or  that  of  a  relative, 
might  justify  a  supply  beyond  the  limits  of 
strict  necessity,  which  a  dealer  might  furnish 
bona  fide  on  the  credit  of  the  ward;  but, 
though  the  guardian  might  subject  himself  to 
payment  of  a  grossly  improvident  bill,  by  a 
permission  amounting  to  an  order,  his  con- 
nivance at  an  improper  supply  by  a  trades- 
man, would  not  subject  the  ward  to  payment 
of  it  Indeed,  it  has  been  said  (3  Wil.s.  Bacon, 
595,  In  marg.)  to  have  been  several  times  de- 
cided that  where  credit  has  been  given  to  the 
parent  or  guardian,  the  creditor  has  no  re- 
course to  the  infant.  The  guardian  is  set  over 
the  ward  for  the  very  purpose  of  preventing 
him  from  making  such  a  bill;  and  his  deser- 
tion of  his  trust  would  not  help  the  case  of 
one  who  had  dealt  with  the  ward  mala  fide. 
As,  then,  the  plaintiffs  were  bound  to  know 
that  the  guardian  abused  his  trust  in  allow- 
ing the  infant  to  run  up  this  biU,  they  can 
recover  no  more  of  it  than  was  proper  to  re- 
lieve the  ward's  necessities.  This  notion  that 
the  guardian's  permission  might  legitimate 
the  demand,  may  have  had  a  misguiding  In- 
fluence on  the  jury;  for  a  passive  acquaintance 
with  the  transaction  which  the  law  would 
presume  from  his  duty  to  have  an  eye  on 
the  doings  of  the  ward,  would  be  a  construct- 
ive permission;  or  it  might  be  implied  from 
the  fact  that  he  had  left  the  ward  to  shift 
for  himself. 

Again,  the  defendant  prayed  direction,  "thsK 
it  the  plaintiffs  were  justifiable  in  dealing 
with  the  ward,  the  bill  is  so  exorbitant  that 
the  plaintiffs  themselves  could  not  have  con- 
sidered them  (the  goods)  necessaries;  and  that 
they  are  therefore  not  entitled  to  recover;" 
In  answer  to  which,  the  court  charged  that; 
"What  are  necessaries,  is  a  question  of  fact 
mixed  with  law.  It  is  to  be  decided  by  the 
jury  under  the  direction  of  the  court,  and  de- 
pends on  the  estate,  circumstances  and  pm*- 
suits  of  the  minor.  The  jury  wiU  probably 
think  this  bill  extravagant,  and  that  the  plain- 
tiffs could  not  have  supposed  many  of  the 
Items  necessary.  Some  of  them,  they  must 
have  known,  were  not  necessary.  The  plain- 
tiffs cannot  recover  for  what  were  not  neces- 
saries." Not  a  word  in  this  in  response  to 
the  prayer  for  direction  as  to  the  effect  of 
the  plaintiffs'  consciousness  that  the  supply 
was  extravagant,  though  consciousness  would 
affect  them  with  mala  fides,  and  deprive  them 
at  once  of  whatever  merit  they  might  other- 
wise pretend  to  have  from  the  guardian's  im- 
plied sanction.  The  judge  said  truly  that 
what  are  necessaries  is  a  question  mixed  of 
fact  and  law;  but  ho  did  not  say,  as  he  might 
and  perhaps  ought  to  have  done,  that  an 
over-supply  of  goods  otherwise  proper  ceases 
to  be  a  supply  of  necessaries  as  to  the  excess. 
The  jury  were  indeed  left  to  say  what  were 
necessaries;  but  rather  as  regards  the  sort 
than  the  quantity,   in  respect  to   which   the 


INFANTS. 


289 


effect  of  excess  was  overlooked  throuj^hout. 
Had  it  been  properly  impressed,  the  jui-y 
could  not  have  found  more  than  a  fourth  part 
of  the  bill.  To  them  doubtless  belonj^s  the 
question  of  extravagance;  but  where  the  sup- 
ply has  been  so  grossly  profuse  as  to  shock 

liOPK.SEL,CAS.CONT.— 19 


the  sense,  it  is  the  business  of  the  judge  to 
say  so  as  matter  of  law,  and  charge  that  there 
can  be  no  recovery  for  more  than  was  abso- 
lutely necessary. 

Judgment  reverbed,  and  a  venire  facia-s  de 
novo  awarded. 


CAPACITY  OF  PARTIES. 


STAFFORD  v.  ROOF. 
(9  Cow.  626.) 

'Q<iDrt  of  Errors  of  New  York.    Dec,  1827. 

On  error  from  the  supreme  court.  7  Cow. 
179.  John  Stafford  brought  trover  for  a 
horse  against  Roof,  in  the  C.  P.  of  the  city 
of  Albany,  called  the  mayor's  court;  and  the 
cause  was  tried  there  in  October,  1824.  On 
the  trial,  the  plaintiff  below  proved  that  in 
July,  1834,  he  owned  the  horse,  and  on  the 
23d  of  that  month  sold  it  to  the  defendant 
below;  and  took  his  note  in  these  words: 
"For  value  received,  I  promise  to  pay  John 
Stafford  fifty  dollars  in  liquor  at  my  bar." 
On  this  note  the  following  payments  were 
endorsed  by  the  plaintiff  below:  July  26th, 
1824,  $4.  Same  day,  $1  25.  July  30th,  cash, 
$5  50.  August  4th,  cash,  $18  00.  August 
7th,  $12  34.  The  defendant  below  also  prov- 
ed, that  at  the  time  of  the  purchase  of  the 
horse,  the  plaintiff  below  owed  the  defend- 
ant below  between  thirty  and  forty  dollars 
for  board,  lodging,  carriage-hire,  and  liquor. 
The  plaintiff  below  proved  that  some  time 
after  the  sale  of  the  horse,  the  defendant  be- 
low offered  the  horse  for  sale  as  his  own 
property,  to  one  John  Griffith,  who  declined 
to  purchase;  and  farther,  that  the  plaintiff 
below  was  but  19  years  of  age  at  the  time 
of  the  sale  of  the  horse;  that  Spencer  Staf- 
ford was  his  general  guardian. 

The  defendant  below  moved  for  a  nonsuit, 
on  the  ground  that  no  conversion  had  been 
proved;  and  also  on  the  ground  that  it  was 
not  competent  for  the  plaintiff'  below  to 
avoid  his  contract  while  yet  under  age.  The 
motion  was  overruled;  and  the  defendant  be- 
low excepted. 

The  defendant  below  then  proved  a  receipt 
given  by  the  plaintiff  below,  dated  August 
27th,  1824,  during  the  pendency  of  the  suit, 
in  full  of  the  note;  and  that  the  plaintiff  be- 
low had  disavowed  the  suit. 

The  court  below  charged  that  the  plaintiff 
below  had  a  riglit  to  bring  his  action  while  yet 
an  infant;  that  the  contract  was  void;  that 
the  defendant  below  was  not  entitled  to  have 
any  of  the  payments  made  by  him  allowed, 
except  such  as  were  in  necessaries;  and  that 
the  plaintiff  was  entitled  to  recover.  The 
defendant  below  excepted.  Verdict  for  the 
plaintiff  below  of  $55,  upon  which  the  may- 
or's court  gave  judgment.  The  defendant 
below  brought  error  to  the  supreme  court, 
who  reversed  the  judgment  on  the  sole 
ground  that  an  infant  cannot  avoid  his  exe- 
cuted contract  during  his  minority.  Upon 
which  the  defendant  below  brought  error  to 
this  court. 

The  reasons  for  the  judgment  of  the  su- 
preme court  were  now  assigned,  as  in  7  Cow. 
180-185. 

Jacob  Lansing,  for  plaintiff  in  error.  A. 
Taber,  contra. 

JONES,  Ch.,  said,  it  is  true  in  general  that 
the   deed   of  an   infant  is  voidable   merely. 


when  delivered  with  his  own  hand,  and  is 
of  equal  validity,  whether  it  be  of  lands  or 
chattels.  Some  of  the  old  writers  seem  to 
make  a  distinction  between  deeds  and  other 
contracts  of  infants  accompanied  by  manual 
delivery;  but  the  distinction  is  now  discard- 
ed, and  the  same  eft"ect  is  given  to  both. 
They  are  not  void,  but  voidable,  where  any 
act  of  delivery  is  done  by  the  infant  calcu- 
lated to  carry  an  estate;  and  this  whether 
the  contract  be  beneficial  to  the  infant  or 
not.  But  a  manual  delivery  seems  in  such 
case  to  be  essential.  None  was  shown  in 
this  case.  The  fact  of  possession  by  the 
vendee  would  be  evidence  of  deliveiy  in  the 
case  of  an  adult;  but  in  case  of  an  infant 
vendor,  there  should  be  strict  proof  of  a  per- 
sonal delivery.  An  infant  cannot  make  an 
attorney.  The  appointment  would  be  void; 
and  there  being  no  proof  of  actual  manual 
deliveiy,  the  contract  would  seem  to  be  void. 
The  agreement  to  sell  conferred  no  right  up- 
on the  vendee  to  take.  The  mere  agreement 
of  the  infant  to  sell  would  not  protect  the 
vendee  against  an  action  of  trespass  for  tak- 
ing the  horse.  The  taking  would  be  tortious; 
and  in  itself  a  conversion. 

But  suppose  the  sale  to  be  merely  voidable; 
could  the  infant  or  his  guardian  avoid  it  be- 
fore he  arrived  at  21  years  of  age?  The  gen- 
eral rule  is,  that  an  infant  cannot  avoid  his 
contract  executed  by  himself,  and  which  is 
therefore  voidable  only  while  he  is  Avithin 
age.  Bool  v.  Mix,  17  Wend.  119;  Slocum  v. 
Hooker,  13  Barb.  536.  He  lacks  legal  discre- 
tion to  do  the  act  of  avoidance.  But  this 
rule  must  be  taken  with  the  distinction  that 
the  delay  shall  not  work  unavoidable  preju- 
dice to  the  infant;  or  the  object  of  his  priv- 
ilege, which  is  intended  for  his  protection, 
would  not  be  answered.  When  applied  to 
a  sale  of  his  property,  it  must  be  his  land;  a 
case  in  which  he  may  enter  and  receive  the 
profits  until  the  power  of  finally  avoiding 
shall  arrive;  and  such  was  the  doctrine  of 
Zouch  V.  Parsons,  3  Burrows,  1794.  Should 
the  law  extend  the  same  doctrine  to  sales  of 
his  personal  estate,  it  would  evidently  ex- 
pose him  to  great  loss  in  many  cases;  and 
we  shall  act  up  to  the  principle  of  protection 
much  more  effectually  by  allowing  him  to 
rescind  while  under  age,  though  he  may 
sometimes  misjudge,  and  avoid  a  contract 
which  is  for  his  own  benefit.  The  true  rule, 
then,  appears  to  me  to  be  this;  that  where 
the  infant  can  enter,  and  hold  the  subject  of 
the  sale  till  his  legal  age,  he  shall  be  inca- 
pable of  avoiding  till  that  time;  but  where 
the  possession  is  changed,  and  there  is  no 
legal  means  to  regain  and  hold  it  in  the 
mean  time,  the  infant,  or  his  guardian  for 
him,  has  the  right  to  exercise  the  power  of 
rescission  immediately.  Now  the  common 
law  gives  no  action  or  other  means  by  which 
the  mere  possession  of  personal  property  can 
be  reclaimed,  and  held  subject  to  the  right  of 
avoidance. 
Besides,  in  this  case  the  iiilaui  had  a  gen- 


INFANTS. 


291 


eral  guardian.  It  may  well  be  doubted 
whether  he  eould  make  any  coutiact  of  sale 
whieh  should  bind  him,  for  any  purpose,  dur- 
ing his  wardship. 

STEBBINS,  Senator.  Whatever  may  be 
the  correet  opinion  (and  I  am  not  prepared 
to  express  any)  upon  the  question  discussed 
by  the  supreme  court  in  this  cause,  and  in 
the  opiuiun  of  his  honor  the  chancellor,  as 
to  the  right  of  an  infant  to  avoid,  during  his 
minority,  a  sale  of  property  made  by  him, 
theip  is  another  point  upon  which  I  must 
place  my  vote. 

The  plaintiff  brought  his  action  of  trover 
against  the  defendant  in  the  mayor's  court, 
fur  the  horse  which  he  had  sold  him  during 
his  infancy,  and  recovered.  The  defendant 
took  a  bill  of  exceptions  upon  the  ground, 
among  others,  that  no  conversion  was 
proved. 

The  cause  coming  before  the  supreme  court 
upon  this  bill  of  exceptions,  the  judgment  is 
reversed,  for  the  reason  that  the  plaintiff,  be- 
ing an  infant,  could  not  legally  avoid  his 
contract  of  sale,  until  he  should  become  of 
age.  This  court  is  possessed  of  the  cause  up- 
on a  writ  of  error  brought  to  reverse  the 
judgment  of  the  supreme  court,  and  to  re- 
store to  the  plaintiff  his  judgment  obtained 
in  the  mayor's  court. 

It  is  obvious,  therefore,  that  if  no  conver- 
sion of  the  horse  was  proved  in  the  mayor's 
court,  the  judgment  of  that  court  ought  to 
have  been  reversed  by  the  supreme  court, 
for  tliat  reason  as  well  as  for  the  reason  as- 
signed by  them;  and  if  the  exception  was 
well  taken  by  the  defendant,  the  judgment 
of  the  supreme  court  ought  now  to  be  af- 
firmed. 

The  only  evidence  of  conversion  is,  that 
the  defendant  upon  one  occasion,  offered  to 
sell  the  horse;  and  this,  in  my  judgment, 
does  not  amount  to  a  conversion.  There  is 
no  evidence  of  any  tortious  taking,  or  de- 
mand and  refusal. 

The  defendant  came  into  possession  as  a 
purchaser.  The  sale  was  not  void,  but  void- 
able by  the  infant;  and  conceding,  therefore, 
that  he  may  avoid  it  before  coming  of  age, 
it  is  certainly  good  until  avoided;  and  the 
possession  of  the  defendant  must  have  been 


rightful  until  such  avoidance.     His  offer  to 
sell,  then,  can  be  no  conversion. 

The  first  evidence,  or  notice  of  his  election 
to  avoid  the  contract  which  the  plaintiff 
seems  to  have  given,  was  the  commencement 
of  this  suit.  I  think  he  sijould  lirst  have 
given  notice  of  his  election  to  avoid  the  eon- 
tract,  and  demanded  the  horse,  and  wailed 
for  a  refusal  to  deliver,  as  evidence  of  con- 
version, before  he  commenced  his  prosecu- 
tion; and  for  tliis  reason  I  am  in  favor  of 
affirming  the  judgment  of  the  supreme  courL 

JONES,  Ch.,  said  his  attention  had  been 
mainly  employed  upon  the  questioji  discussed 
by  tlie  supreme  court.  He  had  attended  but 
slightly  to  that  branch  of  the  case  examined 
by  the  honorable  senator;  nor  did  he  feel 
prepared  to  express  himself  strongly  upon 
the  question  whether  an  offer  to  sell  a  chat- 
tel by  one  who  comes  lawfully  into  the  pos- 
session of  it,  sliall  be  holden  a  conversion. 
He  inclined  to  think  that  it  was  an  act  of 
such  control,  inconsistent  with,  and  in  defi- 
ance of  the  rights  of  the  true  owner,  as  to 
be,  prima  facie,  evidence  of  a  conversion. 

But  here  is  a  sale  set  up  as  having  been 
made  by  an  infant  under  the  care  of  a  gen- 
eral guardian,  and  accompanied  with  no  ev- 
idence whatever  of  a  manual  delivery  by  the 
ward.  Ho  had  remarked  that  such  a  deliv- 
ery cannot  be  intended,  though  it  would  be 
otherwise  in  the  case  of  an  adult.  It  then 
stands  before  us,  at  best,  as  the  case  of  an 
infant  contracting  to  sell;  and  the  vendee 
taking  possession  in  virtue  of  the  contract, 
without  its  being  followed  up  by  any  act  of 
delivery.  Such  a  talving  would  be  tortious, 
and  a  couvei-sion  in  itself. 

He  was  of  opinion,  on  the  whole  case,  that 
the  judgment  of  the  supreme  court  should  be 
reversed. 

For  reversal:  THE  CHANCELLOR,  AL- 
LEN, CHARY.  ELSWOKTH,  ENOS,  GARD- 
INER, IIAIGHT,  HART,  JORDAN.  LAKE, 
McMARlTN.  WATERMAN,  and  WILKE- 
SON,  Senators. 

For  aflirraance:  BURROWS,  DATAN.  Mc- 
CALL.  NELSON,  OLR'ER,  SMITH,  and 
STEBBINS,  Senators. 

Judgment  reversed- 


292 


CAPACITY  OF  PARTIES. 


GOODNOW  et  al.  v.  EMPIRE  LUMBER 

et  al.  , 

(IS  N.  W.  283,  31  Minn.  468.)      y 
Supreme  Court  of   Minnesota.     Jan.   28,   1SS4. 
Appeal  from  an  ord?r  of  the  distxict  coui-t, 
Winona  county. 

W.  H.  Yale  and  J.  M.  Gliman,  for  respond- 
ents, Mary  Hamilton  Goodnow  and  another. 
Triomas  Wilson,  for  appellants,  the  Empire 
Lmnber  Co.  and  another. 

GILFILToAN,  C.  J.  November  27,  1857, 
Elizabeth  M.  Hamilton,  then  a  married  wom- 
au  and  owner  of  certain  real  estate  in  the 
fity  of  Winona,  conveyed  the  same,  her  hus- 
band joining  in  the  deed,  to  the  defendant 
Huff,  imder  whom  the  other  defendant 
claims.  Mrs.  Hamilton  was  born  April  21, 
1S42.  She  died  December  16,  1867,  and  her 
husband  died  November  10,  1874.  Plaintiffs 
are  their  children,  Mary,  born  March  31, 
lSo9,  and  Eugenia,  January  29,  1863.  They 
bring  the  action  to  avoid  the  conveyance,  be- 
cause of  the  minority  of  Elizabeth  M.  Ham- 
ilton when  she  executed  it.  Plaintiffs  gave 
notice  to  the  lumber  company  of  their  intent 
to  disaffirm  the  conveyance,  March  22,  188.3. 
Ti"<>ating  this  as  a  sufficient  act  of  disaffirm- 
ance in  case  they  then  had  the  right  to  dis- 
affirm, and  it  is  not  material  whether  it  was 
or  not,  for  the  bringing  of  the  action,  which 
was  sufficient,  immediately  foUowed,  there 
elapsed  between  the  execution  of  the  deed 
and  its  disaffirmance  tw-entj^-five  years  and 
four  months.  The  disability  of  infancy  on 
tne  part  of  the  infant  grantor  ceased  April 
21,  1863.  and  as  the  real  estate  was  owned  by 
her  at  tha  time  of  her  marriage,  her  disabil- 
ity from  coverture,  so  far  as  affected  her  right 
to  reclaim,  hold  and  control  the  property 
ceased  August  1,  1866,  when  the  General  Stat- 
utes (1866)  went  into  effect;  so  that  for  four 
years  and  eight  months  before  she  died  she 
was  free  of  the  disabiliry  of  infancy,  and  for 
one  year  four  and  a  half  months,  she  was 
practically  free  of  the  disability  of  coverture. 
During  the  latter  period,  at  least,  she  was 
capable  in  law  to  disaffirm  the  deed,  if  she 
had  the  right  to  do  so,  and  if  she  was  re- 
quired to  exercise  the  right  witliin  a  reason- 
able time  after  her  disability  ceased,  the  time 
was  running  for  that  period.  The  youngest 
of  the  plaintiffs  became  of  age  January  29, 
1881,  so  tliat  even  if  the  period  of  minoi'ity 
of  plaintiffs  were  to  be  excluded  (and  we 
doubt  if  it  should  be)  there  is  to  be  added  at 
least  two  years  and  two  months  to  the  time 
which  had  elapsed  when  the  grantor  died, 
making  the  time  three  years  and  over  six 
months. 

The  main  question  in  the  case  is,  must  one 
who,  while  a  minor,  has  conveyed  real  estate, 
di.saffirm  the  conveyance  within  a  reasonable 
time  after  minority  ceases,  or  be  barred.  Of 
the  decided  cases  the  majority  are  to  the  ef- 
fect that  he  need  not,  (where  there  are  no 
circumstances  other  than  lapse  of  time  and 


silence,)  and  that  he  is  not  barred  by  mere 
acquiescence  for  a  shorter  period  than  that 
prescribed  in  the  statute  of  limitations.  The 
following  are  the  principal  cases  so  decided: 
Vaughan  v.  Parr,  20  Ark.  600;  Boody  v.  :Mc- 
Kenney,  23  Me.  517;  Davis  v.  Dudley,  70 
Me.  236;  Praut  v.  Wiley,  28  Mich.  164;  Cause 
V.  Norcum,  12  Mo.  550;  Norcum  v.  Gaty,  19 
Mo.  69;  Peterson  v.  Laik,  24  Md.  541;  Baker 
V.  Kennett,  54  Mo.  82;  Huth  v.  Dock  Co.,  56 
Md.  206;  Hale  v.  Gerrish,  8  N.  H.  374;  Jack- 
son V.  Carpenter,  11  Johns.  538;  Voorhies  y. 
Voorhies,  24  Barb.  150;  INIc^.Iurray  v.  Mc- 
Murray,  66  N.  Y.  175;  Lessee  of  Drake  v. 
Ramsey,  5  Oliio,  252;  Cresinger  v.  Lessee  of 
Welsh,  15  Ohio,  156;  Irvine  v.  Irvine,  9  Wall. 
617;    Ordinary  v.  Wherry,  1  Bailey,  28. 

On  the  other  hand,  there  are  many  decisions 
to  the  effect  that  mere  acquiescence  beyond  a 
reasonable  time  after  the  minority  ceases  bars 
the  right  to  disaffirm,  of  which  cases  the  fol- 
lowing are  the  principal  ones:  Holmes  v. 
Blogg,  8  Taunt.  35;  Railway  Co.  v.  Black,  8 
Exch.  ISO;  Thomasson  v.  Boyd,  13  Ala.  419; 
Delano  v.  Blake,  11  Wend.  85;  Bostwick  v. 
Atkins,  3  N.  Y.  53;  Chapin  v.  Shafer,  49  N. 
Y.  407;  Jones  v.  Butler,  30  Barb.  041;  Kline 
V.  Beebe,  6  Conn.  494;  Wallace's  Lessee  v. 
Lewis,  4  Har.  80;  Hastings  v.  Dollarhide,  24 
Cal.  195;  Scott  v.  Buchannan,  11  Humph. 
467;  Hartman  v.  Kendall,  4  Ind.  403;  Bige- 
low  V.  Kinney,  3  Vt.  353;  Richardson  v.  Bo- 
right,  9  Vt.  308;  Harris  v.  Cannon,  6  Ga.  382; 
Cole  V.  Pennoyer,  14  111.  158;  Black  v.  Hills, 
36  III.  376;  Robinson  v.  Weeks,  50  Me.  102; 
Little  V.  Duncan,  9  Rich.  Law,  55. 

The  rule  holding  certain  contracts  of  an 
infant  voidable  (among  them  his  conveyances 
of  real  estate)  and  giving  him  the  right  to 
affirm  or  disaffirm  after  he  arrives  at  ma- 
jority, is  for  the  protection  of  minors,  and  so 
that  they  shall  not  be  prejudiced  by  acts  done 
or  obligations  incurred  at  a  time  when  they 
are  not  capable  of  determining  what  is  for 
their  interest  to  do.  For  this  purpose  of  pro- 
tection the  law  gives  them  an  opportunity', 
after  they  have  become  capable  of  judging  for 
themselves,  to  determine  whether  such  acts 
or  obligations  are  beneficial  or  prejudicial  to 
them,  and  whether  they  will  abide  by  or  avoid 
them.  If  the  right  to  affirm  or  disaffirm  ex- 
tends beyond  an  adequate  opportunity  to  so 
determine  and  to  act  on  the  result,  it  ceases 
to  be  a  measure  of  protection,  and  becomes, 
in  the  language  of  the  court  in  Wallace's  Les- 
see V.  Lewis,  "a  dangerous  weapon  of  of- 
fen.se,  and  not  a  defense."  For  we  cannot 
assent  to  the  reason  given  in  Boody  v.  Mc- 
Kenney  (the  only  reason  given  by  any  of  the 
cases  for  the  rule  that  long  acquiescence  in 
no  proof  of  ratification)  "that  by  his  silent 
acquiescence  he  occasions  no  injury  to  other 
persons  and  secures  no  benefits  or  new  rights 
to  himself.  There  is  nothing  to  urge  him  as 
a  duty  to  others  to  act  speedily." 

The  existence  of  such  an  infirmity  in  one's 
title  as  the  right  of  another  at  his  pleasure  to 
defeat  it,  is  neccs.sarily  prejudicial  to  it.  and 


INFANTS. 


293 


tlic  longer  it  may  continue  the  more  serious 
the  injuiy.     SiJi^  a  ri^ih^JiLa  continual^  men-_ 
ace  to  the  title. 
the  title  is  ol 


lloldiug  such  a  menace  over 
course  an  injury  to  the  owner 
of  it;  one  possessing  such  a  right  is  bound  in 
justice  and  fairness  towards  the  owner  of  the 
title  to  determine  without  delay  whether  he 
will  exercise  it.  The  right  of  a  minor  to  dis- 
aflirm  on  coming  of  age,  lilie  the  right  to 
disaffirm  in  any  other  case,  should  be  exer- 
cised with  some  regard  to  the  rights  of  oth- 
ers,—with  as  nmch  regard  to  those  rights  as 
is  fairly  consistent  with  due  protection  to  the 
interests  of  the  minor. 

In  every  other  case  of  a  right  to  di.saffirm,l 
the  party  holding  it  is  required,  out  of  regard' 
to  the  rights  of  those  who  may  be  affected  by 
its  exercise,  to  act  upon  it  within  a  reasonable 
time.  There  is  no  reason  for  allowing  great- 
er latitude  where  the  right  exists  because  of 
infancy  at  the  time  of  making  the  contract. 
A  reasonable  time  after  majority  within 
which  to  act  is  all  that  is  essential  to  the  in- 
fant's protection.  That  10,  15,  or  20  years,  or 
such  other  time  as  the  law  may  give  for 
bringing  an  ac'tion.   is  necessary  as  a  matter 


c^  protection  to  him  is  absurd.  The  only 
eirect  of  giving  more  than  a  reasonable  time 
is  to  enable  the  mature  man,  not  to  correct 
what  he  did  amiss  in  his  infancy,  but  to 
speculate  on  the  events  of  the  future— a  con- 
sequonce  entirely  foreign  to  the  purpose  of  the 
i-ule  which  is  solely  protection  to  the  infant. 
Reason,  justice  to  others,  public  policy,  (whirh 
is  not  subserved  by  cherishing  defective  ti- 
tles,) and  convenience,  require  the  right  of 
disafiinuance  to  be  acted  upon  within  a  rea- 
sonable time.  What  is  a  reasonable  time 
will  depend  on  the  circumstances  of  each  par- 
ticular case,  and  may  be  either  for  the  court 
or  for  the  jury  to  determine.  Where,  as  in 
this  case,  there  is  mcro  delay,  with  nothing 
to  explain  or  excase  it,  or  show  its  necessity, 
it  will  be  for  the  court.  Cochran  v.  Toher, 
14  Minn.  3S5  (Gil.  2'J3);  Derosia  v.  Ilailroad 
Co.,  IS  Minn.  1-3.3  (Gil.  119).  ^h'-^  y^.'ira 
■■^tu  n  hnlf.  the  delay  in  this  case.  _Iexcludin£_ 
the  period  of  p'nip<^'<^'8  m'""^'^y,  '^f*'^^  *^^ 
limg  withinwhich  to  act  had.  coqinienced_to 
run  J  wa^  primafacie_niore_than^a_rfia50liablo 
time,  and~J>rima  faclgllbe_cpnveyance  was 
ratifie^.^  Order  reversed.  ~ 


29i 


.^ 


\ 


CAPACITY  OF  PARTIES. 

MANSFIELD   v.   GORDON.       ,    i/ 
(10  N.  E.  773,  144  Mass.  168.) 


\>' 


Supreme  Judicial  Court  of  Massachusetts.     Suf- 
folk.    Feb.  26,  1SS7. 

Bill  in  equity  to  set  aside  a  mortgage  made 
by  one  Bnrrell,  an  insolvent  debtor,  while 
a  minor.  Trial  in  the  superior  court  upon 
issues  framed  for  a  jurj-,  which  found  that 
the  mortgagor,  Burrell,  was  a  minor,  under 
21  years  of  age,  when  he  executed  the  mort- 
gage; that  he  did  not  at  the  time  represent 
to  the  defendant  that  he  was  21  years  of  age; 
and  that  neither  he  nor  plaintiff  ratified  or 
affirmed  said  mortgage  after  Burrell  became 
21  years  of  age,  or  waive  the  objection  of  his 
minority.  After  further  hearing  in  said 
court  before  Barker,  J.,  the  bill  was  dis- 
missed, and  the  plaintiff  appealed.  Other 
facts  appear  in  the  opinion. 

A  Hemenway  and  A  L.  Murray,  for  plain- 
tiff. J.  Willard  and  J.  R.  Churchill,  for  de- 
fendant 

DEVEXS,  J.  The  plaintiff  by  his  bUl  seeks 
to  relieve  the  realty  of  BurreU,  an  insolvent 
debtor,  of  whose  estate  he  is  assignee,  from 
the  incumbrance  of  a  mortgage  thereon  con- 
ditioned for  the  payment  of  a  note  of  $1,000. 
The  note  and  mortgage  were  executed  by 
Burrell  when  under  age.  He  is  now  of  age, 
and  was  so  when  the  plaintiff  was  appointed 
assignee.  Since  his  majority,  he  has  not 
ratified  the  note  and  mortgage,  nor  is  it  al- 
leged that  he  has  done  any  act  in  disaffirm- 
ance thereof.  The  assignment  vests  in  the 
assignee  not  only  all  the  property  of  the 
debtor,  both  real  and  personal,  which  he 
could  lawfully  have  sold,  assigned,  or  con- 
veyed, including  debts  due  him  and  the  se- 
curities therefor,  but  also  "all  his  rights  of 
action  for  goods  or  estate,  real  or  personal." 
"By  the  right  of  action  mentioned  in  the 
statute,"  it  Ls  said  by  Chief  Justice  Shaw, 
"the  legi.slature  intended  all  valuable  rights 
actually  subsis;ting,  whether  absolute  or  con- 
ditional, legal  or  equitable,  which  were  to 
be  obtained  by  the  aid  of  any  species  of  ju- 
dicial process."  Gardner  v.  Hooper,  3  Gray, 
404. 

It  is  the  contention  of  the  plaintiff  that,  by 
virtue  of  this  clause,  as  assignee  he  is  en- 
titled to  exercise  the  privilege  which  the  in- 


I /solvent   might   have    exercised    on    reaching 
I  his   majority,   and    disaffirm    this    mortgage, 
I  and  thus  is  entitled  to  a  decree  relieving  the! 
I  estate  therefrom.    That  an  individual  cred^ 
itor  cannot  attach  property   conveyed  by  a 
debtor   while   a    minor,     the    conveyance    of 
which   such  debtor  might  have  disaffirmed, 
and  thus  avail  himself  of  the  infant's  privi- 
lege, is  well  settled.    McCarty  v.  Murray,  3 
Gray,  578;    Kendall   v.   Lawrence,   22   Pick. 
540;     Kingman   v.    Perkins,    105   Mass.    111. 
While  the  rights  of  the  assignee  are  not  al- 
ways tested  by  those  of  the  individual  cred- 
itor, there  woulu  seem  to  be  no  reason  why 
larger    rights   in   an    estate    conveyed    by   a 
minor  are  obtained  by  an  assignee  acting  on 
behalf  of  all  the  creditors.    The  contracts  of  an 
infant  are  voidable  only,  and  not  void,  and  it 
has  often  been  said  that  the  right  to  avoid 
his  contracts  is  a  personal  privilege  of  the 
infant  only,  not  to  be  availed  of  by  otliers. 
Nightingale    v.    Withington,    15    Mass.    272; 
Chandler  v.   Simmons,  97  Mass.   508-511;    1 
Chit  Cont.  (11th  Ed.)  note  6.    It  is  said  in 
Austin  V.  Charlestown  Fem.  Sem.,  8  Mete. 
196-200,  by  Judge  Wilde:    "Voidable  acts  by 
an  infant,  or  matters  of  record  done  or  suf- 
fered by  him,  can  be  avoided  by  none  but 
himself,  or  his  friends  in  blood,  and  not  by 
privies  in  estate,  and  this  right  of  avoidance 
is  not  assignable."    Bac.  Abr.    "Infancy  and 
Age,"  1,  6;   Whittingham's  Case,  S  Coke,  43. 
It  is  said  that  it  is  for  the  benefit  of  the 
debtor  that  the  assignee  should  be  allowed  to 
avoid  his  mortgage,  as  the  assets  of  the  es- 
tate  are  thus  increased.    The   ground  upon 
which  an  infant  is  allowed  to  avoid  his  con- 
tracts is  for  personal  benefit,   and  for  pro- 
tection   against    the    improvidence   which    is 
the    consequence    of    his    youth.    He    may 
therefore  avoid  his  contract  without  return- 
ing the  consideration  received,  but  it  is  not 
easy   to  see  why   his   creditors,   or  the   as- 
signee as  representing  them,  should  have  this 
right.    It  may  well  be  that  the  estate  of  the 
insolvent  has  been  augmented  to  that  extent 
by  the  very  sum  of  money  which  the  minor 
received.    The  fact  that  the  infant  may  re- 
scind   without   returning   the    consideration 
indicates  that  the  right  is  strictly  a  personal 
privilege;    and  that,  as  the   rule  permitting 
him  to  thus  avoid  his  contract  is  established 
solely    for   his   protection,    so    he   alone    can 
have  the  benefit  of  it.    Decree  affirmed. 


r  ^\         TUCKER  v.  MORELAND.  ,*)>^ 

^  (10  Pet.  58.)  W /V^j 

Supreme  Court  of  the  United  States.   -Jbn' 
Term,  ISotJ.  ^^ 

The  case  is  stated  in  tlie  opinion  of  the 
court. 

Mr.  Coxe,  for  plaintiff.  Bradley  &  Swann, 
contra. 

STORY,  J.  This  Is  a  writ  of  error  to  the 
circuit  court  for  the  county  of  Washington, 
and  District  of  Columbia. 

The  original  action  was  an  ejectment 
brought  by  the  plaintiff  in  error  against  the 
defendant  in  error;  and  both  parties  claimed 
the  title  under  Richard  N.  Barry.  At  the  trial 
of  the  cause  upon  the  general  issue,  it  was 
admitted  that  Richard  N.  Barry,  being  seised 
in  fee  of  the  premises  sued  for,  on  the  1st 
day  of  December,  1831,  executed  a  deed 
thereof  to  Richard  Wallach.  The  deed,  after 
reciting  that  Barry  and  one  Bing  were  in- 
debted to  Tucker  and  Thompson,  in  the  sum 
of  $3,238,  for  which  they  had  given  their 
promissory  note,  payable  in  six  months  after 
date,  to  secure  which  the  convejance  was  to 
be  made,  conveyed  the  premises  to  Wallach, 
in  trust,  to  sell  the  same  in  case  the  debt 
should  remain  unpaid  ten  days  after  the  1st 
day  of  December  then  next.  The  same  were 
accordingly  sold  by  Wallach,  for  default  of 
payment  of  tlie  note,  on  the  2.3d  of  February, 
1S33,  and  were  bought  at  the  sale  by  Tucker 
and  Thompson,  who  received  a  deed  of  the 
same  on  the  7th  of  March,  of  the  same  year. 
It  was  admitted,  that  after  the  execution  of 
the  deed  of  Barry  to  Wallach,  the  former 
continued  in  possession  of  the  premises  until 
the  8th  of  February,  1S33(  when  he  executed 
a  deed,  including  tlie  same  and  other  iiarcels 
of  land,  to  liis  mother,  Eliza  G.  Moreland,  the 
defendant,  in  consideration  (as  recited  in  the 
deed)  of  the  sum  of  $1,138.61,  which  he  owed 
his  mother;  for  the  recovery  of  which  she 
had  instituted  a  suit  against  him,  and  of  oth- 
er sums  advanced  him,  a  particular  account 
of  which  had  not  been  kept,  and  of  the  fur- 
ther sum  of  §o.  At  the  time  of  the  sale  of 
Wallach,  the  defendant  gave  public  notice  of 
her  title  to  the  premises,  and  she  pubhcly 
claimed  the  same  as  her  absolute  right.  The 
defendant  further  gave  evidence  at  the  trial, 
to  prove  tliat  at  the  time  of  the  execution  of 
the  deed  by  Barry  to  Wallach,  he,  Barry, 
was  an  infant  under  21  yeare  of  age;  and,  at 
the  time  of  the  execution  of  the  deed  to  the 
defendant,  he  was  of  the  full  age  of  21  years. 

Upon  this  state  of  the  evidence,  the  coun- 
sel for  the  defendant  prayed  the  court  to 
instruct  the  jury,  that  if  upon  the  whole  evi- 
dence given  as  aforesaid  to  the  jury,  they 
should  believe  the  facts  to  be  as  stated  as 
aforesaid,  then  the  deed  from  the  said  Wal- 
lach to  the  plaintiffs,  did  not  convey  to  the 
plaintiffs  any  title  which  would  enable  them 


lis  FA  NTS. 


295 


to  sustain  the  action.  This  Instruction  the 
court  gave;  and  this  constitutes  the  exception 
now  relied  on  by  the  plaintiff  in  error  in  his 
first  bill  of  exceptions. 

Some  criticism  has  been  made  upon  the  lan- 
guage in  which  this  instruction  is  couched. 
But,  in  substance,  it  raises  the  question  which 
has  been  so  fully  argued  at  the  bar,  as  to  the 
validity  of  the  plaintiffs'  title  to  recover;  if 
Barry  was  an  infant  at  the  time  of  the  execu- 
tion of  his  deed  to  Wallach.  If  that  deed 
was  originally  void,  by  rea.son  of  Barry's  in- 
fancy, then  the  plaintiff,  who  must  recover 
upon  the  strength  of  his  own  title,  fails  in 
that  title.  If,  on  the  other  hand,  that  deed 
was  voidable  only,  and  not  void,  and  yet  It 
has  been  avoided  by  the  subsequent  convey- 
ance to  the  defendant  by  Barry;  then  the 
same  conclusion  follows.  And  these,  accord- 
ingly, are  the  considerations  which  are  pre- 
sented under  the  present  instruction. 

In  regard  to  the  point  whether  the  deed  of 
lands  by  an  infant  is  void  or  voi<lable  at  the 
common  law,  no  inconsiderable  diversity  of 
opinion  is  to  be  found  in  the  authorities. 
That  some  deeds  or  instruments  under  seal 
of  .an  infant  are  void,  and  others  voidable, 
and  others  vahd  and  absolutely  obhgatory,  is 
not  doubted.  Thus,  a  single  bill  under  seal 
given  by  an  infant  for  necessaries,  is  abso- 
lutely binding  upon  him;  a  bond  with  a  pen- 
alty for  necessaries  is  void,  as  apparently  to 
his  prejudice;  and  a  lease  reserving  rent  is 
voidable  only.  The  difficulty  is  in  ascertain- 
ing the  true  principle,  upon  which  these  dis- 
tinctions depend.  Lord  Mansfield,  m  Zouch 
V.  Parsons,  3  Burrows,  1804,  said,  that  it  was 
not  settled  what  is  the  true  gi-ound  upon 
which  an  infant's  deed  is  voidable  only; 
whether  the  solemnity  of  the  instrument  is 
sufficient,  or  it  depends  upon  the  semblance 
of  benefit  from  the  matter  of  the  deed  upon 
the  face  of  it.  Lord  Mansfield,  upon  a  full 
examination  of  the  authorities  on  this  occa- 
sion, came  to  the  conclusion  (in  which  the 
other  judges  of  the  court  of  king's  bench  con- 
curred) that  it  was  the  solemnity  of  the  in- 
strument, and  delivery  by  the  infant  himself, 
and  not  the  semblance  of  benefit  to  him,  that 
constituted  the  true  line  of  distinction  be- 
tween void  and  voidable  deeds  of  the  infant, 
but  he  admitted  that  there  were  respectable 
sayings  the  other  way.  The  point  was  held 
by  the  court  not  necessary  to  the  determina- 
tion of  that  case;  because  in  that  case  the 
circumstances  showed  that  there  was  a  sem- 
blance of  benefit  sufficient  to  make  the  deed 
voidable  only,  upon  the  matter  of  the  convey- 
ance. There  can  be  little  doubt  that  the  de- 
cision in  Zouch  v.  Parsons  was  perfectly  cor- 
rect; for  it  was  the  case  of  an  infant  mort- 
gagee, releasing  by  a  lease  and  release  his 
title  to  the  premises,  upon  the  payment  of 
the  mortgage  money  by  a  second  mortgagee, 
with  the  consent  of  the  mortgagor.  It  was 
precisely  such  an  act  as  the  infant  was  bound 
to  do;  and  would  have  been  compelled  to  do 
by    a   court    of   equity,   as    a   trustee   of    the 


296 


CAPACITY  OF  PARTIES. 


mortgagor.  And  certainly  it  was  for  his  in- 
terest to  do,  -what  a  court  of  equity  would,  by 
a  suit,  have  compelled  him  to  do. 

Upon  this  occasion.  Lord  Mansfield  and  the 
court  approved  the  law  as  laid  down  by  Per- 
kins (section  12,)  that  "all  such  gifts,  grants, 
or  deeds  made  by  infants,  which  do  not  take 
effect  by  delivery  of  his  hand,  are  void.  But 
all  gifts,  grants,  or  deeds  made  by  infants 
by  matter  of  deed  or  in  writing,  which  do 
take  effect  by  delivery  of  his  hand,  are  voida- 
ble by  himself,  by  his  heirs,  and  by  those 
who  have  his  estate."  And  in  Lord  Mans- 
field's view,  the  words  "which  do  take  effect," 
are  an  essential  part  of  the  definition;  and 
exclude  letters  of  attorney,  or  deeds,  which 
delegate  a  mere  power,  and  convey  no  inter- 
est. So  that,  according  to  Lord  Mansfield's 
opinion,  there  is  no  difference  between  a  feoff- 
ment and  any  deeds  which  convey  an  inter- 
iest.  In  each  case,  if  the  infant  makes  no 
feoffment,  or  delivers  no  deed  in  person,  it 
takes  effect  by  such  delivery  of  his  hand, 
and  is  voidable  only.  But  if  either  be  done 
by  a  letter  of  attorney  from  the  infant,  it  is 
void,  for  it  does  not  take  effect  by  a  delivery 
of  his  hand. 

There  are  other  authorities,  however,  which 
are  at  variance  with  this  doctrine  of  Lord 
Mansfield,  and  which  put  a  different  interpre- 
tation upon  the  language  of  Perkins.  Accord- 
ing to  the  latter,  the  semblance  of  benefit  tc 
the  infant  or  not,  is  the  true  ground  of  hold- 
ing his  deed  voidable  or  void.  That  it  makes 
no  difference,  whether  the  deed  be  delivered 
by  his  own  hand  or  not;  but  whether  it  be 
for  his  benefit  or  not.  If  the  former,  then 
it  is  voidable;  if  tlie  latter,  then  it  is  void. 
And  that  Perkins,  in  the  pas.sage  above  stat- 
ed, in  speaking  of  gifts  and  grants  taking 
effect  by  the  deli^-eiy  of  the  infant's  hand, 
did  not  refer  to  the  deliverj^  of  the  deed,  but 
to  the  deliverj'  of  the  thing  granted;  as,  for 
Instance,  in  the  case  of  a  feoffment  to  a  de- 
livery of  seisin  by  the  infant  personally; 
and  in  case  of  chattels,  by  a  delivery  of  the 
same  by  his  own  hand.  This  is  the  sense 
in  which  the  doctrine  of  Perkins  is  laid  down 
in  Shcppard's  Touchstone,  232.  Of  this  lat- 
ter opinion,  also,  are  some  other  highly  re- 
spectable text  writers  (see  Prest.  Conv.  248, 
2.50;  Com.  Dig.  "Enfant,"  c.  2;  Shep.  Touch. 
232,  and  Acherly's  note;  Bac.  Abr.  "Infan- 
cy," I,  3;  Eng.  Law  J.  1804,  p.  145;  8  Am. 
Jur.  327.  But  see  1  Pow.  Mortg.  [by  Cov- 
entry] note,  208;  Zouch  v.  Parsons,  1  W. 
Bl.  575;  Ellsley's  notes,  h  and  v,  Co.  Litt 
51;  G  Harg.  note,  331;  Holmes  v.  Blogg,  8 
Taunt.  508;  1  Fonbl.  Eq.  bk.  1,  c.  11,  §  3, 
and  notes  y,  z,  a,  b);  and  perhaps,  the  weight 
of  authority,  antecedent  to  the  decision  in 
Zouch  V.  Parsons,  3  Burrows,  1804,  inclined 
in  the  same  way.  Lord  Chief  Justice  Eyre, 
in  Keane  v.  Boycott,  2  H.  Bl.  515,  alluded 
to    this    distinction    in    the    following    terms. 

After  having  corrected  the  generality  of 
some  expressions  in  Litt.  §  259,  he  added: 
"We   have   seen  that   some  contracts  of  in- 


fants, even  by  deed,  shall  bind  them;  some 
are  merely  void,  namely,  such  as  the  court 
can  pronounce  to  be  to  their  prejudice;  oth- 
ers, and  the  most  numerous  class,  of  a  more 
uncertain  nature  as  to  benefit  or  prejudice, 
are  voidable  only,  and  it  is  in  the  election 
of  the  infant  to  affirm  them  or  not.  In 
RoUe,  Abr.  728,  tit  'Enfant,'  and  in  Com. 
Dig.  under  the  same  title,  instances  are  put 
of  the  three  dift'erent  kinds,  of  good,  void, 
and  voidable  contracts.  Where  the  contract 
is  by  deed,  and  not  apparently  to  the  preju- 
dice of  the  infant,  Comyns  states  it  as  a  rule, 
tliat  the  infant  cannot  plead  non  est  factunf, 
but  must  plead  his  infancy.  It  is  his  deed; 
but  this  is  a  mode  of  disaffirming  it.  He 
indeed  states  the  inile  generally;  but  I  limit 
it  to  that  case,  in  order  to  reconcile  the  doc- 
trine of  void  and  voidable  contracts."  A 
doctrine  of  the  same  sort  was  held  by  the 
court  in  Thompson  v.  Leach,  3  Mod.  310; 
in  Fisher  v.  Mowbray,  8  East,  330;  and  Bay- 
lis  V.  DIneley,  3  Maule  &  S.  477.  In  the  last 
two  cases,  the  court  held  that  an  infant  can- 
not bind  himself  in  a  bond  with  a  penalty. 
and  especially  to  pay  interest  In  the  case  of 
Baylis  v.  Dineley,  Lord  EUenborough  said; 
"In  the  case  of  the  infant  lessor,  that  being  a 
lease,  rendering  rent,  imported  on  the  face  of 
it  a  benefit  to  the  infant;  and  his  accepting 
the  rent  at  full  age  was  conclusive  that  it  was 
for  his  benefit.  But  how  do  these  authorities 
affect  a  case,  like  the  present,  where  it  is 
clear  upon  the  face  of  the  instrument  that  it 
is  to  the  prejudice  of  the  infant,  for  it  is  an 
obligation  with  a  penalty,  and  for  the  pay- 
ment of  interest?  Is  there  any  authority  to 
show,  that  if,  upon  looking  to  the  instrument, 
the  court  can  clearly  pronounce,  that  it  is 
to  the  infant's  prejudice,  they  will,  neverthe- 
less, suffer  it  to  be  set  up  by  matter  ex  post 
facto  after  full  age?"  And  then,  after  com- 
menting on  Keane  v.  Boycott  and  Fisher  v 
Mowbray,  he  added:  "In  Zouch  v.  Parsonc;, 
where  this  subject  was  much  considered, 
I  find  nothing,  which  tends  to  show  that  an 
infant  may  bind  himself  to  his  prejudice. 
It  is  t'ne  privilege  of  the  infant,  that  he  shall 
not;  and  we  should  be  breaking  down  the 
protection,  which  the  law  has  east  around 
him,  if  we  were  to  give  effect  to  a  confirma'- 
tion  by  parol  of  a  deed,  like  this,  made  during 
his  infancy." 

It  is  apparent  then,  upon  the  English  au- 
thorities, that  however  true  it  may  be  that 
an  infant  may  so  far  bind  himself  by  deed  in 
certain  cases,  as  that  in  consequence  of  the 
solemnity  of  the  instrument  it  is  voidable 
only,  and  not  void;  yet  that  the  instnmient, 
however  solemn,  is  held  to  be  void,  if  upon  its 
face  it  is  apparent  that  it  is  to  the  prejudice 
of  the  infant.  This  distinction,  if  admitted, 
would  go  far  to  reconcile  all  the  cases;  for  it 
would  decide  that  a  deed  by  virtue  of  its 
solemnity  should  be  voidable  only,  unless  it 
appeared  on  its  face  to  be  to  his  prejudice, 
in  which  case  it  would  be  void.  See  Bac. 
Abr.  "Infancy  and  Age,"  I,  3,  I,  7. 


INFANTS. 


2'J7 


The  same  question  has  undergone  no  incon- 
siderable discussion  in  the  American  courts. 
In  Oliver  v.  Iloudlet,  13  Mass.  23U,  the  court 
seemed  to  think  the  true  rule  to  be,  that 
those  acts  of  an  infant  are  void,  which  not 
only  apparently,  but  necessarily  operate  to 
his  prejudice.  In  Whitney  v.  ■  Dutch,  14 
Mass.  4G2,  tlie  same  court  said,  that  when- 
over  tlie  act  done  may  be  for  the  beueflt  of 
the  infant,  it  shall  not  be  considered  void; 
but  that  he  shall  have  his  election,  when 
he  conies  of  age,  to  allirm  or  avoid  it.  And 
they  added,  that  this  was  the  only  clear  and 
definite  proposition  which  can  be  extracted 
from  the  authorities.  See  Boston  Bank  v. 
Chamberlain,  15  Mass.  220.  In  Conroe  v. 
Birdsall,  1  Johns.  Cas.  127,  the  court  ap- 
proved of  the  doctrine  of  Perkins  (section  12), 
as  it  was  interpreted  and  adopted  in  Zouch 
V.  Parsons;  and  in  the  late  case  of  Uouf  v. 
Stafford,  7  Cow.  180,  181,  the  same  doctrine 
was  fully  recognized.  But  in  an  intermedi- 
ate case,  Jackson  v.  Burchin,  14  Johns.  12G, 
the  court  doubted  whether  a  bargain  and  sale 
of  lands  by  an  infant  was  a  valid  deed  to 
pass  the  land,  as  it  would  make  him  stand 
seised  to  the  use  of  another.  And  that  doubt 
was  well  warranted  by  what  is  laid  down 
in  2  Inst.  G73,  where  it  is  said  that  if  an  in- 
fant bargain  and  sell  lands,  which  are  in  the 
realty,  by  deed  indented  and  enrolled,  he  may 
avoid  it  when  he  will,  for  the  deed  was  of  no 
effect  to  raise  a  use 

The  result  of  the  American  decisions  has 
been  correctly  stated  by  Mr.  Chancellor  Kent, 
in  his  learned  Commentaries  (2  Comm.  Lect 
31),  to  be,  that  they  are  in  favor  of  constni- 
iug  the  acts  and  conti-acts  of  infants  general- 
ly to  be  voidable  only,  and  not  void,  and  sub- 
ject  to  tlieir  election,  when  they   become  of 
age,  either  to  affirm  or  disallow  them;    and 
tliat   the  doctrine   of  Zouch   v.   Parsons  has 
been  recognized  and  adopted  as  law.     It  may 
be  added,  that  they  seem  generally  to  hold 
that  the  deed  of  an  infant  conveying  lands  i 
is  voidable  only,  and   not  void;    unless,   per-  j 
haps,  tlie  deed  should  manifestly  appear  on  ! 
the  face  of  it  to  be  to  the  prejudice  of  the  in-  j 
fant;    and    this  upon  the   nature  and   solem- 
nity, as  well  as  the  opei-ation  of  the  instru- 
ment 

It  is  not,  however,  necessary  for  us  in  this 
case  to  decide  whether  the  present  deed, 
either  from  its  being  a  deed  of  bargain  and 
sale,  or  from  its  nature,  as  creating  a  trust 
for  a  sale  of  the  estate,  or  from  the  other 
circumstances  of  the  case,  is  to  be  deemed 
void,  or  voidable  only.  For  if  it  be  voidable 
only,  and  has  been  avoided  by  the  infant 
then  the  same  result  will  follow,  tiat  tJie 
plaintiff's  title  is  gone. 

Let  us,  then,  proceed  to  the  consideration 
of  the  other  point,  whether,  supposing  the 
deed  to  Wallach  to  be  voidable  only,  it  has 
been  avoided  by  the  subsequent  deed  of  Bar- 
ry to  Mrs.  Moreland.  There  is  no  doubt  that 
an  infant  may  avoid  his  act  deed,  or  con- 
tract,   by   different   means,    according    to    the 


nature  of  the  act,  and  the  circumstances  of 
the  case.  He  may  sometimes  avoid  it  by 
matter  in  pai.s,  as  in  case  of  a  feoffment  by  an 
entry,  if  his  entry  is  not  tolled;  sometimes 
by  plea,  as  when  he  is  sued  upon  his  bond 
or  otlier  contract;  soojietimes  by  suit  aa 
when  he  disaffirms  a  contract  made  for  the 
sale  of  his  chattels,  and  sues  for  the  chattels; 
sometimes  by  a  writ  of  error,  as  when  he 
has  levied  a  flue  during  his  nonage;  some- 
times by  a  writ  of  audita  (piL-rela,  as  when 
he  has  acknowledged  a  recognizance  or  stat- 
ute staple  or  merchant;  (see  Cora.  Dig.  "En- 
fant," bks.  1,  2,  cc.  2-5,  8,  9,  11;  2  lusL 
G73;  2  Kent,  Comm.  §  31;  Bac.  Abr,  "In- 
fancy and  Age,"  I,  5,  I.  7);  sometimes,  as 
in  the  case  of  an  alienation  of  his  estate  dur- 
ing his  nonage  by  a  writ  of  entry,  dum  suit 
infra  a^tatem,  after  his  arrival  of  age.  The 
general  result  seems  to  be  that  where  the 
act  of  the  infant  is  by  matter  of  record,  he 
must  avoid  it  by  some  act  of  record,  (as,  for 
instance,  by  a  writ  of  error,  or  an  audita 
querela,)  during  his  minority.  But  if  the 
act  of  the  infant  is  a  matter  in  pais,  it  may 
be  avoided  by  an  act  in  pais  of  equal  solem- 
nity or  notoriety;  and  this  according  to  some 
authorities,  eitlier  during  his  nonage  or  after- 
wards; and  according  to  others,  at  all  events, 
after  his  arrival  of  age.  See  Bac  Abr.  "In- 
fancy and  Age,"  I,  3,  I,  5,  I,  7;  Zouch  v. 
Parsons,  3  Biu"rows,  1794;  Roof  v.  Stafford, 
7  Cow.  179,  183;  Com.  Dig.  "Enfant,"  C,  9, 
C,  4,  C,  11.  In  Co.  Litt  3S0b,  it  is  said: 
"Herein  a  diversity  is  to  be  observed  between 
matters  of  record  done  or  suffered  by  an  in- 
fant, and  matters  in  fait;  for  matters  ir 
fait  he  shall  avoid  either  within  age  or  a; 
full  age,  as  hath  been  said;  but  matters  ol 
recoixl,  as  statutes,  merchants,  and  of  tbt 
staple,  recognizances  acknowledged  by  him 
or  a  fine  levied  by  him,  recovery  against  hire, 
&c.,  must  be  avoided  by  him,  namely,  stat- 
utes, &c.,  by  audita  querela;  and  the  fino 
and  recovery  by  a  writ  of  error  during  hisj 
minority,  and  the  like."  In  short,  the  nature 
of  tlie  original  act  or  conveyance  generally 
governs,  as  to  the  nature  of  tlie  act  required 
to  be  done  in  the  disaflirmauce  of  it  If 
the  latter  be  of  as  high  and  solemn  a  naturt 
as  the  former,  it  amounts  to  a  valid  avoid- 
ance of  it  We  do  not  mean  to  say.  that  in 
all  cases  the  act  of  disatfirmance  should  be 
of  the  Siime,  or  of  as  high  and  solemn  a  na- 
ture as  the  original  act;  for  a  deed  may  be 
avoided  by  a  plea.  But  we  mean  only  to 
say,  that  if  the  act  of  disaffirmance  be  of  as 
high  and  solemn  a  nature,  there  is  no  ground 
to  impeach  its  sutliciency.  Lord  Ellenbor- 
ough,  in  Baylis  v.  Dineley.  3  Maule  &  Selw. 
481,  482.  held  a  parol  confirmation  of  a  bond 
given  by  an  infant  after  he  came  of  age  to 
be  invalid;  insisting  that  it  should  be  by 
something  amounting  to  an  estoppel  in  law, 
of  as  high  authority-  as  the  deed  itself;  but 
that  the  same  deed  might  be  avoided  by  the 
plea  of  infancy.  There  are  cases,  however, 
in  which  a  confiiination   may  be  good   witJi- 


298 


CAPACITY  OF  PARTIES. 


out  being  by  deed;  as  in  case  of  a  lease  by  an 
infant,  and  his  receiving  rent  after  be  came 
of  age.  See  Bac.  Abr.  "Infancy  and  Age," 
I,  8. 

The  question  then  is,  whether,  in  the  pres- 
ent case,  the  deed  to  Mrs.  Moreland,  being  of 
as  high  and  solemn  a  nature  as  the  original 
deed  to  Wallach,  is  not  a  valid  disaffirmance 
of  it.  We  think  it  is.  If  it  was  a  voidable 
conveyance  which  had  passed  the  seisin  and 
possession  to  Wallach,  and  he  had  remained 
in  possession,  it  might,  like  a  feoffment,  have 
been  avoided  by  an  entiy  by  an  infant  after 
he  came  of  age.  See  Inhabitants  of  Worces- 
ter V.  Eaton,  13  Mass.  375;  Whitney  v. 
Dutch,  14  Mass.  4G2.  But  in  point  of  fact 
Barry  remained  in  possession;  and  therefore 
he  could  not  enter  upon  himself.  And  when 
he  conveyed  to  Mrs.  Moreland,  being  in  pos- 
session, he  must  be  deemed  to  assert  his  orig- 
inal interest  in  the  land,  and  to  pass  it  in  the 
same  manner  as  if  he  had  entered  upon  the 
land  and  delivered  the  deed  thereon,  if  the 
same  had  been  in  an  adverse  possession. 

The  cases  of  Jackson  v.  Carpenter,  11 
Johns.  593,  and  Jackson  v.  Burchin,  14  Johns. 
124,  are  directly  in  point,  and  proceed  upon 
principles  which  are  in  perfect  coincidence 
with  the  common  law,  and  are  entirely  satis- 
factory. Indeed,  they  go  further  than  the 
circumstances  of  the  present  case  require; 
for  they  dispense  with  an  entry  where  the 
possession  was  out  of  the  party  when  he 
made  the  second  deed.  In  Jackson  v.  Bur- 
chin,  the  court  said  that  it  would  seem  not 
only  upon  principle  but  authority,  that  the 
infant  can  manifest  his  dissent  in  the  same 
way  and  manner  by  which  he  first  assented 
to  convey.  If  he  has  given  livery  of  seisin, 
he  must  do  an  act  of  equal  notoriety  to  dis- 
affirm the  first  act;  he  must  enter  on  the 
land  and  make  known  his  dissent.  If  he  has 
conveyed  by  bargain  and  sale,  then  a  sec- 
ond deed  of  bargain  and  sale  will  be  equally 
solemn  and  notorious  in  disaffirmance  of  the 
first.  See  the  same  point,  2  Kent,  Comm.  § 
31.  We  know  of  no  authority  or  principle 
which  contradicts  this  doctrine.  It  seems 
founded  in  good  sense,  and  follows  out  the 
principle  of  notoriety  of  disaffirmance  in  the 
case  of  a  feoffment  by  an  entry;  that  is,  by 
an  act  of  equal  notoriety  and  solemnity  with 
the  original  act.  The  case  of  Prost  v.  Wolves- 
ton,  1  Strange,  94,  seems  to  have  proceeded 
on  this  principle. 

Upon  these  grounds  we  are  of  opinion  that 
the  deed  of  BaiTy  to  Mrs.  Moreland  was  a 
complete  disaffirmance  and  avoidance  of  his 
prior  deed  to  Wallach;  and  consequently, 
the  instruction  given  by  the  circuit  court 
was  unexceptionable.  To  give  effect  to  such 
disaffirmance,  it  was  not  necessary  that  the 
infant  should  first  place  the  other  party  in 
statu  quo. 

The  second  bill  of  exceptions,  taken  by  the 
plaintiff,  turns  upon  the  instructions  asked 
upon  the  evidence  stated  therein,  and  scarce- 
ly admits  of  abbreviation.    It  is  as  follows: 


"The  plaintiff,  further  to  maintain  and 
prove  the  issue  on  his  side,  then  gave  in  evi- 
dence, by  competent  witnesses,  facts  tend- 
ing to  prove  that  the  said  Richard  N.  Barry 
had  attained  the  full  age  of  twenty-one  years 
on  the  14th  day  of  September,  1S31;  and  that, 
in  the  month  of  November,  1831,  the  said  de- 
fendant, who  was  the  mother  of  the  said 
Richard,  did  assert  and  declare  that  said 
Richard  was  born  on  the  14th  day  of  Sep- 
tember, 1810;  and  that  she  did  assert  to  Dr. 
McWilliams,  a  competent  and  credible  wit- 
ness, who  deposed  to  said  facts,  and  who 
was  the  accoucheur  attending  on  her  at  the 
period  of  the  birth  of  her  said  son,  that  such 
birth  actually  occurred  on  the  said  14th  of 
September,  1810,  and  applied  to  said  Dr. 
McWilliams  to  give  a  certificate  and  depo- 
sition that  the  said  day  was  the  true  date  of 
the  birth;  and  thereupon  the  counsel  for 
the  plaintiff  requested  the  court  to  instruct 
the  jury— 

"1.  That,  if  the  said  jury  shall  believe, 
from  the  said  evidence,  that  the  said  Rich- 
ard N.  Barry  was  of  full  age,  and  above  the 
age  of  twenty-one  years,  at  the  time  of  the 
execution  of  said  deed  to  said  Wallach.  or 
if  the  defendant  shall  have  failed  to  satisfy 
the  jury  from  tITe  evidence  that  said  Barry, 
was  at  the  said  date,  an  infant  under  twenty- 
one  years,  that  then  the  plaintiff  is  entitled 
to  recover. 

"2.  Or  if  the  jury  shall  believe,  from  the 
said  evidence,  that  if  said  Richard  was  un- 
der age  at  the  time  of  the  execution  of  said 
deed,  that  he  did,  after  his  arrival  at  age, 
voluntarily  and  deliberately  recognize  the 
same  as  an  actual  conveyance  of  his  right,  or 
during  a  period  of  several  months  acquiesce 
in  the  same  without  objection,  that  then  the 
said  deed  cannot  now  be  impeached  on  ac- 
count of  the  minority  of  the  grantor. 

"3.  That  the  said  deed  from  the  said  Rich- 
ard N.  Barry  to  the  defendant,  being  made 
to  her  with  full  notice  of  said  previous  deed 
to  said  Wallach,  and  including  other  and 
valuable  property  is  not  so  inconsistent  with 
said  first  deed  as  to  amount  to  a  disaffirm- 
ance of  the  same. 

"4.  That,  fi'om  the  relative  position  of  the 
parties  to  said  deed  to  defendant,  at  and 
previous  to  its  execution,  and  from  the  cir- 
cumstances attending  it,  the  jury  may  infer 
that  the  same  was  fraudulent  and  void. 

"5.  That,  if  the  les.sors  of  plaintiff  were 
induced,  by  the  acts  and  declarations  of  said 
defendant,  to  give  a  full  consideration  for 
said  deed  to  Wallach,  and  to  accept  said 
deed  as  a  full  and  only  security  for  the  debt 
bona  fide  due  to  them,  and  propeiiy  bona 
fide  advanced  by  them,  and  to  believe  that 
the  said  security  was  valid  and  effective, 
that  then  it  is  not  competent  for  said  de- 
fendant in  this  action  to  question  or  deny 
the  title  of  said  plaintiff  under  said  deed, 
whether  the  said  acts  and  declarations  were 
made  fraudulently,  and  for  the  purpose  of 
practising  deception,  or  whether  said  defend- 


INFANTS. 


299 


ant,  from  any  cause,  wilfully  misrepresent- 
ed the  tiutli. 

"Whereupon,  the  court  gave  the  first  of 
the  said  instructions  so  prayed  as  aforesaid, 
and  refused  to  give  the  others. 

"To  which  refusal  the  counsel  for  tlie 
pl.'iintlff  excepted." 

Tlie  1st  instruction  being  given  by  the  court, 
is,  of  course,  excluded  from  our  consideration 
on  the  present  writ  of  error.  The  second  in- 
struction is  objectionable  on  several  ac- 
counts. In  the  first  place,  it  assumes,  as 
matter  of  law,  that  a  voluntary  and  de- 
lil)orate  recognition  by  a  person  after  his 
arrival  at  age,  of  an  actual  conveyance  of 
his  riglit  during  his  nonage,  amounts  to  a 
confirmation  of  such  conveyance.  In  the 
next  place,  that  a  more  acquiescence  in  the 
same  conveyance,  without  objection,  for  sev- 
eral months  after  his  arrival  at  age,  is  also 
a  confirmation  of  it.  In  our  judgment,  nei- 
tlier  proposition  is  maintainable.  The  mere 
recognition  of  the  fact,  that  a  conveyance 
lias  boon  made,  is  not  per  se,  proof  of  a  con- 
firmation of  it.  Lord  Ellouborough,  in  Bay- 
lis  V.  Dineley,  3  Maule  &  S.  4S2,  was  of  opin- 
ion tliat  an  act  of  as  high  a  solemnity  as  the 
original  act  was  necessary  to  a  confirmation. 
"We  cannot,"  said  he,  "surrender  the  inter- 
ests of  the  infant  into  such  hands  as  he  may 
chance  to  get.  It  appears  to  me,  that  we 
should  be  doing  so  in  this  case,  (that  of  a 
deed,)  unless  we  required  the  act  after  full 
age  to  be  of  as  great  a  solemnity  as  the  orig- 
inal instrument."  "Without  undertalcing  to 
apply  this  doctrine  to  its  full  extent,  and  ad- 
mitting tliat  acts  in  pais  may  amount  to  a 
confirmation  of  a  deed,  still,  we  are  of  opin- 
ion that  these  acts  should  be  of  such  a  sol- 
emn and  unequivocal  nature  as  to  establish 
a  clear  intention  to  confirm  the  deed,  after 
a  full  knowledge  that  it  was  voidable.  See 
Bank  v.  Ghamberlin.  15  Mass.  220.  A  for- 
tiori, mere  acquiescence,  uncoupled  with  any 
acts  demonstrative  of  an  intent  to  confirm 
it,  would  be  insufficient  for  the  purpose.  In 
.Tackson  v.  Carpenter,  11  Johns.  542.  54.'>.  the 
court  held  that  an  acquiescence  by  the  gran- 
tor in  a  conveyance  made  during  his  infancy, 
for  eleven  years  after  he  came  of  age,  did 
not  amount  to  a  confirmation  of  that  con- 
veyance; that  some  positive  act  was  neces- 
sary, evincing  his  assent  to  the  conveyance. 
In  Curtin  v.  Batton.  11  Sorg.  &  R.  311.  the 
court  held  that,  to  constitute  a  confirmation 
of  a  conveyance  or  contract  by  an  infant, 
after  he  arrives  of  age,  there  must  be  some 
distinct  act,  by  whicli  he  either  receives  a 
benefit  from  the  contract  after  he  arrives  at 
age,  or  does  some  act  of  express  ratification. 
There  is  much  good  sense  in  these  decisions, 
and  they  are  indispensable  to  a  just  sup- 
port of  the  rights  of  infants  according  to 
the  common  law.  Besides,  in  the  present 
case,  as  Barry  was  In  possession  of  the 
premises  during  the  whole  period  until  the 
execution  of  his  deed  to  Mrs.  ;Morelaud.  there 
was  no  evidence  to  justify  the  jury  in  draw- 


ing any  inference  of  any  intentional  acquies- 
cence in  the  valitlity  of  the  deed  to  Wallach. 

The  3d  instruction  is,  for  the  reasons  al- 
ready stated,  unmaintainable.  The  deed  to 
2Mrs.  Moreland  contains  a  convej'ance  of  the 
very  land  in  controversy,  with  a  warranty  of 
the  title  against  all  persons  claiming  under 
liim,  (Barrj',)  and  a  covenant,  that  he  had 
good  right  and  title  to  convey  the  same,  and, 
therefore,  is  a  positive  disaffirmance  of  the 
former  deed. 

The  4th  instruction  proceeds  upon  the  sup- 
position that  if  the  deed  to  Mrs.  Moreland 
was  fraudulent  between  the  parties  to  it.  it 
was  utterly  void,  and  not  merely  voidable. 
But  it  is  clear  that,  between  the  parties,  it 
would  be  binding  and  availaltle;  however, 
as  to  the  persons  whom  it  was  intended  to 
defraud,  it  might  bo  voidable.  Even  if  it 
was  made  for  the  very  purpose  of  defeating 
the  conveyance  to  Wallach,  and  was  a  mere 
contrivance  for  this  purpose,  it  was  still  an 
act  competent  to  be  done  by  Barry,  and 
amounted  to  a  disaffirmance  of  the  convey- 
ance to  Wallach.  In  many  cases,  the  dis- 
affirmance of  a  deed  made  during  infancy, 
is  a  fraud  upon  the  other  party.  But  this 
has  never  been  held  sufficient  to  avoid  the 
disaffirmance,  for  it  would  otherwise  take 
away  the  veiy  protection  which  the  law  in- 
tends to  throw  round  him,  to  guard  him 
from  the  effects  of  his  folly,  rashness,  and 
misconduct.  In  Saunderson  v.  Marr,  1  H. 
Bl.  75,  it  was  held  that  a  warrant  of  attor- 
ney, given  by  an  infant,  although  there  ap- 
peared circumstances  of  fraud  on  his  part, 
was  utterly  void,  even  though  the  applica- 
tion was  made  to  the  equity  side  of  the  court, 
to  set  aside  a  judgment  founded  on  it.  So, 
in  Conroe  v.  Birdsall,  1  Johns.  Cas.  127.  a 
bond  made  by  an  infant,  who  declared  at 
the  time  that  he  was  of  age,  was  held  void, 
notwitlistanding  his  fraudulent  declaration; 
for  the  court  said  that  a  different  decision 
would  endanger  all  the  rights  of  infants.  A 
similar  doctrine  was  held  by  the  court  in 
Curtin  v.  Patton,  11  Serg.  &  R.  309,  o^o.  In- 
deed, the  same  doctrine  is  to  be  found  af- 
firmed more  than  a  century  and  a  half  ago. 
in  Johnson  v.  Pie.  1  Lev.  100.  1  Sid.  2.">S;  1 
Kebb.  905,  913.  See  Bac.  Abr.  "Infancy  and 
Age,"  H;   2  Kent,  Comm.  Lect.  31. 

But  what  are  the  facts  on  which  the  in- 
struction relies  as  pr(X)f  of  the  deed  to  Mrs. 
Moreland  being  fraudulent  and  void?  They 
are  "the  relative  positions  of  the  parties  to 
said  deed,  at  and  previous  to  its  execution:" 
that  is  to  say.  the  relation  of  mother  and 
son,  and  the  fact  tliat  she  had  then  insti- 
tuted a  suit  against  him,  and  arrested  him, 
and  held  him  to  bail,  as  stated  In  the  evi- 
dence, and  "from  the  circumstances  attend- 
ing the  execution  of  it;"  that  is  to  say,  that 
Mrs.  Moreland  was  informed  by  Barry,  be- 
fore his  deed  to  her,  that  he  had  so  convey- 
ed the  said  property  to  Wallach,  and  that 
subsequently,  and  with  such  knowledge,  she 
prevailed  on    Bariy    to  execute   to    her   the 


3D0 


CAPACITY  OF  PARTIES. 


same  conveyance.  Now,  certainly,  these 
facts  alone  could  not  justly  authorize  a  con- 
clusion that  the  conveyance  to  Mrs.  More- 
land  was  fraudulent  and  void;  for  she  might 
be  a  bona  fide  creditor  of  her  son.  And  the 
considei-ation  averred  in  that  conveyance 
showed  her  to  be  a  creditor,  if  it  was  truly 
stated,  (and  there  was  no  evidence  to  con- 
tradict it;)  and  if  she  was  a  creditor,  then 
she  had  a  legal  right  to  sue  her  son,  and 
there  was  no  fraud  in  prevailing  on  him  to 
give  a  deed  to  satisfy  that  debt.  It  is  prob- 
able that  the  instruction  was  designed  to 
cover  all  the  other  facts  stated  in  the  bill  of 
exceptions,  though  in  its  actual  terms  it  does 
not  seem  to  comprehend  them.  But  if  it  did, 
we  are  of  opinion  that  the  jury  would  not 
have  been  justified  in  inferring  that  the  deed 
was  fraudulent  and  void.  In  the  first  place, 
the  proceedings  in  the  orphans'  court  may, 
for  aught  that  appears,  have  been  in  good 
faith,  and  under  an  innocent  mistake  of  a 
year. of  the  actual  age  Of  Barry.  In  the  next 
place,  ii  not.  so,  still,  the  mother  and  the 
son  were  not  estopped  in  any  other  proceed- 
ing to  set  up  the  nonage  of  BaiTy,  whatever 
might  have  heen  the  case  as  to  the  parties 
and  property  involved  in  that  proceeding. 
In  the  next  place,  there  is  not  the  slightest 
proof  that  these  proceedings  had,  at  the 
time,  any  reference  to,  or  intended  opera- 
tion upon,  the  subsequent  deed  made  to  Wal- 
lach,  or  that  Mrs.  Moreland  was  party  to,  or 
assisted  in,  the  negotiations  or  declarations 
on  which  the  deed  to  Wallach  was  founded 
Certainly,  without  some  proofs  of  this  sort, 
it  would  be  going  too  far  to  assert  that  the 
jury  might  infer  that  the  deed  to  Mrs.  More- 
land  was  fraudulent.  Fraud  is  not  presum- 
ed either  as  u  matter  of  law  or  fact,  unless 
under  circumstances  not  faariy  susceptible 
of  any  other  interpretation. 

The  rtb  instruction  was  properly  refused 
by  the  court,  for  the  plain  reason  that  there 
was  no  evidence  in  the  case  of  any  acts  or 
declarations  by  Mrs.  Moreland  to  the  effect 
therein  star/^d.  It  was.  therefore,  the  com- 
mon case  uf  an  ir.'itif  ction  asked  upon  a 
mere  hycjotbotica'  statement,  ultrj,  the  evi- 
dence. 


The  third  bill  of  exceptions  is  as  follows:^-         I 

"The  court  having  refused  the  2d,  3d,  4th,  ^ 

and  5th  instructions  prayed  by  the  plaintiffs, 
and  the  counsel,  in  opening  his  case  to  the 
jury,  contending  that  the  questions  present- 
ed by  the  said  instructions  wore  open  to  the 
consideration  of  the  jury,  the  counsel  for  the 
defendant  thereupon  prayed  the  court  to  in- 
struct the  jury  that  if,  from  the  evidence 
so  as  aforesaid  given  to  the  jui-y,  and  stated 
in  the  prayers  for  the  said  instructions,  they 
should  be  of  opinion  that  the  said  Richard 
was  under  the  age  of  twenty-one  years  at 
the  time  he  made  his  deed  as  aforesaid  to 
the  said  Richard  Wallach,  under  whom  the 
plaintiffs  claim  their  title  in  this  case,  and 
that  at  the  time  he  made  his  deed  as  here- 
inbefore mentioned  to  the  defendant  he  was 
of  full  age,  that  such  last-mentioned  deed 
was  a  disaffirmance  of  his  preceding  deed 
to  him  the  said  Richard  Wallach,  and  that 
in  that  case  the  jury  ought  to  find  their  ver- 
dict for  the  defendant,  and  that  the  evidence 
upon  which  the  2d,  3d,  4th,  and  5th  instruc- 
tions were  prayed  by  the  plaintiff  as  afore- 
said, which  evidence  is  set  forth  in  the  in- 
structions so  prayed,  is  not  competent  in 
law  to  authorize  the  jury  to  find  a  verdict 
for  the  plaintiff  upon  any  of  the  grounds  or 
for  any  of  the  reasons  set  forth  in  the  said 
prayers,  or  to  authorize  them  to  find  a  ver- 
dict for  the  plaintiff,  if  they  should  be  of 
opinion  that  the  said  Richard  Barry  was 
under  the  age  of  twenty-one  years  at  the 
time  he  made  his  deed  as  aforesaid  to  the 
said  Richard  Wallach. 

"Which  instruction  the  court  gave  as  pray- 
ed, and  the  counsel  for  the  plaintiff  excepted 
thereto." 

It  is  unnecessary  to  do  more  than  to  state, 
that  the  bill  of  exceptiotis  is  completely  dis- 
posed of  by  the  considerations  already  men- 
tioned. It  contains  no  more  than  the  con- 
verse of  the  propositions  stated  in  the  sec- 
ond bill  of  exceptions,  and  the  reassertion  of 
the  instruction  given  by  the  court  in  the 
first  bill  of  exceptions. 

Upon  the  whole,  it  is  the  opinion  of  the 
court  that  the  judgment  of  the  circuit  court 
ought  to  be  affirmed,  with  costs. 


INFANTS. 


301 


HENRY  V.  ROOT. 

(33  N.  Y.  o2G.) 

Court  of  Appeals  of  New   York.      Sept,   1865. 

L.  J.  Burditt,  for  appellant.  E.  M.  Harris, 
for  respondent. 

DA\'IES,  J.  This  action  was  brought  to 
recover  tlie  amount  of  a  promissory  note  for 
$000  made  at  Fort  Des  Moines,  in  the  state 
of  Iowa,  by  the  defendant,  whereby  he  prom 
ised  to  pay  to  the  plainti.T,  for  value  received, 
the  .said  sum  of  .$G00,  with  interest  at  the 
rate  of  ten  per  cent  per  annum,  on  or  before 
the  l.jth  day  of  April,  1857. 

The  defendant  set  up  in  his  answer  two  dis- 
tinct grounds  of  defense:  First.  That  the 
note  was  given  for  part  of  the  consideration 
of  certain  lots,  situated  in  the  town  of  Logan, 
in  the  territory  of  Nebraska;  that  the  agree- 
ment for  the  purchase  of  said  lots  was  made 
by  the  defendant  with  one  Campbell,  the 
agent  of  the  plaintiff,  when  and  whereby  the 
defendant  agreed  to  purchase  said  lots  at  and 
for  a  price  of  $700;  that  he  paid  in  cash  $100, 
and  gave  said  note  for  the  residue  of  the  con- 
sideration or  purchase-money  of  said  lots; 
that  said  purchase  was  the  only  consideration 
for  the  same,  and  that  he  relied  wholly  upon 
the  statements  and  representations  of  said 
Campbell  as  to  the  situation  and  value  of  said 
lots.  The  answer  then  sets  out  the  represen- 
tations made,  and  that  the  plaintiff's  title  was 
good,  whereas  he  had  no  title  to  the  same, 
and  such  repre.sentatious  were  untrue,  and 
that  he  was  deceived  and  defrauded  thereby; 
that  he,  the  defendant,  never  had  possession 
of  said  lots,  and  had  never  sold  or  conveyed 
any  or  either  of  them. 

For  a  second  defense,  the  defendant  aver- 
red that  at  the  time  of  making  and  executing 
the  said  note,  he  was  an  infant  under  the 
age  of  twenty-one  years.  On  the  trial  the 
note  was  produced  and  read  in  evidence;  and 
the  plaintiff  rested. 

The  defendant  then  offered  himself  as  a 
witness,  and  testilied  that  at  the  time  the 
note  was  executed  he  was  not  twenty-one 
years  of  age,  and  further  testimony  to  the 
same  effect  was  offered.  The  defendant  at- 
tained the  age  of  twenty -one  years  on  the 
J.'.th  of  February.  1S57.  The  witness  testi- 
lied that  on  the  20th  of  Januarj',  1857,  tlie 
day  after  date  of  the  note,  he  received  a  con- 
veyance for  said  lots  of  land  executed  by 
Campbell  as  agent  of  the  plaintilT,  and  that 
the  same  was  acknowledged  the  same  day. 
'I'lie  plaintiff  then  offered  the  same  in  evi- 
dence, and  the  deed  was  objected  to  by  the 
defendant's  counsel,  on  the  ground  that  it  was 
not  properly  acknowledged  nor  authenticated; 
that  it  was  not  .shown  that  the  person  who 
executed  it  had  authority  from  the  grantor, 
and  also  that  it  was  not  under  seal,  and  there- 
fore void.  The  court  sustained  the  objection, 
and  the  plaintiff  excepted.  The  plaintiff  then 
offered  to  show  by  the  witness  that  defendant 


took  possession  of  the  land  under  this  deed, 
and  that  on  the  19th  of  May.  1857,  defendant 
conveyed  a  portion  of  the  land  to  one  Sand- 
ford  B.  Terry  of  Chicago  by  a  deed  not  under 
seal,  for  the  consideration  of  $100.  This  was 
objected  to  by  the  defendant,  on  the  ground 
that  no  title  was  obtained  by  the  defendant 
by  the  paper  received  by  him,  and  the  objec- 
tion was  sustained  by  the  court,  and  the 
plaintiff  excepted.  The  witness  testified  that 
the  consideration  of  the  note  was  for  the  con- 
veyance of  real  estate. 

The  deed  was  then  put  in  evidence  by  the 
defendant,  and  by  it  the  plaintiff,  for  the  con- 
sideration of  $100  paid,  the  receipt  whereof 
was  acknowledged,  and  the  further  consider- 
ation of  $000,  to  be  paid  on  the  15th  day  of 
April,  1857,  sold,  released,  and  forever  quit- 
claimed to  the  defendant  all  his  right,  title 
and  interest  to  the  said  real  estate,  and  the 
plaintiff  did  thereby  w-arrant  and  defend  the 
above  property.  It  was  dated  June  2f>,  1857, 
and  signed,  "Wm.  R.  Henry,  by  his  agent,  H. 
C.  Campbell."  It  was  acknowledged  on  the 
same  day  by  the  agent  before  a  notarj-  public. 

The  court  held  and  decided  the  paper  in 
evidence  conveyed  no  title  to  the  land  in  ques- 
tion to  the  defendant,  not  being  under  seal, 
and  no  power  of  attorney  shown;  to  which 
i-uling  and  decision  the  counsel  for  the  plain- 
tiff excepted.  The  court  also  decided  that 
the  defendant  was  not  bound  to  tender  to  the 
plaintiff  a  reconveyance;  to  which  ruling  and 
decision  the  counsel  for  the  plaintiff  also  duly 
excepted.  The  court  also  held  and  decided 
that  the  defendant  was  not  liable  on  the  note, 
because  he  was  an  infant  when  he  executed 
it:  to  which  ruling  and  decision  the  plaintiff 
also  duly  excepted.  And  thereupon  the  court 
directed  the  jurj-  to  render  a  verdict  for  the 
defendant;  to  which  ruling  and  direction  the 
plaintiff'  al.so  excepted.  Thereupon,  the  ex- 
ceptions were  directed  to  be  heard  in  the  first 
instance  at  the  general  term,  where  judgment 
thereon  was  given  for  the  defendant.  The 
plaintiff  now  appeals  to  this  court. 

There  is  no  controversy  that  the  defendant 
was  an  infant  at  the  time  this  note  was  ex- 
ecuted. If  he  has  done  nothing  since  attain- 
ing his  majority  which  makes  the  contract 
obligatory  upon  him.  then  the  direction  of  the 
court  to  the  jury  to  find  a  verdict  for  the  de- 
fendant was  correct.  But  if  however  he 
promised  to  pay  the  note,  after  arriving  at 
full  age,  or  ratified  the  contract,  or  affirmed 
the  purchase  for  which  the  note  was  given, 
then  the  note  became  obligatory  upon  him. 

The  defendant  failed  to  sustain  the  allega- 
tion by  his  answer  that  any  fraudulent  rep- 
resentations had  been  made  to  him  to  induce 
him  to  enter  into  the  purchase,  or  that  tliere 
was  any  failure  of  title  in  the  plaintiff,  and 
consequently  a  failure  of  the  consideration  of 
the  note. 

There  has  been  much  discussion  in  the 
books  as  to  what  acts  or  declarations  of  a 
party  will  revive  a  debt  barred  by  the  statute 
of  limitations,  or  one   discharged   by  an    in- 


302 


CAPACITY  OF  PARTIES. 


solvent  or  bankrupt  discbarge,  or  render  ob- 
lisatory  and  valid  the  contract  of  an  infant. 
There  has  been  a  commingling  of  all  these 
cases  in  judicial  opinions,  and  frequently  no 
clear  and  marked  lines  of  distinction  have 
been  presented.  I  shaU  make  the  effort  to 
eliminate  some  principles  which  are  applica- 
ble to  each  of  these  cases,  and  endeavor  to 
show  wherein  they  differ  and  the  reasons  for 
such  difference,  and  wherein  they  are  coinci- 
dent and  the  principles  which  have  been  es- 
tablished as  applicable  to  these  three  classes 
of  cases.  A  clear  imderstanding  of  the  vari- 
ous decisions  and  the  principles  settled  by 
them,  makes  such  an  examination  imperative, 
and  from  it  we  shall  discover  the  doctrine 
settled,  and  the  reasons  therefor. 

In  Sands  v.  Gelston,  15  Johns.  519,  Spencer, 
J.,  lays  down  what  appears  to  be  the  correct 
rules  in  reference  to  debts  barred  by  the  stat- 
ute of  limitations,  debts  of  infants  not  for 
necessaries,  and  the  debts  of  bankrupts  dis- 
charged under  the  bankrupt  acts.  In  all 
these  cases,  although  by  reason  of  certain 
provisions  of  law  such  debts  cannot  be  en- 
forced against  the  debtors,  still  the  debt  re- 
mains, and  the  moral  obligation  to  pay  con- 
tinues in  fuU  force.  Hence  it  is  after  a  debt 
is  baiTed  by  the  statute  in  the  one  case  or 
discharged  by  the  operation  of  the  bankrupt 
or  insolvent  laws  in  the  other,  or  in  the  case 
of  the  infant  who  on  attaining  his  majority, 
and  not  before,  can  make  a  legal  contract, 
which  can  be  eo  instanti  enforced  against 
him,  that  in  all  these  cases  the  moral  obliga- 
tion has  been  held  a  sufficient  and  legal  con- 
sideration without  any  other,  for  the  promise 
or  undertalving  to  pay  the  debt,  by  acknowl- 
edgment, ratification  or  a  new  promise.  In 
other  words,  the  courts  have,  in  truth,  re- 
garded the  old  debt  as  continued  or  revived, 
and  no  new  consideration  was  required  to 
.support  it.  Spencer,  J.,  says,  in  Sands  v. 
Gelston:  "I  never  could  see  the  difference  as 
regards  the  revival  of  a  debt,  between  one 
barred  by  the  statute  of  limitations  and  one 
from  which  the  debtor  has  been  discharged 
under  the  bankrupt  or  insolvent  laws.  The 
remedy  is  equally  gone  In  both  cases.  The 
statute  of  limitations  requires  all  actions  on 
contract  to  be  commenced  within  six  years 
next  after  the  cause  of  such  action  accrued, 
and  not  after.  The  remedy  being  suspended 
after  six  years,  there  yet  exists  a  moral  duty 
on  the  part  of  the  debtor  to  pay  the  debt;  and 
accordingly  a  promise  to  pay  a  debt  not  ex- 
liuguished,  but  as  to  which  the  remedy  is 
lost,  is  a  valid  pi-omise,  and  may  be  enforced 
on  the  ground  of  the  pre-existing  moral  duty. 
There  is  then  no  substantial  difference  be- 
tween a  debt  barred  by  the  statute  of  limi- 
tations, and  a  debt  from  the  payment  of 
which  the  debtor  is  exonerated  by  a  discharge 
under  bankrupt  or  insolvent  laws.  Both  of 
these  rest  on  the  same  principle  with  a  debt 
contracted  by  an  infant  not  for  necessaries; 
yet  it  is  singular  that  in  neither  of  the  latter 
ca.ses  wiU  the  bare  acknowledgment  that  the 


debt  once  existed  and  has  not  been  paid,  sup- 
port an  action— an  express  promise  to  pay 
being  necessary.'"  A  review  of  the  cases  on 
the  question  of  what  is  necessary  to  revive  a 
debt  barred  by  the  statute  of  limitations,  will 
clearly  show  that  a  bare  or  mere  acknowledg- 
ment of  the  existence  of  the  debt  is  sufficient, 
as  the  law  will  imply  or  infer  from  its  exist- 
ence a  promise  to  pay  it;  and  it  is  of  little 
moment  whether  it  be  regarded  as  a  new 
promise  or  a  revivor  and  continuation  of  the 
old  one. 

In  Johnson  v.  Beardslee,  15  Johns.  4,  an 
acknowledgment  of  the  debt  was  holden  to  be 
sufficient  evidence  for  the  jury  to  presume  a 
new  promise.  In  Sluby  v.  Champlin,  4  Johns. 
4G1,  the  defendant  said  the  debt  ought  to  be 
paid,  and  mentioned  eighteen  months  as  the 
time  he  wanted  for  payment.  This  was  held 
a  promise  sufficient  to  make  him  liable.  In 
Jones  V.  Moore,  7  Bin.  573,  an  acknowledg- 
ment of  a  subsisting  debt  was  sufficient  to 
take  the  case  out  of  the  statute,  and  it  was 
held  it  would  authorize  the  jury  to  infer  a 
new  promise  to  pay,  or  rather  that  the  old 
promise  was  continued,  or  as  some  choose  to 
call  it,  revived.  Mosher  v.  Hubbard,  1.3 
Johms.  510.  On  the  claim  being  presented  to 
the  defendant,  he  did  not  intimate  that  he 
intended  to  avail  himself  of  the  statute;  but 
the  only  question  to  his  mind  seemed  to  be 
whether  the  account  had  not  been  paid,  and 
he  promised  to  examine  his  papers,  and  if  he 
found  he  had  paid  the  order  he  was  to  write 
the  witness,  but  as  the  witness  testified  he 
had  never  written,  the  court  held  that  this 
was  sufficient  to  raise  an  implied  promise  to 
pay  the  money,  unless  on  examination  it 
should  be  found  that  the  order  had  been  paid, 
and  there  was  no  evidence  whatever  of  any 
payment.  Sands  v.  Gelston,  supra.  Spencer, 
J.,  says:  "I  am  bound  by  authority  to  con- 
sider the  acknowledgment  of  the  existence  of 
a  debt  within  six  years  before  the  suit  was 
brought,  as  evidence  of  a  promise  to  pay  the 
debt." 

In  Clemenstine  v.  Williamson,  8  Cranch, 
72,  Marshall,  C.  J.,  says:  "It  has  been  fre- 
quently decided  that  acknowledgment  of  a 
debt,  barred  by  the  statute  of  limitations. 
takes  the  case  out  of  that  statute,  and  re- 
vives the  original  cause  of  action.  So  far  as 
decisions  have  gone,  principles  may  be  con- 
sidered as  settled,  and  the  court  will  not 
lightly  unsettle  them.  *  *  *  It  is  not  suf- 
ficient to  take  the  case  out  of  the  act  tliat  the 
claim  should  be  proved,  or  be  acknowledged 
to  have  been  originally  just:  the  acknowl- 
edgment must  go  to  the  fact  that  it  is  still 
due." 

The  same  learned  judge,  in  Wetzel  v.  Buz- 
zard, 11  Wheat.  309,  remarked:  "It  is  con- 
tended on  the  part  of  the  plaintiff  that  he 
has  proved  an  acknowledgment  of  the  debt, 
and  that  such  acknowledgment,  according  to 
a  long  series  of  decisions,  revived  the  original 
I  promise,  or  it  lays  the  foundation  upon  which 
the  law  raises  a  new  promise.     The  English 


INFANTS. 


ms 


and  American  books  are  filled  with  decisions 
which  support  this  general  proposition.  An 
iiiKlualified  admission  that  the  debt  was  due 
at  the  time  has  always  been  held  to  remove 
the  bar  created  by  the  statute." 

In  Bloodgood  v.  Bruen,  8  X.  Y.  302,  Gardi- 
ner, J.,  says:  "A  mere  ackuowledj^ment  of 
an  indebtedness  is  but  evidence  from  which 
a  promise  to  pay  may  be  inferred.  When  it 
is  unconditional,  a  court  or  jury  may  infer  a 
willingness  to  pay,  or  a  promise  to  that  ef- 
fect, because  it  would  be  ditlicult  to  assign 
any  other  reason  for  a  voluntary  admission  of 
this  sort." 

Marcy,  J.,  says  in  Depuy  v.  Swart,  3  Wend. 
1;'>'J,  "that  the  bare  acknowledgment  of  a  debt, 
barred  by  the  statute  of  limitations,  is  held 
to  revive  it." 

In  Purdy  v.  Austin,  3  Wend.  189,  the  same 
jiLstice  says,  after  discussing  the  reasoning 
of  the  court  in  Sands  v.  Gelston,  that  the  un- 
qualified and  unconditional  acknowledgment 
of  a  debt,  made  by  a  party  within  six  years 
before  suit  brought,  is  adjudged  at  law  to 
imply  a  promise  to  pay. 

In  Bell  V.  Morrison,  1  Pet.  3.31,  Justice 
Story,  in  delivering  the  opinion  of  the  court, 
oljserves,  that  "the  rule  announced  in  11 
Wheat,  was  the  result  of  a  deliberate  exam- 
ination by  the  court  of  the  English  and  Amer- 
ican authorities,"  and  adds:  "We  adhere  to 
the  doctrine  as  there  stated,  and  think  it  the 
only  exposition  of  the  statute  which  is  con- 
sistent with  its  true  object  and  import."  He 
then  says:  "If  there  be  no  express  promise, 
but  a  promise  is  to  be  raised  by  implication 
of  law  from  the  acknowledgment  of  the  party, 
such  acknowledgment  ought  to  contain  an  un- 
qualified and  direct  admission  of  the  previous 
subsisting  debt  which  the  party  is  liable  and 
willing  to  pay."  At  the  conclusion  of  the 
opinion,  he  says  that  it  is  to  be  understood 
that  it  is  not  miauimous,  but  that  of  a  ma- 
jority of  the  court,  and  that  it  has  been  prin- 
cipally, if  not  exclusively,  infiuenced  by  the 
course  of  decision  in  Kentucky  on  this  sub- 
ject. I  think  particular  note  should  be  made 
of  this  remark,  as  Judge  Story's  observations 
in  this  cause  have  been  disapproved  of  by  two 
of  the  judges  of  our  own  state,  hereafter  al- 
luded to.  It  is  to  be  observed  that  Judge 
Stoiy  introduces  an  element  which  is  not,  so 
far  as  my  researches  extend,  contained  in  any 
previous  authority,  viz.:  that  the  party  maJc- 
ing  the  acknowledgment  must  be  "willing  to 
pay."  He  does  not  s:iy  that  he  must  express 
that  willingness,  as  some  judges  have  sup-  > 
posed,  or  whether  that  willingness  may  be  in-  ' 
ferred  from  his  acknowledgment  of  the  pre- 
vious subsisting  debt.  I  think  the  latter  view 
nuist  be  the  correct  interpretation  of  this  re- 
mark, as  I  am  unable  to  find  any  dictum  of 
any  judge  anterior  to  this,  that  in  addition 
to  the  acknowledgment  it  was  required  that  the  | 
party  must  also  express  a  willingness  to  pay. 
In  Purdy  v.  Austin,  supra,  the  judgment  was 
reversed  on  the  ground  that  the  acknowledg- 
ment of  the  defendant  did  not  amount  to  an  , 


unequivocal  and  positive  recognition  of  tlie 
subsisting  claim  in  favor  of  the  plaintiff. 

In  Stafford  v.  Bryan,  3  Wend.  53o,  Suther- 
land, J.,  in  delivering  the  opinion  of  the  court 
of  errors,  says:  "All  acknowledgment,  which 
is  to  have  the  effect  of  taking  a  demand  out 
of  the  effect  of  the  statute  of  limitations, 
ought  to  be  clear  and  explicit  in  relation  to 
the  subject  of  the  demand  to  which  it  refers. 
The  acknowledgment  or  new  promise  is  to  be 
aflirnuUively  establislied  by  the  plaintiff." 
He  adds:  "Although  I  cannot  yield  my  assent 
to  aU  the  points  decided  in  that  case  (Bell  v. 
Morrison),  nor  to  all  the  reasonings  and  posi- 
tions advanced  by  the  learned  judge  who  de- 
livered the  opinion  of  the  court,  the  general 
views  to  which  I  have  assented  appear  to 
me  to  be  sound  and  impressive."  In  Dean 
V.  Hewitt,  5  Wend.  2.'37,  Marcy,  J.,  remarks, 
that  "the  statute  of  limitations  proceeds  upon 
the  presumption  of  payment;  a  recognition  of 
the  existence  of  the  debt,  after  the  statute 
has  attached,  revives  the  remedy  which  was 
lost,  but  the  cause  of  action  is  the  same  as  it 
was  before  the  remedy.  This  court  has  al- 
ways considered  the  acknowledgment  or  new 
promise  as  a  contiuu,;nce  of  the  old  promise. 
*  *  *  The  acknowledgment  rebuts  the  pre- 
sumption of  payment;  and  when  made  be- 
fore the  statute  attaches,  has  the  same  effect 
as  though  made  afterward.  It  keeps  alive,  if 
I  may  so  express  it,  the  remedy.  •  *  *  It 
cannot  be  said  that  the  new  promise  either 
revives  the  cause  of  action  or  the  remedy'; 
it  only  continues  the  latter."  He  adds,  t li  it 
he  is  aware  that  some  of  the  positions  there 
stated  conflict  with  the  views  of  Mr.  Justice 
Stoiy,  as  expressed  in  Boll  v.  Morrison,  but 
we  cannot  yield  to  these  views,  and  give  full 
effect  to  them,  without  unsettling  principles 
that  have  been  so  long  established  as  to  en- 
title them  to  be  evidence  of  the  laws  of  this 
state. 

In  Hancock  v.  Bliss,  7  Wend.  2G7.  Chief 
Justice  Savage  said,  the  acknowledgment 
must  however  be  explicit,  and  without  a  de- 
nial of  the  equity  or  legality  of  the  demand, 
hence  if  the  defendant  denies  the  justice  of 
the  demand,  or  ivposes  himself  upon  the  stat- 
ute, a  promise  will  not  be  presumed. 

In  Patterson  v.  Choate,  7  Wend.  445,  the 
court  by  Suth.-rland,  J.,  held  that  an  ac- 
knowledgment of  an  existing  indebtedness 
was  suthcient  to  raise  a  new  promise.  There 
the  witness  first  stated  what  the  defendant 
said,  as  follows:  That  "the  balance  as  ex- 
hibited by  their  books  of  account  was  due  to 
the  plaintiff  at  the  time  of  the  dissolution  of 
the  copartnership,  and  had  not  been  paid  to 
his  knowledge."  Upon  being  internipted  by 
the  plaintiff's  counsel,  he  said  the  expression 
used  by  Patterson  was  that  the  balance  was 
due  at  the  time  of  the  dissolution,  and  still 
is  due,  as  witness  thought;  it  might  have 
been,  that  it  was  then  due  and  had  never 
been  paid;  either  version  of  it  amounts  to  a 
clear  and  explicit  admission  of  a  subsisting  io- 
debtedness. 


304 


CAPACITY  OF  PAKTIES. 


In  Galley  v.  Crane,  21  Pick.  523,  the  su- 
preme court  of  Massachusetts  says,  the  doc- 
trine laid  down  in  the  case  of  Bangs  v.  Hall, 
2  Pick.  oLiS,  was  well  considered,  has  since 
been  tested  by  experience,  and  is  undoubtedly 
sound  and  wise.  It  has  been  everywhere  ac- 
knowledged as  sound  law  (citing  a  large  num- 
ber of  authorities  to  sustain  this  position). 
The  court  further  say:  "The  principles  there 
laid  down  are.  that  to  take  a  debt  out  of  the 
statute  of  limitations  there  must  be  either  an 
express  promise  to  pay,  or  an  imqualitied  ac- 
knowledgment of  present  indebtedness.  In 
the  latter  ease  the  law  will  imply  a  promise 
to  pay." 

In  Allen  v.  Webster,  15  Wend.  284,  Savage. 
C.  J.,  after  reviewing  all  the  authorities,  says: 
"Whatever  therefore  uviy  be  the  true  philo- 
sophy of  the  rule,  and  learned  judges  have 
differed  on  that  subject,  yet  since  the  case  of 
Sands  v.  Gelston,  there  has  been  no  dispute 
as  to  what  the  rule  in  fact  is,  to-wit:  that  to 
revive  a  debt  barred  by  the  statute  of  limita- 
tions, whether  the  statute  theoretically  oper- 
ates upon  the  debt  itself,  or  upon  the  remedy 
only,  there  must  be  an  express  promise  or  an 
acknowledgment  of  a  present  indebtedness, 
a  subsisting  liability,  and  a  willingness  to 
pay."  This  last  remark  about  a  willingness 
1o  pay  has  no  foundation,  but  Judge  Story's 
ob.->ervation  in  BeU  v.  Morrison,  and  which 
liad  been  disapproved  of  by  two  of  our 
judges;  Gardiner,  J.,  states  the  rule  as  he  is 
inclined  to  think  it  is  in  Wakeman  v.  Sher- 
man, 9  N.  Y.  91,  in  these  words:  "That  to 
revive  a  demand  thus  barred  there  must  be 
an  express  promise  to  pay,  either  absolute  or 
conditional,  or  an  acknowledgment  of  the 
debt  as  subsisting,  made  under  such  circum- 
stances, that  such  a  promise  may  be  fairly 
implied."  And  this  case  also  enunciates  the 
rule  laid  down  in  many  other  cases,  that  the 
acknowledgment  of  existing  indebtedness  or 
the  promise  to  pay  must  be  made  to  the  party 
to  whom  the  debt  is  due,  or  to  his  agent;  an 
acknowledgment  or  promise  to  a  stranger  will 
not  answer. 

As  has  been  seen  from  the  remarks  of  Chief 
Justice  Spencer  in  Sands  v.  Gelston,  some- 
thing more  has  been  required  to  establish  a 
debt  against  a  bankrupt,  which  has  been  dis- 
charged by  his  certificate,  or  a  discharge  from 
his  debts  under  an  insolvent  law.  In  the 
latter  case  the  debt  has  ceased  to  exist.  It 
has  been  extinguished,  and  though  the  moral 
obligation  notwithstanding  remains  to  pay  it, 
and  is  held  to  be  a  good  consideration  for  the 
promise  to  pay  it,  yet  there  must  be  a  new 
promise  equivalent  to  a  new  contract.  In  the 
case  of  a  debt  barred  by  the  statute  of  limi- 
tations, we  have  seen  that  the  debt  is  not  dis- 
charged, but  the  remedy  by  action  is  only 
takeu  away  or  suspended  until  the  debt  is  re- 
vived. In  the  case  of  Roberts  v.  Morgan,  2 
Exch.  73G,  Eyre,  C.  J.,  says  a  debt  barred  by  a 
eeitificate,  under  a  commission  of  bankruptcy, 
by  a  new  promise  to  pay  it,  becomes  a  new- 
debt.     Lord  Mansfield  also  says,  when  there 


has  been  a  new  promise  after  the  discharge, 
the  bankrupt  is  liable  as  on  a  new  contract. 
Doug.  192.  The  moral  obligation  uniting  to 
the  new  promise  makes  what  he  calls  in  the 
case  of  Truman  v.  Fenton,  Cowp.  544,  "a 
new  undertaking  and  agreement." 

In  Dupuy  v.  Swart,  3  Wend.  135,  Marcy,  J., 
says:  "The  bare  acknowledgment  of  a  debt 
barred  by  the  statute  of  limitations  is  held  to 
revive  it;  but  an  acknowledgment  of  a  debt 
from  which  the  defendant  has  been  dis- 
charged, be  it  ever  so  explicit,  gives  no  chance 
of  action."  After  referring  to  the  authorities 
also  alluded  to  he  says:  "The  authorities 
clearly  show  that  the  new  promise  is  the  con- 
tract upon  which  the  action  against  the  de- 
fendant must  rest.  The  old  debt  has  no  fur- 
ther connection  with  this  suit  than  what 
arises  from  the  circumstance  that  it  is  resort- 
ed to  for  the  purpose  of  furnishing  a  consid- 
eration for  the  promise,  by  reason  of  its  moral 
obligation  after  its  legal  obligation  is  de- 
stroyed by  the  discharge.  The  liability  there- 
fore of  the  defendant  is  on  the  new  contract." 

A  protracted  struggle  has  been  maintained 
in  the  courts,  on  the  one  hand  to  protect  in- 
fants or  minors  from  their  own  improvidence 
and  folly,  and  to  save  them  from  the  depre- 
dations and  frauds  practiced  upon  them  by 
the  designing  and  imprincipled,  and  on  the 
other  to  protect  the  rights  of  those  deaUng 
with  them  in  good  faith  and  on  the  assump- 
tion tliat  they  could  lawfully  make  contracts. 

Much  discussion  has  been  had  in  the  books, 
by  eminent  and  learned  judges,  whether  the 
contracts  of  an  infant  were  void  or  voidable, 
and  the  earlier  decisions  were  that  such  con- 
tracts were  void.  And  the  method  adopted 
by  the  courts  to  protect  an  infant  against  the 
effects  of  his  own  weakness,  has  been  to  con- 
sider his  acts  as  not  binding.  Bing.  Inf.  5. 
Miserable  (says  Lord  INIansfield,  in  3  Bur- 
rows, ISOl)  must  the  condition  of  minors  be, 
excluded  from  the  society  and  commerce  of 
the  world,  deprived  of  necessaries,  education. 
enq)loyment  and  many  advantages,  if  they 
could  do  no  binding  acts.'  Great  inconven- 
ience must  arise  to  them  if  they  were  bound 
by  no  act.  The  law  therefore  at  the  same 
time  that  it  protects  their  inability  and  in- 
discretion from  injury,  through  their  own  im- 
prudence, enables  them  to  do  binding  acts, 
and  without  prejudice  to  themsdves,  for  the 
benefit  of  others.  And  in  that  case  (Couch 
v.  Parsons),  it  was  expressly  decided  that  an 
infant's  conveyance,  by  lease  and  release, 
was  voidable  only  and  not  void.  This  deci- 
sion has  been  considered  by  many  judges  and 
lawyers  as  unsound,  and  particularly  by  Mr. 
Preston,  in  his  work  on  Conveyancing,  in 
which  he  says:  "No  lawyer  of  eminence  has 
thought  it  safe  to  follow  that  decision  in  prac- 
tice. To  admit  indeed  that  such  a  decision  is 
law,  is  to  confound  all  distinctions  and  to 
oppose  all  authorities  on  this  head"  (2  Prest. 
Conv.  24S);  and  at  page  375  he  also  says: 
"It  would  be  well  for  every  lawyer  that  such 
a  decision  had  never  existed."     These  views 


INFANTS. 


o05 


of  this  learned  author  show  how  firmly  iui- 
Ijlanted  in  the  loyal  muid  was  the  doctrine, 
that  the  acts  and  conti'acts  of  an  infant  wei"e 
void  and  not  voidable. 

We  shall  see  that  the  modem  doctrine  is 
fully  iu  harmony  with  that  laid  down  in 
Couch  V.  I'arsous,  and  that  such  is  now  the 
well  and  firmly-eslablished  rule  of  law.  A 
void  act  never  is  nor  never  can  be  binding, 
either  on  the  person  with  whom  it  origi- 
nates or  on  others.  All  who  claim  through 
or  under  it  must  fail,  and  it  never  can,  at 
any  time  or  by  any  means,  be  confirmed  or 
rendered  valid.  A  voidable  act  is  binding  on 
others  until  disafhrmed  by  the  party  with 
whom  it  originated;  it  is  capable,  at  a  prop- 
er time  and  by  proper  means,  of  being  con- 
firmed or  rendered  valid.     Bing.  Inf.  7. 

I  tliink  it  will  be  found,  on  a  careful  exam- 
ination of  the  cases  and  the  current  of  de- 
cision by  learned  judges,  that  the  doctrine  of 
an  express  promise  by  an  infant,  after  his 
attiiiuiug  his  majority,  being  necessary  to  es- 
tablish a  contract  as  binding  made  by  him 
during  infancy,  originated  maiuly  from  two 
sources:  First,  the  notion  of  the  English 
Judges  that  it  was  their  peculiar  duty  to  pro- 
tect infants  from  their  own  acts  of  impru- 
dence and  folly;  and  second,  that  their  con- 
tracts being  wholly  void,  something  must  be 
done  equivalent  to  a  new  contract  after  com- 
ing of  age  to  make  that  legal  and  effective 
wluch  before  had  no  force  or  existence.  And 
from  this  latter  consideration  I  think  another 
error  had  its  origin  into  which  so  many  judg- 
es have  fallen,  that  to  make  binding  a  con- 
tract of  an  infant  after  he  attained  his  ma- 
jority, acts  must  be  done  of  an  equal  charac- 
ter or  degree  which  a  bankrupt  discharged 
from  a  debt  must  peilorm  to  give  new  life, 
vigor  and  vitahty  to  a  debt  discharged  and 
canceled  by  his  bankrupt  or  insolvent  dis- 
Qharge.  The  promise  to  pay  a  debt  dis- 
charged under  an  ins)lvent  law,  as  we  have 
seen,  becomes  a  new  contract.  In  the  case 
of  Roberts  v.  :Morgan,  2  Exch.  730,  Eyre,  C. 
,T.,  says  a  debt  barred  by  a  certificate  under 
a  commission  of  bankruptcy,  by  a  new  prom- 
ise to  pay  it, ,  becomes  a  new  debt.  Lord 
Mansfield  also  says,  when  there  has  been  a 
new  promise  after  the  discharge,  the  bank- 
rupt is  liable  as  on  a  new  contract.  Doug. 
192.  The  moral  obligation,  uniting  to  the 
new  promise,  makes  what  he  calls,  in  the 
case  of  Truman  v.  Fenton,  Cowpi  544,  "a 
new  undertaking  and  agreement." 

In  Lynbuiy  v.  Weightman,  5  Exch.  198, 
Lord  Ellenborough  said,  that  in  order  to  bind 
a  bankrupt  by  a  new  promise,  he  should  ex- 
pect a  positive  and  precise  promise  to  pay; 
and  in  a  note  to  this  case  it  is  said  that 
bankrupts  and  infants  stand  on  a  dittereut 
ground  with  respect  to  debts  from  which 
they  are  discharged. 

If  the  contract  of  the  infant  be  not  void, 
but  only  voidable,  can  it  be  justly  said  that 
it  has  been  discharged  paid,  that  is.  as  if  it 
had  no  existence?     It  seems  to  me  not,  and 

HOPE.  SEI..  CAS.  CONT.  — 20 


that  the  course  of  argument  of  many  learned 
judges,  in  assuming  that  the  conti-act  of  the 
infant  aud  that  of  a  bankrupt  discharged  by 
the  act  are  to  be  placed  on  the  same  foot- 
ing, cannot  be  sustained,  either  by  sound  rea- 
soning or  by  authority.  I  think  the  founda- 
tion of  the  reas<jniug  lies  in  the  as.sumption 
that  the  contracts  of  the  infant  were  void. 
If  tills  were  so,  then  the  analogy  would  cer- 
tainly be  complete.  But  if  voidalde  only, 
then  it  is  submitted  that  it  wholly  fails,  and 
that  the  contracts  of  an  infant,  which  are 
only  suspended  during  his  minority,  may  be 
revived  and  ratified  by  him  on  arriving  at 
age,  upon  the  same  principles  aud  for  the 
same  reasons,  and  by  the  same  means,  as  a 
debt  barred  by  the  statute  of  limiUxtions  may 
be  revived  and  restored  to  its  pristine  vigor 
and  efficacy.  A  review  of  the  cases  will  I 
think  warrant  us  in  arriving  at  this  conclu- 
sion. 

In  Stone  v.  Weythipol,  Cro.  Eliz.  12G,  an 
action  was  brought  against  the  executor  of 
an  infant,  on  a  debt  due  by  him,  and  which 
he  had  promised  to  pay.  Egerton,  for  the 
plaintiff,  contended  that  the  promise  of  an 
infant  is  not  void,  but  for  his  non-age  he 
may  help  himself  by  plea;  but  if  debt  had 
been  brought  against  him,  and  he  pleads  nil 
debet,  it  shall  be  found  against  him,  and  if 
at  his  full  age  he  had  payment,  it  had  been 
good  and  in  foro  conscientise,  the  promise  of 
the  infant  had  been  good.  Coke  contended 
that  it  is  no  consideration,  for  every  consid- 
eration that  doth  charge  the  defendant  in  an 
assumpsit  must  be  to  the  benefit  of  the  de- 
fendant, or  charge  of  the  plaintiff,  and  no 
case  can  be  put  out  of  this  rule,  and  this 
contract  by  the  infant  was  void;  and  after- 
ward the  court  was  clearly  of  the  opinion  that 
the  action  did  not  lie,  for  the  coniract  of 
the  infant  was  merely  void,  and  in  debt 
against  him  he  might  plead  nil  debet.  Eger- 
ton then  said:  "It  had  been  adjudged  in 
that  court,  in  Edmonds  v.  Burton,  that  when 
an  infant  was  bound  in  an  obligation,  and  at 
his  full  age  he  promised  payment,  an  action 
was  maintainable  against  his  executor  on 
this  promise,  to  which  the  court  agreed,  for 
tlie  bond,  which  was  the  ground  of  it,  was 
not  void,  but  voidable,  and  he  could  not 
plead  non  est  factum  or  nil  debet  to  a  bond, 
and  if  at  his  full  age  he  had  accepted  a  de- 
feasance of  the  bond,  this  had  made  it  good, 
and  in  the  case  cited  the  promise  was  by  the 
infant  himself,  which  in  conscience  he  ought 
to  pay."  Moning  v.  Knoss,  Cro.  Eliz.  700, 
was  an  action  of  assumpsit,  where  an  in- 
fant being  bound  iu  a  bond  for  the  payment 
of  £17  at  his  full  age,  in  consideration  that 
the  plaiutifl',  the  obligee,  would  sUay  the  siut 
he  had  brought  on  the  bond,  he  answered 
that  he  would  pay  the  £17  on  a  certain  day 
after.  Upon  nonassumpsit  pleaded,  it  was 
found  for  the  plaintiff,  and  it  was  alleged  in 
arrest  of  judgment  that  there  was  not  any 
consideration  to  ground  an  assumpsit,  nnd 
in  proof  thereof  the  case  of  Stone  v.  Weythi- 


306 


CAPACITr  OF  PARTIES. 


pol.  supra,  was  cited;  for  the  bond  not  be- 
ing surliciont  to  bind  him,  there  is  not  any 
cause  for  liim  to  make  this  assumpsit,  and  of 
this  opinion  was  Turner,  but  Clinch  arrested, 
and  tlie  other  judges  being  absent,  tlie  mat- 
ter was  adjourned. 

In  Thrupp  v.  Fiolden,  2  Exch.  628,  the  ac- 
tion was  assumpsit,  and  the  plaintiff  proved 
a  payment  of  f-iO,  on  account  of  the  bill, 
since  defendant  came  of  age.  For  the  plain- 
tiff, it  was  contended  tliat  tliis  was  an  ad- 
mission by  the  defendant  of  bis  liability  to 
pay,  and  tantamount  to  a  new  promise.  But 
Lord  Keuyon  said:  "This  is  not  such  a  prom- 
ise as  satisfies  the  issue.  The  case  of  in- 
fancy differs  from  the  statute  of  limitations; 
in  the  latter  case,  a  bare  acknowledgment 
has  been  held  to  be  sufficient  In  the  case 
of  an  infant,  I  shaU  hold  an  acknowledg- 
ment not  to  be  sufficient,  and  require  proof 
of  an  express  promise  to  pay  made  by  the 
infant  after  he  had  attained  that  age  when 
the  law  presumes  that  he  has  discretion." 

It  seems  to  me,  these  cases  have  proceeded 
on  the  principle,  that  the  obligations  of  the 
infant  were  void,  and  that  on  his  attaining 
his  majority  he  was  as  much  discharged 
from  them,  on  that  ground,  as  a  bankrupt  is 
by  his  discharge  under  the  bankrupt  or  in- 
solvent laws. 

It  will  be  convenient  here  to  examine  the 
course  of  decision  in  this  country  upon  this 
branch  of  the  law. 

In  an  early  case  in  Ck)nnecticut  (Rodgers  v. 
Hand  [1S09]  4  Day,  57)  the  supreme  court  of 
errors  held,  that  all  contracts  made  by  in- 
fants against  their  interest  were  void,  and 
that  the  same  evidence  might  be  required  of 
the  confirmation  of  a  voidable  contract  after 
fuU  age  as  of  the  execution  of  a  new  one,  to 
avoid  fraud  and  imposition. 

This  case  was  followed  by  the  court  in 
Benham  v.  Bishop,  9  Conn.  333.  Daggett,  J., 
there  lays  down  the  rule  very  broadly,  that 
the  note  of  an  infant  cannot  be  satisfied  by 
merely  acknowledging  that  he  made  it,  or 
that  it  is  due.  Unlike  an  admission  of  the 
debt  barred  by  the  statute  of  limitations, 
which  has  been  held  to  remove  the  bar,  and 
authorize  a  recoverj',  he  says,  in  the  case  of 
a  note  or  bond  of  a  minor,  there  must  be  a 
promise  to  pay  when  of  full  age. 

In  Wilcox  V.  Roath,  12  Conn.  550,  the  lan- 
guage used  by  the  court  is  broad  and  sweep- 
ing. It  is,  that  it  has  been  contended  that 
the  evidence  which  would  take  a  case  out  of 
the  statute  of  limitations  is  sufficient  to 
prove  the  ratification  of  a  contract  made  by 
an  infant.  Such  however  the  court  says  is 
not  the  rule.  The  cases  are  not  analogous. 
They  stand  on  different  grounds,  and  are 
governed  by  different  principles.  In  the  one 
case,  the  debt  continues  from  the  time  it 
was  contracted.  A  new  promise  merely  re- 
buts the  presumption  created  by  the  statute, 
and  the  plaintiff  recovers  not  on  the  ground 
of  any  new  right  of  action,  but  that  the 
statute  does  not  apply  to  bar  the  old  one.    In 


the  other,  there  never  was  any  legal  ri.uht 
capable  of  being  enforced,  and  in  case  of  a 
promise,  after  the  infant  became  of  age,  to 
take  upon  himself  a  new  liability,  proceeded 
indeed  upon  a  moral  obligation  existing  be- 
fore. Accordingly  it  is  well  settled  that  a 
bare  acknowledgment  is  sufficient  to  take  a 
case  out  of  the  statute  of  limitations.  But 
in  regard  to  the  contract  of  an  infant,  it  has 
been  repeatedly  adjudged  that  there  must  be 
an  express  promise  to  pay  the  debt  after  he 
arrives  at  full  age,  otherwise  there  is  no  rat- 
ification. 

In  Smith  v.  Mayo,  9  Mass.  G2,  the  supreme 
court  held  that  a  direct  promise  when  of 
age  is  necessary  to  establish  a  contract  made 
during  minority,  and  that  a  mere  acknowl- 
edgment, as  in  cases  under  the  statute  of  lim- 
itations, will  not  have  that  effect;  and  it  is 
also  stated  that  the  rule  is,  that  such  prom- 
ise must  be  made  deliberately  and  with  a 
knowledge  that  the  party  is  not  liable  by  law. 
In  this  case  the  infant  made  a  bond,  and 
after  he  came  of  age  made  his  will,  disposing 
of  his  estate,  "after  his  just  debts  are  paid;" 
and  the  court  held  that  this  expression  did 
not  amount  to  a  promise  to  pay  the  bond; 
that  it  contained  a  direction  only  to  paj'  just 
debts,  and  there  was  nothing  in  the  case 
from  which  the  court  could  infer  that  what 
was  not  in  law  a  debt  could  be  considered 
by  the  testator  as  a  just  debt.  The  same 
doctrine  was  repeated  in  Ford  v.  Phillips,  on 
the  authority  of  this  case,  and  it  was  af- 
firmed that  a  direct  promise  was  necessary; 
a  mere  acknowledgment  of  the  debt  is  not 
svifficient  But  the  true  doctrine  is  more  ac- 
cui-ately  laid  down  in  Whitney  v.  Dutch,  14 
Mass.  460.  There  Parker,  C.  J.,  says:  "By 
the  authorities,  a  mere  acknowledgment  of 
the  debt,  such  as  would  take  the  case  out  of 
the  statute  of  limitations,  is  not  a  ratification 
of  the  contract  made  during  minority.  The 
distinction  is  no  doubt  well  taken.  The  rea- 
son is,  that  a  mere  acknowledgment  avoids 
the  presumption  of  payment  which  is  accept- 
ed by  the  statute  of  limitations;  whereas  the 
contract  of  an  infant  may  always,  except  in 
certain  cases  sufficiently  known,  be  voided 
by  him  by  plea,  whether  he  acknowledge  tlie 
debt  or  not,  and  such  positive  act  or  declara- 
tion on  his  part  is  necessary  to  defeat  his 
power  of  avoiding  it.  But  the  terms  of  the 
i-atification  need  not  be  such  as  to  import  a 
direct  promise  to  pay.  All  that  is  necessary 
is,  that  he  expressly  agrees  to  ratify  his  con- 
tract, not  by  doubtftil  acts,  such  as  payment 
of  a  part  of  the  money  due,  or  the  interest, 
but  by  words,  oral  or  in  writing,  which  im- 
port a  recognition  and  a  confirmation  of  his 
promise." 

In  Thompson  v.  Lay,  4  Pick.  4S,  Parker,  C. 
J.,  says  the  cases  of  Whitney  v.  Dutch  and 
Ford  V.  Phillips  explicitly  lay  down  the  prin- 
ciple that  the  promise  of  an  infant  cannot 
be  revived  so  as  to  sustain  an  action,  unless 
there  be  an  express  confirmation  or  ratifica- 
tion after  he  comes  of  age.     "A  promise  to 


INFANTS. 


807 


pay  is  evidence  of  a  ratification;  so  is  a  di- 
rect confirmation,  tliougli  not  in  words 
amounting  to  a  direct  promise;  as  if  the 
party  sliould  say,  after  coming  of  age,  'I  do 
ratify  and  confirm,'  or,  'I  do  agree  to  pay  tlie 
debt'  "  And  in  Kocd  v.  Batcbelder,  1  .Mete. 
(Mass.)  559,  Shaw,  C.  J.,  says,  the  question, 
what  acts  of  an  infant  are  voidable  and  what 
void,  is  not  very  delinitely  settled  I)y  author- 
ities; but  in  general  it  may  be  said,  the  tend- 
ency of  modern  decisions  is  to  consider  them 
voidable,  and  thus  leave  the  infant  to  atiirra 
or  disaflirm  when  he  comes  of  age,  as  his 
own  views  of  his  interest  may  lead  him  to 
elect,  and  that  it  is  establislied  in  Massacliu- 
setts  that  the  note  of  an  infant  Is  voidable 
only,  and  may  be  regarded  as  a  good  founda- 
tion for  a  new  promise  when  he  comes  of 
age,— citing  Whitney  v.  Dutch  and  Thompson 
V.  Lay,  supra,  and  Martin  v.  Mayo,  10  Mass. 
13T. 

In  Pierce  v.  Tobey,  4  Mete.  (:Mass.)  168,  the 
court  said:  "A  conti-act  made  by  a  minor 
may  be  affirmed  after  his  arrival  at  full  age; 
and  if  so  done,  and  by  words  proper  to  give 
it  force  and  effect,  as  a  valid  contract,  it  will 
be  operative  and  binding  upon  him.  A  mere 
acknowledgment  of  a  debt  so  existing  is  not 
sufficient;  but  there  must  be  a  direct  prom- 
ise, or  a  direct  confirmation,  before  any  lia- 
bility attaches." 

In  Hall  V.  Gerrish.  8  N.  H.  574,  the  su- 
preme court  of  that  state  say:  "An  acknowl- 
edgment of  a  subsisting  debt,  when  a  claim 
has  been  barred  by  the  statute  of  limitations, 
furnishes  evidence,  unless  explained  or  qual- 
ified, from  which  a  new  promise  may  be  im- 
plied; but  the  promise  of  an  infant  cannot 
be  revived  so  as  to  sustain  an  action,  unless 
there  be  an  express  confirmation  or  ratifica- 
tion, after  he  comes  of  age.  This  ratifica- 
tion must  either  be  a  direct  promise  or  by 
saying,  'I  ratify  and  confirm,'  or,  'I  agree  to 
pay  the  debt,'  or  by  positive  acts  of  the  in- 
fant, after  he  has  been  of  age  a  reasonable 
time  in  favor  of  his  contract,  which  are  of  a 
character  to  constitute  a  perfect  evidence  of 
ratification  as  an  express  and  unqualified 
promise."  To  the  same  effect  is  the  case  of 
Ilobbius  v.  Eaton,  10  N.  H.  5G1. 

We  will  now  advert  to  the  course  of  judi- 
cial decisions  in  this  state.  A  reference  has 
already  been  made  to  the  remarks  of  Chief 
Justice  Spencer  in  Sands  v.  Gelston,  where 
he  observed  that  he  could  never  see  the  dif- 
ference, as  regards  the  revival  of  a  debt,  be- 
tween one  barred  by  the  statute  of  limita- 
tions and  one  from  which  the  del)tor  had 
been  discharged  under  the  bankrupt  or  in- 
solvent laws.  He  says:  "There  is  no  sub- 
stantial difference  between  a  debt  barred  by 
the  statute  of  limitations,  and  a  debt  from 
the  payment  of  which  the  debtor  is  exoner- 
ated by  a  discharge  under  a  bankrupt  or  in- 
solvent act  A  fortiori,  a  debt  not  dischar- 
ged, as  that  of  an  infant  ought  certainly  not 
be  placed  on  the  same  footing  with  one 
which  is." 


I  tliiuk  we  shall  find,  on  examination  of 
the  cases  in  this  state,  that  there  has  been 
a  great  change  of  views  and  modification  of 
opinion  on  the  subject  of  infants'  contracts. 
All  the  cases  hold  that  the  contract  of  the 
minor  is  not  void,  but  voidable  only.  Good- 
sell  v.  Myers,  3  Wend.  470;  Everson  v.  Car- 
penter, 17  Wend.  417;  Delano  v.  Blake,  11 
Wend.  85;  Bay  v.  Guun,  1  Denio,  108;  Taft 
V.  Sergeant,  18  Barb.  3li0. 

Having  now  as  I  think  conclusively  estab- 
lished tliat  the  promissory  note  or  contract 
of  an  infant  is  voidable  only  and  not  void, 
and  that  it  is  a  subsisting  liability  which 
cannot  however  be  enforced  without  some 
further  act  on  his  part  after  he  attains  his 
majority,  it  will  be  necessary  in  the  next 
place  to  inquire  what  is  the  rule  of  law  in 
this  state  as  to  acts  or  declarations  of  his, 
which  may  have  the  effect  of  making  it  le- 
gally binding  upon  him,  so  that  it  may  be 
enforced  in  the  courts  against  him.  It  is 
well  to  bear  in  mind  that  principles  of  law 
which  were  recognized  and  enforced  to  pro- 
tect infants  against  their  acts  of  indiscretion 
and  folly  while  of  such  j-ears  as  the  law  as- 
sumed they  could  not  act  with  prudence  and 
discretion,  should  not  be  invoked  to  aid  them 
in  the  perpetration  of  gross  fraud,  and  to 
wrong  the  innocent  and  confiding. 

Not  a  few  have  been  of  the  opinion  that  a 
man  who  by  representing  himself  as  compe- 
tent to  contract  and  on  the  faith  of  such  rep- 
resentations does  contract  and  obtain  a  ben- 
efit to  himself,  which  he  retains,  should  not 
be  allowed  afterward,  when  that  contract  is 
sought  to  be  enforced  against  him,  to  set  up 
and  allege  that  he  had  no  legal  power  to 
make  the  contract  and  therefore  he  was  not 
liable  on  it  Common  honesty  and  fair  deal- 
ing among  men  would  seem  to  require  that 
he  should  be  estopped  from  setting  up  such  a 
defense. 

It  is  certainly  the  duty  of  courts  not  to  aid 
such  defenses,  when  their  countenance  ran 
be  withheld  without  doing  violence  to  estab- 
lished principles  of  law.  If  we  find  that  the 
rules  of  law  as  expounded  by  the  courts  and 
learned  authors  will  sustain  us  in  overruling 
such  a  defense,  we  should  not  be  slow  in  fol- 
lowing their  leadings.  We  have  seen  by  the 
earlier  cases,  that  to  bind  a  bankrupt  or  in- 
fant there  must  be  proven  a  proisc  and  pos- 
itive promise  to  pay  the  particul.ir  debt  after 
the  discharge,  or  after  attaining  full  age, 
and  the  reason  assigned  was,  that  in  such 
cases  they  were  discharged  from  their  liabili- 
ties, or  were  never  subject  to  answer.  Thks 
was  certainly  so  as  to  the  bankrupts,  and  un- 
doubtedly so  as  to  the  infant  if  his  contract 
was  void.  He  had  no  capacity  to  make  it 
and  his  state  of  infancy  discharged  him 
tlierefrom,  or  made  it  no  contract.  In  both 
cases  the  debts  were  in  the  eye  of  the  law  as 
though  they  had  never  been,  and  therefore 
the  court  in  this  respect  required  proof  equiv- 
alent to  a  new  contract  to  make  them  bind- 
ing. 


306 


CAPACITY  OF  TARTJES. 


But  it  has  been  found,  on  a  more  careful 
examination  of  the  cases,  tlie  later  ones  es- 
pecially, that  the  contracts  of  an  infant  were 
not  void  but  only  voidable,  and  therefore  the 
gi'ouud  was  changed,  and  a  different  element 
v\-as  thrown  in;  and  the  courts  have  adopted 
the  more  sound  and  sensible  rule,  that  rati- 
hcation  or  confirmation  of  the  contract  made 
in  infancy  will  bind  the  party  if  done  after 
his  coming  of  age.  This  new  promise,  posi- 
tive and  precise,  equivalent  to  a  new  con- 
tract, is  not  now  essential;  but  a  ratifica- 
tion or  confirmation  of  what  was  done  dur- 
ing the  minority,  is  sufficient  to  malie  the 
contract  obhgatory.  These  words  "ratify  or 
confirm,"  necessarily  import  that  there  was 
something  in  existence  to  which  the  ratifica- 
tion or  confirmation  could  attach,  entirely  ig- 
noring therefore  the  notion  that  an  infant's 
oblig-ations  or  contiucts  were  discharged  or 
extinguished  by  reason  of  the  state  of  in- 
fancy. And  it  was  said  in  the  case  of  Whit- 
ney v.  Dutch,  supra,  that  the  terms  of  the 
ratification  need  not  he  such  as  to  import  a 
direct  promise  to  pay.  All  that  is  necessai"y 
is  that  the  infant,  after  attaining  his  major- 
ity, should  expressly  agree  to  ratify  his  con- 
tract by  words,  oral  or  in  writing,  or  by 
acts  which  import  a  recognition  and  a  confir- 
mation of  his  promise.  In  Goodsell  v.  Myers, 
sui'ra,  Savage,  C.  J.,  said:  "A  i-atification  of 
an  infant's  contract  should  be  something 
more  than  a  mere  admission  to  a  stranger 
that  sv.ch  a  contract  existed;  there  should 
be  a  promise  to  a  party  in  intei'est  or  to  his 
a^ent,  or  at  least  an  explicit  admission  of  an 
existiug  liability  from  which  a  promise  is 
implied."  This  rule  is  affirmed  in  Delano  v. 
Blake,  supra.  In  the  case  of  Insurance  Co. 
v.  Grant,  2  Edw.  Ch.  544,  the  vice-chancellor 
held  that  ii  provision  in  a  will,  made  after 
attaining  full  age,  directing  "all  his  just 
lebts  and  personal  expenses  to  be  first  paid 
iU'l  satisfied,"  was  a  confirmation  of  a  mort- 
ga-^e  given  by  the  testator  while  an  infant. 

In  Bigelow  v.  Grannis,  2  Hill,  120, the  court 
says:  "In  the  case  of  infancy,  there  must  be 
a  new  promise,  or  a  ratification  of  the  con- 
tract, after  the  defendant  has  attained  the 
age  of  twenty-one  years,  and  so  in  the  cases 
of  contract.  The  minds  of  the  parties  must 
meet.  A  promise  to  a  stranger  will  not  an- 
swer." 

The  same  rule  is  recognized  in  Watkins  v. 
Stevens,  4  Barb.  168. 

I  think  that  the  course  of  decision  in  this 
state  authorizes  us  to  assume  that  the  nar- 
row and  stringent  rule,  formerly  enunciated, 
that  to  establish  the  contract,  when  made  in 
infancy,  there  must  be  a  precise  and  positive 
promise  to  pay  the  particular  debt,  after  at- 
taining majority,  is  not  sustained  by  the 
more  modern  decisions.  A  brief  reference  to 
the  course  of  legislation  and  decisions  in 
England  of  a  more  modern  date,  will  illus- 
trate and  confirm  these  views.  In  1828  an 
act  was  passed,  called  "Lord  Tenterden's 
Act,"  (9  Geo.  IV.  c.  14),  having  reference  to 


the  acts  necessary  to  be  done  to  revive  and 
give  full  force  to  the  contracts  barred  by  the 
statute  of  limitations  and  the  contracts  of 
infants. 

A  statute  had  been  passed  in  6  Geo.  IV. 
(Go  St.  at  Large,  46),  in  reference  to  bank- 
rupts, the  one  hundred  and  thirty-first  sec- 
tion of  which  declares  that  no  bankrupt,  aft- 
er his  discharge,  shall  be  liable  to  pay  or 
satisfy  any  debt,  claim  or  demand  from 
which  he  shall  have  been  discharged,  upon 
any  contract,  promise  or  agreement  made  or 
to  be  made  after  the  suing  out  of  the  com- 
mission, unless  such  promise,  contract  or 
agreement  be  made  in  writing,  and  signed 
by  the  bankrupt  or  some  person  authorized 
by  him. 

The  first  section  of  the  act  of  9  Geo.  lY. 
declares  that  to  take  a  debt  or  simple  con- 
tract out  of  the  operation  of  the  statute  of 
limitations,  no  acknowledgment  or  promise 
by  words  orally  shall  be  deemed  suflicient 
evidence  of  a  new  or  continuing  contract, 
and  to  make  it  operative,  such  acknowledg- 
ment or  promise  shall  be  in  writing,  signed 
by  the  party  to  be  charged  thereby. 

And  section  5  enacts,  that  no  action  shal! 
be  maintained  whereby  to  charge  any  person 
upon  any  promise,  made  after  fuU  age,  to 
pay  any  debt  contracted  during  infancy,  or 
upon  any  ratification,  after  full  age,  of  any 
promise  or  simple  contract,  made  during  in- 
fancy, unless  such  promise  or  ratification 
shall  be  in  writing  to  be  signed  by  the  party 
to  be  charged  thereby.  The  framers  of  this 
act  make  the  same  distinction  as  the  courts 
in  this  state,  viz.:  a  promise  to  pay,  and  a 
ratification  of  a  promise  or  of  the  contract; 
the  only  difference  now  being,  that  in  Eng- 
land such  promise  or  ratification  must  by 
this  statute  be  in  writing,  while  with  us  it 
may  rest  in  parol  or  acts.  The  principle  is 
the  same  in  both  countries,  and  the  differ- 
ence is  onlj^  in  matter  of  evidence. 

In  Hartley  v.  Vi'harton,  11  Adol.  &  E.  934, 
an  infant  was  held  to  have  ratified  a  con- 
tract for  the  purchase  of  goods  sold  and  de- 
livered to  him  during  infancy,  by  a  letter  or 
paper  which  was  given  to  the  agent  of  the 
plaintiff  when  he  called  and  demanded  pay- 
ment of  the  debt. 

He  made  no  other  answer,  and  the  paper 
had  no  address.  It  was  in  those  words:  "Sir, 
I  am  son-y  to  give  you  so  much  trouble  in 
calling,  but  I  am  not  prepared  for  you,  but 
will  without  neglect  remit  you  in  a  short 
time.  Yours,  respectfully,  Frederick  Whar- 
ton." Lord  Denman,  C.  J.,  says,  the  effect- 
ive words  in  the  act  are,  "promise"  and  "rat- 
ification." The  mischief  to  be  provided 
against  was,  not  the  want  of  particularity  as 
to  the  sum,  but  looseness  of  proof  as  to  the 
fact  of  acknowledgment,  and  the  defendant 
was  hold  to  have  ratified  the  contract. 

Harris  v.  Wall,  1  Exch.  122,  is  an  important 
case,  and  deserves  careful  consideration.  It 
was  an  action  of  assumpsit  by  indorsee 
against   the   acceptor  of  a   bill  of  exchange,. 


INFANTS. 


309 


dated  29th  .Marcli,  1S45,  for  the  sum  of  £500. 
Defendant  plead  that  at  the  time  of  making 
11)0  promise,  etc.,  be  was  an  infant  under  the 
a;;e  of  twenty-one  j'oars.  Replication  that 
before  the  commencement  of  the  suit,  and 
after  be  attained  bis  full  aj^e  of  twenty-one 
years,  he,  the  defendant,  by  a  certain  memo- 
randum sijmed  by  him,  ratified  and  confirmed 
the  said  contracts  and  promises,  and  then 
promised  the  plaintiff  to  pay  him  the  moneys 
mentioned  in  the  declaration.  It  appeared 
that  there  was  another  acceptance  of  the  de- 
fendant for  £l,rjOO,  but  by  whom  held  does 
not  distinctly  appear,  though  little  doubt  can 
exist  it  was  by  the  plaintiff.  It  was  proven 
that  the  defendant  attained  bis  full  age  on 
the  10th  of  December,  1S45.  The  ratification 
and  confirmation  were  sought  to  be  made  out 
by  letters,  addressed  to  the  plaintiff,  and  writ- 
ten and  sijiucd  by  the  defendant.  The  first, 
dated  .January  2,  1S4G,  was  in  these  words: 
"Mr.  Harris:  I  should  feel  particularly 
oblised  if  you  would  arrange  to  keep  the  bills 
back  for  a  little  time,  as  my  late  brother's 
executors  have  lost  their  mother  and  only 
sister  lately,  and  which  prevents  them  from 
settling  with  you.  The  money  will  shortly 
be  paid,  say  £2,(X)0.  I  have  hoard  from  Mr. 
r.urnett  this  morning;  and  he  tells  me  a  Mr. 
(Jreen  has  written  to  him  for  the  money. 
I'lease  arrange  with  him,  and  write  to  me  by 
return."  It  is  stated  that  the  executors  of 
defendant's  brother,  referred  to  in  the  fore- 
going letter,  were  the  Messrs.  Hall  mentioned 
in  defendant's  letter  of  January  19,  1&4G. 
The  defendant's  brother  had  died  in  Febru- 
ary, 1845,  and  had  left  him  a  considerable 
fortune,  more  than  ample  for  the  payment  of 
ihe  £2,000.  When  the  bills  became  due  they 
were  dishonored,  and  the  defendant  shortly 
thereafter  wrote  the  plaintiff  as  follows,  un- 
der date  of  January  G,  1S4G:  "The  bills 
drawn  out  by  Mr.  Burnett  and  me,  and  my 
acceptances,  one  for  £1,500  and  the  other  for 
£.500,  due  on  the  first  of  January  last,  will 
most  likely  be  settled  shortly,  and  would 
have  been  settled  before  had  not  a  sudden 
accident  occurred,  which  prevented  their  be- 
ing paid."  On  the  I'Jth  of  January,  1S4G,  the 
defendant  addressed  the  plaintiff  this  letter: 
"Sir:  I  beg  to  inform  you  that  I  have  this 
day  forwarded  your  letter  to  Messrs.  Hall, 
and  also  the  letters  from  Messrs.  Green  and 
lUunett.  1  camiot  exactly  tell  you  about 
what  time  they  will  be  settled,  as  I  have  not 
the  money  myself,  and  as  I  have  told  you 
before,  have  left  it  entirely  in  their  hands." 
On  the  25th  January,  1S4G,  be  again  ad- 
dressed to  the  plaintiff  this  letter:  "Sir:  I 
received  your  letter  of  yesterday,  and  am  sor- 
ry to  find  that  you  are  not  contented  with  the 
letter  I  gave  you  when  at  my  house  some 
short  time  ago.  I  have  heard  from  the 
Messrs.  Hall  yesterday,  and  they  said  they 
had  written  to  their  agents  in  Dublin  to  ar- 
range the  whole  thing.  I  therefore  beg  you 
will  immediately  see  and  inform  Mr.  Lazarus, 
who  I  beard  from  this  day,  of  it.    It  is  not 


a  bit  of  use  writing  these  sort  of  lettere,  as 
payment  will  not  be  made  the  sooner  for 
them.  What  I  tell  you  is  perfectly  correct, 
and  the  matter  will  be  settled  shortly." 
^  liolfe,  B.,  in  delivering  the  opinion  of  the 
court  says:  "The  question  is,  whether  from 
all  or  any  of  these  letters,  the  court  can  say 
that  the  defendant  ratified  the  promise  made 
dui-ing  his  infancy  to  pay  the  £500  bill. 
There  is  some  diUiculty  in  cases  like  the 
present,  in  understanding  clearly  what  is 
I  meant  by  a  ratification.  •  •  •  But  what- 
I  ever  dirticulty  may  exist,  the  case  clearly 
I  recognizes  ratification  as  something  distinct 
from  a  new  pronnse.  Indeed,  Lord  Tenter- 
den's  act  (9  Geo.  IV.  c  14),  which  was  cited 
in  the  argument  before  us,  expressly  makes 
a  distinction  between  a  new  promise  and  the 
ratification,  after  majority,  of  the  old  prom- 
ise, made  during  minority,  in  both  cases  re- 
quiring a  written  instrument  signed  by  the 
party.  The  first  step  therefore  to  take  to- 
ward a  decision  of  this  case  is  to  understand 
clearly  what  is  meant  by  a  ratification,  as 
distinguished  from  a  new  promise.  We  are 
of  opinion  (from  Lord  Tenterden's  act),  that 
any  act  or  declaration,  which  recognizes  the 
existence  of  the  promise  as  binding,  is  a 
ratification  of  it.  As  in  the  case  of  agency, 
any  thing  which  recognizes  as  binding  an 
act  done  by  an  agent,  or  by  a  party  who  has 
acted  as  agent,  is  an  adoption  of  it.  Any 
written  instrument  signed  by  the  party, 
which  in  case  of  .adults  would  have  amounted 
to  the  adoption  of  the  act  of  a  party  acting 
as  agent,  will,  in  the  case  of  an  infant,  who 
has  attained  his  majority,  amount  to  a  ratifi- 
cation. Applying  this  test  to  the  case  now 
before  us,  we  think  it  clear  that  there  has 
been,  a  ratification.  There  cannot  we  think 
be  a  doubt  but  that  if  the  bill  in  question,  in- 
stead of  having  been  accepted  by  an  infant, 
had  been  accepted  by  A.  B.  on  behalf  of  the 
defendant,  being  an  adult,  the  letter  in  ques- 
tion would  have  amounted  to  an  adoption  of 
the  agency  of  A.  B.,  and  that  the  defendant 
would  have  been  liable.  And  he  must  on  the 
same  ground  be  liable  in  the  present  case. 
Ho  in  truth  treats  his  own  act  during  infancy 
as  having  been  done  on  behalf  of  himself, 
after  his  majority.  Our  decision  is  thus  con- 
formable to  that  of  the  queen's  bench,  in 
Hartley  v.  Wharton,  where  however  the  letter 
of  ratification  was  certainly  stronger  than 
the  letters  now  before  us.  We  should  have 
had  gi-eat  difficulty  in  holding  that  the  letters 
of  the  present  defendant  were  such  as  to 
amount  to  another  promise;  but  according 
to  the  meaning  we  have  attributed  to  the 
word  'ratification.'  we  think  that  the  plain- 
tiff has  made  out  his  ratification,  and  is  there- 
fore entitled  to  judgment" 

We  have  quoted  thus  liberally  from  this 
case,  because,  we  think,  it  states  with  clear- 
ness axid  accuracy  the  rules  and  principles 
applicable  to  cases  of  this  character,  and 
such  as  have  been  recognized  and  atiirmed 
In  our  own  courts. 


310 


CAPACITY  OF  PARTIES. 


The  legislation  and  adjudications  in  Eng- 
land haYe  clearly  defined  what  is  to  be  done, 
in  the  three  classes  of  cases  under  considera- 
tion, to  revive  and  make  effective  debts  and 
contracts,  of  infants,  bankrupts,  or  those 
barred  by  the  statute  of  limitations.  In  the 
latter  case,  they  are  revived  and  restored  to 
their  original  vigor  by  an  acknowledgment 
or  promise;  in  the  case  of  infants,  by  a  new 
promise  or  ratification  of  the  acts  done  in  in- 
fancy, after  attaining  full  age;  and  the  case 
of  bankrupt,  by  a  new  promise,  contract,  or 
agreement  made  after  the  discharge. 

It  may  be  conceded  that  the  paper  produced 
in,  evidence  by  the  defendant,  for  want  of  a 
seal,  could  not  operate  as  a  deed  and  valid 
conveyance    of   the   land   therein    mentioned. 
But  clearly  the  defendant  could  have  availed 
himself  of  it  as  a  contract  of  sale  of  those 
lands,  and  have  enforced  a  specific  perform- 
ance of  it  by  a  valid  and  effectual   convey- 
ance.   All  that  the  statute  of  fraud  requires 
is,  that  a  contract  of  sale  of  lands  shall  be  in 
writing,   and   that   such   writing   express   the 
consideration  and  be  subscribed  by  the  party 
by  whom  the  sale  is  to  be  made,  or  by  his 
agent  lawfully  authorized.    The  evidence  of 
the  authority   may   be  by  parol.     Neither  a 
written  authority  nor  an  authoritv  under  seal 
is  required.    Worrall  v.   Munn,  5  N.   Y.  229; 
2  Rev.  St.  135,  §§  S,  9;   10  Paige,  386;   5  Hill, 
107.    But  in  the  present  case,  the  authority 
of  the  agent  cannot  be   questioned.     In  the 
first  place  the  principal,  the  present  plaintiff, 
has  fully  ratified  the  act  of  his  agent  in  mak- 
ing the  sale.    The  commencement  of  this  suit 
to  recover  the  balance  of  the  purchase-money, 
is  a  full  and  complete  ratification  of  the  sale 
by  the  agent  to  this  defendant.    Again,   the 
plaintiff  offered  on  the  trial  to  show  by  the 
agent  that  he  was  authorized  by  the  plaintiff 
to  sell  this  land  for  him,  and  did  so  sell  it; 
that  he  had  a  power  of  attorney   from  the 
plaintiff  to  sell  and  convey  the  lots,  and  that 
as  such  attorney   he   made   and   executed   a 
quit-claim  deed  to  the  defendant  of  the  lots. 
This  testimony,  which  was  taken  on  commis- 
sion, was  offered  by  the  plaintiff  and  objected 
to,  and  excluded  by  the  court  as  immaterial, 
and  to  which  the  plaintiff  excepted.    The  de- 
fendant accepted  the  deed  as  made  out,  and 
executed  by  the  agent,   and  went  into  pos- 
session under  it,   and  we   are  authorized  to 
assume,   as   these   facts   were  offered    to   be 
proved,  actually  sold   and  conveyed  away  a 
portion  of  the  premises,    and   the  defendant 
must  be  regarded  as  having  acquired  at  least 
an  equitable   title   to   the   lands.    Worrall   v. 
Munn,  supra;    Delano  v.  Blake,  11  Wend.  85; 
Roof  V.  Stafford,  8  Cow.  179;  Palmer  v.  Mil- 
ler, 25  Barb.  399;    Jones  v.  Phenix  Bank,  8 
N.  Y.  2.34;    Am.  Lead.  Cas.  2.58.    In   Delano 
V.  Blake,  supra,  the  court,  by  Judge  Nelson, 
says:    "The  purchase  by  an  infant  of  real  es- 
tate is  voidable,  but  it  vests  in  him  the  free- 
hold until  he  disagrees  to  it,  and  the  continu- 
ance in  possession  after  he  arrives  of  age  is 
an  implied  confirmation  of  the  contract."    So 


as  to  a  lease  to  an  infant,  the  continuance  in 
possession,  after  the  party  arrives  of  age,  is 
a  confirmation,  and  he  must  pay  the  rent. 
Bac.  Abr.  tit.  "Infant,"  611,  012. 

The  infant  in  this  case  certainly  acquired 
an  equitable  title  to  the  real  estate  purchased 
of  the  plaintiff'. 

He  went  into  the  possession  and  continued 
in  possession  after  he  attained  the  age  of 
twenty-one,  and  bargained  and  sold  a  portion 
of  the  real  estate,  and  received  the  considera- 
tion therefor.  And  these  circumstances  must 
be  regarded  as  affording  the  strongest  evi- 
dence of  his  having  attirmed  the  purchase, 
and  his  consequent  liability  upon  the  note  in 
suit.  When  an  infant  purchases  property, 
and  continues  to  enjoy  the  use  of  the  same, 
and  then  sells  it,  or  any  part  of  it,  and  re- 
ceives the  money  for  it,  he  must  be  consid- 
ered as  having  elected  to  aflirm  the  contract, 
and  he  cannot  afterward  avoid  payment  of 
the  consideration.  Boody  v.  McKenney,  2:i 
Me.  517;  Lawson  v.  Lovejoy,  8  Me.  405; 
Boyden  v.  Boyden,  9  Mete.  (Mass.)  519.  In 
this  last  case.  Chief  Justice  Shaw  observes, 
that  if  the  infant,  after  coming  of  age,  re- 
tains the  property  purchased  by  him  during 
his  minority,  for  his  own  use,  or  sells  or.  oth- 
erwise disposes  of  it,  such  detention,  use  or 
disposition,  which  can  be  conscientiously  done 
only  on  the  assumption  that  the  contract  of 
sale  was  a  vahd  one,  and  by  it  the  property 
became  his  own,  is  evidence  of  an  intention 
to  affii-m  the  contract,  from  which  a  ratifica- 
tion may  be  inferred,  when  he  purchases 
land  and  goes  into  possession,  and  continues 
in  possession  after  his  arrival  at  full  age,  for 
he  thereby  affirms  the  purchase  and  ratifies 
the  contract  of  sale.  Hubbard  v.  Cummings, 
1  Greenl.  11;  Boody  v.  McKenney,  supra; 
Bobbins  v.  Eaton,  10  N.  H.  561;  1  Pai*s.  Cont. 
271. 

In  Hubbard  v.  Cummings,  supra,  Chief  Jus- 
tice MeUen  said,  we  have  seen  that  the  infant 
continued  in  possession  of  the  lands  until  he 
sold  to  Cummings,  and  until  after  his  arrival 
at  full  age.  If  an  infant  make  an  agreement 
and  receive  interest  upon  it  after  he  is  of 
full  age,  he  confirms  the  agreement.    Citing 

1  Vt.  132.  Or  if  he  make  an  exchange  of 
land,  and  after  he  is  of  full  age,  continue  in 
possession  of  the  land  received  in  exchange. 

2  Vt  225.  So  if  he  purchase  lands  while  un- 
der age;  and  continue  in  possession  after  he 
arrives  at  full  age,  it  is  an  attirmation  of  the 
contract.  Co.  Litt.  3a;  3  Com.  Dig.  "En- 
fant." C,  6;  2  Bulst.  69;  2  Vent.  203;  3 
Burrows,  1710.  On  this  point,  says  the  chief 
justice,  the  authorities  seem  clear  and  de- 
cisive; the  law  is  plain  as  the  fact.  In  Rob- 
bins  V.  Eaton,  supra,  the  court  say,  some  au- 
thorities confine  an  affirmation  of  a  purchase 
of  land  to  an  actual  subsequent  sale  of  the 
same  by  the  infant  after  he  becomes  of  age; 
but  it  seems  to  be  limiting  to  a  very  narrow 
point  the  evidence  of  affirmation  of  such  a 
contract,  and  without  any  sufficient  reason, 
as  many  other   acts   may   constitute  just  as 


INFANTS. 


311 


full  and  uudoubted  evideuce  of  a  design  on 
the  part  of  the  infant  to  allirm  such  contract 
as  an  actual  sale  of  the  land.  The  court 
thinks  the  bettor  authority  to  be,  that  if  the 
grantee  being  an  infant  cuniinues  in  posses- 
sion of  the  laud  after  becoming  of  full  age, 
this  is  an  allirniance  of  the  contract.  In  the 
case  at  bar  the  ratilieation  was  attempted  to 
be  shown  by  the  facts,  that  the  infant  con- 
tinued in  possession  after  full  age,  and  sold 
a  portion  of  the  premises,  and  received  the 
consideration  therefor.  Within  all  the  cases 
these  acts  amount  to  an  unequivocal  ratifica- 
tion of  the  contract  of  purchase  by  the  in- 
fant, and  settle  conclusively  his  Liability  for 
the  purchase-money.  Another  principle  is 
firmly  established  by  the  cases,  namely,  that 
the  infant  on  attaining  full  age  cannot  hold 
on  to  the  purchase  and  thus  atfirm  that,  and 
plead  his  infancy  to  avoid  the  payment  of  the 
purchase-money.  Kline  v.  Beall,  G  Conn.  494; 
Bigelow  V.  Kinny,  3  Vt.  353;  4  Bac.  Abr.  37G; 
Cheshire  v.  Barrett,  4  McCord,  241;  Lynde  v. 
Budd,  2  Paige,  Ch.  191;  Kitchen  v.  Lee,  11 
Paige,  Ch.  107;  Dcason  v.  Boyd,  1  Dana,  45; 
Badger  v.  Phinney,  15  Mass.  3.j9. 

In  Dana  v.  Coombs,  supra,  the  court  say, 
had  the  suit  been  upon  notes  given  for  the 
purchase-mone3'  of  land,  and  the  defendant 
had  set  up  the  defense  of  infancy,  it  might 
well  have  been  assumed  that  they  were  given 
as  part  of  the  consideration  of  the  purchase 
of  lands,  which  the  tenant  at  fuU  age  chose 
to  retain.  In  Cheshire  v.  Barrett,  supra,  the 
court  say,  a  very  slight  circumstance  demon- 
strating his  assent  will  bind  an  infant,  or  any 
act  by  which  his  assent  is  manifested.  Thus 
if  an  infant  purchase  land  and  continue  in 
possession,  after  lie  attains  full  age,  it  will 
be  regarded  as  a  confirmation  of  the  pur- 
chase. Citing  cases.  In  Lynde  v.  Budd,  su- 
pra. Chancellor  Walworth  held  that  an  infant 
who  had  purchased  land,  by  continuing  in 
possession  after  he  became  twenty-one  yeai's 
of  age,  and  conveying  the  land,  affirmed  the 
whole  bargain  and  made  himself  legally  lia- 
ble for  the  payment  of  the  residue  of  the  pur- 
chase-money. And  in  Kitchen  v.  Lee,  supra, 
the  same  learned  judge  declared  the  rule  of 
law  to  be,  that  an  infant  cannot  be  permitted 
to  retain  the  property  purchased  by  him,  and 
at  the  same  time  repudiate  the  contract  upon 
which  he  received  it. 

It  is  therefore  entirely  clear  upon  all  the 
authorities  that  the  acts  of  the  defendant, 
after  he  attained  full  age,  were  a  ratification 
and  confirmation  of  the  contract  of  purchase, 
so  as  to  render  him  liable  to  pay  the  pur- 
chase-money. The  defendant  set  up  in  his 
answer,  but  did  not  prove,  any  failure  of  the 
consideration  of  the  note.  The  only  ground 
of  defense  set  forth  in  his  answer,  proved 
and  relied  upon  on  the  trial,  was  that  of  in- 
fancy. It  has  been  seen  that  that  is  unavail- 
ing to  him. 

It  is  now  urged  that  as  the  deed  of  the 
plaintiff  was  not  under  seal,  no  valid  title 
was    conveyed    to    the    defendant,    and    that 


therefore  he  has  ratified  or  confirmed  noth- 
ing. Several  answers  to  these  objections 
present  themselves.  In  the  first  place  we 
have  seen  that  the  paper  produced,  if  not 
valid  as  a  deed,  is  as  a  contract  for  the  sale 
of  lands.  It  stated  the  consideration,  the 
thing  sold,  and  is  signed  by  the  party  to  be 
charged  thereby,  or  his  lawful  agent.  If  the 
defendant  has  not  got  such  a  deed  as  he  was 
entitled  to  under  his  contract,  he  can  compel 
the  plaintiff  to  give  him  one  upon  the  pay- 
ment of  the  purchase-money.  He  could  have 
asked  by  his  answer  that  such  a  deed  be 
given,  and  it  could  have  been  providerl  for 
in  the  judgment  in  this  action.  It  was  the 
contract  of  purchase  which  the  defendant  has 
ratified  and  confirmed,  by  such  unequivocal 
acts  as  make  it  binding  and  obligatory  upon 
him,  and  subjects  him  to  the  payment  of  the 
purchase-money. 

The  judgment  should  therefore  be  reversed 
and  a  new  trial  ordered,  costs  to  abide  the 
event. 

DAVIS,  J.  The  note  in  suit  was  given  by 
defendant,  for  the  purchase-price  of  lands 
situate  in  Nebraska  territory-,  on  the  Gth  day 
of  January,  1S57.  The  defendant  became  of 
age  on  the  25th  day  of  February  following. 
At  the  time  of  receiving  the  note,  the  plain- 
tiff, by  his  attorney,  executed  to  defendant 
an  instrument,  which  in  form  purported  to 
be  a  conveyance  of  the  lands  sold,  but  it  was 
without  seal,  and  for  that  reason,  invalid  at 
common  law  as  a  conveyance  of  the  title  to 
real  estate.  No  proof  of  the  validity  of  this 
instrument,  as  a  grant  under  the  law  of  Ne- 
braska, was  given  on  the  trial.  The  legal 
presumption  was  therefore  that  the  common 
law  prevailed  in  that  territory,  and  .that  it 
was  the  same  as  the  common  law  of  this 
state.  Holmes  v.  Broughton,  10  Wend.  75; 
Starr  v.  Peck,  1  Hill,  270;  15  N.  Y.  3.53;  2 
How.  201. 

In  answer  to  the  defense  of  infancy,  the 
plaintiff  offered  in  substance,  to  show  that 
the  defendant  took  possession  of  the  lands 
under  the  instrument  above  mentioned,  and 
after  he  became  of  age,  sold  a  portion  of 
them  to  one  Perry,  for  the  sum  of  $100,  and 
executed  to  him  what  is  called  in  the  offer, 
"a  deed  not  under  seal,"  which  it  may  be 
assumed  was  an  instrument  like  that  exe- 
cuted to  defendant  by  plaintiff.  This  was 
objected  to  by  defendant,  on  the  ground  that 
he  obtained  no  title  by  the  paper  he  received; 
and  on  that  ground  the  evidence  was  re- 
jected by  the  court. 

The  fact  of  defendtuit's  infancy  at  the  time 
he  gave  the  note  having  been  established,  it 
was  incumbent  upon  the  plaintiff,  and  compe- 
tent for  him,  to  show  a  ratification  of  the 
transaction  by  defendant  after  he  attained 
his  majority.  The  rejected  offer  was  made 
with  that  view.  The  court  below  has  sus- 
stained  the  ruling  at  circuit,  on  the  assump- 
tion that  "the  defendant  never  acquired  any 
title  to  the  land  for  which  he  gave  the  note. 


CAPACITY  OF  PARTIES. 


acd  that  he  never  conveyed  any  title  to  an- 
other to  any  part  of  it."  It  is  not  asserted 
that,  if  the  lej^al  title  had  passed  to  the  de- 
fendant by  the  instrument,  his  entering  into 
possession  and  sale  of  a  part  of  the  land  after 
he  became  of  age  would  not  have  ratifted  his 
contract  with  plaintiff  and  given  validity  to 
the  note.  Hubbard  v.  Cummings,  1  Greenl. 
11;  Ilobbins  v.  Klaton,  10  N.  li.  5G1;  1  Pars. 
Cont.  271. 

It  seems  to  me  the  court  below  overlooked 
the  true  question  on  this  subject  of  ratifica- 
tion. Conceding  that  the  instrument,  for 
want  of  a  seal,  passed  no  legal  title  in  the 
lauds  to  the  infant,  did  it  not  transfer  to  him 
a  valuable  equitable  interest,  which  he  could 
enforce  and  maintain  against  the  plaintiff? 
Failing  as  a  deed,  it  contains  sufficient  to 
constitute  it  a  contract  of  purchase  and  sale 
between  the  parties,  and  it  contains  an  agree- 
ment of  warranty  by  which  plaintiff  under- 
takes '"to  warrant  and  defend  the  above  prop- 
erty against  the  lawful  claims  of  all  persons 
whomsoever,"  with  a  specific  exception.  The 
fact  that  it  is  executed  by  but  one  of  the 
parties  is  no  objection  to  its  validity  as  a 
contract.  In  Worrall  v.  Munn,  5  N.  Y.  229, 
it  was  held  by  the  court  that  such  a  contract 
"can  be  enforced  either  at  law  or  in  equity 
against  the  vendor,  and  wanting  mutuality 
is  no  defense."  It  is  upon  sufficient  consid- 
eration; and  the  offer  was  to  show  that  the 
defendant  entered  into  possession  of  the  land 
under  it.  Under  such  a  state  of  facts  the 
rights  of  the  infant  under  the  contract  would, 
in  the  courts  of  the  state,  be  very  clear.  Up- 
on the  basis  of  this  instrument  and  his  pos- 
session under  it  he  could,  on  attaining  his 
majority,  have  elected  to  enforce  his  equities 
by  compelling  the  plaintiff  to  execute  a  prop- 
er conveyance;  and  I  can  conceive  of  no  de 
fense  the  plaintiff  could  have  made,  beyond 
perhaps  the  protection  of  payment  of  the  con- 
sideration money,  which  the  court  would  have 
given  him.  Who  can  doubt  that  on  discov- 
ei-y  by  a  vendee  that  a  supposed  deed  of  his 
property,  of  which  he  has  taken  possession 
and  for  which  he  has  paid  or  secured  the 
consideration,  is  defective  for  want  of  a  seal, 


he  may  call  on  his  supposed  grantor  to  exe- 
cute a  perfect  conveyance,  and  enforce  his 
call  by  suit,  if  the  vendor  unjustly  refuse? 
When  the  defendant  became  of  age  he  was 
under  no  obligation  to  have  taken  that 
course.  The  instrument  as  to  him  was  void- 
able, and  he  might  undoubtedly  have  avoid- 
ed it,  abandoned  the  possession  of  the  lands 
and  repudiated  his  note.  He  did  not  elect 
to  do  so.  On  the  contrary,  if  the  offer  be 
true,  he  retamed  the  possession,  several 
months  afterwards  sold  a  portion  of  the  lands 
to  a  third  party  for  $100,  and  executed  to 
him  a  supposed  conveyance,  but  without  a 
seal.  It  is  essential  to  the  rights  of  that 
party,  as  weU  as  of  the  defendant,  that  this 
should  be  regarded  as  a  ratification.  As  to 
him  the  defendant  has  no  defense  of  infancy 
to  interpose;  and  unquestionably  that  per- 
son has  acquired  by  his  purcliase  all  the 
rights  in  the  parcel  sold  that  defendant  had 
under  his  contract  with  plaintiff.  But  it  is 
enough  for  this  case  to  say  that  the  evidence 
offered  tended  to  show  a  ratification;  for  it 
showed  that  defendant,  after  he  became 
twenty-one,  elected  to  deal  with  the  property 
as  his  own,  and  to  dispose  of  it  accordingly. 
I  am  clearly  of  opinion  that  the  evidence  of- 
fered should  have  been  received.  The  objec- 
tion that  the  authority  of  the  plaintiff's  agent 
who  executed  the  instrument  was  not  shown 
was  of  no  force.  The  plaints  was  by  the 
very  suit  affirming  the  authority,  by  offering 
the  supposed  deed  as  his  own,  and  by  claim- 
ing and  enforcing  the  note  given  for  the  con- 
sideration. And  under  such  circumstance^^, 
it  was  not  necessary  he  should  give  evidence 
of  the  actual  authority  of  his  agent  to  make 
the  instrument  at  tlie  time  it  was  made.  Be- 
sides the  case  passed  off  altogether  on  the 
other  groimd;  and  if  the  court  had  intimated 
an  adverse  opinion  on  this  point,  the  plaintiff 
could  doubtless  have  readily  cured  it  by  call- 
ing himself  the  agent  and  a  witness. 

In  my  opinion,  the  judgment  should  be  re- 
versed and  a  new  trial  granted,  with  costs  to 
abide  the  event 

All  concur. 

Judgment  reversed. 


c 


\ 


INFANTS. 

0 


313 


LEMMON  V.  BEEMAN. 

(15  N.  E.  47G,  45  Ohio  «t.  505.) 
Supreme  Court  of  Ohio.     Jan.  10,  li 

Error  to  district  court,  Sandusky  county. 

William  J.  Beemau,  the  plaintiff  below, 
sued  the  defendant,  James  F.  Lemnion,  as  ad- 
ministrator, for  money  paid  by  him  upon  the 
purchase  of  a  certain  stock  of  drugs  of  James 
Lemon,  the  defendant's  decedent,  the  plaintifC 
being  a  minor  at  the  time  of  the  purchase, 
and  having  elected,  on  becoming  of  age,  to 
rescind  the  contract.  On  the  trial  of  the 
case,  in  the  common  pleas,  the  defendant  ex- 
cepted to  a  part  of  the  charge  of  tlie  court, 
and  took  a  bill  of  exceptions,  setting  forth  the 
evidence  and  the  charge;  to  which  exception 
was  taken.  The  judgment  was  for  the  plain- 
tiff, and  was  attirmed  in  the  district  court. 
The  part  of  the  charge  to  which  exception 
was  taken  is  to  the  effect  that,  upon  the  facts 
of  the  case,  the  plaintiff  could  recover  with- 
out returning  the  property.  The  facts  are 
stated  in  the  opinion. 

M.  B.  Lemmon  and  J.  M.  Lemmon,  for  plain- 
tiff in  error.  J.  H.  Rhodes,  for  defendant  in 
error. 

MIXSHALL,  J.,  (after  stating  the  facts  as 
.-ibove.)  In  ISSl,  Beeman,  then  a  minor,  pur- 
chased of  James  Lemmon,  then  in  life,  but  since 
deceased,  a  certain  stock  of  drugs,  for  which 
lie  paid  at  the  time  $400,  the  price  as  agreed 
un  between  them.  The  stock  was  in  a  store 
in  the  state  of  Illinois;  and  the  sale  was  made 
by  Lemmon,  through  his  agent.  Dr.  Everett, 
who  some  time  before  had  sold  the  stock  to 
Lemmon,  and,  as  his  agent,  h:id  continued  in 
possession  of  the  property,  and  conducted  the 
business  for  him.  In  a  short  time  after  the 
sale  had  been  made  to  Beeman,  the  goods 
were  taken  from  liim  imder  an  execution  is- 
sued upon  a  judgment  against  Everett,  upon 
the  claim  of  the  creditor  of  the  latter  that 
they  belonged  to  him,  and  not  to  Lemmon. 
Beeman  made  an  effort  to  recover  the  prop- 
erty; and,  in  a  short  time  after  he  became 
of  age,  (which  was  in  18S2,)  disaffirmed  the 
contract,  presented  a  claim  to  the  adminis- 
trator of  Lcnimon's  estate  for  the  money  he 
had  paid  on  the  purcliase,  and  demanded  its 
return;  which  was  refused  and  the  claim  re- 
jected. 

No  point  is  made  as  to  the  ownership  of  the 
goods;  it  is  averred  in  the  petition,  and  must 
be  taken  as  the  fact,  that  they  belonged  to 
the  deceased  at  the  time  of  the  sale  to  Bee- 
man. Again,  there  is  no  room  for  a  claim, 
nor  is  it  made,  that  the  property  purchased 
was  in  the  nattire  of  necessaries,  and  the  con- 
tract, for  such  reason,  incapable  of  being  dis- 
affirmed: nor  is  it  claimed  that  the  decedent 
or  his  agent  was  in  any  way  deceived  as  to 
the  age  of  Beeman  at  the  time  the  sale  was 
made.  The  only  question  presented  upon  the 
record  is  whether,  upon  the  facts  as  stated, 
the  minor  had  the  right,  on  becoming  of  age. 


to  rescind  the  contract,  and  recover  the  con- 
sideration he  had  paid,  without  returning  the 
property-  that  had  been  sold  and  delivered  to 
him.  The  true  doctrine  now  seems  to  be  that 
the  contract  of  an  infant  is  in  no  case  ab.so- 
lutely  void.  1  Pars.  Cont.  295,  328;  Pol.  Cont. 
30;  liaruer  v.  Dipple,  31  Ohio  St.  72;  Wil- 
liams V.  Moor,  11  Mees.  &  W.  2.5G.  An  infant 
may,  as  a  general  rule,  di.saffirm  any  contract 
into  which  he  has  entered;  but,  until  he  does 
so,  the  contract  may  be  said  to  subsist,  capa- 
ble of  being  made  absolute  by  affirmance,  or 
void  by  disaffirmance,  on  his  arrivuig  at  age; 
in  other  words,  infancy  confers  a  privilege 
rather  than  imposes  a  disability.  Hence  the 
disaffirmance  of  a  contract  by  an  infant,  in 
the  exercise  of  a  right  similar  to  that  of  re- 
scission in  the  case  of  an  adult,  the  ground 
being  minority,  independent  of  questions  of 
fraud  or  mistake.  But,  in  all  else,  the  gen- 
eral doctrine  of  rescission  is  departed  from 
no  further  than  is  necessarj'  to  preserve  the 
grounds  upon  which  the  privilege  is  allowed; 
and  is  governed  by  the  maxim  that  infancy 
is  a  shield,  and  not  a  sword.  He  is  not  in 
aU  cases,  as  is  an  adult,  required  to  restore 
the  opposite  party  to  his  former  condition; 
for  if  he  has  lost  or  squandered  the  property 
received  by  him  in  the  transaction  that  he 
rescinds,  and  so  is  unable  to  restore  it.  he 
may  still  disaffirm  the  contract  and  recover 
back  the  consideration  paid  by  him  without 
making  restitution;  for,  if  it  were  otherwise, 
his  privilege  would  be  of  little  avail  as  shield 
against  the  inexperience  and  improvidence 
of  youth.  But  when  the  property  rescinded 
by  him  from  the  adult  is  in  his  possession,  or 
under  his  control,  to  permit  him  to  rescind, 
without  returning  it,  or  offering  to  do  so, 
would  be  to  permit  him  to  use  his  privilege 
as  a  sword,  rather  than  as  a  shield.  This 
view  is  supported,  not  only  by  reason,  but  by 
the  greater  weight  of  authority.  It  was  recog- 
nized and  applied  by  this  court  in  Cresinger 
V.  Welch,  15  Ohio,  15G,  decided  in  1S16.  The 
following  is  the  language  used  by  Mr.  Tyler 
on  the  subject:  "If  the  contract  has  been 
executed  by  the  adult,  and  the  infant  has  the 
property  or  consideration  received  at  the  time 
he  attains  full  age,  and  he  then  repudiates 
the  transaction,  he  must  return  such  property 
or  consideration,  or  its  equivalent,  to  the  adult 
party.  If,  however,  the  infant  has  wasted  or 
squandered  the  propertj-  or  consideration  re- 
ceived during  infancy,  and  on  coming  of  age 
repudiates  the  transaction,  the  adult  part)-  is 
remediless."  He  then  adds  that  "there  are 
expressions  of  judges  and  text  writers  against 
this  latter  proposition,  but."  he  says,  "the 
weight  of  authority  is  in  harmony  with  it, 
and  is  decidedly  in  accord  with  the  general 
principles  of  law  for  the  protection  of  in- 
fants." Tyler,  Inf.  (2d  Ed.)  SO,  and  cases  cit- 
ed by  the  author.  See.  also,  the  case  of  Price 
V.  Furman.  27  VL  2GS,  and  the  notes  thereto 
of  Mr.  Ewell.  in  his  Leading  Cases  on  In- 
fancy &  Coverture.  119.  After  an  exhaustive 
review  of  the  cases,  this  author  says:    "The 


314 


CAPACITY  or  PARTIES. 


true  doctrine,  and  the  one  supported  by  the 
weight  of  authority,  (at  least  in  the  United 
States,)  would  seem  to  be  that  when  an  infant 
disaffirms  liis  executed  contract,  after  arriv- 
ing at  age,  and  seeks  a  recovery  of  the  con- 
sideration moving  from  him,  and  where  the 
specific  consideration  received  by  him  remains 
in  his  hands,  in  specie  at  the  time  of  disaf- 
firmance, and  is  capable  of  return,  it  must  be 
returned  by  him;  but  if  he  has,  during  in- 
fancy, wasted,  sold,  or  otherwise  disposed  of, 
or  ceased  to  possess  the  consideration,  and 
has  none  of  it  in  his  hands  in  kind  on  arriv- 
ing at  majority,  he  is  not  liable  therefor,  and 
may  disaffirm  without  tendering  or  account- 
ing for  such  consideration."  This  statement 
of  the  law,  supported,  as  it  is,  not  only  by 
the  greater  weight  of  authority,  but  also  of 
reason,  meets  with  our  full  approval  There 
is,  however,  much  conflict  in  the  decisions  of 
the  different  states;  greater  perhaps  than  up- 
on any  other  question  connected  with  the  law 
of  infancy,  (Mete.  (3ont.  76;)  but  we  deem  it 
unnecessary  to  attempt  to  review  or  discuss 
them,  for  the  very  good  reason,  that  it  has 
been  done  with  thoroughness  and  ability  by 
the  authors'  just  referred  to.  See,  also,  the 
notes  of  ^Ir.  Ewell  to  the  recent  case  of 
Adams  v.  Beall,  decided  by  the  Maryland 
court  of  appeals,  26  Am.  Law  Reg.  710  (8  AtL 
664). 

We  have  been  cited,  by  counsel  for  the  de- 
fendant below,  to  a  number  of  the  previous 
decisions  of  this  court,  supposed  to  affect  the 
right  of  the  plaintiff  to  recover;  but  a  careful 
examination  will  disclose  that  such  is  not  the 
case.  In  Starr  v.  Wright,  20  Ohio  St.  97,  a 
conveyance  had  been  made  by  a  father  to 
his  minor  son,  it  being  without  any  considera- 
tion and  intended  to  defraud  creditors;  and, 
during  minority,  the  son  had  reconveyed  to 
the  father  to  enable  him  to  raise  money  and 
pay  his  creditors,  who,  for  a  full  considera- 
tion, then  conveyed  to  the  defendant.  The 
court  denied  the  right  of  the  son  on  arriving 
at  age  to  disaffirm  his  deed  of  reconveyance. 
Being  the  voluntary  grantee  of  his  father,  the 
son  had  done  no  more  than  was  his  moral 
duty  to  do;  and  what  he  might  have  been  com- 
pelled to  do  in  favor  of  creditors  and  pur- 
chasers. The  court  applied  the  maxim,  that 
infancy  is  a  shield  and  not  a  sword.  The 
case  is  qtiite  analogous  in  principle  to  the 
leading  one  of  Zouch  v.  Parsons,  decided  by 
Lord  Mansfield,  in  1765.  It  was  there  held 
that  where  an  infant  does  what  he  might 
have  been  compelled  by  a  court  of  equity  to 
do.  he  cannot  afterwards  disaffirm  his  act.    3 


Burrows,  1794.  In  Harner  v.  Dipple,  31  Oh^o 
St.  72,  the  question  was  whether  an  under- 
taking executed  by  an  infant  for  stay  of 
execution  was  void,  or  only  voidable.  The 
court  held  that  it  was  voidable  only,  and 
might  therefore  be,  as  it  had  been,  affirmed 
by  the  infant  on  arriving  at  age.  In  Curtiss 
V.  McDougal,  26  Ohio  St.  67,  it  appears  an 
infant  has  purchased  a  team  of  mules,  and  at 
the  same  time  had  executed  a  mortgage  on 
them  to  secure  the  purchase  money.  He  aft- 
erwards sold  the  property  to  his  father,  who 
brought  an  action  in  replevin  against  an  as- 
signee of  the  mortgage  to  recover  ijossession. 
The  claim  was  based  on  the  theory  that,  by 
the  subsequent  sale  of  the  mortgaged  prop- 
erty, the  infant  had  disaffirmed  the  mortgage, 
as  he  would  have  had  a  right  to  do  so.  It  is 
difficult  to  see  how  the  sale  of  the  property 
purchased  could  be  treated  as  a  disaffirmance 
of  the  contract  by  which  he  had  acquired  it; 
it  was  rather  an  affirmance  than  a  disaf- 
firmance of  that  contract,  and  entirely  consist- 
ent with  the  existence  of  the  mortgage  that 
he  had  given  to  secure  the  payment  of  the 
purchase  money.  Again,  there  was  no  posi- 
tive disaffirmance  by  the  infant,  the  claim  be- 
ing made  by  a  third  person,  his  gi'antee,  al- 
though the  rule  is  well  settled  that  the  privi- 
lege is  personal  to  the  infant,  and  is  not  avail- 
able to  third  persons.  1  Pars.  Cont  329. 
But  the  court  placed  its  decision  upon  the 
broader  groimd  that  it  was  not  vrithin  the 
privilege  of  the  infant  to  disaflirm  the  se- 
curity he  had  given  for  the  purchase  money 
without  also  avoiding  the  purchase,  saying 
that  "in  such  case,  if  the  infant  would  rescind 
a  part,  he  must  rescind  the  whole  c'ontract, 
and  thereby  restore  to  the  vendor  the  title 
acquired  by  the  purchase;"  again  applying  the 
principle  that  infancy  may  be  used  as  a 
shield,  but  not  as  a  sword.  So  that  the  claim 
of  the  plaintiff  in  replevin  defeated  his  right 
to  recover,  as  a  disaffirmance  of  the  mortgage 
would  necessarily  have  divested  the  title  by 
which  he  claimed  the  property.  It  is  apparent 
that  none  of  these  cases,  when  rightly  con- 
sidered, affect  the  right  of  the  plaintiff  to  dis- 
affirm the  purchase  made  of  the  decedent, 
and  to  recover  the  consideration  paid.  Nei- 
ther he,  nor  any  one  claiming  under  him, 
makes  any  claim  to  the  property  purchased. 
By  his  disaffirmance,  the  title  has  been  re- 
stored to  the  estate  of  the  vendor,  and  the 
property,  or  its  value,  may  be  recovered  by 
the  administrator,  \f  it  was  wrongfully  taken- 
by  the  sheriff  under  the  execution  against 
Everett    Judgment   affirmed. 


^\ 


315 


RICE  V.  BOYER.         '  |t  .b 

(9  N.  E.  420,  108  Ind.  472.)       1   |i  "!l*t 

Supreme  Court  of  Indiana.     Dec.  16,  1886] 

Appeal  from  circuit  court,  Clinton  county. 

F,  P.  Moore,  for  appellant  Kent  &  Mer- 
litt,  for  appellee, 

ELLIOTT,  C.  J.  It  Is  alleged  In  the  com- 
plaint of  the  appellant  that  the  appellee, 
with  intent  to  defraud  the  appellant,  false- 
ly and  fraudulently  represented  that  he  was 
21  years  of  age;  that,  relying  on  this  repre- 
sentation, the  appellant  was  induced  to  sell 
and  deliver  to  the  appellee,  on  one  year's 
credit,  a  buggy  and  a  set  of  harness;  that 
the  appellee,  in  payment  for  the  property, 
delivered  to  appellant  a  buggy,  and  executed 
to  him  a  promissory  note,  payable  one  year 
after  date,  and  also  executed  a  chattel  mort- 
gage to  secure  the  payment  of  the  note;  that 
the  appellee's  representation  was  untrue; 
that  he  had  not  attained  the  age  of  21  years; 
that,  on  account  of  appellee's  nonage,  the 
note  cannot  be  enforced;  that  the  appellee 
avoided  his  note  and  mortgage  by  a  sale  of 
the  mortgaged  property,  and  repudiates  and 
refuses  to  be  bound  by  his  contract  in  refer- 
ence thereto;  that  the  appellant  brings  in- 
to court  the  note  and  mortgage  executed  to 
him,  and  tenders  them  to  the  appellee. 
Prayer  for  judgment  for  the  value  of  the 
property  delivered  to  appellee.  To  this  com- 
plaint a  demurrer  was  sustained,  and  error 
is  assigned  on  that  ruling. 

The  appellee's  counsel  defend  the  ruling 
principally  upon  the  ground  that  the  action 
was  prematurely  brought,  inasmuch  as  it 
cannot  be  determined  that  any  injury  will  be 
done  the  appellant  until  the  expiration  of 
the  year  fixed  for  the  payment  of  the  prop- 
erty purchased  of  the  appellant  We  agree 
with  counsel  that  the  contract  is  voidable, 
not  void,  and  that  the  appellee  might  have 
performed  it  notwithstanding  his  nonage,  if 
he  had  so  elected.  Price  v.  Jennings,  G2  Ind. 
Ill;  Board,  etc.,  v.  Anderson,  63  Ind.  367; 
Shrock  V.  Crowl,  S3  Ind.  243. 

But  this  principle  is  not  broad  enough  to 
meet  the  averment  of  the  complaint  that 
the  appellee  has  repudiated  his  contract,  and 
refuses  to  be  bound  by  it.  As  the  authori- 
ties relied  on  by  counsel  do  not  fully  cover 
the  case,  further  investigation  is  necessary, 
and  the  first  step  in  this  investigation  is  to 
ascertain  and  declare  tlie  effect  of  the  in- 
fant's repudiation  of  his  contract. 

In  Shrock  v.  Crowl,  supra,  the  holding  in 
Mustard  v.  WohLford,  15  Grat  329,  that, 
where  a  voidable  act  of  an  infant  is  disaf- 
firmed, it  avoids  the  contract  ab  initio,  is  ful- 
ly approved.  If  this  is  the  law.  then,  when 
the  appellee  repudiated  his  contract  he  de- 
stroyed it  for  all  purposes.  It  no  longer 
bound  him,  nor  could  he  take  any  benefit 
from  it  If  the  conti"act  was  destroyed  back 
to  the  beginning,  it  ceased  to  be  operative 
for  anybody's  benefit    We  think   the   prin- 


ciple of  law  is  correctly  stated  in  the  cases 
to  which  we  have  referred,  and  that  the  con- 
clusion we  have  stated  is  the  logical,  and, 
indeed,  inevitable,  sequence  of  that  princi- 
ple.    Tyler,  Inf.  78. 

An  infant  may  repudiate  a  contract  re- 
specting personal  property,  during  nonage. 
Briggs  V.  McCabe,  27  Ind.  327;  Manufactur- 
ing Co.  V.  Wilcox,  59  Ind.  429;  Clark  v.  Van 
Court  100  Ind.  113^  House  v.  Alexander, 
105  Ind.  100,  4  N.  E.  891;  Hoyt  v.  Wil- 
kinson, 57  Vt  404;  Price  v.  Furman,  27  Vt 
2GH;  Willis  V.  Twambly,  13  Mass.  204;  Staf- 
ford V.  Roof,  9  Cow.  628;  Bool  v.  Mix.  17 
Wend.  119. 

The  repudiation  by  the  appellee  was  there- 
fore a  complete  avoidance  of  the  contract, 
effectually  putting  an  end  to  its  existence, 
both  as  to  him,  and  as  to  the  adult  with 
whom  he  contracted. 

It  is  evident  from  what  we  have  said,  that 
the  ground  taken  by  the  appellee's  couu.sel 
is  not  tenable;  for,  when  their  client  repudi- 
ated the  contract,  as  it  is  alleged  he  did  do, 
it  ceased  to  be  effective  for  any  purpose. 

It  is  contended  by  appellee's  counsel  that 
the  appellant  cannot  recover  the  value  fixed 
on  the  property  by  the  contract,  and  that 
the  complaint  is  therefore  insufiiciout 
There  is  a  plain  fallacy  in  this  argumcut 
If  a  complaint  states  facts  entitling  the 
plaintiff  to  relief,  it  will  repel  a  demurrer, 
although  it  may  not  entitle  him  to  all  the 
relief  prayed.  Bayless  v.  Glenn,  72  Ind.  5. 
and  cases  cited.  The  question  as  to  the 
measure  of  damages  is  riot  presented  by  a 
demurrer  to  a  complaint,  where  a  cause  of 
action  is  presented  entitling  the  plaintiff  to 
some  damages,  for  the  question  which  the 
demurrer  presents  is  whether  the  facts  are 
sufficient  to  constitute  a  cause  of  action, 
The  material  and  controlling  question  in  the 
case  is  tliis:  Willa^a^tion_to_reiic«^F--^ 
actual    loss,  justan je^^  ^yII§I-El&iatiffi — lie 

nc^nTrTffTnn  infant  whn  hns  fihtniripd  pi^apftgty 


-^  the_faI7lI_of  a  falseand  fraudulent  repre- 
Jentation~that  he  TF  of  fuU^age? 

Infanti~are,TU  mau>  cases,  liable  for  torts 
committed  by  them,  but  they  are  not  liable 
where  the  wrong  is  connected  with  a  con- 
tract and  the  result  of  the  judgment  is  to 
indirectly  enforce  the  contract  Judge  Cooley 
says:  "If  the  wrong  grows  out  of  contract 
relations,  and  the  real  injury  consists  in  the 
non-performance  of  the  contract  into  wliith 
the  party  wronged  has  entered  with  an  in- 
fant the  law  will  not  permit  the  former  to 
enforce  the  contract  indirectly  by  counting 
on  the  infant's  neglect  to  perform  It,  or  omis- 
sion of  duty  under  it  as  a  tort."  Cooley, 
Torts,  116.  In  another  place  the  same  au- 
thor says:  "So,  if  an  infant  effects  a  sale 
by  means  of  deception  and  fraud,  his  in- 
fancy protects  him."  Cooley.  Torts,  107. 
Addison,  following  the  English  cases,  says 
an  infant  is  not  liable  "if  the  cause  of  action 
is  grounded  on  a  matter  of  contract  with 
the  infant  and  constitutes  a  breach  of  con- 


316 


CAPACITY  OF  PARTIES. 


tract  as  well  as  a   tort."    Add.   Torts,   par. 
1314. 

Upon  this  principle  it  has  been  held  In 
some  of  the  cases  that  an  infant  is  not  liable 
for  the  value  of  property  obtained  by  means 
of  false  representations.  Hewlett  v.  Has- 
well,  4  Camp.  118;  Green  v,  Greenbank,  2 
Mai-sh.  4S5;  Vasse  v.  Smith,  6  Cranch,  226, 
1  Am.  Lead.  Gas.  237;  Studwell  v.  Shapter, 
54  N.  Y.  249.  It  is  also  generally  held  that 
an  infant  is  not  estopped  by  a  false  repre- 
sentation as  to  his  age;  but  this  doctrine 
rests  upon  the  principle  that  one  under  the 
disability  of  coverture  or  infancy  has  no 
power  to  remove  the  disability  by  a  repre- 
sentation. Carpenter  v.  Carpenter,  45  Ind. 
142;  Sims  v.  Everhardt,  102  U.  S.  300;  Whit- 
comb  V.  Joslyn,  51  Vt.  79;  Conrad  v.  Lane, 
26  Minn,  3S9,  4  N.  W.  695;  Wieland  v.  Ko- 
bick,  110  111.  16;  Ward  v.  Insurance  Co.,  9 
N.  E.  361. 

It  is  evident,  from  this  brief  reference  to 
the  authorities,  that  it  is  not  easy  to  extract 
a  principle  that  will  supply  satisfactory  rea- 
sons for  the  solution  of  the  difficulty  here 
presented.  It  is  to  be  expected  that  we 
should  find,  as  we  do,  stubborn  conflict  in 
the  authorities  as  to  the  question  here  di- 
rectly presented,  namely,  whether  an  action 
will  lie  against  an  infant  for  falsely  repre- 
senting himself  to  be  of  full  age.  Johnson 
V.  Pye,  1  Sid.  25S;  Price  v.  Hewett,  8  Exch. 
146;  Association  v.  Fairhurst,  9  Exch.  422; 
Brown  v.  D'jnham,  1  Root,  272;  Curtin  v. 
Patton,  11  Serg.  &  R.  309;  Homer  v.  Thwing, 
3  Pick.  492;  Word  v.  Vance,  1  Nott  &  M. 
197;  Fitts  v.  Hall,  9  N.  H.  441;  Norris  v. 
Vance,  3  Rich.  104;  Gilson  v.  Spear,  38  Vt. 
311. 

Our  judgment,  however,  is  that,  where  the 
infant  does  fraudulently  and  falsely  repre- 
sent that  he  is  of  f  uU  age,  he  is  liable  in  an 
action  ex  delicto  for  the  injury  resulting 
from  his  tort.  This  result  does  not  involve 
a  violation  of  the  principle  that  an  infant 
is  not  liable  where  the  consequence  would 
be  an  indirect  enforcement  of  his  contract; 
for  the  recovery  is  not  upon  the  contract, 
"that~lsT;reated  a.s  of  no~efl;ect,  nor  is  he 


jfta4ev^pay  tEeTontract  price^of  the  article 

purrhfiBf^d    by   h'""i,   ««   Tip  ig-nrily   hr-lrt-rh  gjTT 

swer  for  the  actual  loss  caused  by  his  fraud. 
loItrnr^rTnm   responsible   for~~EIIe 


In  holdifljr  him  responsible  for  the  conse- 
quences of  his  wrong,  an  equitable  conclusion 
is  reached,  and  one  which  strictly  harmon- 
izes with  the  general  doctrine  that  an  infant 
is  liable  for  his  torts.  Nor  does  our  con- 
clusion invalidate  the  doctrine  that  an  in- 
fant has  no  power  to  deny  his  disability; 
for  it  concedes  this,  but  affirms  that  he  must 
answer  for  his  positive  fraud. 

Our  conclusion  that  an  infant  is  liable  in 
tort  for  the  actual  loss  resulting  from  a  false 
and  fraudulent  representation  of  his  age  is 
weU  sustained  by  authority,  although,  as  we 
have  said,  there  is  a  fierce  conflict,  and  it  is 
strongly  entrenched  in  principle.  It  has  been 
sanctioned  by  this  court,  although,  perhaps, 


not  in  a  strictly  authoritative  way;  for  it 
was  said  by  Worden,  J.,  speaking  for  the 
court,  in  Carpenter  v.  Carpenter,  supra,  that 
"the  false  representation  by  the  plaintiff,  as 
alleged,  does  not  make  the  contract  valid,  nor 
does  it  estop  the  plaintiff  to  set  up  his  in- 
fancy, although  it  may  furnish  ground  of  an 
action  against  him  for  tort.  See  1  Pars. 
Cont.  317;  2  Kent,  Comm.  (12th  Ed.)  241." 
The  reasoning  of  the  court  in  the  case  of 
Pittsburgh,  etc.,  Co.  v.  Adams,  105  Ind.  151, 
5  N.  E.  187,  tends  strongly  in  the  same  direc- 
tion. 

In  NefC  V.  Landis  (Pa.  Sup.)  1  Atl.  177,  it 
was  said:  "It  cannot  be  doubted  that  a  mi- 
nor who,  under  such  circumstances,  obtains 
the  property  of  another,  by  pretending  to  be 
of  full  age  and  legally  responsible,  when  in 
fact  he  is  not,  is  guilty  of  a  false  pretense, 
for  which  he  is  answerable  under  the  crim- 
inal law.  2  Whart.  Or.  Law,  2099."  If  it 
be  true,  as  asserted  in  the  case  from  which 
we  have  quoted,  that  an  infant  who  falsely 
and  fraudulently  represents  himself  to  be  of 
full  age  is  amenable  to  the  criminal  law,  it 
must  be  true  that  he  is  responsible  in  an 
action  of  tort  to  the  person  whom  he  has 
wronged. 

The  earlier  English  cases  were  undoubtedly 
against  our  conclusion,  but  the  later  cases 
seem  to  take  a  different  view  of  the  question. 
Thus,  in  Ex  parte  Unity,  etc.,  Ass'n,  3  De 
Gex  &  J.  03,  it  was  held  that,  in  equity,  an 
infant,  who  falsely  and  fraudulently  repre- 
sented himself  to  be  of  full  age,  was  bound 
to  pay  the  obligation  entered  into  on  the 
faith  of  his  representation.  In  the  note  to 
the  case  of  Humphrey  v.  Douglass,  33  Am. 
Dec.  177,  Mr.  Freeman  says,  in  speaking  of 
the  decision  in  Kilgore  v.  Jordan,  17  Tex. 
341,  that,  "aside  from  any  question  of  author- 
ity, the  rule  given  in  the  case  last  cited  by 
Hemphill,  C.  J.,  as  the  rule  of  the  Spanish, 
derived  from  the  civil  law,  that  if  a  minor 
represents  himself  to  be  of  age,  and  from  his 
person  he  appears  to  be  so,  he  will  be  bound 
by  any  contract  made  with  him,  seems  to  be 
most  consonant  with  reason  and  justice." 
]\Ir.  Pomeroy  pushes  the  doctrine  much  fur- 
ther than  we  are  required  to  do  here,  for  he 
says,  "If  an  infant  procures  an  agreement 
to  be  made  through  false  and  fraudulent  rep- 
resentations that  he  is  of  age,  a  court  of  equi- 
ty will  enforce  his  liability  as  though  he  were 
an  adult,  and  may  cancel  a  conveyance  or  ex- 
ecuted contract  obtained  by  fraud."  2  Pom. 
Eq.  465. 

In  addition  to  cases  cited  which  sustain 
our  view  may  be  cited  the  following  authori- 
ties: Fitts  V.  Hall,  9  N.  H.  441;  Eckstein 
V.  Frank,  1  Daly,  384;  Schunemann  v.  Para- 
dise, 46  How.  Prac.  426;  Tyler,  Inf.  182;  1 
Pars.  Cont.  317,  note;    1  Story,  Eq.  385. 

The  English  cases  recognize  a  distinction 
between  suits  of  equitable  cognizance  and 
actions  at  law,  and  declare  that  a  representa- 
tion as,  to  age,  when  falsely  and  fraudulently 
made,    will   bind    an    infant    in    equity.     Ex 


I 


INFANTS. 


317 


parte  Unity,  etc.,  Ass'n,  supra,  and  authori- 
ties cited.  UndG'  our  system,  we  can  rec- 
ognize no  such  distinction,— a  distinction 
which  is,  as  we  thinli,  a  shadowy  one  under 
any  system,  for,  in  our  system,  the  rules  of 
law  and  equity  are  merged  and  mingled. 
Under  such  a  system  as  ours,  courts  should 
pursue  such  a  course  as  will  render  justice 
to  suitors  under  the  rules  of  equity,  wliich, 
after  all,  are  but  the  embodiment  of  the  prin- 
ciples of  natural  justice. 

It  cannot  be  the  duty  of  any  court  of  In- 
diana to  deny  substantial  justice  because  the 
complaint  states  a  cause  of  action  in  a  pecu- 
liar form;  for,  under  our  system,  courts  must 
render  such  judgments  as  yield  justice  to 
those  who  invoke  their  aid,  irre.spective  of 
mere  forms,  in  all  cases  where  the  substan- 
tial facts  are  stated,  and  are  such  as  entitle 
the  party  to  the  general  relief  sought.  They 
will  not  inquire  whether  the  proceeding  which 
asks  their  aid  is  at  law  or  in  etjuity,  but 
they  will  render  justice,  to  those  who  ask  it, 
in  the  method  prescribed  by  our  Code  of 
Civil  Procedure.  It  is  laid  down  as  a  general 
rule  by  all  the  text  writers  that  infants  are 
liable  for  their  torts;  but  many  of  these 
writers,  when  they  come  to  consider  such  a 
question  as  we  have  here,  are  sorely  per- 
plexed by  the  early  English  decisions,  and, 
by  subtle  refinement,  attempt  to  discriminate 
between  pure  torts  and  torts  connected  with 
contracts,  and  to  create  an  artificial  class  of 
actions.  Their  reasoning  is  not  satisfactory. 
Aside  from  mere  personal  torts,  it  is  scarce- 
ly possible  to  conceive  a  tort  not  in  some  way 
connected  with  a  contract,  and  yet  all  the 
autliorities  agree  that  the  liability  of  infants 
is  not  confined  to  mere  personal  torts.  There 
is  a  connection  between  a  contract  and  a  tort 
in  every  case  of  bailment,  of  the  bargain  and 
sale  of  personal  property,  and  of  the  pur- 
chase and  sale  of  real  estate;  and,  if  an  in- 
fant is  not  responsible  for  his  fraudulent 
representation  of  his  age  in  connection  with 
such  transaction,  there  is  not  within  the 
whole  range  of  business  transactions  any 
case  in  which  he  could  be  made  liable  for 
his  fraud.  There  are  many  cases,  far  too 
numerous  for  citation,  where  there  is  some 
connection  between  the  contract  and  the  tort, 
and  yet  it  is  unhesitatingly  hold  that  the  in- 
fant is  liable  for  his  tort  Cooley,  Torts, 
112,  authorities  cited  in  notes.  The  cases 
certainly  do  agree — it  is,  indeed,  dillicult,  if 
not  impossible,  to  perceive  how  it  could  be 
otherwise — that,  although  there  may  be  some 
connection  between  the  contract  and  the 
wrong,  the  infant  may  be  liable  for  his  tort. 
It  seems  to  us  that  the  only  logical  and  de- 
fensible conclusion  is  that  he  is  liable,  to  the 
extent  of  the  loss  actually  sustained,  for  his 
tort,  where  a  recovery  can  be  had  without 
giving  effect  to  his  contract.  The  test,  and 
the  only  satisfactory  test,  is  supplied  by  the 
answer  to  the  question-  Can  the  infant  be 
held  liable  without  directly  or  indirectly  en- 
forcing his  promise? 


There  is  no  enforcement  of  a  promise 
where  an  infant,  who  has  been  guilty  of  a 
positive  fraud,  is  made  to  answer  for  the 
actual  loss  his  wrong  has  caused  to  one  who 
has  dealt  with  him  in  good  faith,  and  has 
exercised  due  diligence;  nor  does  such  a  rule 
open  the  way  for  designing  men  to  take  ad- 
vantage of  an  infant,  for  it  holds  one  who 
contracts  witli  an  infant  to  the  exercise  of 
good  faith  and  rea.sonable  diligence,  and  does 
not  enable  him  to  make  any  profit  out  of  the 
transaction  with  the  infant,  for  it  allows  him 
only  compensation  for  the  actual  loss  sus- 
tained. It  does  not  permit  him  to  make  any 
profit  out  of  an  executory  contract,  but  it 
simply  makes  good  his  actual  loss. 

It  is  wortliy  of  observation  that,  in  the  cas- 
es which  hold  that  an  infant's  representa- 
tion will  not  estop  him  to  deny  his  disability, 
it  is  generally  declared  that  he  may,  never- 
theless, be  held  liable  for  his  tort.  It  may 
often  happen  that  the  age  and  appearance  of 
the  infant  will  be  such  as  to  preclude  a  recov- 
ery for  a  fraud,  because  reasonable  diligence, 
which  is  exacted  in  all  cases,  would  warn 
the  plaintiff  of  the  nonage  of  the  defendant. 
On  the  other  hand,  the  infant  may  be  in 
years  almost  of  full  age,  and  in  appearance 
entirely  so,  and  thus  deceive  the  most  dili- 
gent by  his  representations.  Suppose  a  mi- 
nor who  is  really  20  years  and  10  months 
old,  but  in  appearance  a  man  of  fuU  age. 
should  obtain  goods  by  falsely  and  fraudu- 
lently representing  that  he  is  21  years  of 
age,  ought  he  not,  on  the  plainest  principles 
of  natural  justice,  to  be  held  liable,  not  on 
his  contract,  but  for  the  loss  occasioned  bv 
his  fraud?  The  rule  which  we  adopt  will 
enable  courts  to  protect,  in  some  measiu-e, 
the  honest  and  dUigent,  but  none  other,  who 
are  misled  by  a  false  and  fraudulent  repre- 
sentation; and  it  will  not  open  the  way  to 
imposition  upon  infants,  for  in  no  event  can 
anything  more  than  the  actual  loss  sustained 
be  recovered,  and  no  person  who  trusts  where 
fair  dealing  and  due  diligence  require  him 
not  to  trust  can  reap  any  benefit.  It  will 
not  apply  to  an  executory  contract  which  an 
infant  refuses  to  perform,  for,  in  such  a  case, 
the  action  would  be  on  the  promise,  and  the 
only  recovery-  that  could  be  had  would  be 
for  the  breach  of  contract,  and  the  terms  of 
our  rule  forbid  such  a  result;  but  it  will  ap- 
ply where  an  infant,  on  the  faith  of  his  false 
and  fraudulent  representation,  obtains  prop- 
erty from  another,  and  then  repudiates  his 
contract 

Any  other  rule  would,  in  many  cases,  suffer 
a  person  guilty  of  positive  fraud  to  escape 
loss,  although  his  fraud  had  enabled  him  to 
scK'ure  and  make  way  with  the  property  of 
one  who  had  trusted  in  good  faith  to  his  rep- 
resentation, and  had  exercised  due  care  and 
diligence.  We  are  unwilling  to  sanction  any 
rule  which  will  enable  an  infant  who  has 
obtiined  the  property  of  another  by  falsely 
and  fraudulently  representing  himself  to  be 
of  full  age,  to  enjoy  the  fruits  of  his  fraud. 


318 


CAPACITY  OF  PARTIES. 


either  by  keeping  the  property  himself,  or 
selling  it  to  another,  and,  when  asked  to  pay- 
its  just  and  reasonable  value,  successfully 
plead  his  infancy.  Such  a  rule  would  make 
the  defense  of  Infancy  both  a  shield  and  a 


sword,  and  this  is  a  result  which  the  princi- 
ples of  justice  forbid,  for  they  require  that 
it  should  be  merely  a  shield  of  defense. 

Judgment    reversed,    with    instructions    to 
overrule  the  demurrer  to  the  complaint 


c^ 


> 


INSANE  PERSONS  AND  IDIOTS. 


319 


ALLIS  V.  BILLINGS. 
(6  Mete  415.) 


1^ 


r,^ 


Supreme  Judicial  Court  of  Massachusetts. 
Sept  Term,  1843. 

Writ  of  entry  to  recover  seven  acres  of  land 
in  Hatfield.  At  the  trial,  the  tenant  gave  in 
evidence  a  deed  from  the  demandant,  dated 
March  25th,  1835,  convcyinj;  the  demanded 
premises,  and  several  other  parcels  of  land, 
being  the  farm  and  outlands  belonging  to  the 
demandant,  whose  previous  title,  by  devise 
from  his  father,  was  admitted.  The  consid- 
eration of  said  deed  was  a  note,  given  to  the 
demandant  by  the  tenant  and  a  surety,  for 
$4,G00,  payable  In  six  years,  with  yearly  in- 
terest. On  this  note  were  sundry  indorse- 
ments, reducing  it  to  about  $3,000.  Some  of 
these  indorsements  were  in  the  hand-writing 
of  the  tenant,  and  some  in  that  of  the  de- 
mandant. The  demandant  did  not  offer  to  re- 
turn the  note  or  the  money  received. 

The  tenant  sold  the  said  farm,  and  part  of 
said  outlands  for  a  sum  somewhat  exceeding 
$5,000;  and  a  writ  of  entry  was  commenced 
against  his  grantee,  by  the  demandant,  to  re- 
cover the  same;  which  writ  was  returnable 
at  a  term  subsequent  to  that  at  which  the 
present  action  was  tried. 

It  appeared  that  the  tenant  went  into  pos- 
session under  said  deed,  and  was  In  posses- 
sion of  the  demanded  premises,  when  this  ac- 
tion was  commenced,  claiming  title  thereto 
under  said  deed. 

The  demandant,  to  avoid  the  effect  of  the 
said  conveyance  to  the  tenant,  offered  to 
prove  that  he  was  insane  when  it  was  ex- 
ecuted by  him,  and  also  that  it  was  obtained 
by  undue  influence.  The  evidence  which  he 
introduced  tended  to  show  that  he  had  been 
insane  and  sane,  at  different  times,  for  a 
number  of  years  prior  to  the  making  of  said 
conveyance,  and  also  since. 

The  tenant  requested  the  Judge  who  tried 
the  cause  to  instruct  the  jury:  "That  if  the 
demandant  was  subject  only  to  temporary 
turns  of  insanity,  and  insane  when  he  made 
the  deed,  yet  if,  after  he  became  sane,  and 
when  sane,  he  did  acts  in  affirmation  of  the 
contract,  as  by  receiving  payments  on  the 
note,  and  the  like,  he  could  not  afterwards 
maintain  an  action  to  avoid  the  deed  on  the 
ground  of  insanity;  that,  as  between  the  pres- 
ent parties,  this  action  could  not  be  main- 
tained for  one  of  several  parcels  described  in 
the  deed,  and  remaining  in  the  possession  of 
the  tenant;  and  that  the  demandant,  to  main- 
tain his  action,  should  return  the  note  and 
yio  money  received." 

The  judge  instructed  the  jurj',  that  if  they 
were  satisfied  that  the  demandant  was  not 
of  sane  mind  when  he  made  the  deed,  it  was 
void  absolutely,  and  not  voidable  merely,  and 
that  the  receipt  of  money  on  tlie  note  would 
not  bar  an  action,  though  the  demandant  was 
sane  at  the  time  he  received  it;  that  it  was 
not  necessary  for  him  to  return  the  note  or 
money  received,  under  the  circumstances  of 


this  suit;  and  that  the  demandant  was  not 
obliged  to  demand  in  this  action  all  the  par- 
cels in  the  possession  of  the  tenant  and  un- 
sold. 

The  jury  found  that  the  deed  was  made 
when  the  demandant  was  Insane,  and  they 
did  not  consider  the  allegation  of  fraud. 

New  trial  to  be  granted,  if  the  ruling  of  the 
judge  was  incorrect;  otherwise,  judgment  to 
be  rendered  for  the  demandant,  on  the  ver- 
dict 


Mr.   Huntington,   for  the   tenant 
Forbes,  for  the  demandant 


Wells  & 


DEWEY,  J.  The  quf  stion  raised  In  the 
present  case  is  whether  the  deed  of  one  who 
is  insane  at  the  time  of  the  execution  thereof 
is  void  absolutely,  or  merely  voidable. 

The  term  "void,"  as  applicable  to  convey- 
ances or  other  agreements,  has  not  at  all 
times  been  used  with  technical  precision,  nor 
restricted  to  its  peculiar  and  limited  sense 
as  contradistinguished  from  "voidable";  it  be- 
ing frequently  Introduced,  even  by  legal  writ- 
ers and  jurists,  where  the  purpose  is  nothing 
further  than  to  indicate  that  a  contract  was 
invalid,  and  not  binding  in  law.  But  the  dis- 
tinction between  the  terms  "void"  and  "void- 
able," in  their  application  to  contracts,  is  often 
one  of  great  practical  importance;  and  when- 
ever entire  technical  accuracy  is  required  the 
term  "void"  can  only  be  properly  applied  to 
those  contracts  that  are  of  no  effect  whatso- 
ever; such  as  are  a  mere  nullity,  and  incapa- 
ble of  confirmation  or  ratification. 

This  question,  then,  arises:  Is  the  deed  of 
a  person  non  compos  mentis  of  such  a  char- 
acter that  it  is  incapable  of  confirmation? 
This  point  is  not  now  for  the  first  time  raised, 
but  has  been  the  subject  of  comment  both  by 
elementary  writers  and  in  judicial  opinions. 
Mr.  Justice  Blackstone,  in  his  Commentaries 
(volume  2,  p.  291),  states  the  doctrine  thus: 
"Idiots,  and  persons  of  non-sane  memory,  in- 
fants, and  persons  under  duress,  are  not  to- 
tally disabled  to  convey  or  purchase,  but  sub 
modo  only,  for  their  conveyances  and  pur- 
chases are  voidable,  but  not  actually  void." 
Chancellor  Kent  says,  "By  the  common  law, 
a  deed  made  by  a  person  non  compos  is  void- 
able only,  and  not  void."  2  Kent,  Comm. 
(4th  Ed.)  451.  In  Wait  v.  Maxwell.  5  Pick. 
217,  this  court  adopted  the  same  principle,  and 
directly  ruled  that  the  deed  of  a  non  compos, 
not  under  guardianship,  was  not  void,  but 
voidable.  Such  a  deed  conveys  a  seizin  to  the 
grantee,  and  the  deed,  to  that  extent  is  valid, 
until,  by  entry  or  action  the  same  is  avoided. 
Mitchell  V.  Kingman,  5  Pick.  431,  is  to  the 
like  effect  In  Seaver  v.  Phelps,  11  Pick.  305, 
the  contracts  of  ins;ine  persons  are  noticed 
as  contracts  not  absolutely  void,  but  voidable. 

It  may  seem  somewhat  absurd  to  hold  that 
a  deed  should  have  any  effect  when  wanting 
in  one  of  the  essential  elements  of  a  valid 
contract,  viz.  that  of  parties  capable  of  giv- 
ing an  assent  to  such  contract    But  this  ob- 


320 


CAPACITY  OF  PARTIES. 


jection  as  strongly  applies  to  cases  of  deeds 
executed  by  infants,  who  axe  aJike  wanting 
in  capacity  to  make  a  binding  contract  Yet 
this  principle  of  giving  so  much  effect  to  the 
contract  as  removes  it  beyond  that  of  a  mere 
nullity,  and  renders  it,  to  some  present 
purpose,  effectual,  and  susceptible  of  complete 
future  ratification,  is  well  settled  and  under- 
stood as  to  infants  who  enter  into  contracts; 
and  it  will  be  found  that  there  is  a  common 
principle  on  this  subject,  alike  applicable  to 
the  inability  of  a  contracting  party,  arising 
from  lunacy  or  infancy.  The  civil  and  the 
common  law  writers  group  together  idiots, 
madmen,  and  infants,  as  parties  incapable  of 
contracting  for  want  of  a  rational  and  delib- 
erate consenting  mind.  1  Story,  Eq.  §  223, 
and  authorities  there  cited. 

It  is  true  that  the  rule  of  the  common  law, 
as  held  at  one  time,  seemed  to  sanction,  in 
one  particiilar,  a  most  xinwarrantable  distinc- 
tion between  the  cases  of  deeds  made  by  per- 
sons non  compos  and  those  made  by  infants; 
holding  that  the  former  could  not  be  avoided 
by  the  party,  upon  the  ground  that  no  man  of 
fiill  age  should  be  admitted  to  stultify  him- 
self, although  it  allowed  privies  in  blood,  or 
privies  in  representation,  after  the  death  of 
the  non  compos,  to  avoid  the  deed,  on  the 
ground  of  incapacity  in  the  grantor.  This 
•distinction  has  not  been  adopted  by  out 
courts.  On  the  contrary,  we  hold  that  such 
conveyance  by  one  non  compos  mentis  may  be 
avoided  by  himself,  as  in  the  case  of  an  in- 
fant grantor.  This  principle  was  directly 
recognized  in  the  case  of  Mitchell  v.  King- 
man, 5  Pick.  431.  Indeed,  the  English  rule 
has,  in  modem  times,  been  often  questioned 
in  England;  and  in  the  courts  of  our  sister 
states  it  has  received  little  if  any  sanction. 
1  Story,  Eq.  §  225,  and  cases  there  cited. 

It  was  urged  by  the  demandant's  counsel 
that  the  doctrine  that  the  deed  of  a  non  com- 
pos person  was  voidable  only,  and  not  void, 
was  to  be  limited  to  feoffments,  or  cases 
where  there  is  livery  of  seizin,  or  what  is 
equivalent,  and  would  not  embrace  a  convey- 
ance by  an  unrecorded  deed.  But  we  do  not 
think  that  such  a  distinction  can  be  main- 
tained. As  between  the  grantor  and  gran- 
tee, such  unrecorded  deed  is  good  and  effec- 
tual, by  force  of  our  statute;  and  the  effect 
of  such  a  conveyance  would  be  to  vest  the 
title  of  the  grantor  in  the  grantee  immediately 
upon  the  execution  of  the  deed,  and  before 
the  same  is  recorded.  Marshall  v.  Fisk,  6 
Mass.  31.  A  deed  made  in  proper  form,  and 
duly  acknowledged  and  recorded,  is,  in  this 
commonwealth,  equivalent  to  a  feoffment 
with  livery  of  seizin.  Somes  v.  Brewer,  2 
Pick.  197.  Without  the  registry,  where  the 
delivery  of  the  deed  is  accompanied  by  the 
surrender  of  the  possession  of  the  conveyed 
premises  to  the  grantee,  the  effect  would  be 
the  same  as  to  the  conveyance  by  a  non  com- 
pos as  would  result  from  a  feoffment  made 
by  him.  A  deed  of  bargain  and  sale,  it  is 
said,  places  the  grantee  upon  the  footing  of  a 


feoffment,  as  it  passes  the  estate  by  the  de- 
livery of  the  hand;  such  grants  or  deeds  as 
take  effect  by  delivery  of  the  hand  being 
voidable  only.  Somes  v.  Brewer,  2  Pick.  197; 
Zouch  v.  Parsons,  3  Burrows,  1S04.  We 
come,  therefore,  to  the  result,  that  the  deeds 
of  infants  and  insane  persons  are  alike  void- 
able, but  neither  are  absolutely  void. 

Upon  the  trial  of  the  present  action  the 
plaintiff  put  his  case  upon  two  distinct 
grounds:  1st.  That  he  was  insane  at  the 
time  he  executed  the  deed  under  which  the 
tenant  derives  his  title:  2d.  That  the  deed 
was  obtained  by  vmdue  influence  and  fraud 
on  the  part  of  the  tenant.  Upon  both  these 
points  the  plaintiff  introduced  evidence. 
What  was  the  extent  of  the  evidence  upon 
the  latter  ground,  and  what  would  have  been 
the  finding  of  the  juiy  upon  that  point,  we 
have  no  means  of  judging.  This  was  a  dis- 
tinct and  independent  ground,  and  one  which, 
if  found  hi  favor  of  the  demandant,  might 
have  been  decisive  of  the  case,  but  which,  in 
the  final  disposition  of  the  cause,  was  not 
considered  or  passed  upon  by  the  jury.  AU 
the  evidence,  therefore,  bearing  upon  this 
point,  is  now  to  be  treated  as  if  never  of- 
fered, and  the  sole  inquiry  for  our  considera- 
tion is  whether  the  instructions  of  the  court 
were  such,  in  matter  of  law,  that  the  verdict 
may  be  maintained,  taken  as  it  was  upon  the 
first  ground  solely. 

The  presidin£_iudge_juled,  as  a  matter  of 
law.  tEafXdeed  of  an  lnsane_person  was  ab- 
solutely  void.  Under  this  ruling,  all  that 
'was  required  of  the  demandant  to  entitle 
himself  to  a  verdict  in  his  favor  was  to  show 
a  temporary  insanity  at  the  time  of  the  exe- 
cution of  the  deed.  No  matter  what  might 
have  occurred  subsequently,  or  how  soon 
afterwards  the  demandant  might  have  been 
restored  to  a  sound  mind;  no  matter  what 
acts  of  confirmation  may  have  been  done  by 
him,  or  however  fully  he  may  have  adopted 
and  ratified  the  transaction,  by  the  receipt  of 
money,  or  other  valuable  consideration  paid 
for  the  land,— still  the  legal  title  in  the  land 
would  be  in  him.  This  was  the  necessary 
result  of  the  doctiine  that  the  deed  of  a  non 
compos  was  absolutely  void,  while,  if  it  had 
been  held  only  voidable,  these  subsequent  acts 
of  the  party  might  materially  affect  the  ver- 
dict of  the  jury.  But  adopting,  as  we  do, 
the  principle  that  the  deed  of  an  insane  per- 
son is  only  voidable,  this,  while  it  gives  the 
insane  grantor  full  power  and  authority  to 
avoid  his  deed,  and  thus  furnishes  full  pro- 
tection to  him  against  all  acts  injurious  to  his 
interests,  done  while  he  was  non  compos, 
also  entitles  the  other  party  to  set  up  the 
deed,  if  he  can  show  a  ratification  or  adoption 
of  it  by  the  grantor,  after  he  is  restored  to 
a  sound  mind.  If  the  grantor  when  thus 
capable  of  acting,  and  with  full  knowledge  of 
his  previous  acts,  and  of  the  nature  and  ex- 
tent of  them,  will  deliberately  adopt  and  rat- 
ify them;  if  he  will  knowingly  and  in  the 
exercise  of  his  proper  faculties,  take  the  bene- 


INSANE  PERSONS  AND  IDIOTS. 


521 


fit  of  a  contmct  mado  while  he  was  Insane,— 
it  is  competent  fur  him  to  do  so.  But  the 
consequence  will  be,  to  give  force,  effect,  and 
legal  validity  to  his  contract,  which  was  be- 
fore voidable. 

In  the  present  case,  therefore,  upon  the 
point  first  relied  upon  In  the  defence,  viz. 
that  the  demandant  was  In.sane  when  he  ex- 
ecuted the  deed,  the  jury  should  have  been 
Instructed  that  this  fact.  If  established,  ren- 
dered the  deed  voidable,  and  that  it  was  com- 
petent for  the  demandant  to  avoid  it  on  that 
ground  If  not  estopped  by  his  subsequent  acts, 
done  while  in  his  ri^^ht  mind;  but  that  a 
voidable  deed  was  capable  of  confirmation; 
and  that  If  the  grantor,  in  his  lucid  Intervals, 

HOPK.  BEL.  0A8.  CONT.  — 2 1 


or  after  a  general  restoration  to  sanity,  then 
being  of  sound  mind  and  well  knowing  and 
imderstanding  the  nature  of  the  contract,  rat- 
ified it,  adopted  it  :!-  a  valid  contract,  and 
participated  in  the  beuffits  of  it  by  rtH^e.ving 
from  the  purchaser  the  purchase  money  due 
on  the  contract,  this  would  give  effect  to  the 
deed,  and  render  the  same  valid  in  the  hands 
of  the  grantee,  and  would  thus  become  ef- 
fectual to  pass  the  lands,  and  divest  the  title 
of  the  grantor.  Such  Instructioas  would  have 
presented  the  question  in  ls.sue  in  a  different 
aspect  to  the  jury,  and  might  have  led  to  a 
different  result  upon  the  only  point  upon 
which  they  passed. 
Verdict  set  aside,  and  a  new  trial  granted- 


R?2 


CAPACITY  OF  PARTIES. 


/y 


c 


C^"- 


HOVEY  V.  HOBSON.      /^  ^ 
(53  Me.  451.)  /  S;  ^  . 


Supreme  Judicial  Court  of  Maine. 
A.  MerriD,  for  plaintiff.    H.  P.  Deane,  for 
defendant. 

APPLETON,  C.  J.  On  July  27,  1835,  Ste- 
phen Xeal,  then  owning  the  land  in  contro- 
versy, conveyed  the  same  to  Samuel  E,  Crock- 
er, from  whom  the  tenant  by  various  mesne 
conveyances  derives  his  title. 

On  Dec.  28,  1836,  Stephen  Neal  died,  leav- 
ing Lydia  Dennett,  then  wife  of  Oliver  Den- 
nett, his  sole  heiress  at  law.  On  Dec.  18, 
1851,  Oliver  Dennett  died. 

On  July  15,  1858,  Lydia  Dennett  conveyed 
the  demanded  premises  to  the  plaintiff. 

The  plaintiff  introduced  evidence  tending 
to  show  that  Stephen  Neal  at  the  date  of 
his  deed  to  Crocker  was  insane,  and  claimed 
to  avoid  said  deed  by  reason  of  such  insan- 
ity. 

After  the  testimony  reported  had  been  in- 
troduced, the  presiding  justice  ruled  "that, 
if  Samuel  E.  Crocker  without  fraud,  for  an 
adequate  consideration,  purchased  the  land 
of  Stephen  Neal,  and  afterwards  said  Crock- 
er and  those  claiming  under  him,  conveyed 
said  land  in  good  faith  until  it  came  into  the 
hands  of  the  tenant,  for  a  valuable  consider- 
ation, without  any  knowledge  on  his  part  of 
any  defect  in  the  title,  or  of  any  right  or 
claim  of  any  other  person  therein,  then  Mrs. 
Dennett  or  those  claiming  under  her  could  not 
avoid  her  father's  deed  as  against  the  de- 
fendant, on  the  ground  of  his  unsoundness 
of  mind;  and  that  the  tenant  would  be  en- 
titled to  a  verdict." 

If  Crocker,  "without  fraud,  for  an  ade- 
quate consideration,  purchased  the  land  of 
Stephen  Neal,"  Neal  being  sane,  his  grantees 
would  undoubtedly  acquire  a  good  title.  The 
ruling  Is  that,  if  insane,  the  same  result 
would  follow,  the  grantees  of  Crocker  being 
bona  fide  purchasers,  and  ignorant  of  the 
Insanity  of  Neal.  The  questions  therefore 
arise,  (1)  as  to  the  rights  of  an  insane  man 
when  restored  to  sanity,  or  of  his  heirs  to 
avoid,  as  against  his  immediate  grantee,  his 
deed  executed  and  delivered  when  insane; 
and,  (2)  as  to  the  rights  of  those  deriving 
a  title  in  good  faith  without  notice,  and  for 
a  valid  consideration  from  such  grantee. 

1.  The  deed  of  an  insane  man  not  under 
guardianship  is  not  void  but  voidable,  and 
may  be  confirmed  by  him  if  afterwards  sane, 
or  by  his  heirs.  If  under  guardianship,  the 
deed  is  absolutely  void.  Wait  v.  Maxwell,  5 
Pick.  219.  The  right  of  avoiding  a  contract 
exists,  notwithstanding  the  person  with 
whom  the  insane  man  contracted  was  not 
apprized  of  and  had  no  reason  to  suspect 
the  existence  of  such  insanity,  and  did  not 
overreach  him  by  any  fraud  or  deception. 
Seaver  v.  Phelps,  11  Pick.  304.  So  an  infant 
may  avoid  his  contract,  though  the  person 
dealing  with  him  supposed  him  of  age  (Van 


"Winkle  v.  Ketcham,  3  Caines,  323);  or  even 
when  he  fraudulently  and  falsely  represent- 
ed himself  of  age  (Conroe  v.  Birdsall,  1 
Johns.  Cas.  127).  The  deed  of  an  insane  man 
being  voidable,  he  may  ratify  it  after  he  be- 
comes sane,  or  his  heirs  after  his  decease. 
Allis  V.  Billings,  6  Mete.  Olass.)  415.  An  in- 
sane person  or  his  guardian  may  bring  an 
action  to  recover  land  of  which  a  deed  was 
made  by  him  while  insane,  without  first  re- 
storing the  consideration  to  the  grantee,  the 
deed  not  having  since  been  ratified  nor  con- 
firmed. Gibson  v.  Soper,  6  Gray,  279.  In 
this  case,  the  remark  of  Shaw,  C.  J.,  in  Ar- 
nold V.  Iron  Works,  1  Gray,  434,  that  if  "the 
unfortunate  person  of  unsound  mind,  com- 
ing to  the  full  possession  of  his  mental  facul- 
ties, desires  to  relieve  himself  from  a  con- 
veyance made  during  his  incapacity,  he  must 
first  restore  the  price.  If  paid,  or  surrender 
the  contract  for  it,  if  unpaid,"  is  limited  and 
restricted  by  Thomas,  J.,  "to  the  case  of  a 
grantor  having  in  his  possession  the  notes 
which  were  the  consideration  of  the  deed 
and  restored  to  the  full  possession  of  his 
mind."  In  the  deed  or  other  contract  of  an 
insane  man  the  consenting  mind  is  wanting. 
"To  say  that  an  insane  man,"  observes 
Thomas,  J.,  'Tiefore  he  can  avoid  a  voidable 
deed,  must  first  put  the  grantee  in  statu  quo, 
would  be  to  say,  in  effect,  that,  in  a  large 
majority  of  cases,  his  deed  shall  not  be 
avoided  at  all.  The  more  insane  the  grantor 
was  when  the  bargain  was  made,  the  less 
likely  will  he  be  to  retain  the  fruits  of  his 
bargain,  so  as  to  be  able  to  make  restitution. 
It  would  be  absurd  to  annul  the  bargain  for 
the  mental  incompetency  of  a  party,  and  yet 
to  require  of  him  to  retain  and  manage  the 
proceeds  of  his  sale  so  wisely  and  discreetly 
that  they  shall  be  forthcoming,  when  with 
restored  intellect  he  shall  seek  its  annul- 
ment" Lunatics  and  persons  non  compos 
are  not  bound  by  their  contracts,  though  no 
fraud  nor  imposition  has  been  practiced  on 
them.    Chew  v.  Bank,  14  Md.  318. 

The  ruling  presupposes  a  sale  without 
fraud  and  for  an  adequate  consideration. 
That  a  grantor  sold  his  land  for  a  fair  price, 
that  the  purchase  money  was  fully  secured, 
that  in  the  transaction  he  evinced  by  his 
conduct  a  knowledge  of  the  value  of  his 
property  and  capacity  in  its  management, 
would  go  far  to  negative  an  utter  incompe- 
tency to  contract,  inferable  only  from  a  loss 
of  memory  common  to  old  age  or  from  a 
disregard  of  the  decencies  or  courtesies  of 
life.  So  the  conversion  by  a  feeble  old  man 
past  labor,  of  property  unproductive  and  bur- 
dened by  taxation,  into  notes  well  secured 
and  bringing  an  annual  income,  would  hard- 
ly be  deemed  proof  of  utter  imbecility,  if  the 
price  was  equal  to  the  fair  market  value  of 
the  property  sold. 

As  the  deed  of  an  insane  man  is  voidable 
only,  it  follows  that  it  is  capable  of  subse- 
quent ratification  by  the  grantor  if  he  be  re- 
stored to  reason,  or  by  his  heirs.    The  reten- 


INSANE  PERSONS  AND  IDIOTS. 


323 


tion  of  the  notes  after  such  restoration  and 
the  receiving  payments  on  them,  would  be 
evidence  of  such  ratification.  In  the  analo- 
gous case  of  infancy,  it  scorns  that  there  may 
be  an  acquiescence  by  the  grantor  under 
such  circumstances  as  would  amount  to  an 
eqiiitable  estoppel.  In  Wallace's  Lessee  v. 
Lewis,  4  liar.  75,  it  was  held,  that  an  In- 
fant's acquiescence  in  a  conveyance  for  four 
years  after  age  and  seeing  the  property  ex- 
tensively improvetl,  would  be  a  confirmation. 
Though  mere  lapse  of  time  will  not  amount 
to  a  confirmation,  unless  continued  for  twen- 
ty years,  yet  in  connection  with  other  cir- 
cumstances It  maj'  amount  to  a  ratification, 
Crosinger  v.  Welch,  15  Ohio,  15G;  Wheaton 
V.  East,  5  Yerg.  41.  Whether,  in  the  case  be- 
fore us,  the  deed  of  Stephen  Ncal  has  been 
affirmed  by  the  reception,  by  those  author- 
ized, of  the  purchase  money  for  the  land,  or 
the  heir  at  law  after  the  death  of  her  hus- 
band or  the  passage  of  the  laws  in  relation 
to  maiTied  women  is  equitably  estopped  by 
her  omission  to  act  under  circumstances 
which  required  action  on  her  part,  are  ques- 
tions which  at  this  time  are  not  pressing  for 
consideration. 

It  Is  true  the  English  courts  adopt  a  some- 
what different  doctrine  from  that  of  the 
.\merican  courts  as  to  the  right  of  an  in- 
sane man  when  sane,  or  of  his  heirs  to 
avoid  a  deed  or  contract  executed  when  in- 
sane. Thus,  In  Solby  v.  Jackson,  6  Beav. 
200,  Lord  Langdale  refused  to  set  aside  a 
deed  executed  in  good  faith  by  an  insane 
man  and  for  an  adequate  consideration, 
when  the  parties  could  not  be  reinstated. 
"There  are."  observes  Tuck,  J.,  in  Chew  v. 
Bank,  14  Md.  318,  "many  cases  in  England 
to  show  that  such  persons  are  held  by  their 
i-ontracts  unless  fraud  and  Imposition  have 
l)oen  practiced,  but  to  this  we  cannot  assent. 
The  doctrine  in  this  country  is  the  other 
way,  and,  as  we  think.  Is  sustained  by  bet- 
ter reasoning  than  the  English  rule  as  an- 
nounced in  some  of  their  decisions.  The  ef- 
fect in  many  cases  would  be  to  place  luna- 
tics on  the  same  footing  with  persons  of 
sound  mind,  with  less  effective  means  to 
protect  the  injured  party  against  the  fraud, 
for  at  law,  as  well  as  in  equity,  fraud  or 
imposition  may  be  relied  on,  without  refer- 
ence to  the  mental  capacity  of  the  parties 
except  so  far  as  such  defect  may  give  weight 
to  other  facts,  from  which  the  fraud  may  be 
deduced." 

The  ruling,  however,  in  the  case  at  bar,  ia 
not  in  accordance  with  that  of  the  English 
courts,  which  require  that,  in  addition  to  good 
faith  and  a  full  consideration,  the  person  con- 
tracting should  be  apparently  of  sound  mind, 
and  not  known  to  be  otherwise  to  the  party 
with  whom  he  contracts.  Molton  v.  Camroux, 
2  Exch.  487.  These  elements  are  not  requir- 
ed by  the  ruling  under  consideration. 

2.  It  is  Insisted,  even  if  the  deed  of  Neal 
might  have  been  avoided  as  between  the  orig- 
inal grantor  and  grantee,   that  this  right  of 


avoidance  ceases  when  the  title  has  passed 
into  the  hands  of  third  persons  in  good  faith, 
for  an  adequate  consideration,  and  ignorant 
of  any  facts  tending  to  impeach  such  title. 

It  is  apparent  that  the  protection  of  the 
insane  and  the  idiotic  will  be  materially  di- 
minished, If  the  heirs  cannot  follow  the  projicr- 
ty  conveyed,  but  are  limited  in  their  rigiit 
of  avoidance  to  the  Immediate  grantee  of  such 
Insane  or  idiotic  person. 

The  acts  of  lunatics  and  infants  are  treated 
as  analogous,  and  subject  to  the  same  rules. 
Key  V.  Davis,  1  Md.  32;  Hume  v.  Barton,  1 
Ridg.  PI.  77.  "The  grants  of  infants  and 
persons  non  compos  are  parallel  both  in  law 
and  reason."    Thompson  v.  Leach,  3  Mod.  310. 

The  law  is  well  settled  that  a  minor  when 
of  age  may  avoid  his  deed  given  when  an  in- 
fant. He  may  do  this  not  merely  against  his 
grantee,  but  he  may  follow  the  title  wherever 
it  may  be  found  and  recover  his  land.  "It 
may  be  objected,"  observes  Marshall,  J.,  in 
Myers  v.  Sanders'  heirs,  7  Dana,  524,  "that 
these  restrictions  upon  the  right  of  an  adult 
to  avoid  his  deed  obtained  by  fraud  are  incon- 
sistent with  the  principle  which  allows  an  in- 
fant to  avoid  his  deed,  into  whose  hands 
soever  the  bill  may  have  passed  and  without 
regard  to  time,  except  as  a  statutory  bar  run- 
ning after  he  becomes  of  age.  But,  waiving 
the  inquiry  how  far  the  mere  acquiescence 
of  an  infant  grantee  after  he  becomes  of  age 
may  determine  his  right  of  revoking  his  title 
from  the  hands  of  a  purchaser  for  value,  who 
has  acquired  it  after  such  acquiescence,  we 
think  the  analogy  between  the  cases  is  too 
slight  to  have  any  decisive  influence  upon  the 
present  question.  The  right  of  an  infant  to 
avoid  his  deed  is  an  absolute  uncontrollable 
privilege,  founded  upon  an  incapacity  con- 
clusively fixed  by  the  law  to  bind  himself  ab- 
solutely by  deed  or  to  pass  an  indefeasible 
title.  These  principles  are  irreversibly  fixed 
by  the  law,  and  it  enforces  them  without  in- 
quiring into  particular  circumstances,  and 
without  regard  to  consequences.  It  must  do 
so  in  order  to  maintain  them.  The  right  of 
an  adult  grantor,  to  avoid  his  deed  for  fraud, 
stands  upon  an  entirely  different  basis.  It 
grows  out  of  the  particular  circumstances;  it 
is  founded  in  a  regard  to  justice  between  man 
and  man;  it  is  given  as  a  remedy  for  the 
hardship  of  his  case.  In  its  very  foundation 
and  essence,  it  is  limited  by  the  justice  which 
is  due  to  others,  and  therefore  cannot  be  ex- 
ercised without  a  regard  to  their  rights  and 
\nterests." 

"But  again,  infancy  is  not,  like  fraud,  a 
circumstance  wholly  extraneous  from  the  ti- 
tle. The  deed  shows  who  the  grantee  is;  the 
purchaser  knows  tl.at  an  infant  grantee  can- 
not pass  an  indefeasible  title;  he  is  bound  to 
know  the  identity  of  the  person,  who  assumes 
to  convej-  the  title;  and  It  Is  not  an  unrea- 
sonable requisition  that  he  shall  know  wheth- 
er the  grantee,  under  whom  he  claims  title. 
Is  under  incapacity  or  not.  In  this  view  of 
the  subject,  no  purchaser  under  an  infant's 


324 


CAPACITY  OF  PARTIES. 


deed  is  innocent  In  the  eye  of  the  law,  until 
the  title  has  been  confirmed  by  the  matured 
consent  of  the  grantor."  In  Bool  v.  jMix,  17 
Wend.  119,  the  suit  was  against  one  claim- 
ing by  a  title  derived  from  the  grantee  of 
the  minor,  but  the  ground  was  not  taken 
that  in  consequence  thereof  the  tenant  had 
an  indefeasible  title.  The  principles  applica- 
ble to  deeds  voidable  for  the  Infancy  of  the 
grantor  are  equally  applicable  where  the  gran- 
tor is  insane.  When  a  man  is  defrauded,  he 
may,  as  against  his  grantee,  avoid  his  deed, 
but  not  against  those  deriving  in  good  faith 
and  for  an  adequate  consideration  a  title  from 
such  grantee.  He  has  the  ability  to  convey 
an  indefeasible  title,— and  he  does  convey 
such  title  to  all  bona  fide  purchasers  from  his 


grantee.  The  insane  man  has  not  the  power 
to  convey  such  indefeasible  title.  This  in- 
capacity inheres  in  all  titles  derived  from 
him.  The  grantee,  whose  title  is  thus  deriv- 
ed, must  rely  on  the  covenants  of  his  deed. 
He  risks  the  capacity  to  convey  of  all  through 
whom  his  title  has  passed.  The  right  of 
infants  and  of  the  insane  alike  to  avoid  their 
contracts  is  an  absolute  and  paramount  right, 
superior  to  all  equities  of  other  persons,  and 
may  be  exercised  against  bona  fide  purchasers 
from  the  grantee.    1  Am.  Lead.  Cas.  259. 

Exceptions   sustained.    The  case  to  stand 
for  triaL 

CUTTING,  WALTON,  DICKEESON.  DAN- 
FORTH  and  TAPLEY,  JJ.,  concurred. 


INSANE  PEKSONS  AND  IDIOTS. 


325 


MUTUAL  LIFE  INS.  CO.  t.  BDQNT. 

(79  N.  Y.  &41.) 

Court  of  Appeals  of  New  York.     1879. 

Robert  P.  Harlow,  for  appellanta.  Win- 
chester Britton,  lor  respondent. 

DANFORTH,  J.  The  action  is  for  the  fore- 
closure of  a  bond  and  mortgage,  dated  April 
23,  1S70,  and  then  executed  by  the  defendant 
Hunt  for  the  purpose  of  securinj,'  lu  the 
plaintiff  the  payment  of  $4,000  on  the  1st  of 
September,  1S71.  The  complaint  shows  that 
interest  was  paid  on  the  1st  of  March,  1871, 
but  default  made  in  September  following; 
that  in  December,  1871,  the  defendant  Hunt 
was  adjudged  a  lunatic,  and  Arnold  H.  Wag- 
ner appointed  committee  of  her  person  and 
estate.  He  was  made  co-defendant  with 
her;  and  in  her  behalf,  and  by  way  of  de- 
fense, alleges  "that  at  the  time  of  the  exe- 
cution of  the  bond  and  mortgage  she  was  a 
lunatic,  and  incapable  of  making  or  execut- 
ing them."  The  issue  thus  presented  was 
tried  before  a  careful  and  experienced  judge 
at  special  term  and  he  found  as  a  fact: 
"That  at  the  time  of  the  execution  and  de- 
livery of  the  bond  and  mortgage,  the  said 
Camilla  Hunt  was  of  sound  mind,  and  was 
capable  of  making  and  executing  said  bond 
and  mortgage,"  and  ordered  judgment  in  ac- 
cordance with  the  prayer  of  the  complaint. 
The  finding  is  well  warranted  by  the  evi- 
dence, and  upon  this  ground  alone  we  should 
be  required  to  affirm  the  judgment 

But  the  learned  court  at  general  term  went 
beyond  it  and  for  the  purposes  of  the  ap- 
peal assumed,  without  deciding  the  contrary 
of  the  finding  to  be  the  truth,  yet  held  that 
as  the  case  presented  a  contract  executed 
upon  a  valuable  consideration,  of  which  the 
lunatic  had  the  benefit,  made  by  the  plain- 
tiff "in  good  faith,  without  fraud  or  unfair- 
ness, without  knowledge  of  the  insanity,  and 
without  notice  or  information  calling  for  in- 
quiry," the  plaintiff  was  entitled  to  recover. 
The  correctness  of  this  conclusion  is  strenu- 
ously assailed  by  the  learned  counsel  for  the 
appellant,  but  both  upon  principle  and  au- 
thority we  think  it  must  be  sustained.  Up- 
Dn  principle  because  the  plaintiff's  money 
was  had  by  the  defendant,  appropriated  to 
her  use,  and  thus  tended  to  increase  the  oody 
of  her  estate,  and  although  in  some  cases  a 
man  ma.v  now,  notwithstanding  the  old  com- 


mon-law maxim  to  the  contrary  (Beverly's 
Case,  2  C3oke,  508,  pt  4,  123b),  "be  admitted 
to  stultify  himself"  yet  he  cannot  do  so  to 
the  prejudice  of  others,  for  he  would  thus 
make  his  own  misfortune  an  excuse  for 
fraud,  and  against  that  the  doctrine  of  the 
maxim  stands  unaffected  by  any  exception. 
1  Story,  Eq.  Jur.  §  22G.  In  this  case  the  loan 
was  made  in  the  ordinary  course  of  business; 
it  was  a  fair  and  reasonable  transaction;  the 
defendant  acted  for  herself,  but  with  the  aid 
of  an  attorney;  if  mental  unsoundness  ex- 
isted it  was  not  known  to  the  plaintiff,  and 
the  parties  cannot  now  be  put  in  statu  quo. 
The  defendant  was  therefore  properly  held  11 
able. 

Very  much  in  point  and  upon  circumstan- 
ces similar  to  those  above  stated  was  Mol- 
ton  V.  Camroux,  2  Welsh.  H.  &  G.  487;  af- 
firmed in  error,  4  Welsh.  H.  &  G.  17.  Con- 
cerning it  the  chancellor,  in  Elliott  v.  luce, 
7  De  Gex,  M.  &  G.  487,  says:  "The  principle 
of  that  case  was  very  sound,  viz.:  that  an 
executed  contract,  when  parties  have  been 
dealing  fairly  and  in  ignorance  of  the  lunacy, 
shall  not  afterward  be  set  aside;  that  was  a 
decision  of  necessity,  and  a  contrary  doc- 
trine would  render  all  ordinary  dealings  be- 
tween man  and  man  unsafe."  And  so  it 
has  been  held,  and  like  contracts  enforced 
upon  the  same  principle,  in  repeated  instan- 
ces, in  the  courts  of  this  and  other  states. 
Loomis  V.  Spencer,  2  Paige,  153;  Matter  of 
Beckwith,  3  Hun,  443;  Canfield  v.  Fairbanks. 
03  Barb.  401;  Banlv  v.  Moore,  78  Pa.  St  407; 
Wilder  V.  Weakley,  34  Ind.  181;  Matthiessen 
V.  McMahon,  38  N.  J.  Law,  536;  Behrens  v. 
McKenzie,  23  Iowa,  333.  These  cases  stand 
on  the  maxim,  "that  he  who  seeks  equity 
must  do  equity,"  and  it  is  applicable  to  the 
case  in  hand;  for  the  defendant  seeks  to 
deprive  the  plaintiff  of  its  remedies  to  en- 
force the  security  while  she  retains  the  ben- 
efit of  the  contract  This  is  so  plainly  in- 
equitable and  unjust  as  to  render  a  further 
discussion  unnecessaiy.  Nor  does  the  fact 
that  the  borrower  was  subsequently,  upon 
inquisition  taken,  declared  to  be  insane,  al- 
ter the  result.  Such  proceeding  has  no  ef- 
fect upon  a  contract  made  without  such  no- 
tice, and  on  the  faith  of  the  presumption  tliat 
the  person  contracted  with  was  of  compe- 
tent understanding. 

The  judgment  should  be  affirmed. 

All  concur. 

Judgment  affirmed. 


326 


b 


i^ 


SEAVER  V.   PHELPS.     ^^ 
(11  Pick.  304.) 
Supreme  Judicial    Court   of   Massachusetts. 


CAPACITY  OF  PARTIES 
3 


Hampden-     Sept.  Term,   1S31. 

Trover,  to  recover  the  value  of  a  promis- 
sory note,  pledged  by  the  plaintiff  to  the  de- 
fendant. The  suit  was  brought  on  the  ground 
that  the  plaintiff  was  in  a  state  of  insanity 
at  the  time  when  he  made  the  pledge.  At  the 
trial  in  the  common  pleas,  before  Williams, 
J.,  the  counsel  for  the  defendant  requested 
the  judge  to  instruct  the  jury,  that  although 
they  should  believe  the  plaintiff  was  insane 
and  incapable  of  vrndurstauding  at  the  time  of 
making  the  contract,  yet  that  if  tlie  defendant 
was  not  apprized  of  that  fact,  or  had  no  rea- 
son, from  the  conduct  of  the  plaintiff"  or  from 
any  other  source,  to  suspect  it,  and  did  not 
oven-each  or  impose  upon  the  plaintiff',  or 
practise  any  fraud  or  unfairness,  then  the 
contract  was  not  to  be  annulled.  But  the 
judge  held  this  not  to  be  law,  and  instructed 
the  jury  otherwise;  and  the  jurj'  returned  a 
verdict  for  the  plaintiff.  To  this  opinion  the 
defendant  excepted. 

Mr.  WUlard,  in  support  of  the  exceptions. 
G.  Bliss  and  G.  Ashmun,  opposed. 

WHLiDE,  J.,  delivered  the  opinion  of  the 
court.  The  general  doctrine  that  the  eon- 
tracts,  and  other  acts  in  pais,  of  idiots  and 
insane  persons,  are  not  binding  in  law  or 
equity,  is  not  denied.  Being  bereft  of  reason 
and  understanding,  they  are  considered  in- 
capable of  consenting  to  a  contract,  or  of  do- 
ing any  other  valid  act  And  although  their 
contracts  are  not  generally  absolutely  void, 
but  only  voidable,  the  law  takes  care  effectu- 
ally and  fully  to  protect  their  interests;  and 
will  allow  them  to  plead  their  disability  in 
avoidance  of  their  conveyances,  purchases  and 
contracts,  as  was  settled  in  Mitchell  v.  King- 
man, 5  Pick.  431.  And  such  is  probably  the 
law  in  England  at  the  present  day,  although 
the  doctrine  for  a  long  time  prevailed  there, 
that  no  one  should  be  allowed  to  plead  his 
own  incapacity  and  to  stultify  himself.  These 
principles  are  not  controverted  by  the  de- 
fendant's counsel;  but  they  maintain,  that 
if  the  plaintiff  was  of  unsound  mind  and  in- 
capable of  understanding,  at  the  time  he 
pledged  the  note  to  the  defendant,  yet  if  the 
defendant  was  not  apprized  of  that  fact,  or 
had  no  rea.son  to  suspect  it  from  the  plain- 
tiff's conduct,  or  from  any  other  source,  and 
did  not  overreach  him,  or  practise  any  fraud 
or  unfairness,  then  that  the  contract  of  bail- 
ment was  valid  and  binding,  and  could  not  be 
avoided  in  the  present  action.  And  they  re- 
quested the  court  of  common  pleas  so  to  in- 
struct the  jury.  That  court,  however,  were 
of  opinion  that  the  law  was  otherwise,  and 
we  all  concur  in  the  same  opinion.  K  It  had 
been  only  proved  that  the  plaintiff  was  a  per- 
son of  weak  understanding,  the  instructions 
requested  would  have  been  appropriate  and 
proper.    For  every  man  after  arriving  at  full 


age,  whether  wise  or  unwise,  If  he  be  compos 
mentis,  has  the  capacity  and  power  of  con- 
tracting and  disposing  of  his  property,  and 
his  contracts  and  conveyances  wUl  be  valid 
and  binding,  provided  no  undue  advantage 
be  taken  of  his  imbecility. 

It  is  sometimes  difficult  to  determine  what 
constitutes  insanitj%  and  to  distinguish  be- 
tween that  and  great  weakness  of  imder- 
standing.  The  boundary  between  them  may 
be  very  narrow,  and  in  fact  often  is,  although 
the  legal  consequences  and  provisions  attach- 
ed to  the  one  and  the  other  respectively  are 
widely  different. 

In  the  present  case  however  this  point  is 
settled  by  the  verdict,  and  no  question  is 
made  respecting  it.  We  are  to  consider  the 
plaintiff  as  in  a  state  of  insanity  at  the  time 
he  pledged  his  note  to  the  defendant;  and  this 
being  admitted,  we  think  it  cannot  avail  him, 
as  a  legal  defence,  to  show  that  he  was  ig- 
norant of  the  fact,  and  practised  no  imposi- 
tion. The  fairness  of  the  defendant's  condjjct 
cannot  silpply"The  plaintin  s  want  of  "capacity 
-—-The  dufghdant's  counsel  rely  principally  on 
a  distinction  between  contracts  executed,  and 
those  which  are  executory.  But  if  this  dis- 
tinction were  material,  we  do  not  perceive 
how  it  is  made  to  appear  that  the  contract 
of  bailment  is  an  executed  contract,  for  if  the 
note  was  pledged  to  secure  the  performance 
of  an  executory  contract,  and  was  part  of 
the  same  transaction,  it  would  rather  be  con- 
sidered an  executory  contract.  But  we  do 
not  consider  the  distinction  at  aU  material. 
It  is  well  settled  that  the  conveyances  of  a 
uon  compos  are  voidable,  and  may  be  avoid- 
ed by  the  writ  dum  fuit  non  compos  mentis, 
or  by  enti-y. 

The  case  of  Bagster  v.  Earl  of  Portsmouth, 
5  Barn.  &  C.  172.  but  more  fully  reported  in  7 
Dowl.  &  R.  614,  has  been  relied  on  as  coimte- 
nancing  the  distinction  contended  for,  and  to 
show  its  bearing  on  the  point  in  question; 
and  it  is  true  that  some  of  the  remarks  which 
fell  from  the  court  in  giving  their  opinion, 
may  be  thought  to  have  some  bearing  in  this 
respect.  But  the  point  decided,  and  the 
grotmds  of  the  decision,  not  only  fail  to  sup- 
port the  defence  in  this  action,  but  may  be 
considered  as  an  authority  in  favor  of  the 
plaintiff.  That  was  an  action  of  assumpsit 
for  the  use  of  certain  carriages  hired  by  the 
defendant  he  being  at  the  time  of  unsound 
mind,  and  judgment  was  rendered  for  the 
plaintiff,  on  the  ground  that  no  imposition 
had  been  practised  on  his  part;  and  particu- 
larly because  the  carriages  furnished  appear- 
ed to  be  suitable  to  the  condition  and  degree 
of  the  defendant  considering  the  contracts 
of  a  non  compos  on  the  same  footing  as  those 
of  an  infant;  and  the  court  say  in  Thompson 
V.  Leach,  3  Mod.  310,  "that  the  grants  of  In- 
fants, and  of  persons  non  compos,  are  par- 
allel both  In  law  and  reason."  Now  no  one 
would,  we  apprehend,  undertake  to  maintain 
that  the  plaintiff  would  have  been  bound,  if 
he  had  been  a  minor  when   he  pledged   the 


INSANE  PEliSONS  AND  IDIOTS. 


327 


note.  It  does  not  appear  to  have  been  pledged 
for  necessaries;  and  all  contracts  of  infants 
are  either  void  or  voidable,  unless  made  for 
education  or  necessaries  suitable  to  their 
degree  and  condition.  And  even  If  the  note 
had  been  pledged  as  security  for  the  payment 
of  necessaries,  it  would  not  have  been  bind- 
ing if  the  plaintiff  had  been  an  infant  For 
a  pledge  is  in  the  nature  of  a  penalty,  and 
may  be  forfeited,  and  can  be  of  no  advantage 
to  the  infant,  and  therefore  shall  not  bind 
him. 

If  then  idiots  and  Insane  persons  are  lia- 
ble on  their  contracts  for  necessaries,  they 
are  certainly  entitled  to  as  much  protection 
as  infants.  It  matters  not,  however,  how 
this  may  be,  since  the  contract  in  question 
is  not  one  for  necessaries. 

In  the  case  of  Browne  v.  Joddrell,  1  Moody 
&  M.  105,  Lord  Tenterden  expressed  an 
opinion,  that  in  assumpsit  for  goods  sold  and 
delivered  and  for  work  and  labor,  it  would  be 
no  defence  that  the  defendant  was  of  un- 
bound mind,  unless  the  plaintiff  knew  of,  or 
In  any  way  took  advantage  of  his  Incapacity, 


to  Impose  on  him.  This,  however,  was  an 
opinion  expressed  at  nisi  prius,  and  whether 
the  opinion  was  followed  up  to  the  final  de- 
cision of  the  cause  or  not,  does  not  appear. 
But  however  this  may  be,  the  opinion  is 
founded  on  the  old  rule,  somewhat  qualified, 
that  no  one  can  be  allowed  to  plead  his  own 
disability  or  incapacity,  in  avoidance  of  his 
contracts.  This  rule  having  been  wholly  ex- 
ploded in  this  commonwealth.  Lord  Tenter- 
don's  opinion  can  have  no  weight  here,  un- 
less some  good  reason  could  be  shown  for 
overruling  the  case  of  Mitchell  v.  Kingman; 
which  we  think  cannot  be  done. 

We  are  aware  that  insanity  is  sometimes 
hard  to  detect,  and  that  persons  dealing  with 
the  insane  may  be  subjected  to  loss  and  dif- 
ficulty; but  so  they  may  be  by  dealing  with 
minors.  The  danger,  however,  cannot  be 
great,  and  seems  to  furnish  no  sufficient  cause 
for  modifj-ing  the  rules  of  law  in  relation  to 
Insane  people,  if  we  had  any  power  and  au- 
thority so  to  do;   which  we  have  not. 

Judgment  of  com*t  of  common  pleas  afflrm< 
ed. 


il 


:r 


CAPACITY  OF  PARTIES. 


SAWYER  V.  LUFKIN. 

(56  Me.  308.) 

Supreme  Judicial  Court  of  Maine, 
1868. 


Hancock. 


The  following  is  the  official  report: 

Assumpsit  on  an  account  annexed,  for  "la- 
bor in  taking  care"  of  the  defendant  "144 
weeks,  to  March,  1859,  at  $1.50  per  week," 
with  certain  credits. 

On  the  part  of  the  plaintiff  it  appeared  that 
the  defendant  was  insane,  and  entirely  in- 
capable of  taking  care  of  herself;  that  her 
family  consisted  of  herself  and  two  minor 
sons;  that  in  May,  1856,  at  the  request  of 
one  of  the  sons,  who  was  then  about  eighteen 
years  of  age,  the  plaintiff  went  to  the  defend- 
ant's house,  and  nursed  and  took  care  of  her; 
that  she  found  her  in  a  very  filthy  condition 
as  to  clothing,  etc.;  that  the  defendant  was 
violent  at  times,  and  needed  much  care;  that 
the  guardian  came  to  the  defendant's  house 
but  two  or  three  times  during  the  whole  time 
the  plaintiff  was  there,  and  exercised  no  con- 
trol and  furnished  nothing;  that  the  plaintiff 
continued  there  during  the  time  mentioned  In 
the  writ;  and  that  the  defendant's  sons  were 
absent  most  of  the  time. 

Thomas  S.  Puller  appeared  as  guardian  of 
the  defendant,  duly  appointed  prior  to  the 
time  the  plaintiff's  services  were  rendered, 
established  his  guardianship,  contested  the 
plaintiff's  claim,  and  offered  testimony  tend- 
ing to  prove  thrit  the  guardian  contracted  with 
the  defendant's  sons  to  take  care  of  and  sup- 
port their  mother,  that  in  consideration  there- 
of they  were  tc  be  paid  out  of  her  property, 
and  that  the  items  of  credit  were  received 
from  the  sons.  If  the  action  was  maintain- 
able, the  action  was  to  stand  for  trla'. 

Mr.  Eaiowles,  for  platntifu 

C.  J.  Abbott,  for  defendant 

There  Is  no  conflict  between  sections  7  and 
22,  c.  67,  Rev.  St.,  the  former  includes  those 
under  as  well  as  those  over  twenty-one  years 
of  age. 

They  have  different  objects;  the  former 
renders  void  all  contracts  and  transfers  of 


property  made  during  the  pendency  of  an  ap- 
plication for  the  appointment  of  a  guardian; 
the  other  declares  all  contracts  and-  transfers 
of  property  made  by  persons  over  twenty -one 
years  of  age  and  under  guardianship  to  be 
imqualifi&dly  and  absolutely  void,  notwith- 
standing the  death,  resignation,  or  removal 
of  the  guardian. 

APPLETON,  C.  J.  This,  is  an  action  for 
necessaries  furnished  the  defendant,  an  in- 
sane person,  over  twenty-one  years  of  age, 
and  under  guardianship.  The  guardian  ap- 
pears and  contests  the  plaintiff's  claim, 

K  necessaries  are  furnished  a  person  in  this 
condition  in  good  faith  and  under  circum- 
stances justifying  their  being  so  furnished, 
the  person  furnishing  may  recover.  If  the 
law  were  not  so,  the  insane  might  perish,  if 
a  guardian,  having  means,  should  neglect  or 
refuse  to  furnish  the  supplies  needed  for  their 
support  They  stand  in  the  same  position  as 
minors,  and  are  liable  for  necessaries.  Seaver 
V.  Phelps,  11  Pick.  304;  Leach  v.  Marsh,  47 
Me.  548.  Such  is  the  rule  of  the  common 
law. 

Nor  is  this  limited  liability  changed  by  Rev. 
St.  1857,  c.  67,  §  22,  which  provides  that 
"when  a  person  over  twenty  years  of  age  is 
under  guardianship,  he  shall  be  deemed  in- 
capable of  disposing  of  his  property  other- 
wise than  by  his  last  will,  or  of  making  any 
contract,  notwithstanding  the  death,  resigna- 
tion or  removal  of  the  guardian,"  etc.  This 
prohibits  all  express  contracts  by  the  insane. 
They  cannot  be  liable  on  any  express  prom- 
ise. But  their  estate  may  be  held  when 
the  law  implies  one.  The  insane  must  not 
be  allowed  to  starve,  though  the  guardian  is 
dead,  has  resigned  or  been  removed.  The  es- 
tate of  the  insane  is  legally,  as  well  as  eq- 
uitably, liable  for  necessaries  furnished  in 
good  faith,  and  under  circumstances  justify- 
ing their  being  so  furnished.  McCrillis  v. 
Bartiett,  8  N.  H.  569;  1  Pars.  Cont.  313  et 
seq.     The  case  to  stand  for  trial. 

KENT,  WALTON,  BARROWS,  and  DAN- 
FORTH,  JJ.,  concurred- 


DRUNKEN  PEKSOXS. 


329 


^^ 


BARRETT  v.  BUXTON,      l^i 
(2  Aik.   167.) 


Supreme  Court  of  Vermont. 
Jan.,  182G. 


Rutland. 


Assumpsit,  on  a  promissory  note,  for  the  sum 
of  one  thousand  dollars  aud  the  interest.  Plea, 
the  general  issue. 

The  case  was,  the  plaintiff  and  defendant 
had  entered  into  a  written  contract  for  an  ex- 
change of  certain  real  estate,  and  the  note  was 
given  on  that  occasion,  by  the  defendant  to  the 
plaintiff,  for  the  diJIcreuce  money  agreed  to  be 
paid,  between  the  two  parcels  of  real  estate. 
The  plaintiff  afterwards  executed  a  deed  on 
his  part,  according  to  the  contract,  and  tend- 
ered it  to  the  defendant.  The  defendant  re- 
fused to  accept  the  deed,  or  pay  the  note. 

These  facts  being  proved  on  the  trial  of  the 
issue,  the  defendant  olTered  testimon}-  tending 
to  prove,  that  at  the  time  of  e.xeciitiug  the  said 
contract  and  note,  and  of  making  the  bargain 
therein  specitied,  he  was  drunk,  and  thereby 
incapacitated  to  judge  of  the  nature  or  conse- 
quences of  said  bargain.  But  the  plaintiff  ob- 
jecting, the  court  refused  to  admit  said  testi- 
mony, unless  the  same  could  be  accompanied 
with  testimony,  tending  to  prove  that  the  said 
drunkenness  was  procured  by  or  at  the  instiga- 
tion of  the  plaintiff.  To  which  decision  the 
defendant  excepted. 

The  defendant  also  offered  testimony  tend- 
ing to  prove,  that  the  farm  which  he  had 
agreed  to  convey  to  the  plaintiff,  at  the  time  of 
giving  said  note,  was  actually  worth  as  much, 
or  more  than  the  premises  which  the  plaintiff 
had  agreed  to  convey  to  the  defendant  in  ex- 
change This  testimony,  being  objected  to,  the 
court  refused  to  receive;  and  to  this  decision 
also,  the  defendant  excepted. 

A  verdict  was  returned  for  the  plaintiff;  and 
the  defendant  now  moved  that  the  same  be  set 
aside,  and  for  a  new  trial,  for  the  reasons  ap- 
parent in  the  exceptions  aforesaid. 

The  counsel  for  the  defendant,  in  support  of 

the  motion,  relied  on  a  recent  decision  of 

*l(j8    this  court  in  Addison  countv.    They*also 

cited  1  Chitty's  PI.  470,  479.-3  Campb. 

33,  Pitt  vs.  Smith.— Bull.  N.  P.  172. 

For  the  plaintiff',  it  was  contended,  that 
drunkenness  will  not  relieve  a  man,  for  it  is  a 
great  offence  and  aggravates  the  act  done,  and 
is  no  excuse  for  him.  unless  it  was  procured  by 
the  contrivance  or  managonicnt  of  the  man  who 
received  the  deed,  or  made  the  contract  with 
him. 

To  avoid  any  contract  made,  or  deed  given 
by  the  party  wlieu  drunk,  would  be  taking  ad- 
vantage of  his  own  wrong;  which  no  man  ia 
permitted  to  do. — 2  Co.  Kcp.  5(58,  Beverley's 
case. — 1  Mad.  Chancerj',  2;{8. — 1  Fonblanque  60. 
.—3  Campb.  Rep.  35.-4  Mass.  ICl,  Churchhill 
vs.  Suter. 

Chauncey  Langdon  and  Chs.  K.  "Williams, 
for  plain  till. 

Wm.  Page  and  R.  B.  Bates,  for  defendant. 

Tlie  opinion  of  the  Court  was  pronounced  by 

PRENTISS,  J.  This  is  an  action  upon  a  prom- 
issory note,  executed  by  the  defendant  to  the 
plaintiff  for  the  sum  of  !?I000,  being  the  differ- 
ence agreed  to  be  paid  the  plaintiff  on  a  con- 
tract for  the  exchange  of  lands.  The  agree- 
ment of  exchange  was  in  writing,  and  the  plain- 
tiff afterwards  tendered  to  the  defendant  a 
deed,  in  performance  of  his  part  of  the  agree- 
ment, which  the  defendant  refused.  The  de- 
fendant offered  evidence  to  prove,  that  at  the 
time  of  executing  the  note  and  agreement,  he 


was  intoxicated,  and  thereby  incapable  of  judg- 
ing of  the  nature  and  consequences  of  the  bar- 
gain. The  court  refused  to  admit  the  evidence, 
without  proof  that  the  intoxication  was  pro- 
cured by  the  plaintiff.  The  question  is,  whether 
the  evidence  was  admissible  as  a  defence  to  the 
action,  or,  in  other  words,  whether  the  defend- 
ant could  be  allowed  to  set  up  his  intoxication 
to  avoid  the  contract. 

This  question  has  been  already  substantially 
decided  b\'  the  court  on  the  present  circuit; 
but  the  importance  of  the  question,  and  the 
magnitude  of  the  demand  in  this  case,  have  led 
us  to  give  it  further  consideration.  According 
to  Beverley's  case,  4  Co.  123,  a  party  cannot  set 
up  intoxication  in  avoidance  of  his  contract 
under  any  circumstances.  Although  Lord  Coke 
admits,  that  a  drunkard,  for  the  time  of  his 
drunkenness,  is  Twn  c<mipo8  nuuiu,  yet  he  says, 
"his  drunkenness  shall  not  extenuate  his  act  or 
offence,  but  doth  aggravate  his  offence,  and 
doth  not  derogate  from  his  act,  as  well  touch- 
ing his  life,  lands,  and  goods,  as  any  thing  that 
concerns  him."  lie  makes  no  distinction  be- 
tween criminal  and  civil  cases,  nor  intimates 
an}'  qualilication  of  his  doctrine,  on  the  ground 
of  the  drunkenness  being  procured  b}'  the  con- 
trivance of  another  wlio  would  profit  b}'  it. 
Ilis  doctrine  is  general,  and  without  any  quali- 
fication whatever;  and  connected  with  it,  he 
holds,  that  a  party  shall  not  be  allowed  to  stul- 
tify himself,  or  disable  himself,  on  the  ground 
of  idiocy  or  lunacy.  The  latter  proposition  is 
supported,  it  is  true,  by  twu  or  three  cases  in 
the  year  books,  during  the  reigns  of  Edward  3 
and  llenry  G;  by  Littleton,  s.  405,  who  lived  in 
the  time  of  Hen.  6;  and  by  Stroud  vs.  Marshall, 
Cro.  Eliz.  398,  and  Cross  vs.  Andrews,  Cro. 
Eliz.  622.  Sir  William  Blackstone,  how- 
ever, *who  traces  the  progress  of  this  no-  *169 
tion,  as  he  calls  it,  considers  it  contrary 
to  reason,  and  shows  that  such  was  not  the 
ancient  common  law.  The  Register,  it  appears, 
contains  a  writ  for  the  alienor  himself,  to  re- 
cover lands  aliened  b}-  him  during  his  insanity; 
and  Britton  states,  that  insanit}'  is  a  sufficient 
plea  for  a  man  to  avoid  his  own  bond.  Fitz- 
nerbert  also  contends,  "that  it  stands  with  rea- 
son that  a  man  should  show  how  he  was  visited 
by  the  act  of  God  with  infirmity,  by  which  he 
lost  his  memory  and  discretion  for  a  time." 
Blackstone  considers  the  rule  as  having  been 
handed  down  from  the  loose  cases  in  the  times 
of  Edw.  3,  and  lien.  G,  founded  upon  the  ab- 
surd reasoning,  that  a  man  cannot  know,  in  his 
sanity,  what  he  did  when  he  was  n-on  compos 
inenlis;  and  he  says,  later  opinions,  feeling  the 
inconvenience  of  the  rule,  have,  in  many 
points,  endeavoured  to  restrain  it.  (2  Blac.  Com. 
29L)  In  Thompson  vs.  Leach.  3  Mod.  301,  it 
was  held,  that  the  deed  of  a  man  non  c</mpos 
mentis,  was  not  merei^v  voidable,  but  was  void 
ab  initio,  for  want  of  capacity  to  bind  himself 
or  his  property.  In  Yates  vs.  Boeu,  2  Stra. 
1104,  the  defendant  pleaded  non  eM  factum  to 
debt  on  articles,  and  upon  the  trial,  offered  to 
give  lunacy  in  evidence.  The  chief  justice  at 
first  thought  it  ought  not  to  be  admitted,  upon 
the  rule  in  Beverley's  case,  that  a  man  shall  not 
stultify  himself;  but  on  the  authority  of  l^mith 
vs.  Can,  in  1728.  where  Chief  Baron  Penirelley, 
in  alike  case  admitted  it;  and  on  considering  the 
case  of  Thompson  vs.  Leach,  the  chief  justice 
suffered  it  to  be  given  in  evidence,  and  the 
plaintiff  became  nonsuit.  Themost  approved 
elementary  writers  and  compilers  of  the  law  re- 
fer to  this  case,  and  lay  it  down  as  settled  law, 
that  lunac}'  may  be  given  in  evidence,  on  the 
plea  of  lio'n  esi'faclum.  by  the  party  himself; 
and  it  is  said  to  have  been  so  ruled  by  Lord 


330 


CAPACITY  OF  PAllTIES. 


Mansfield,  in  Chamberlain  of  London  vs.  Ev- 
ans, mentioned  in  note  to  1  Chit.  PI.  470.  In 
this  countr}',  it  has  been  decided  in  several  in- 
stances, that  a  party  may  take  advantage  of  his 
own  disability,  and  avoid  his  contract,  by  show- 
ing that  he  was  insane  and  incapable  of  con- 
tracting. (Rice  vs.  Peet,  15  Johns.  Kep.  503. — 
Webster  vs.  Woodford.  3  Day's  Hep.  90.)  These 
decisions  are  founded  in  the  law  of  nature  and 
of  justice,  and  go  upon  the  plain  and  true 
ground,  that  the  contract  of  a  party  non  compos 
i/untis  is  absolutely  void,  and  not  binding  upon 
him.  The  rule  in  Beverlej's  case,  as  to  lunacy, 
therefore,  is  not  only  opposed  to  the  ancient 
common  law,  and  numerous  authorities  of 
great  weight,  but  to  the  principles  of  natural 
right  and  justice,  and  cannot  be  recognized  as 
law;  and  it  is  apprehended,  that  the  case  is  aa 
little  to  be  regarded,  as  authority  in  respect 
to  intoxication,  which  rests  essentially  upon 
the  same  principle. 

It  is  laid  down  in  Buller's  N.  P.  172,  and  ap- 
pears to  have  been  decided  bj^  Lord  Holt,  in 
Cole  vs.  Kobins,  there  cited,  that  the  defend- 
ant ma\^  give  in  evidence  under  the  plea  of  7t.on 
estfac:ura  to  a  bond,  that  he  was  made  to  sign 
it  when  he  was  so  drunk  that  he  did  not  know 
what  he  did.     And  in  Pitt  vs.  Smith,  3  Campb. 

Cas.  33,  where  an  objection  was  made  to 
*170    an  attesting*witness  being  asked  whether 

the  defendant  was  not  in  a  complete  state 
of  intoxication  when  he  executed  the  agree- 
ment, Lord  Ellenborough  says,  "you  have  al- 
leged that  there  was  an  agreement  between  the 
parties:  but  there  was  no  agreement,  if  the  de- 
fendant was  intoxicated  in  the  manner  sup- 
posed. He  had  not  an  agreeing  mind.  Intox- 
ication is  good  evidence  upon  a  plea  of  non  est 
factum  to  a  deed,  of  non  concessit  to  a  grant,  and 
of  non  assumpsit  to  a  promise."  Chitty,  Sel- 
wyn.  and  Phillips  lay  down  the  same  doctrine 
and  Judge  Swift  in  his  digest  saj'S,  that  an  agree- 
ment, signed  b3'  a  man  in  a  complete  state  of 
intoxication,  is  void.  (1  Chit.  PI.  470. — Selw. 
N.  P. 5(33.— 1  Phil.  Ev.  128.— 1  Swift's  Dig.  173.) 
In  these  various  authorities,  it  is  laid  down 
generally,  and  without  any  qualification,  that 
drunkenness  is  a  defence,  and  no  intimation  is 
made  of  any  distinction,  founded  on  the  intox- 
ication being  procured  by  the  party  claiming 
the  benefit  of  the  contract.  It  is  true,  that  in 
Johnson  vs.  ^Nledlicott,  3  P.  Wms.  130,  that  cir- 
cumstance was  considered  essential  to  entitle 
the  party  to  relief  in  equity  against  his  con- 
tract. Sir  Joseph  Jekyl  held,  that  the  having 
been  in  drink  was  not  any  reason  to  relieve  a 
man  against  his  deed  or  agreement,  unless  the 
party  was  drawn  into  drink  by  the  manage- 
ment or  contrivance  of  him  who  gained  the 
deed.  But  from  what  is  said  in  1  Fonb.  Eq.  68, 
it  woiiJld_jTnt^  HPP.iTi  t^iat  the  author  considered 
(Efs  circiiiristf'"'''^  as  jndiRpenstiblft.  He  says, 
equfly  will  relieve,  especiallyuT.he  drunken- 
ness were  caused  by  the  fraud  or  contrivance 
of  the  other  party,  and  he  is  so  excessively 
drunk,  that  he  is  utterly  deprived  of  the  use  of 
his  reason  or  understanding;  for  it  can  by  no 
means  be  a  serious  and  deliberate  consent;  and 
without  this,  no  contract  can  be  binding  by  the 
law  of  nature.  In  Spiers  vs.  Higgins.  decided 
at  the  Rolls  in  1814,  and  cited  in  1  Mad.  Ch. 
304,  a  bill  filed  for  a  specifick  performance  of 
an  agreement,  which  was  entered  into  with  the 
defendant  when  drunk,  was  dismissed  with 
costs,  although  the  plaintiff  did  not  contribute 
to  make  the  defendant  drunk. 

On  principle,  it  would  seem  impossible  to 
maintain,  that  a  contract  entered  into  by  a  party 
when  in  a  state  of  complete  intoxication,  and 
deprived  of  the  use  of  his  reason,  is  binding 


upon  him,  whether  he  was  drawn  into  that  sit- 
uation by  the  contrivance  of  the  other  party  or 
not.  It  is  an  elementary  principle  of  law,  that 
it  is  of  tbe_essence  of  everj' .contract,  thafth©" 
paiT}"  lo  beTjouucTstroTrtd^  consent  to  whatever 
Is  stipTitgtgdT  otherwise  jid  obligation  is  im- 
posed uponT[rrn:  If  he  has  hot  the  command 
of-insTEITson,  he  has  n^TTThe  power" to  give'his 
assent,  and  is  Incnpabre  of  entering  into  a  con- 
tract to  blTid  "himself.  Accordingly  Pothier 
holds,  "(voir  1,  c.  r,  u.  4,  s.  1.)  that  ebriety,  whea 
it  is  such  as  to  take  away  the  use  of  reason, 
renders  the  person  who  is  in  that  condition, 
while  it  continues,  unable  to  contract,  since  it 
renders  him  incapable  of  assent.  And  it  seems 
Heineccius  and  Pullendorf  both  consider  con- 
tracts entered  into  under  such  circumstances, 
as  invalid.  By  the  Scotch  law,  also,  an  obliga- 
tion granted  by  a  person  while  he  is  in  a 
state  of  abso*lute  and  total  drunkenness,  *171 
is  ineffectual,  because  the  grantor  is  in- 
capable of  con  sent;  but  a  lesser  degree  of  drunk- 
enness, which  only  darkens  reason,  is  not  suffi- 
cient. (Ersk.  Inst.  447.)  The  author  of  the  late 
excellent  treatise  on  the  principles  and  practice 
of  the  court  of  chancery,  after  reviewing  the 
various  cases  in  equity  on  the  subject,  and  cit- 
ing the  Scotch  law  with  approbation,  observes, 
"the  distinction  thus  taken  seems  reasonable; 
for  it  never  can  be  said  that  a  person  absolutely 
drunk,  has  that  freedom  of  mind,  generally  es- 
teemed necessary  to  a  deliberate  consent  to  a 
contract;  the  reasoning  faculty  is  for  a  time  de- 
posed. At  law  it  has  been  held,  that  upon  non 
est  factum  the  defendant  may  give  in  evidence, 
that  they  made  him  sign  the  bond  when  he  was 
so  drunk  that  he  did  not  know  what  he  did. 
So  a  will  made  by  a  drunken  man  is  invalid. 
And  will  a  court  of  equity  be  less  indulgent  to 
human  frailty?  It  seems  to  be  a  fraud  to  make 
a  contract  with  a  man  who  is  so  drunk  as  to 
be  incapable  of  deliberation.  "  (1  Mad.  Ch.  302.) 
Mr.  Maddock  seems  to  consider  it  as  settled, 
that  at  law,  complete  intoxication  is  a  defence, 
and  that  it  ought  to  be  a  sufiicieut  ground  for 
relief  in  equity;  and.  indeed,  it  would  seem  dif- 
ficult to  come  to  a  different  conclu.sion.  As  it 
respects  crimes  and  torts,  sound  policy  forbids 
that  intoxication  should  be  an  excuse;  for  if  it 
were,  under  actual  or  feigned  intoxication,  the 
most  atrocious  crimes  and  injuries  might  be 
committed  with  impunity.  But  in  questions  of 
mere  civil  concern,  arising  ex  contractu,  and  af- 
fecting the  rights  of  property  merely,  policy 
does  not  require  that  any  one  should  derive  an 
unjust  profit  from  a  bargain  made  with  a  per- 
son in  a  state  of  intoxication,  although  brought 
upon  himself  by  his  own  fault,  or  that  he  should 
be  a  prey  to  the  arts  and  circumvention  of 
others,  and  be  ruined,  or  even  embarrassed,  by 
a  bargain,  when  thus  deprived  of  his  reason. 
It  is  a  violation  of  moral  duty,  to  take  advan- 
tage of  a  man  in  that  defenceless  situation,  and  , 
draw  him  into  a  contract;  and  if  the  intoxica- 
tion is  such  as  to  deprive  him  of  the  use  of  his 
reason,  it_£annot  Ije  very  materiiU-.-Bdicthe£^it. 

was  prociiTfifl  hyJ^nj^f  h p.r  pnrty   cxv  Wtta_pUPely 

The  former  circumstance  would 
the  transaction  with  deeper  turpi- 
tude, and  make  it  a  more  aggravated  fraud. 
The  evidence  which  was  offered  and  rejected 
at  the  trial  in  the  case  before  us,  went  not  only 
to  show  that  the  defendant  was  so  intoxicated 
at  the  time  of  giving  the  note,  as  to  be  incapa- 
ble of  the  exercise  of  his  understanding,  but 
that  the  contract  was  grossly  unequal  and  un- 
reasonable; and,  both  on  principle  and  author- 
ity, we  think  the  evidence  was  admissible,  and 
that  a  new  trial  must  be  granted. 
New  trial  granted. 


MARRIED  WOMEN. 


331 


[ARTIN   V.   DWELLY   et   aLi 

(6  Wend.  9.) 

Court  for  the  Correction  of  Errors  of  New 
York.      Dec,  1830. 

J.  Crary,  for  appellant.  S.  Stevens  and  D. 
Russell,  for  respondents. 

SUTHERLAND,  J.  The  general  question 
presented  by  this  case  is,  whether  a  deed  of 
a  feme  covert,  not  executed  and  acknowledg- 
ed according  to  the  provisions  of  the  statute 
(1  R.  L.  309),  and  therefore  void  and  inopera- 
tive at  law,  is  to  be  considered  and  treated 
in  a  court  of  equity  as  a  valid  agreement  to 
convey,  the  specific  performance  of  which  will 
l>e  decreed  as  against  the  feme  covert  or 
her  hoirs. 

By  the  common  law  a  feme  covert  could 
not  by  uniting  with  her  husband  in  any  deed 
or  conveyance,  bar  herself  or  her  heirs  of 
any  estate  of  which  she  was  seised  in  her  own 
right,  or  of  li^r  right  of  dower  in  the  real  es- 
tate of  her  husband.  This  disability  Is  sup- 
posed to  be  founded  in  the  principle  that  the 
separate  legal  existence  of  the  wife  is  sus- 
[)onded  during  the  marriage,  and  is  strength- 
ened by  the  consideration  that  from  the 
nature  of  the  connection,  there  is  danger  that 
the  influence  of  the  husband  may  be  im- 
properly exerted,  for  the  purpose  of  forcing 
the  wife  to  part  with  her  rights  In  his  favor. 
The  law  therefore  considers  any  such  deed 
or  conveyance  as  the  act  of  the  husband  only, 
although  the  wife  may  have  united  In  it,  and 
restrained  its  operation  to  the  husband's  in- 
terest in  the  premises,  and  gives  to  it  the 
same  effect  as  though  he  alone  had  executed 
the  conveyance. 

The  only  mode  in  which  a  feme  covert  could 
at  common  law  convey  her  real  estate,  was  by 
uniting  with  her  husband  In  levying  a  fine.  This 
Is  a  solemn  proceeding  of  record.  In  the  face 
of  the  court,  and  the  judges  are  supposed  to 
watch  over  and  protect  the  rights  of  the  wife, 
and  to  ascertain  by  a  private  examination 
that  her  participation  in  the  act  Is  voluntary 
and  unconstrained.  This  is  the  principle  up- 
on which  the  efficacy  of  a  fine  is  put  by  most 
of  the  authorities.  3  Cruise,  Dig.  153,  tit 
35,  c.  10;  2  Inst.  515;  1  Vent.  121a.  But 
whatever  may  be  the  foundation  of  the  doc- 
trine, it  is  now  fully  established. 

Our  statute  declares  that  no  estate  of  a 
feme  covert  residing  in  this  state  shall  pass 
by  her  deed,  without  a  previous  aclvnowledg- 
raent  made  by  her  before  a  proper  officer 
apart  from  her  husband,  that  she  executed 
such  deed  freely  without  fear  or  compulsion 
of  her  husband.  1  R.  L.  3G9.  This  provision, 
it  will  be  observed.  Is  an  enlargement  and 
not  a  restraint  of  the  common  law  powers 
of  a  feme  covert     It  authorizes  a  less  formal 

1  Irrelevant  parts  omitted. 


mode  of  conveyance  than  was  known  to  the 
common  law.  It  gives  to  her  deed,  when 
duly  aclcnowledged,  the  same  power  and  ef- 
fect as  a  fine;  but  if  not  acknowledged  ac- 
cording to  the  directions  of  the  statute,  it  de- 
clares that  no  estate  shall  pass  by  it.  It 
loaves  It  as  It  would  have  stood  at  the  com- 
mon law,  if  the  statute  had  never  been  pas.**- 
cd,  absolutely  void  and  inoperative. 

It  was  conceded  that  such  must  be  the  con- 
sequence at  law;  but  it  was  contonded  that 
a  court  of  equity  would  consider  it  as  an 
agreement  to  convey,  and  if  it  was  shown  to 
have  been  voluntarily  made  for  a  valuable 
consideration,  would  compel  the  wife  or  her 
heirs  specifically  to  perform  It.  This  doctrine 
appears  to  me  to  be  unsound  in  principle  and 
unsupported  by  any  color  of  authority.  A 
feme  covert,  by  the  principles  of  the  common 
law,  is  not  only  incapable  of  conveying  her 
real  estate  by  deed,  but  she  cannot,  as  a  gen- 
oral  rule  make  a  valid  contract  of  any  de- 
scription Ln  relation  either  to  real  or  personal 
property.  This  disability  results  from  the 
nature  of  the  matrimonial  connection.  In 
contemplation  of  law,  the  wife  is  hardly  con- 
sidered as  having  a  separate  legal  existence. 
She  and  her  husband  constitute  but  one  per- 
.son.  She  cannot  bind  either  her  husband  or 
herself  by  any  contract.  She  may  execute  a 
naked  power,  and  as  to  her  separate  estate, 
that  is,  such  estate,  either  real  or  personal, 
as  is  settled  on  her  for  her  separate  use,  with- 
out any  control  over  it  on  the  part  of  her 
husband,  a  court  of  chancery  for  certain  pur- 
poses will  consider  her  a  feme  sole,  and  her 
contracts  in  relation  to  It  may  be  binding 
(5  Day,  496;  2  Kent,  Comm.  137-141;  1 
Johns.  Gas.  450;  3  Johns.  77;  17  Johns.  548); 
but  her  own  lands,  or  her  right  of  dower  In 
the  lands  of  her  husband  are  not  her  separate 
estate,  within  the  meaning  of  this  rule.  It 
certainly  will  not  be  contended  that  the  con- 
veyance in  this  case  can  have  any  greater 
effect  than  an  express  covenant  on  the  part 
of  the  hu.sl)and  and  wife  to  convey;  and  I 
apprehend  that  an  examination  of  the  cas<">3 
will  show  that  such  a  covenant  made  during 
coverture  would  be  absolutely  void  against  the 
wife  and  her  heirs,  both  at  law  and  in  equity. 
The  greatest  extent  to  which  the  English 
courts  liave  ever  gone,  is  to  hold  that  an  ac- 
tion would  lie  against  a  wife  after  the  death 
of  her  husband,  upon  a  covenant  of  war- 
ranty contained  in  a  fine,  executed  by  her  and 
her  husband,  though  she  was  a  feme  covert 
when  it  was  levied.  This  was  held  in  the 
case  of  Wotton  v.  Helo,  2  Saimd.  178,  and  1 
Mod.  290.  It  was  also  held  in  some  of  the 
earlier  cases,  that  if  baron  and  feme  joined 
in  a  lease  for  years  by  indenture  of  the  wife':? 
land,  and  she  accepted  rent  after  his  death, 
she  was  liable  to  the  covenants  in  the  lease. 
Greenwood  v.  Tyber,  Cro.  Jac.  563,  564;  2 
Saund.  ISO,  note  9.  The  acceptance  of  the 
rent  is  a  confirmation  of  the  lease,  and  may 
be  considered  equivalent  to  a  new  execution 


332 


CAPACITY  or  PARTIES. 


and  delivery,  though  the  wife  was  at  liberty, 
after  her  husband's  death,  to  avoid  or  affirm 
It  if  she  had  chosen. 

The  doctrine  that  a  wife  is  bound  by  her 
covenant  of  warranty,  entered  into  during 
coverture,  is  considered  by  Chancellor  Kent 
(2  Kent,  Comm.  140)  as  at  war  with  the  es- 
tablished principle  of  the  common  law;  that 
she  is  incapable  of  binding  hei-self  by  any 
cou tract;  and  a  contrary  doctrine  has  been 
expressly  held,  both  in  this  state  and  in 
Massachusetts  (Fowler  v.  Shearer,  7  Mass.  21; 
Colcord  V.  Swan,  7  Mass.  291).  In  these  cases 
it  was  observed,  that  although  the  deed  of  a 
married  woman  is  ipso  facto  void  by  the  com- 
mon law  of  England,  j-et  by  the  immemorial 
usage  of  Massachusetts  it  would  pass  her  es- 
tate, and  she  would  be  estopped  by  her  coven- 
ants, though  no  action  would  lie  against  her 
for  a  breach  of  them.  But  the  supreme  court 
of  this  state,  in  Jaclison  v.  A^anderheyden,  17 
Johns.  107,  went  still  fiirther,  and  held  that 
a  feme  covert  not  only  was  not  liable  to  an 
action  on  the  covenants  contained  in  a  deed 
executed  and  acli;nowledged  according  to  the 
statute,  by  her  and  her  husband,  but  that 
she  was  not  estopped  by  her  covenant  from 
setting  up  any  outstanding  title  to  the  premis- 
es, or  any  other  defence.  Chief  Justice  Spen- 
cer, in  delivering  the  opinion  of  the  court, 
observed,  that  it  was  a  settled  principle  of 
the  common  law,  that  coverture  disqualifies 
a  feme  covert  from  entering  into  a  contract 
or  covenant  personally  binding  upon  her.  She 
may  at  common  law  pass  her  real  property 
by  a  fine  duly  levied;  and  under  our  own 
statute,  she  may  also  in  conjunction  with  her 
husband,  on  due  examination  before  a  com- 
petent officer,  convey  her  real  estate;  but 
such  deed  cannot  operate  as  an  estoppel  to 
her  subsequently  acquired  interest  in  the 
same  land. 

There  is  a  class  of  cases  in  which,  where  the 
husband  had  expressly  covenanted  that  his 
wife  should  join  in  a  fine  of  her  real  estate, 
he  has  been  decreed  specifically  to  perform  his 
covenant,  or  to  snfFer  imprisonment  by  way 
of  penalty.  Griffin  v.  Taylor,  Toth.  lOG;  Har- 
rington V.  Horn,  2  Eq.  Cas.  Abr.  17,  pi.  7; 
Hall  V.  Hardy,  3  P.  Wms.  187;  Morris  v. 
Stephenson,  7  Ves.  474;  Withers  v.  Pinchard, 
cited  in  Morris  v.  Stephenson.  In  most  of 
those  cases,  however,  it  did  not  appear  that 
the  wife  had  refused  to  unite  in  the  fine;  and 
the  only  reason  on  which  the  decisions  are 
put,  is,  that  it  is  to  be  presumed  she  was  con- 
sulted by  her  husband  before  he  entered  into 
the  covenant,  and  gave  her  assent  to  it.  Lord 
Cowper,  however,  questioned  this  doctrine  in 
Outread  v.  Round,  4  Viner,  Abr.  203,  pi. 
4,  cited  m  1  Fonbl.  293,  note  7,  as  did  the 
master  of  the  rolls  In  Daniels  v.  Adams, 
Ambl.  495.  Its  soundness  was  also  denied  by 
Chief  Baron  Gilbert,  in  his  Lex  Prsetoria, 
24.5,  and  most  pointedly  by  Lord  Eldon,  in 
Emery  v.  Wade,  8  Ves.  514,  and  in  Martin 
V.  Mitchell,  2  Jac  &  W.  425.    It  was  conceded 


by  the  counsel  and  by  Sir  Thomas  Plumer, 
the  master  of  the  rolls,  that  such  was  not 
the  law  at  this  day.  The  same  opinion  had 
been  previously  expressed  by  the  same  learn- 
ed judge,  in  Howell  v.  George,  1  Madd.  Ch. 
16. 

The  case  of  Baker  v.  Childs,  2  Vern.  Gl, 
is  the  only  one  which  I  have  been  able  to 
find  which  contains  the  slightest  intimation 
that  a  feme  will  be  decreed  specifically  to 
execute  an  agreement  made  by  her  during 
coverture.  The  whole  report  of  that  case  is 
this:  "Where  a  feme  covert,  by  agreement 
made  with  her  husband,  is  to  sun-ender  or 
levy  a  fine,  though  the  husband  die  before 
it  be  done,  the  court  wiU  by  decree  compel 
the  woman  to  perform  the  agreement."  No 
facts  or  circumstances  are  stated.  Whether 
it  was  an  ante-nuptial  agi-eement  between  the 
husband  and  wife,  or  an  agreement  made  by 
them  with  some  third  person,  it  is  difficult  to 
discover.  It  is  altogether  too  loose  and  bald 
a  case  to  be  entitled  to  any  consideration;  and 
it  is  said  of  that  case,  in  1  Eq.  Cas.  Abr. 
G2,  pi.  2,  that  upon  looking  into  the  register's 
minutes,  it  appeared  that  the  court  made  no 
decree  in  it;  but  it  was,  by  consent  referred 
to  Mr.  Serjt.  Rawlinson  for  his  arbitration. 
It  is  in  no  point  of  view,  therefore,  an  au- 
thority. The  case  of  Roupe  v.  Atkinson, 
Bumb.  163,  cited  by  the  counsel  for  the  ap- 
pellants, was  this:  A  lease  for  a  term  of 
years  was  assigned  to  the  trustees  before 
marriage,  in  trust  that  they  should  malie 
leases  for  the  benefit  of  the  husband  and 
wife.  After  marriage,  the  husband  and  wife 
assigned  the  lease  to  one  Sparke  for  a  valu- 
able consideration.  After  the  death  of  the 
husband,  the  widow  brought  her  biU  against 
Sparke,  to  be  levied  against  this  assignment 
made  during  coverture,  on  the  groimd  that 
no  fine  had  been  levied.  It  was  held  that  the 
assignment  by  the  cestuis  que  trust  was  in 
the  nature  of  an  appointment,  and  should 
bind  him  in  equity  as  much  as  if  it  had  been 
made  by  the  trustees  by  their  direction.  It 
bears  no  analo.^y  to  this  case.  The  anony- 
mous case  in  Moseley,  248,  is  equally  inap- 
plicable. An  estate  was  purchased  in  trust 
for  the  husband  and  wife  and  their  heirs,  and 
the  husband  and  wife  joined  in  a  mortgage 
to  the  vendor  to  secure  a  part  of  the  purchase 
money.  The  mortgagee  brought  a  bill  of  fore- 
closure, and  the  husliand  and  wife  put  in  a 
joint  answer,  in  which  it  is  to  be  inferred 
no  objection  was  taken  to  the  mortgage  on 
account  of  the  coverture  of  the  wife.  The 
husband  died  ponding  the  suit,  and  the  wife 
then  moved  for  leave  to  amend  her  answer, 
in  order  to  set  up  the  defence  that  no  fine 
had  been  levied.  The  lord  chancellor  refused 
the  motion,  with  the  single  oljservation,  that 
though  the  mortgage  was  insufficient  at  law, 
he  should  consider  the  answer  that  had  been 
put  in  as  equal  to  a  fine.  Penne  v.  Peacock, 
Cas.  t.  Talb.  41,  was  a  case  of  a  mortgage 
given  by  the  husband  to  the  plaintiff  upon  the 


MARRIED  WOMEN. 


33a 


lands  of  his  wife,  which  had  been  conveyed 
by  her  to  trustees,  with  his  privity,  before 
the  marriage,  in  trust  to  pay  the  rents  and 
profits  to  her  separate  use  for  her  life.  After 
the  mortgage  given,  the  husband  and  wife 
levied  a  line  of  the  mortgaged  premises,  and 
both  declared  the  uses  of  the  fine  to  be  to  the 
plaintiff,  for  securing  the  principal  and  in- 
terest of  the  mortgage.  The  wife  insisted 
in  her  answer  that  she  had  joined  in  the  fine 
by  duress  of  her  husband,  and  that  she  had 
no  estate  in  the  premises  upon  which  a  fine 
could  operate.  The  suggestions  of  duress 
and  fraud  were  not  sustained  by  the  proofs, 
and  it  was  held  as  an  established  doctrine, 
that  the  operation  of  a  fixie  is  the  same  upon 
ti-ust  as  upon  legal  estates.  That  case  also 
is  entirely  inapplicable  to  this. 

The  precise  question,  however,  involved  In 
this  case  has  arisen  in  a  sister  state,  and  been 
very  ably  discussed  both  by  the  counsel  and 
the  court.  I  allude  to  the  case  of  Butler  v. 
Buckingham,  5  Conn.  492.  It  was  there  held 
that  an  agreement  by  a  feme  covert,  with 
the  assent  of  her  husband,  for  the  sale  of  her 
real  estate,  was  absolutely  void  at  law,  and 
could  not  be  enforced  against  her  in  a  court 
of  equity.  The  defendant  in  that  case,  Mrs. 
Buckingham,  as  the  widow  of  her  former 
husband  Joseph  Bryan,  had  a  right  of  dower 
in  a  particular  lot  of  land  of  which  he  died 
seised.  She  subsequently  married  Gideon 
Buckingham,  and  she  and  her  husband,  in 
.Tanuary,  1793,  agreed  to  sell  all  her  interest 
in  the  premises  to  the  plaintiffs  Butler  and 
Atwator,  and  joined  in  a  penal  bond  to  them; 
the  condition  of  which  was,  that  if  she  should 
quit-claim  all  her  right  of  dower  in  the  prem- 
ises to  the  obligees,  then  the  bond  should  be 
void.  The  petition  (which  was  in  the  nature 
of  a  bill  in  chancery)  stated  that  the  petition- 
ers Immediately  entered  into  the  possession  of 
said  land,  and  from  that  time  to  the  date  of 
the  petition,  a  period  of  more  than  20  years, 
liad  had  peaceable  and  uninterrupted  posses- 
sion of  the  same;  that  they  had  made  valua- 
ble improvements  thereon,  -with  the  knowl- 
edge of  the  defendant  and  her  husband,  in 
full  confidence  that  they  would  perform  their 
agreement;  that  Gideon  Buckingham,  the 
luisband  of  the  defendant,  died  in  1810;  and 
tliat  she,  upon  regular  and  repeated  applica- 
tions, had  refu.sed  to  quit-claim  her  right  of 
dower,  and  had  recently  commenced  an  ac- 
tion at  law  to  recover  the  same  from  the 
plaintiffs.  The  petition  prayed  for  a  perpetu- 
al injunction,  or  tJiat  the  defendant  should 
be  decreed  to  convey  her  right  of  dower  in 
the  premises.  Upon  a  demurrer  to  this  peti- 
tion, it  was  held  by  the  nine  judges  sitting 
as  a  court  of  en-ors,  that  the  petitioners  were 
entitled  to  no  relief.  It  was  observed  by  the 
court  that  the  whole  system  of  the  common 
law  was  opposed  to  the  doctrine  on  which  the 
petition  was  founded;  that  it  was  a  funda- 
mental principle  of  the  common  law  that  the 
contract  of  a  feme  covert  is  absolutely  void, 


except  where  she  conveys  her  estate  by  fine 
duly  acknowledged,  or  by  some  matter  of  rec- 
ord, when  slje  is  privately  examined  in  order 
to  ascertain  whether  such  convej-ance  is 
voluntary  on  her  part;  and  it  is  pertinently 
said.  How  absurd  then  would  it  be  to  enforce 
such  a  conti-act  to  convey,  made  without  such 
examination?  It  would  be  saying  that  a  feme 
covei-t  cannot  directly  convey  her  real  estate, 
unless  she  be  privately  examined;  and  yet 
she  can  contract  to  convey  without  such  ex- 
amination, and  such  contract  will  be  enforc- 
ed against  her.  By  this  mode,  the  established 
law  in  relation  to  a  feme  covert  and  her  real 
estate  will  be  completely  subverted. 

A  feme  covert,  in  relation  to  her  separate 
property,  that  is,  property  settled  to  her  sepa- 
rate use  by  deed  or  will,  with  a  power  of  ap- 
pointment, and  rendered  subject  to  her  ex- 
clusive control,  and  also  with  respect  to  prop- 
erty which  she  holds  as  trustee  without  any 
beneficial  interest  in  her  own  right,  is  consid- 
ered as  a  feme  sole,  and  her  contracts  in  re- 
lation to  those  subjects  may  be  valid,  and  a 
court  of  equity  may  interfere  to  enforce  them. 
As  to  all  other  matters,  they  are  absolutely 
void,  and  it  is  no  less  a  moral  than  a  legal 
absurdity,  to  say  that  a  court  of  equity  will 
enforce  a  void  contract;  it  is  a  mere  nullit>'; 
there  is  nothing  to  be  carried  into  execution. 
The  deed  of  a  feme  covert,  not  acknowledged 
according  to  the  statute,  forms  no  considera- 
tion for  a  promise  to  pay  the  purchase  money; 
a  note  given  under  such  circumstances  is  a 
nudum  pactum  and  void  as  between  the  par- 
ties. This  was  expressly  adjudged  by  the 
supreme  court  of  Massachusetts,  in  Fowler  v. 
Shearer,  7  Mass.  14,  and  must  be  so  upon 
every  principle  applicable  to  contracts.  If  an 
absolute  sale  consummated  by  a  deed  is  void, 
unless  such  deed  is  acknowledged  in  the  mode 
prescribed  by  the  statute,  it  is  impossible 
that  a  contract  to  sell  and  convey  at  some 
future  time  should  be  valid. 

The  language  of  the  master  of  the  rolls. 
Sir  Thomas  Plumer,  in  Martin  v.  Mitchell,  2 
Jac.  &  W.  424,  upon  the  general  principle  ap- 
plicable to  the  contracts  of  married  women, 
is  very  strong  and  explicit.  He  says:  "The 
acts  of  a  married  woman  with  respect  to  her 
estate  are  perfectly  void.  She  has  no  dis- 
posing power,  though  she  may  have  a  dis- 
posing mind.  An  agreement  signed  by  her 
with  her  husband  cannot  affect  her  estate, 
and  cannot  give  the  party  a  right  to  call  upon 
her  in  a  court  of  equity  to  execute  a  convey- 
ance, to  bar  her  if  she  survives,  and  to  bind 
her  inheritance.  If  an  agreement  is  signed 
by  a  person  competent  to  contract,  and  is  for 
a  valuable  consideration,  but  defective  in 
form,  there  is  a  remedy  in  equity;  for  you 
have  a  valid  contract  to  stand  upon.  But 
with  a  married  woman  there  can  be  no  bind- 
ing contract.  The  instrument  is  not  good  as 
an  agreement;  then  how  can  it  be  said  to 
bind  her?"  The  same  language  substantially 
is  used  by  the  court  in  the  case  of  Wright  v. 


334 


CAPACITY  OF  PARTIES. 


Buller,  2  Ves.  Jr.  676,  and  is  to'  be  found 
in  all  the  elementary  ti'eatises  upon  the  sub- 
ject. The  cases  of  Jackson  v.  Stevens,  16 
Johns.  114:  Jackson  v.  Calms,  20  Johns.  303; 
and  Doe  ex  dem.  Depeyster  v.  Rowland,  8 
C-ow.  277, — show  verj'  conclusively  the  opinion 
which  has  always  been  entertained  in  our 
courts  of  the  absolute  nuUity  of  a  conveyance 
or  contract  made  by  a  married  woman  in  re- 
lation to  her  real  estate.  In  the  first  case 
Judge  Spencer  observed,  that  the  conveyance, 
although  signed  and  sealed  by  the  wife,  was 
not  her  deed  until  she  had  acknowledged  it 
according  to  the  statute.  It  could  not  bind 
her  as  a  contract.  She  was  not  confirming 
an   inchoate  and   imperfect  agreement.     The 


deed  took  its  efficacy  from  the  period  of  her 
acknowledgment.  There  was  nothing  prior, 
to  which  it  could  relate.  The  other  cases  are 
equally  strong  to  the  same  point.  Vide,  also, 
7  Johns.  81.  The  bill  is  not  framed  with  a 
view  to  the  refunding  of  the  purchase  money 
paid  by  the  appellant  for  the  premises  In 
question.  It  seeks  distinctly  a  specific  exe- 
cution of  the  agreement,  or  a  perpetual  in- 
jimction  of  any  suit  at  law.  Whether  the 
representatives  of  Abner  Dwelly  could  be 
compelled  to  refund,  it  is  not  now  necessary 
to  consider. 

I  am  in  favor  of  affirming  the  decree,  with 
costs. 


MAElilED  WOMEN. 


335 


tEGORT  v.  PIERCE. 

(4  Mete  478.) 

Supreme  Judicial    Court   of   Massachusetts. 
1842. 

Assumpsit  on  a  promissory  note,  signed  by 
the  defendant  in  the  presence  of  an  attesting 
witness,  dated  October  Gth,  1825,  and  pay- 
able to  Putnam  &  Gregory,  partners,  of  whom 
the  plaintiff  is  survivor. 

The  case  was  submitted  to  the  co^rt  of 
common  pleas,  on  an  agreed  statement  of 
facts,  as  follows:  "The  defendant  was  mar- 
ried to  Varney  Pierce,  Jr.,  In  180G,  who,  in 
ISIG,  became  insolvent,  and  left  her  and  went 
out  of  the  commonwealth,  and  did  not  return 
till  1S18,  when  he  came  back  and  remained 
with  ner  about  a  week.  He  then  left  her 
and  went  to  Ohio,  where  he  remained  till  his 
death  In  1S32.  He  made  no  provision  for 
the  support  of  his  wife  and  family,  after  he 
left  her  in  ISIG;  but  she  supported  herself 
and  family,  after  he  left  her,  by  her  own 
labor,  contracting  debts  and  making  contracts 
in  her  own  name.  Putnam  &  Gregory  em- 
ployed her  to  do  work  for  them,  and  supplied 
her  with  necessaries  for  the  support  of  her- 
self and  family;  and  the  note  in  suit  was 
given  for  the  balance  of  accoimt  between  the 
parties." 

The  court  of  common  pleas  rendered  judg- 
ment for  the  plaintiff,  and  the  defendant  ap- 
pealed to  this  court. 

Wells  &  Davis,  for  plaintiff.  Mr.  Brooks, 
for  defendant 

SHAW,  C.  J.  The  principle  Is  now  to  be 
considered  as  established  in  this  state,  as  a 
necessary  exception  to  the  rule  of  the  com- 
mon law,  placing  a  married  woman  under 
disability  to  contract  or  maintain  a  suit,  that 
where  the  husband  was  never  within  the 
commonwealth,  or  has  gone  beyond  its  juris- 
diction, has  wholly  renounced  his  marital 
rights  and  duties,  and  deserted  his  wife,  she 
may  make  and  take  contracts,  and  sue  and  be 
sued  in  her  own  name,  as  a  feme  sole.  It  is 
an  application  of  an  old  rule  of  the  common 
law,  which  took  away  the  disability  of  cover- 
ture when  the  husband  was  exiled  or  had  ab- 
jured the  realm.  Gregory  v.  Paul,  15  Mass. 
31;  Abbot  V.  Bayley,  6  Pick.  89.  In  the  lat- 
ter case,  it  was  held,  that  in  this  respect,  the 
residence  of  the  husband  in  another  state  of 
these  United  States,  was  equivalent  to  a  res- 
idence in  any  foreign  state;  he  being  equally 
beyond  the  operation  of  the  laws  of  the  com- 
monwealth, and  the  jurisdiction  of  its  courts. 

But,  to  accomplish  this  change  in  the  civil 
relations  of  the  wife,  the  desertion  by  the 
husband,  must  be  absolute  and  complete;  It 
must  be  a  voluntary  separation  from  and 
abandormaent  of  the  wife,  embracing  both  the 


fact  and  Intent  of  the  husband  to  renounce 
de  facto,  and  as  far  as  he  can  do  it,  the  mar- 
ital relation,  and  leave  his  wife  to  act  as  a 
feme  sole.  Such  is  the  renunciation,  coupled 
with  a  continued  absence  in  a  foreign  state 
or  couutry,  which  is  held  to  operate  like  an 
abjuration  of  the  realm 

In  the  present  case,  the  court  are  of  opin- 
ion, that  the  circumstances  stated  are  not 
suflJcieut  to  enable  the  court  to  detcnnine 
whether  the  husband  had  so  deserted  his 
wife,  when  the  note  in  question  was  given. 
The  only  facts  stated  are,  that  he  was  in- 
solvent when  he  went  away;  that  he  was 
absent,  residing  seven  or  eight  years  in  Ohio; 
that  he  made  no  provision  for  his  wife  uiid 
her  family,  after  181G;  and  that  she  support- 
ed herself  and  them  by  her  own  labor.  But 
It  does  not  appear  that  he  was  of  ability  to 
provide  for  her;  that  he  was  not  in  corres- 
pondence with  her;  that  he  declared  any  in- 
tention to  desert  her.  when  he  left,  or  mani- 
fested any  such  intention  afterwards;  or 
that  he  was  not  necessarily  detained  by  sick- 
ness, imprisonment  or  poverty. 

The  fact  of  desertion  by  a  husband  may  be 
proved  by  a  great  variety  of  circumstances 
leading  with  more  or  less  probability  to  that 
conclusion;  as,  for  instance,  leaving  his  wife, 
with  a  declared  Intention  never  to  return; 
marrying  another  woman  or  otherwise  living 
in  adultery,  abroad;  absence  for  a  long  time, 
not  being  necessarily  detained  by  his  occupa- 
tion or  business,  or  otherwise;  making  no  pro- 
vision for  his  wife,  or  wife  and  family,  being 
of  ability  to  do  so;  providing  no  dwelling  or 
home  for  her,  or  prohibiting  her  from  follow- 
ing him;  and  many  other  circumstances  tend- 
ing to  prove  the  absolute  desertion  before 
described.  The  general  rule  being  that  a 
married  woman  cannot  make  a  contract  or  be 
sued,  the  burden  of  proof  is  upon  the  plain- 
tiff to  show  that  she  Is  within  the  exceptioru 
In  an  agreed  statement  of  facts,  such  fact  of 
desertion,  using  this  term  in  the  technical 
sense  above  expressed,  as  a  total  renunciation 
of  the  marriage  relation,  must  be  agreed  to, 
or  such  other  facts  must  be  agreed  to.  as  to 
render  the  conclusion  inevitable.  If  the  facts 
stated  are  all  that  can  be  proved  in  the  case, 
the  court  would  consider  that  the  pbiintifif 
had  not  sustained  the  burden  of  proof,  and 
therefore  could  not  have  judgment  See  Wil- 
liamson V.  Dawes,  9  Bing.  292;  Stretton  v. 
Bushnach,  4  Moore  &  S.  GTS,  1  Bing.  139: 
Bean  v.  Morgan,  4  McCord,  14S.  But  ap- 
prehending that  the  statement  may  have  been 
agreed  to,  under  a  misapprehension  of  the 
legal  effect  of  the  facts  stated,  and  tliat  other 
evidence  may  exist  the  court  are  of  opinion, 
and  do  order,  that  the  agreed  statement  of 
facts  be  discharged  and  a  trial  had  at  the 
bar  of  the  court  of  common  pleas. 


CAPACITY  or  PARTIES. 


WILLARD  T.  EASTHAM  et  al. 

I  ■    '  (15  Gray,  328.) 

Snpreme   Judicial   Court   of    Massachusetts. 
March,   1860 

A.  G.  Burke,   for  plaintiff.    G.  H.   Preston, 
for  defendants. 

HOAR,  J.  This  case  presents  a  question  en- 
tirely novel  in  the  jurisprudence  of  this  com- 
monwealth, and  which  could  not  have  come 
before  us  until  the  grant  of  the  full  equity 
powers  which  were  conferred  upon  this  court 
by  a  recent  statute.  St.  1857,  c.  214.  It  is  a 
bill  in  equity,  by  which  the  plaintiff  seeks  to 
charge  the  separate  estate  of  a  man-led  wo- 
man with  the  payment  of  a  promissory  note 
made  by  her.  The  bill  avers,  In  substance, 
that  the  brother  of  Mrs.  Eastham  purchased 
of  the  plaintiff  his  interest  in  a  copartnership; 
that,  being  himself  of  no  sufficient  credit  or 
pecuniary  responsibility,  he  procured  the  note 
of  his  sister,  who  was  then,  and  still  is,  a 
married  woman,  payable  to  himself,  and  in- 
dorsed it  to  the  plaintiff  in  payment  of  the 
purchase  money;  that  she  made  the  note  for 
this  purpose,  and  promised  to  pay  it  at  mi-i- 
tnrlty;  that  It  has  not  been  paid;  and  thai 
Mrs.'  Eastham  was  at  the  date  of  the  note, 
and  still  1&  possessed  of  valuable  real  estate, 
which  she  holds  as  he.-  separate  property. 
and  which  ici  leased  to  two  persons  who  art 
joined  in  the  bill  as  defendants,  who  pay  her 
rent  for  the  same;  and  prays  that  these  rents 
may  be  sequestered  and  appropriated  to  the 
payment  of  the  note.  The  husband  of  Mrt. 
Eastham  is  joined  as  a  defendant;  and  to  this 
bill  all  the  defendants  demur. 

The  question  is,  to  what  extent  and  imder 
what  limitations  the  separate  estate  of  a  mar 
ried  woman  is  to  be  applied  in  equity  to  the 
discharge  of  her  contracts  and  engagements. 
It  was  held  from  a  very  early  period  in  Eng 
land,  that  a  married  woman,  although  in- 
competent at  law  to  make  a  valid  contract, 
would  be  regarded  in  equity  as  a  feme  sole, 
in  respect  to  her  separate  estate.  Grlgby  v. 
Cox,  1  Ves.  Sr.  517;  Peacock  v.  Monk,  2  Ves. 
Sr.  190.  And  the  rule  seems  to  have  been 
universally  recognized,  where  a  married 
woman  made  an  express  contract  respecting 
such  an  estate,  of  which  she  was  entitled  to 
the  beneficial  use,  that  she  and  the  party 
with  whom  she  contracted  might  have  the 
aid  of  a  court  of  equity  to  make  the  contract 
effectual.  This  doctrine  Is  the  legitimate  con- 
sequence of  the  principle  that  a  married 
woman  may  execute  a  power,  and  so  may 
make  a  valid  appointment. 

But  in  Hulme  v.  Tenant,  1  Brown,  C.  C.  16, 
the  doctrine  was  extended  much  farther;  and 
Lord  Thurlow  there  says  that  "determined 
cases  seem  to  go  thus  far;  that  the  general 
engagement  of  the  wife  shall  operate  upon 
her  personal  property,  shall  apply  to  the 
rents  and  profits  of  her  real  estate,  and  that 
her  trustees  shall  be  obliged  to  apply  personal 


estate,  and  rents  and  profits  when  they  arise, 
to  the  satisfaction  of  such  general  engage- 
ment." At  a  subsequent  stage  of  the  case  he 
expresses  the  principle  thus:  "I  have  no 
doubt  about  this  principle;  that  if  a  court  of 
equity  says  a  feme  covert  may  have  a  sepa- 
rate estate,  the  court  will  bind  her  to  the 
whole  extent  as  to  making  that  estate  liable 
to  her  own  engagements;  as,  for  Instance,  for 
payment  of  debts,  etc." 

The  decision  In  Hulme  v.  Tenant,  although 
repeatedly  doubted  by  Lord  Eldon,  was  fol- 
lowed and  acted  upon  l:)y  him  and  by  all  the 
chancellors  through  a  long  series  of  cases. 
In  some  of  these  there  was  an  attempt  to  re- 
strict the  application  of  the  doctrine  to  cases 
of  written  contracts,  and  to  treat  these  con- 
tracts as  in  the  nature  of  appointments.  But 
this  distinction  was  subsequently  abandoned 
as  unsound;  and  a  full  discussion  of  the  whole 
subject,  presenting  with  great  clearness  the 
result  of  the  modem  English  authorities,  is 
found  in  the  elaborate  judgment  of  Lord 
Brougham,  in  Murray  v.  Barlee,  3  Mylne  &  K. 
209,  and  in  that  of  Lord  Cottenham  in  Owens 
V.  Dickenson,  Craig  &  P.  58. 

"In  all  these  cases,"  says  Lord  Brougham, 
"I  take  the  foundation  of  the  doctrine  to  be 
this:  The  wife  has  a  separate  estate,  subject 
to  her  own  control,  and  exempt  from  all  other 
interference  or  authority.  If  she  cannot  af- 
fect it,  no  one  can;  and  the  very  object  of  the 
settlement  which  vests  it  in  her  exclusively 
is  to  enable  her  to  deal  with  it  as  if  sLe  -.vcr^ 
discovert.  The  p'ywer  to  affect  ii  being  un- 
questionable, the  only  doubt  that  can  sr-ze 
is  whether  or  not  she  has  validlj-  incumber- 
ed it  At  first,  the  court  seems  to  havj  sup 
posed  that  nothing  could  touch  it  but  some 
real  charge,  as  a  mortgage,  or  an  instrument 
amounting  to  an  execution  of  a  power,  where 
that  view  was  supported  by  the  nature  of  the 
settlement.  B  at  afterwards  her  intention  was 
more  regarded,  and  the  court  only  required 
to  be  satisfied  that  she  intended  to  deal  witt 
her  separate  property.  When  she  appeared 
to  have  done  so,  the  court  held  her  to  have 
charged  it,  and  made  the  trustees  answer  the 
demand  thus  created  against  it.  A  good  deal 
of  the  nicety  that  attends  the  doctrine  of 
powers  thus  came  to  be  imported  into  this 
consideration  of  the  subject.  If  the  wife  did 
any  act  directly  charging  the  separate  estate, 
no  doubt  could  exist;  just  as  an  instrument 
expressing  to  be  in  an  execution  of  a  power 
was  always  of  course  considered  as  made  in 
execution  of  it  But  so,  if  by  any  reference 
to  the  estate  it  could  be  gathered  that  such 
was  her  intent,  the  same  conclusion  followed. 
Thus,  if  she  only  executed  a  bond,  or  made 
a  note,  or  accepted  a  bill,  because  those  acts 
would  have  been  nugatorj-  if  done  by  a  feme 
covert,  without  any  reference  to  her  separate 
estate,  it  was  held,  in  the  cases  I  have  above 
cited,  that  she  must  be  Intended  to  have  de- 
signed a  charge  on  that  estate,  since  in  no 
other  way  could   the  instrument  thus   made 


MARRIED  WOMEN. 


o37 


by  her  have  any  validity  or  operation.  In  the 
same  manner  as  an  instrument,  which  can 
mean  nothing  If  it  means  not  to  execute  a 
power,  has  been  held  to  be  'made  in  execu- 
tion of  that  power,  though  no  direct  refer- 
ence is  made  to  the  power.  Such  is  the  prin- 
ciple. But  doubts  have  been  m  one  or  two 
instances  expressed  as  to  the  effect  of  any 
dealing  whereby  a  general  engagement  only 
is  raised;  that  is,  where  she  become.s  indebted 
without  executing  any  written  instrument  at 
all.  I  own  I  can  perceive  no  reason  for  draw- 
ing any  such  distinction.  If,  in  respect  of  her 
separate  estate,  the  wife  is  in  equity  taken 
as  a  feme  sole,  and  can  cliarge  it  by  instru- 
ments absolutely  void  at  Liw,  can  there  be 
any  reason  for  holding  that  her  liability,  or, 
more  properly,  her  power  of  affecting  the 
separate  estate,  shall  only  be  exercised  by  a 
written  Instrument?  Are  we  entitled  to  in- 
vent a  rule,  to  add  a  new  chapter  to  the  stat- 
ute of  frauds,  and  to  require  writing  where 
that  act  requires  none?  Is  there  any  equity, 
reaching  written  dealings  with  the  property, 
which  extends  not  also  to  dealing  in  other 
ways,  as  by  sale  and  delivery  of  goods?  Shall 
accessary  supplies  for  her  maintenance  not 
touch  the  estate,  and  yet  money  furnished  to 
squander  away  at  play  be  a  charge  on  it,  if 
fortified  by  a  scrap  of  writing?  No  such  dis- 
tinction can  bfc  taken  upon  any  conceivable 
principle." 

In  Owens  v.  Dickenson,  Lord  Cottenham 
says  of  a  written  agreement:  "It  would 
have  been  operative  upon  the  feme  coverfs 
Separate  estate,  but  not  by  way  of  the  exe- 
eutioa  of  a  power,  although  that  has  been  an 
expression  sometimes  used,  and,  as  I  appre- 
hend, very  Inaccurately  used,  in  cases  where 
the  court  has  enforced  the  contracts  of  mar- 
ried women  against  their  separate  estate.  It 
cannot  be  an  execution  of  the  power,  be- 
caust"  it  neither  refers  to  the  power  nor  to 
the  subject-matter  of  the  power;  nor,  in- 
deed, in  many  of  the  cases  has  there  been 
any  power  existing  at  all.  Besides,  as  It 
was  argued  In  Murray  v.  Barlee,  if  a  mar- 
ried woman  enters  into  several  agreements 
of  this  sort,  and  all  the  parties  come  to  have 
satisfaction  out  of  her  separate  estate,  they 
are  paid  pari  passu;  whereas,  if  the  instru- 
ments took  effect  as  appointments  under  a 
power,  they  would  rank  according  to  the 
priorities  of  their  dates.  It  Is  quite  clear 
therefore  that  there  is  nothing  in  such  a 
transaction,  which  has  any  resemblance  to 
the  execution  of  a  power.  What  it  is,  it  is 
not  easy  to  define.  It  has  sometimes  been 
treated  pa  a  disposmg  of  the  particular  es- 
tate; but  the  contract  is  silent  as  to  the 
separate  estate,  for  a  promissory  note  is  mere- 
ly a  contract  to  pay,  not  saying  out  of  what 
It  is  to  be  paid,  or  by  what  means  it  is  to 
be  paid;  and  it  is  not  correct,  according  to 
legal  principles,  to  say  that  a  contract  to 
pay  Is  to  be  construed  into  a  contract  to  pay 
out  of  a  particular  property,  so  as  to  con- 

HOPK.&BUCAS.CONT. — 22 


stltute  a  lien  on  that  property.  Equity  lays 
hold  of  the  separate  property,  but  not  by 
virtue  of  any  tiling  expressed  in  th<'  contract; 
and  it  is  not  very  cons  stent  with  correct  nrin- 
ciples  to  add  to  the  contrar-t  that  whicii  the 
party  has  not  thought  fit  to  introduce  into  it. 
The  view  taken  of  the  matter  by  Lord  Thur- 
lovv,  in  Huline  v.  Tenant,  is  more  correct. 
According  to  that  view,  the  separate  prop- 
erty of  a  married  woman  being  a  creature  of 
equity,  it  follows  that  if  she  has  a  power  to 
deal  with  it,  she  has  the  other  power  inci- 
dent to  property  in  general,  namely,  the  pow- 
er of  contracting  debts  to  be  paid  out  of  it; 
and  inasmuch  as  her  creditors  have  not  the 
means  at  law  of  compelling  payment  of  those 
debts,  a  court  of  equity  takes  upon  itself  to 
give  effect  to  them,  not  as  personal  liabili- 
ties, but  by  laying  hold  of  the  separate  prop- 
erty, as  the  only  means  by  which  they  can  be 
satisfied." 

The  result  ot  the  English  decisions  would 
therefore  seem  to  be  that  the  separate  es- 
tate of  a  married  woman  is  answerable  foi 
all  her  debts  and  engagements,  to  the  full  ex- 
tent to  which  It  Is  subject  to  hei  ovn  dis- 
posal. 

The  rule  adopted  by  most  of  tht'*  coarlc  in 
the  United  States  has  been  materially  dif- 
ferent from  that  established  in  England;  and 
the  general  current  of  American  authoritioc 
supports  the  principle  that  a  married  woman 
has  no  power  in  relation  to  her  separate  es 
tate  but  such  as  Is  expressly  conferred  in 
the  creation  of  the  estate;  and  that  her  sep- 
arate estate  is  not  chargeable  with  her  debts 
or  obligations,  unless  where  a  provision  for 
that  purpose  is  contained  in  the  instrument 
creating  the  separate  estate.  These  authori- 
ties are  very  fully  collected  and  commented 
on  in  the  notes  to  the  case  of  Hulme  v.  Ten- 
ant, 1  White  &  T.  Lead.  Cas.  Eq.  (Hare  & 
W.  Ed.)  324. 

The  decisions  In  the  state  of  New  Yort 
approximate  somewhat  more  nearly  to  the 
English  rule,  but  with  some  Important  modi- 
fications. The  courts  of  chancerj-  have  thert- 
held  that  a  feme  r^overt,  with  respect  to  he- 
separate  estate,  is  so  far  to  be  regarded  as  a 
feme  sole  that  she  may  dispose  of  it  without 
the  consent  of  her  trustee,  unless  she  le 
specially  restrained  by  the  instrument  under 
which  she  acquires  it;  that  if  she  enters  into 
an  agreement,  and  sufficiently  indicates  her 
intention  to  affect  by  it  her  separate  estate, 
a  court  of  equity  will  apply  it  to  the  satis- 
faction of  sucJi  an  engagement;  but  that  her 
general  personal  engagement  will  not  of  Itself 
affect  her  separate  property;  and  therefore, 
where  creditors  do  not  claim  under  ajiy 
charge  or  appointment  made  in  pursuance  of 
the  instrument  of  settlement,  they  must  show 
that  the  debt  was  contracted  either  for  the 
benefit  of  her  separate  estate,  or  for  her  own 
benefit  upon  the  credit  of  the  separate  es- 
tate; and  that  such  estate  is  not  to  be  char- 
ged upon  any  implied  undertalang.    Jaqnea 


338 


CAPACITY  or  PARTIES. 


V.  Church,  17  Johns.  548;  Dyett  v.  Coal  Co., 
20  Wend.  570;  Gardner  v.  Gardner,  7  Paige, 
112;  Curtis  v.  Engel,  2  Sandf.  Ch.  2S7; 
Knowles  v.  McKamley,  10  Paige,  343;  Cruger 
V.  Cruger,  5  Barb.  227.  In  Vanderheyden  v. 
Mallory,  1  N.  Y.  453,  it  is  said  that  any  debt 
contracted  by  a  married  woman  for  hereelf 
or  her  husband  will  generally  be  regarded  as 
prima  facie  evidence  of  an  intention  to  charge 
her  separate  estate.  But  in  the  recent  case 
of  Yale  V.  Dederer,  IS  N.  Y.  2G5,  the  ques- 
tion arose  of  the  liability  of  the  wife's  sep- 
arate estate  for  the  payment  of  a  note  which 
she  had  signed  as  a  surety  with  her  hus- 
band, the  whole  consideration  having  been 
received  by  him;  and  the  court  of  appeals 
held  that  >t  was  not  liable. 

The  relation  of  married  women  to  their  sep- 
arate estates  in  this  commonwealth  has  been 
materially  affected  by  statute,  especially  so 
far  as  concerns  the  case  at  bar,  by  the  stat- 
utes of  1845  (chapter  208)  and  1855  (chapter 
304).  By  the  provisions  of  these  statutes,  a 
man-led  woman  may,  by  a  marriage  settle- 
ment, or  by  any  deed,  gift,  or  devise,  made 
to  her  by  any  person  except  her  husband 
after  her  marriage,  take  and  hold  any  prop- 
erty, real  or  personal,  to  her  sole  and  sep- 
arate use,  free  from  the  intervention  or  con- 
trol of  her  husband;  and  may  hold  in  like 
manner  any  property  belonging  to  her  at  the 
time  of  her  marriage;  and  may  contract,  sue 
and  be  sued,  and  have  and  be  subject  to  the 
same  remedies  in  law  or  equity  in  relation 
to  property  so  held,  and  to  any  contracts  re- 
specting it  made  by  her,  as  if  she  were  un- 
married She  may  also  engage  in  any  trade 
or  business  on  her  own  account,  and  may  sue 
and  bp  sued  as  if  sole  in  regard  to  her  trade, 
business,  labor,  services  and  earnings. 

It  Is  obvious  from  these  provisions,  that 
if  the  contract  which  we  are  considering  were 
to  be  regarded,  in  conformity  with  the  Eng- 
lish decisions,  as  a  contract  relating  to  the 
separate  estate  of  the  wife,  merely  because 
it  would  be  otherwise  wholly  ineffectual  and 
•without  validity,  the  plaintiff  has  made  no 
case  calling  for  the  aid  of  a  court  of  equity, 
because  he  has  a  plain,  adequate  and  com- 
plete remedy  at  law.  A  married  woman  may 
now  be  sued  upon  any  contract  relating  to 
her  separate  estate,  and  a  judgment  may  be 
recovered  against  her  upon  it,  and  her  sep- 


arate estate  may  be  attached  In  the  suit  nnd 
afterwards  taken  on  execution,  in  liKe  man- 
ner as  if  she  were  sole. 

But  aside  from  this  objection  to  the  plain- 
tiff's suit,  we  cannot  assent  to  the  correct- 
ness of  the  principle  upon  which  it  is  found- 
ed. We  can  see  no  sufficient  reason  for  hold- 
ing a  contract  which  is  whoUy  void  at  law, 
from  which  neither  the  married  woman  nor 
her  estate  receives  any  benefit,  and  which 
does  not  in  any  manner  refer  to  hor  separate 
property  or  undertake  to  make  any  charge 
upon  it,  to  be  a  contract  relating  to  such 
property. 

If  the  giving  of  a  note  or  a  bond  could  be 
considered  as  equivalent  to  an  appointment 
or  charge  upon  her  separate  estate,  and  the 
source  of  the  equity  against  her  be  foimd  in 
such  a  charge  or  appointment,  there  would 
seem  to  be  no  well  founded  distinction  be- 
tween a  contract  by  her  as  a  surety  and  a 
contract  as  principal.  But  against  this  the 
reasoning  in  Murray  v.  Barlee  and  Owens  v. 
Dickenson,  before  cited,  is  quite  conclusive. 
And  we  think,  upon  mature  and  full  con- 
sideration, that  the  whole  doctrine  of  the 
liability  of  he.'  separate  estate  to  discharge 
her  general  engagements  rests  upon  grounds 
which  are  artificial,  and  which  depend  upon 
implications  too  subtle  and  refined.  The  true 
limitations  upon  the  authority  of  a  court  of 
equity  in  relation  to  the  subject  are  stated 
with  great  clearness  and  precision  In  the 
elaborate  and  weU  reasoned  opinions  of  the 
court  of  appeals  in  New  York  in  the  case  of 
Yale  V.  Dederer.  And  our  conclusion  is  that 
when  by  the  contract  the  debt  is  made  ex- 
pressly a  charge  upon  the  separate  estate,  or 
is  expi-essly  contracted  upon  its  credit,  or 
when  the  consideration  goes  to  the  benefit  of 
such  estate,  or  to  enhance  its  value,  then 
equity  will  decree  that  it  shall  be  paid  for 
such  estate  or  its  income,  to  the  extent  to 
which  the  power  of  disposal  by  the  married 
woman  may  go.  But  where  she  is  a  mere 
surety,  or  makes  the  contract  for  the  accom- 
modation of  another,  without  consideration 
received  by  her,  the  contract  being  void  at 
law,  equity  will  not  enforce  it  against  her 
estate,  unless  an  express  instrument  makes 
the  debt  a  charge  upon  It. 

Demurrer   sustained,    and     bill    dismissed, 
with  costs. 


MARRIED  WOMEN. 


339 


OWEN  V.  CAWLEY.i 

(3G  N.   Y.   600.) 
Court  of  Appeals  of  New  York.      1SG7. 

Appeal  from  liie  supreme  court. 

The  action  was  for  jjrofessioual  sen'icea 
rendered  to  a  married  woman  for  the  benetit 
of  her  separate  estate,  and  the  relief  sought 
was  that  the  same  be  declared  an  equitable 
lien  on  such  separate  estate,  and  that  so  much 
thereof  as  might  be  necessary  be  appropriated 
to  the  satisfaction  of  the  claim. 

On  the  first  hearing,  before  Judge  Mitchell, 
the  referee,  judgment  was  rendered  for  the 
plaintiffs  for  a  greater  amount  than  on  the 
last  trial.  That  judgment  was  reversed  at 
the  general  term,  for  the  reasons  appearing 
in  the  report  of  the  case.     3G  Barb.  52. 

The  order  of  reversal  procured  on  that  oc- 
casion provided  that  the  evidence  taken  on 
the  first  trial  should  stand  as  evidence  on 
the  new  trial,  and  that  either  party  should 
be  at  liberty  to  add  such  further  evidence 
as  they  might  be  advised.  Neither  party 
appealed  from  this  order,  and,  so  far  as  ap- 
pears, it  was  mutually  acquiesced  in  and 
acted  upon  by  both. 

On  the  last  hearing,  before  the  same  ref- 
eree, judgment  was  recovered  by  the  plain- 
tiffs, pursuant  to  the  prayer  of  the  complaint; 
the  amount  of  the  lien,  charged  on  the  de- 
fendant's estate,  being  adjudged  to  be  $61.25, 
with  interest  from  the  30th  of  May,  1859, 
and  costs. 

The  defendant  appealed  to  the  general  term 
of  the  supreme  court  in  the  First  district, 
and  the  judgment  was  unanimously  affirmed, 
the  opinion  of  the  court  being  delivered  by 
Mr.  Justice  Sutherland. 

The  following  facts  were  admitted  in  the 
verified  pleadings,  as  amended: 

(1)  That  the  plaintiffs  were  attorneys  and 
counselore,  in  partnership,  in  the  city  of  New 
York. 

(2)  That  the  appellant,  Jane  F.  Cawley,  was 
the  wife  of  the  defendant,  Samuel  B.  Cawley. 

(3)  That  she  was  possessed,  in  her  own 
right,  separate  from  her  hnsband,  of  a  large 
amount  of  real  and  personal  property  in  this 
state,  including  a  house  and  lot  in  Queens 
county,  and  a  store  of  goods  in  New  York, 
In  which  she  had  conducted  the  ship  chandlery 
business  from  a  period  before  the  1st  of  Jan- 
uary, 1858,  down  to  the  commencement  of 
the  suit;  and  that,  in  the  course  thereof,  In 
the  years  1S58  and  18.59,  and  prior  to  the 
commencement  of  this  action,  she  had  vari- 
ous sums  due  and  owing  to  her  by  various 
individuals,  ships  and  vessels. 

(4)  That  during  these  periods,  and  previous 
thereto,  her  husband  carried  on  the  business, 
as  her  agent,  and,  as  such,  managed  and 
conducted  the  same  in  all  its  details. 

The  complaint  also  alleged  the  professional 
services  and  disbursements  of  the  plaintiffs. 
at  her  request  and  that  of  her  agent;    the 

1  ConCTirring  opinioa  of  Parker,  J.,  omitted. 


amount  due  therefor,  and  the  fact  that  such 
services  were  rendered  and  such  disburse- 
ments made,  on  the  credit  and  for  the  ben- 
efit of  her  separate  estate.  These  allegations 
were  put  in  issue  by  the  answer. 

The  referee  found,  among  other  things,  as 
a  matter  of  fact,  that  all  the  services  alleged 
were  rendered,  and  that  all  the  facts  staled 
in  the  complaint  were  true,  with  certain  ex- 
ceptions as  to  amounts,  etc.,  not  material  to 
be  stated.  lie  found,  as  matter  of  fact,  that 
all  the  sen-ices  embraced  in  the  amount  he 
allowed  were  rendered  for  the  benefit  of  Mrs. 
Cawley  and  of  her  separate  estate;  that  she 
employed  the  plaintiffs  to  render  them, 
through  the  agency  of  her  husband,  to  whom 
she  had  intrusted  the  whole  management  of 
the  business  of  her  separate  estate,  having 
fuU  confidence  in  his  ability  to  act  for  her, 
and  not  restricting  his  authority  in  any  way, 
but  requesting  him  "to  let  law  alone,  if  pos- 
sible, and  to  do  a  cash  business."  This  re- 
quest was  not  made  known  to  the  plaintiffs. 
The  prosecution  of  each  of  the  actions  and 
proceedings  was  expedient,  and  there  was  no 
prospect  that  the  demands  would  be  collect- 
ed without  suit. 

The  defendant  attempted  to  establish  a 
special  agreement  that  no  compensation 
should  be  made  for  services  which  did  not 
result  in  collecting  the  money;  but  the  ref- 
eree found,  as  matter  of  fact,  that  no  such 
agreement  was  made. 

A  question  was  raised  whether  some  of  the 
proceedings  which  were  taken  in  the  names 
of  nominal  assignees  of  the  appellant,  for 
particular  reasons  disclosed  by  the  evidence, 
were  not  really  for  the  benefit  of  such  as- 
signees; but  the  referee  found,  as  matter  of 
fact,  that  they  were  so  taken  for  the  benefit 
of  Mrs.  Cawley,  and  of  her  separate  estate, 
and  by  the  direction  of  the  husband  as  her 
agent. 

He  also  found,  that  each  of  the  claims  pre- 
sented by  the  plaintiff,  arose  out  of  sales  by 
her  husband  as  her  agent,  of  goods  belnng- 
ing  to  her  separate  estate,  except  in  a  single 
instance.  In  that  case  the  claim  was  for 
goods  sold  by  J.  C.  Sleight  &  Co..  the  previ- 
ous proprietors  of  the  store,  and  which,  with 
other  goods  and  demands,  had  been  absolute- 
ly assigned  to  her,  in  payment  of  a  debt  for 
advances  from  her  separate  estate. 

The  defendant  attempted  to  prove  a  subse- 
quent agreement  between  Sleight  and  his 
creditors,  for  the  purpose  of  showing  that 
the  transfer  to  her  was  only  colorable:  but 
the  referee  found  that  such  agreement  was 
not  satisfactorily  proved. 

In  the  course  of  the  trial  several  questions 
arose  as  to  the  admission  of  evidence;  and 
exceptions  were  also  taken  to  the  refusal  of 
the  referee  to  dismiss  the  complaint,  and  to 
his  ultimate  conclusions  of  law  upon  the  facts 
as  found. 

D.  McMahon,  for  the  appellant  Thomas 
G.  Shearman,  for  the  respondent 


340 


CAPACITY  OF  PARTIES. 


PORTER,  J.  The  principal  question  in  tills 
case  arises  under  tlie  statutes  of  1S4S  and 
lSi9,  in  relation  to  the  property  of  married 
women.  The  primary  purpose  of  these  acts 
was  to  enable  every  feme  covert  to  hold  prop- 
erty in  her  own  right,  without  the  intei-ven- 
tion  of  trusts  or  marriage  settlements.  It 
was  neither  their  design  nor  effect  to  place 
such  property  beyond  the  reach  of  all  reme- 
dial process,  nor  to  secure  to  the  wife  a  mere 
doi-mant  and  barren  title,  with  none  of  the 
usual  incidents  of  the  jus  disponendi.  Under 
their  operation  she  succeeded  to  the  right 
which  a  trustee  could  have  exercised  under 
the  old  law,  to  protect  the  interests  thus 
vested  by  all  the  usual  agencies,  and  to  en- 
force and  defend  her  claims  in  the  tribunals 
of  law  and  equity.  While  her  antecedent 
disabilities  arising  from  the  conjugal  rela- 
tion were  not  wholly  removed,  they  were 
necessarily  so  far  modified  as  to  secure  her 
in  the  beneficial  enjoyment  of  the  new  in- 
terests she  was  permitted  by  law  to  acquire. 
Yale  V.  Dederer,  IS  N.  Y.  272,  278,  22  N.  Y. 
451;  Bucliley  v.  WeUs,  33  N.  Y.  522.  She 
was  still  left  without  capacity  to  bind  herself 
personally  by  a  naked  promise,  note  or  bond; 
but  she  could  exercise  the  right  of  an  owner 
by  subjecting  her  separate  estate  to  charges 
in  equity,  for  services  rendered  at  her  request 
for  the  benefit  of  such  estate;  or  she  could 
dedicate  it  to  other  purposes  if  she  chose  to 
evince  her  intention  by  a  formal  and  de- 
liberate pledge.  The  mere  fact  however  that 
she  was  the  owner  of  a  separate  estate,  did 
not  affix  to  it,  under  these  acts,  a  liability  in 
equity  in  respect  to  her  engagements  at  large. 
Such  a  lien  could  only  be  deduced  from  an 
express  or  implied  agreement  to  that  effect 
on  her  part,  or  from  some  equivalent  obliga- 
tion resulting  from  her  acts  by  operation  of 
law.  Where  services  are  rendered  for  a  mar- 
ried woman  by  her  procurement,  on  the  credit 
And  for  the  benefit  of  her  separate  estate, 
there  Is  an  implied  agreement  and  obligation 
springing  from  the  nature  of  the  considera- 
tion, which  the  courts  will  enforce  by  char- 
ging the  amount  on  her  property  as  an  equi- 
table lien.  Yale  v.  Dederer,  18  N.  Y.  276, 
282.  284.  22  N.  Y.  4G0.  Where  a  charge  Is 
created  by  her  own  express  agreement,  for  a 
good  consideration,  though  for  a  purpose  not 
beneficial  to  her  separate  estate,  or  even  for 
the  sole  benefit  of  her  husband,  she  is  bound 
in  equity  by  the  obligation  which  she  thus 
deliberately  chooses  to  assume.  Yale  v.  De- 
derer, 28  N.  Y.  276,  283,  22  N.  Y.  451. 

It  was  at  one  time  a  mooted  question  in  the 
courts,  whether  under  the  statutes  above  re- 
ferred to,  and  prior  to  the  act  of  1800,  the 
common-law  disabilities  of  the  wife  were  so 
far  modified  as  to  permit  her  to  manage  her 
estate  through  the  inteiTention  of  agents  and 
employees;  but  it  is  now  entirely  settled  that 
she  acquired  in  this  respect,  the  usual  rights 
Incident  to  absolute  ownership,  and  that  she 
could  avail  herself  of  any  agency,  even  that 
of  her  husband,  with  the  same  effect  as  If 


they  were  not  united  in  marriage.  Knapp  y, 
Smith,  27  N.  Y.  277.  280;  Buckley  v.  Wells, 
33  N,  Y.  518,  522;  Smith  v.  Sweeney,  35  N. 
Y.  294,  295;  Draper  v.  Stouvenel,  Id.  513; 
Abbey  v.  Deyo,  44  Barb.  382. 

In  this  case  the  referee  finds  as  matter  of 
fact,  that  the  plaintiffs  were  employed  by 
the  appellant  through  her  authorized  agent, 
to  whom  she  had  intrusted  the  entire  man- 
agement of  her  business  and  estate.  She 
was  as  effectually  bound  by  the  act  done  in 
her  name,  as  if  she  had  personally  engaged 
the  professional  services  of  the  respondents. 
She  accredited  her  husband  to  the  public,  as 
her  general  agent  in  all  that  pertained  to  her 
business;  and  as  the  plaintiffs  had  no  notice 
of  any  private  restrictions  upon  his  authority, 
the  fact  that  any  such  were  given  would  have 
been  unavailing,  even  if  she  had  succeeded 
in  proving  it.  Bank  v.  Astor,  11  Wend.  87; 
Johnson  v.  Jones,  4  Barb.  369,  373. 

It  Is  also  found  as  matter  of  fact  that  all 
the  sei^ices  In  question  were  rendered  for 
Mrs.  Cawley,  and  for  the  benefit  of  her  sepa- 
rate estate.  Her  coim^el  Insists  that  such 
of  them  as  appertained  to  suits  in  which 
there  was  a  failure  to  collect  the  amount  of 
the  claims,  should  not  be  deemed  beneficial 
in  their  character.  No  such  distinction  can 
be  maintained.  The  rule  of  equity  under 
which  the  estate  of  a  married  woman  is  sub- 
ject to  a  charge  in  respect  to  services  ren- 
dered for  its  benefit,  has  reference  to  the  sub- 
ject-matter and  nature  of  such  services,  and 
not  to  the  contingent  and  ultimate  gain  or 
loss  of  the  parties  procuring  them.  A  build- 
er, who  at  the  request  of  a  feme  covert, 
erects  a  dwelling  on  her  land,  performs  a  ser- 
vice for  the  benefit  of  her  estate  within  the 
meaning  of  the  rule;  and  its  nature  would 
not  be  changed,  though  the  edifice  should 
afterward  be  destroyed  by  fire.  An  employee 
who  tills  her  land  for  hire,  has  an  equitable 
claim  to  compensation;  and  if  he  discharges 
his  duty  faithfully,  he  has  a  remedy  for  his 
wages,  though  her  fields  should  prove  un- 
productive. In  this  case  the  claims  in  ques- 
tion formed  a  part  of  the  separate  estate,  and 
the  services  were  for  its  direct  and  immediate 
benefit.  Dillaye  v.  Parks,  31  Barb.  132.  The 
appellant  preferred  not  to  prosecute  the  suits 
in  person;  and  the  attorneys  who  conducted 
them  in  her  behalf,  having  served  her  with 
suitable  skill  and  fidelity,  are  not  responsible 
for  any  defects  in  her  proof,  or  for  the  in- 
ability of  her  debtors  to  respond  to  their  ob- 
ligations. It  follows  from  those  views,  that 
on  the  principal  questions  involved  in  the 
case,  the  referee  was  right  in  his  conclusions. 
The  plaintiffs  were  properly  allowed  to- 
prove  the  admissions  of  the  appellant  on  the 
previous  hearing.  They  constituted  a  por- 
tion of  the  evidence,  which  under  the  order 
entered  at  the  general  term,  either  party  was 
entitled  to  read,  and  this  right  was  exer- 
cised on  the  second  trial  by  both.  Where  an 
absolute  and  unqualified  admission  is  made 
in  a  pending  cause,  whether  by  written  s-tipu- 


MARRIED  WOMEN. 


841 


latlon  of  t±ie  attomoy  or  as  matter  of  proof 
on  the  hearing,  it  cannot  be  retracted  on  a 
subsequent  triai,  unless  by  leave  of  the  court 
No  cause  for  granting  such  leave  was  shown, 
and  there  was  ao  allegation  of  mistalce,  im- 
position or  surprise.  People  v.  Ilathbun,  21 
Wend.  543,  544;  Elton  v.  Laikins,  24  E.  C. 
L.  372;  Doe  v.  Bird.  32  N.  Y.  41G;  Langley 
V.  Earl  of  Oxford,  1  Mees.  &  W.  508. 

It  is  claimed  in  behalf  of  the  appellant 
that  the  referee  should  not  have  pennitted 
the  reading,  on  the  new  trial,  of  the  evidence 
on  the  former  hearing,  as  provided  in  the  or- 
der of  reversal.  We  see  no  reason  why  the 
parties  are  not  concluded  by  that  order,  in 
which  both  of  them  seem  to  have  acquiesced. 
No  appeal  from  It  has  ever  been  taken,  no 
motion  was  made  to  modify  it,  and  both  par- 
ties have  acted  under  It  Vail  v.  Remsen,  7 
Paige,  207.  It  was  read  In  evidence  without 
objection,  and  no  qiiestion  In  regard  to  it  was 
raised  before  the  referee.  Portions  of  the 
proof,  introduced  under  It  were  objected  to 


on  other  and  specific  grounds;  but  the  posi- 
tion now  taken,  that  the  whole  was  inadmis- 
sible, was  not  even  suggested  on  the  trial. 
Upon  the  facts  disclosed  by  the  case,  we  do 
not  think  the  objection  tenable;  but  if  it  had 
been  well  founded,  It  would  be  too  late  to 
raise  It  on  appeaL  Newton  v.  Harris,  G  N. 
Y.  34.^;   Judd  v.  O'Brien,  21  N.  Y.  100. 

In  the  course  of  the  trial,  objections  were 
taken  to  proof  of  the  acts  and  declarations 
of  the  defendant's  agent  in  relation  to  the 
legal  proceedings  conducted  by  the  plaintiffs. 
They  constituted  a  part  of  the  res  gestie,  and 
as  his  agency  was  conceded,  they  were  ad- 
missible as  acts  and  declarations  of  his  prin- 
cipal. McCotter  v.  Hooker,  8  N.  Y.  503; 
Fleming  v.  Smith,  44  Barb.  554.  Other 
grounds  of  error  are  alleged,  but  they  seem 
to  us  plainly  untenable. 

The  judgment  should  be  affirmed,  with 
costs. 

PARKER,  J.,  concurs. 


342 


CAPACITY  OF  PARTIES. 


DO\>/nING  t.  MX.   WASHINGTON  KOAD 

*-    ^.  CO. 

(40  N    H.  230.) 

Supreme    Court    of    New     Hampshire.    Merri- 
mack     June  Term,  18G0. 

Assumpsit,  brought  by  Lewis  Downing  & 
Sous,  to  recover  the  price  of  eight  omnibxises, 
and  a  model  for  the  same,  one  light  wagon, 
and  one  baggage  wagon,  made  for  the  de- 
fendants, under  a  contract  entered  into  by 
D.  O.  Macomber,  president  of  the  defendant 
corporation  in  their  behalf. 

The  light  wagon  was  made  and  sent  to  one 
Cavis,  the  agent  for  building  the  road,  and 
was  used  by  him  in  making  it.  The  omni- 
buses and  baggage  wagon  were  intended  to 
be  used  in  conveying  passengers  up  and 
down  the  mountain,  after  the  road  was  com- 
pleted. The  omnibuses  were  constructed  in 
a  peculiar  way,  and  are  not  fit  for  use  on 
ordinary  roads. 

By  their  act  of  incorporation,  passed  July 
1,  1853,  the  corporation  was  empowered  to 
lay  out,  make,  and  keep  in  repair,  a  road 
from  such  point  in  the  vicinity  of  Mt.  Wash- 
ington as  they  may  deem  most  favorable,  to 
the  top  of  said  mountain,  etc.,  and  thence 
to  some  point  on  the  northwesterly  side  of 
said  mountain,  etc.,  to  take  tolls  of  pas- 
sengers and  for  carriages,  to  build  and  own 
toll-houses,  and  to  take  land  for  their  road. 

The  coi-poration  was  duly  organized,  and 
at  a  meeting  of  the  directors  on  the  31st  of 
August,  18o3,  before  said  contract  was  made, 
it  was  "voted  that  the  president  be  the  legal 
agent  and  commissioner  of  the  company;" 
and  his  compensation  as  such  was  fixed. 

"The  president"  was  "directed  to  proceed 
with  the  letting  of  the  work  for  the  con- 
struction of  the  road,  *  *  *  the  obtaining 
the  right  of  way,"  and  "what  other  action 
he  shall  deem  proper  for  the  interests  of  the 
company,"  etc. 

A  committee  was  appointed  "to  settle  in 
relation  to  the  right  of  way,  etc.,  and  in  re- 
lation to  land  on  \  Inch  to  build  stables  and 
other  buildings,  for  the  use  of  the  road,  and 
also  for  building  all  such  stables  and  houses 
as  may  be  necessary  for  the  operations  of  the 
company." 

It  appeared  that  by  an  additional  act, 
passed  July  12,  18.50,  the  corporation  were 
authorized  "to  erect  and  maintain,  lease  and 
dispose  of  any  building  or  buildings,  which 
may  be  found  convenient  for  the  accommo- 
dation of  their  business,  and  of  the  horses 
and  carriages  and  travellers  passing  over 
said  road." 

The  defendants  denied  the  authority  of 
Macomber  to  make  such  a  contract  in  behalf 
of  the  corporation,  and  the  power  of  the 
corporation  tmder  its  charter  either  to  au- 
thorize or  to  enter  into  such  a  contract. 

BELL,  C.  J.  Corporations  are  creatures  of 
the  legislature,  having  no  other  powers  than 
such  as  are  given  to  them  by  their  charters. 


or  such  as  are  incidental,  or  necessary  to 
caxi-y  into  effect  the  pui-poses  for  which 
they  were  established.  Trustees  v.  Peas- 
lee,  15  N.  H.  330;  l^erriue  v.  Chesapeake 
Canal  Co.,  9  How.  172.  In  giving  a  construc- 
tion to  the  powei-s  of  a  corporation,  the  lan- 
guage of  the  charter  should  in  general  nei- 
ther be  construed  strictly  nor  liberally,  but 
according  to  the  fair  and  natural  import  of 
it,  with  reference  to  the  purposes  and  ob- 
jects of  the  corporation.  Enfield  Bridge  v. 
Hartford  R.  R.,  17  Conn.  454;  Strauss  v. 
Eagle  Co.,  5  Ohio  St.  39. 

If  the  powers  conferred  are  against  com- 
mon right,  and  trench  in  any  way  upon  the 
privileges  of  other  citizens,  they  are,  in 
cases  of  doubt,  to  be  construed  strictly,  but 
not  so  as  to  impair  or  defeat  the  objects  of 
the  incorporation. 

In  the  present  case  the  power  to  take  the 
lands  of  others,  and  to  take  tolls  of  trav- 
ellers, must  be  strictly  construed,  if  doubts 
should  arise  on  those  points;  but  it  is  not 
seen  that  the  other  grants  to  the  defendant 
corporation  should  not  receive  a  fair  natural 
construction. 

The  charter  of  the  Mt.  Washington  Road 
empowers  them  to  lay  out,  make  and  keep 
in  repair,  a  road  from  Peabody  River  Valley 
to  the  top  of  Mount  Washington,  and  thence 
to  some  point  on  the  northwest  side  of  the 
mountain.  It  grants  tolls  on  passengers  and 
can-iages,  and  authorizes  them  to  take  lands 
of  others  for  their  road,  and  to  build  and 
own  toll-houses,  and  erect  gates,  and  appoint 
toll-gatherers  to  collect  their  tolls.  The  re- 
maining provisions  contain  the  ordinary  pow- 
ers of  corporations  relating  to  directors, 
stock,  dividends,  meetings,  etc.  Laws  1853, 
c.  1486. 

This  chapter  confers  the  usual  powers 
heretofore  granted  to  turnpike  corporations, 
and  no  others.  The  most  natural  and  satis- 
factory mode  of  ascertaining  what  are  the 
powers  incidentally  granted  to  such  compa- 
nies, is  to  inquire  what  powers  have  been 
usually  exercised  under  them,  without  ques- 
tion by  the  public  or  by  the  corporators.  It 
may  be  safely  assumed  that  the  powera 
which  have  not  heretofore  been  found  neces- 
sarj',  and  have  not  been  claimed  or  exer- 
cised under  such  charters,  are  not  to  be  con- 
sidered generally  as  incidentally  granted. 
Such  charters  have  in  former  years  been 
vei-y  common  in  this  and  other  states,  and 
they  have  not,  so  far  as  we  are  aware,  been 
understood  as  authorizing  the  C9rporations 
to  erect  hotels,  or  to  establish  stage  or  trans- 
portation lines,  to  purchase  horses  or  car- 
riages, or  to  employ  drivers  in  transporting 
passengers  or  freight  over  their  roads;  and 
no  such  powers  have  anywhere  been  claimed 
or  exercised  under  them.  We  are,  therefore, 
of  opinion  that  the  power  to  establish  stage 
and  transportation  lines  to  and  from  the 
mountain,  to  purchase  carriages  and  horses 
for  the  purpose  of  carrying  on  such  a  busi- 
ness, was  not  incidentally  granted  to  the  de- 


CORPORATIOXS. 


843 


fendant  corporatiou  by  their  charter.  State 
V.  Commissioners  of  Mansfield,  23  N.  J.  Law, 
510. 

But  it  is  contended  that  the  power  to  malce 
this  contract  is  conferred  by  the  act  in 
amendment  of  the  charter,  passed  July  12, 
1S56.  By  this  act  the  corporation  may  "erect 
and  maintain,  lease  and  dispose  jf  any 
building  or  buildings  which  may  be  found 
convenient  for  the  accommodation  of  their 
business,  and  of  the  horses  and  carriages 
and  travellers  passing  over  their  said  road." 
By  their  business,  which  the  buildings  to  be 
erected  were  designed  to  accommodate,  it  is 
said  tlie  legislature  must  have  intended  some 
permanent  and  continuing  business  beyond 
that  of  merely  building  and  maintaining  a 
road;  and  that  it  could  be  no  other  th;m  that 
of  erecting  a  hotel  on  the  mountain,  and  es- 
tablishing lines  of  carriages,  for  the  pur- 
pose of  carrying  visitors  up  and  down  the 
mountain. 

But  the  foundation  of  this  Implication  is 
very  slight.  The  express  grant  is  of  an  au- 
thority to  erect,  etc.,  buildings,  not  of  all 
kinds,  but  such  as  may  be  found  convenient 
for  the  accommodation  of  their  business, 
and  of  travellers,  etc.  The  business  here  re- 
ferred to  must  be  understood  to  be  such  as 
they  are  by  their  charter  authorized  to  en- 
gage in.  If  nothing  had  been  said  of  horses 
and  travellers,  there  could  hardly  be  any 
foimdation  for  the  idea  that  a  hotel  could 
have  been  contemplated  by  the  legislature. 
Buildings  suitable  for  the  accommodation  of 
their  toll-gatherers  and  workmen  employ- 
ed on  their  road,  would  probably  be  thought 
evei-ything  the  legislature  intended  to  au- 
thorize by  this  additional  act.  Connected 
as  this  authority  now  is  with  travellers, 
horses,  and  carriages,  there  is  scarce  a  pre- 
tence for  argument  that  this  additional  act 
goes  any  further  than  the  original  act,  to 
authorize  a  stage  and  transportation  com- 
pany. It  is  not  unlikely  that  some  of  the 
projectors  of  this  enterprise  intended  to  se- 
cure much  more  extensive  rights  than  those 
of  a  turnpike  and  hotel  company,  but  it 
seems  certain  they  have  not  exhibited  this 
feature  of  their  case  to  the  legislature  so  dis- 
tinctly as  to  secure  their  sanction,  and  the 
charter  and  its  amendment  as  yet  justifies 
them  In  no  such  claim. 

The  power  of  buying  and  selling  real  and 
personal  property  for  the  legitimate  pur- 
poses of  the  corporation,  and  the  power  of 
contracting  generally  for  the  same  purposes, 
within  the  limits  prescribed  by  the  charter, 
being  granted,  we  understand  the  principle 
to  be,  that  their  purchases,  sales,  and  con- 
tracts generally,  will  be  presumed  to  be 
made  within  the  legitimate  scope  and  pur- 
pose of  the  corporation,  until  the  contrary 
appears,  and  that  the  burden  of  showing 
that  any  contract  of  a  corporation  is  beyond 
its  legitimate  powers,  rests  on  the  party 
who  objects  to  it.  Indiana  v.  Woram,  6  Hill, 
37;    Ex   parte   Peiu   Iron   Co.,   7   Cow.   540; 


Farmers'  Loan  &  Trust  Co.  v.  Clowes,  3 
N.  Y.  470;  Farmers'  Loan  &  Trust  'Co.  V. 
Curtis,  7  N.  Y.  400;  Beers  v.  Pha?nix  Glass 
Co.,  14  Barb.  3.j8. 

If  a  corporation  attempt  to  enforce  a  con- 
tract made  with  them  in  a  case  beyond  the 
legitimate  limits  of  their  corporate  power, 
that  fact,  being  shown,  will  ordinarily  con- 
stitute a  perfect  defence.  Green  v.  Seymour, 
3  Sandf.  Ch.  L'S.1;  Bangor  Boom  v.  Whiting, 
29  Me.  123;  Life  &  Fire  Ins.  Co.  v.  Mechan- 
ic Fire  Ins.  Co.,  7  Wend.  31;  New  York,  etc., 
Ins.  Co.  v.  Ely,  5  Conn.  500. 

And  if  a  suit  is  brought  upon  a  contract 
alleged  to  be  made  by  the  corporation,  but 
which  is  shown  to  be  beyond  its  coiporate 
power  to  enter  into,  the  contract  will  bo  re- 
garded as  void,  and  the  coi-poration  may 
avail  themselves  of  that  defence.  Beach  v. 
Fulton  Bank,  3  Wend.  573;  Albert  v.  .Sav- 
ings Bank,  1  Md.  Ch.  Dec.  407;  Abbot  v. 
Baltimore,  etc.,  Co.,  Id.  542;  Strauss  v. 
Eagle  Ins.  Co.,  5  Ohio  St.  59;  Baron  v.  Mis- 
sissippi Ins.  Co.,  31  Miss.  110;  Bank  of  Gen- 
esee V.  Patchin  Bank.  13  N.  Y.  315;  Gage  v. 
Newmarket,  18  Q.  B.  457. 

The  contract  set  up  in  this  case,  was  made 
not  by  the  corporation  itself,  by  a  vote, 
nor  by  an  agent  expressly  authorized  to  sign 
a  contract  already  drawn,  but  it  was  made 
by  the  president  of  the  corporation,  acting 
under  an  appointment  as  their  general  agent; 
and  it  is  argued  that  he  was  fully  author- 
ized by  votes  of  the  corporation  to  bind  them 
by  such  a  contract  as  the  present;  but  it  is 
not  necessary  to  consider  this  question,  as 
we  think  it  settled  that  the  powers  of  the 
agents  of  corporations  to  enter  into  contracts 
in  their  behalf  are  limited,  by  the  nature 
of  things,  to  such  contracts  as  the  corpora- 
tions are  by  their  charters  authorized  to 
make.  This  principle  is  distinctly  recognized 
in  McCullough  v.  Moss,  5  Denio,  567,  over- 
ruling the  case  of  Moss  v.  Rossie  Lead  Co., 
5  Hill,  137,  and  in  Central  Bank  v.  Em- 
pire Stone-Dressing  Co.,  2t3  Barb.  23;  Bank 
of  Genesee  v.  Patchin  Bank,  13  N.  Y.  315. 

The  same  want  of  power  to  give  authority 
to  an  agent  to  contract,  and  thereby  bind 
the  corporation  in  matters  beyond  the  scope 
of  their  corporate  objects,  must  be  equally 
conclusive  against  any  attempt  to  ratify  such 
contract.  What  they  cannot  do  directly  they 
cannot  do  indirectly.  They  cannot  bind 
themselves  by  the  ratification  of  a  contract 
which  they  had  no  authority  to  make.  5 
E>enio,  567,  above  cited.  The  power  of  the 
agent  must  be  restricted  to  the  business 
which  the  company  was  authorized  to  do. 
Within  the  scope  of  the  business  which  they 
had  power  to  transact,  he,  as  its  agent,  may 
be  authorized  to  act  for  it,  but  beyond  that 
he  could  not  be  authorized,  for  its  powers 
extend  no  further. 

This  view  seems  to  us  entirely  conclusive 
against  the  claim  made  for  the  omnibuses 
and  model,  and  probably  for  the  baggage 
wagon. 


344 


CAPACITY  OF  PARTIES. 


As  to  the  light  wagon,  that  may  stand  on 
a  different  ground.  Such  a  wagon  might  be 
useful  and  necessai-y  for  the  use  of  the 
agent  of  the  company,  in  conducting  the  un- 
doubted business  of  the  corporation,— the 
building  and  maintaining  the  road. 

We  are  unable  to  a;ssent  to  the  position 
taken  in  the  argument,  that  a  ratification  of 
part  is  a  ratification  of  the  whole  contract. 
While  the  corporation  may  be  restricted  from 


ratifying  a  contract  beyond  the  scope  of  the 
objects  of  the  corporation,  there  could  be  no 
such  objection  as  to  any  matter  clearly  with- 
in their  power.  The  other  contracting  party 
might  have  a  right  to  reject  such  ratification, 
claiming  that  the  contract  is  entire,  and  if  not 
ratified  as  such,  it  should  not  be  made  good 
for  a  part  only.  But  if  they  claim  the  bene- 
fit of  the  partial  ratification,  the  corporation 
can  hardly  object. 


CORPORATION'S. 


845 


THOMAS  v.  RAILROAD  COMPANY. 

(101  U.   S.  7L) 

Supreme  Court  of  United   Suites.     Oct  Term, 
187'J. 

Error  to  the  circuit  court  of  the  United 
States  for  the  Eastern  district  of  Peuusyl- 
vania. 

This  was  an  action  of  covenant,  by  George 
W.  Thomas,  Alfred  S.  Porter,  and  Nathaniel 
F.  Chew,  against  the  West  Jersey  Railroad 
Company,  and  they,  to  maintain  the  issue  on 
their  part,  offered  to  prove  the  following 
facts: 

On  the  eighth  day  of  October,  18G3,  the 
Millville  and  Glassboro  Railroad  Company, 
a  coi-poration  incorporated  by  the  legisla- 
ture of  New  Jersey,  March  9,  1859,  entered 
Into  an  agreement  with  them,  whereby  It 
was  stipulated  that  the  company  should,  and 
did  thereby,  lease  its  road,  buildings,  and 
rolling-stock  to  them  for  twenty  years  from 
the  first  of  August,  18<>3,  for  the  consid- 
eration of  one-half  of  the  gross  sum  col- 
lected from  the  operation  of  the  road  by 
the  plaintiffs  during  that  period;  that  the 
company  might  at  any  time  terminate  the 
contract  and  retalie  possession  of  the  rail- 
road, and  that  in  such  case,  if  the  plaintiffs 
so  desired,  the  company  would  appoint  an 
arbitrator,  who,  with  one  appointed  by  them, 
should  decide  upon  the  value  of  the  contract 
to  them,  and  the  loss  and  damage  incurred 
by,  and  justlj  ana  eqaitably  due  to  them, 
by  reason  of  such  termination  thereof;  that 
In  event  of  a  difference  of  opinion  between 
the  arbitrators,  they  were  to  choose  a  third, 
and  the  decision  of  a  majority  was  to  be 
final,  conclusive,  and  binding  upon  the  par- 
ties. 

On  the  10th  of  April,  1867,  the  legislature 
of  New  Jei-sey  passed  an  act  entitled  "A 
supplement  to  the  act  entitled  'An  act  to 
incorporate  the  Millville  and  Glassboro  Rail- 
road Company.' "  It  was  therein  enacted 
that  it  should  be  unlawful  for  the  direct- 
ors, lessees,  or  agents  of  said  railroad  to 
charge  more  than  the  sums  therein  named 
for  passengers  and  freight  respectively. 
The  plaintiffs  claim  that  at  the  date  of  the 
passage  of  this  act,  It  was  well  linown  that 
they  were  acting  under  the  said  agreement 
of  Sth   October,    1SG3. 

On  the  12th  of  October,  1SG7,  articles  of 
agreement  were  entered  into  between  the 
Millville  and  Glassboro  Railroad  Company 
and  the  West  Jersey  Railroad  Company,  the 
defendant,  whereby  It  was  agreed  that  the 
former  should  be  merged  Into  and  consol- 
idated with  the  latter. 

In  November,  lSt)7,  a  written  notice  was 
served  by  the  Millville  and  Glassboro  Rail- 
road Company  upon  the  plaintiff's,  putting 
an  end  to  the  contract  and  to  all  the  rights 
thereby  granted,  and  notifying  them  that 
the  company  would  retake  possession  of  the 
railroad  on  the  flrst  day  of  April,  1868. 


On  the  ISth  of  March,  1863,  the  legislature 
of  New  Jersey  passed  an  act  whereby  it  was 
enacted  that,  upon  the  fullillincnt  of  certain 
preliminaries,  the  Millville  and  Glassboro 
Railroad  Companj  should  be  consolidated 
with  the  West  Jersey  Railroad  Company, 
"subject  to  all  the  debts,  liabilities,  and  ob- 
ligations of  both  of  said  companies."  The 
conditions  required  by  that  act  were  ful- 
filled, and  the  railroad  was  duly  deUvered  by 
the  plaintiffs  to  the  West  Jersey  Railroad 
Company  on  the  first  of  April,  1808. 

On  April  13  18G8,  and  again  on  May  22 
of  the  same  year,  notices  to  arbitrate  ac- 
cording to  the  teims  of  the  agreement  were 
served  by  the  plaintiffs  upon  the  Millville  and 
Glassboro  Railroad  Company,  and  immediate- 
ly thereafter  upon  the  West  Jersey  Railroad 
Company.  The  latter  company  refused  to  com- 
ply with  the  terms  of  either  notice;  but  sub- 
sequently, on  the  21st  of  December,  1808, 
an  agreement  of  submission  was  entered  in- 
to between  the  plaintiffs  and  the  latter  com- 
pany, whereby  H.  F.  Kenney  and  Matthew 
Baird  were  appointed  arbitrators,  with  power 
to  choose  a  third,  to  settle  the  controversy 
between  the  parties.  These  arbitrators,  dis- 
agreeing, called  in  a  third,  who  joined  with 
said  Baird  in  an  award,  by  which  the  value 
of  the  unexpired  term  of  the  lease,  and  the 
loss  sustained  by  reason  of  the  termination 
thereof,  to  and  by  the  plaintiffs,  was  ad- 
judged to  be  the  sum  of  $159,437.07;  and 
the  West  Jersey  Railroad  Company  was  or- 
dered to  pay  that  sum  to  the  plaintiffs.  This 
award  was  subsequently  set  aside  in  a  suit 
in  equity  brought  in  New  Jersey. 

The  plaintiffs  further  offered  to  prove  their 
compliance  In  all  respects  with  the  terms  of 
the  lease.  Its  value,  and  the  loss  and  damage 
they  had  sustained  by  reason  of  its  termina- 
tion as  aforesaid.  The  court  excluded  the 
offered  testimony  on  the  ground  that  the 
lease  by  the  Millville  and  Glassboro  Railroad 
Company  to  the  plaintiffs  was  ultra  vires,  and 
directed  the  jury  to  return  a  verdict  for  the 
defendant  The  plaintiffs  duly  excepted,  and 
sued  out  this  writ 

They  assign  for  error  that  the  court  below 
erred,— 

1.  In  excluding  from  the  consideration  of 
the  jury  the  offered  evidence  of  the  said 
agreement  between  the  MillviUe  and  Glass- 
boro Railroad  Company  and  the  plaintiffs; 
of  the  acts  of  assembly  of  New  Jersey,  one 
an  act  to  incorporate  the  Millville  and  Glass- 
boro Railroad  Company,  approved  the  9th  of 
March,  1859,  and  another  an  act  entitled  "A 
supplement  to  the  act  entitled  'An  act  to 
incorporate  the  MillviUe  and  Glassboro  Rail- 
road Company,'  passed  the  tenth  day  of  April, 
1SG7,"  and  the  acts  referred  to  therein;  of  the 
fact  that  it  was  well  known  at  the  date  of  the 
last-named  act  that  the  plaintiffs  were  lessees 
acting  imder  the  said  contract  and  agree- 
ment: and  of  all  the  ether  acts  of  the  leg- 
islature of  the  state  of  New  Jersey  relating 


346 


CAPACITY  OF  PARTIES. 


to  the  West  Jersey  Railroad  Company,  and 
to  the  Millville  and  Glassboro  Raih-oad  Com- 
pany. 

2.  In  directing  the  jury  that  their  verdict 
must  be  for  the  defendant. 

3.  In  entering  judgment  upon  the  verdict 
for  the  defendant. 

Mr.  Justice  MILLER,  after  stating  the 
case,  delivered  the  opinion  of  the  court. 

The  ground  on  which  the  court  held  the 
contract  to  be  void,  and  on  which  the  ruling 
is  supported  in  argument  here,  is  that  the 
contract  amounted  to  a  lease,  by  which  the 
railroad,  rollmg-stock,  and  franchises  of  the 
corporation  were  transfeiTed  to  plaintiffs, 
and  tliat  such  a  contract  was  ultra  vires  of 
the  company. 

It  is  denied  by  the  plaintiffs  that  the  con- 
tract can  be  fairly  called  a  lease. 

But  we  know  of  no  element  of  a  lease  which 
is  wanting  in  this  instnament.  "A  lease  for 
years  is  a  contract  between  lessor  and  lessee, 
for  possession  of  lands,  etc.,  on  the  one  side, 
and  a  recompense  by  rent  or  other  considera- 
tion on  the  other."     4  Bac.  Abr.  632. 

"Any  thing  corporeal  or  incorpoi'eal  lying  in 
livery  or  in  grant  may  be  the  subject-matter 
of  a  lease,  and,  therefore,  not  only  lands  and 
houses,  but  commons,  ways,  fisheries,  fran- 
chises, estovere,  annuities,  rent-charges,  and 
all  other  incorporeal  hereditaments  are  in- 
cluded in  the  common-law  rule."  Bouv.  Law 
Diet.  "Lease";    1  Washb.  Real.  Prop.  310. 

The  railroad  and  all  its  appurtenances 
and  franchises,  including  the  right  to  do  thfi 
business  of  a  railroad  and  collect  the  proper 
tolls,  are  for  a  period  of  twenty  years  leased 
by  the  company  to  the  plaintiffs,  from  whom 
In  return  it  receives  as  rent  one-half  of  all  the 
gross  earnings  of  the  road.  The  usual  provi- 
sion for  a  right  of  re-entry  on  the  failure  to 
perform  covenants  in  addition  to  the  special 
right  to  terminate  the  lease  on  notice,  and  the 
usual  covenant  for  repairs  and  proper  running 
of  the  road,  equivalent  to  good  husbandry  on 
a  farm,  are  inserted  in  the  instrument. 

The  provision  for  the  complete  possession, 
control,  and  use  of  the  property  of  the  com- 
pany and  its  franchises  by  the  lessees  is  per- 
fect. Nothing  is  left  in  the  lessor  but  the 
right  to  receive  rent.  No  power  of  control  in 
the  management  of  the  road  and  in  the  exer- 
cise of  the  franchises  of  the  company  is  re- 
served. A  solitary  exception  to  this  state- 
ment, of  no  value  in  the  actual  control  of  af- 
fairs, is  found  in  the  sixth  clause  of  the  lease, 
which  covenants  that  the  lessees  will  dis- 
charge any  one  in  their  service  on  the  request 
of  the  corporation,  evidenced  by  a  resolution 
of  the  board  of  directors. 

But  while  we  are  satisfied  that  the  contract 
Is  both  technically  and  in  its  essential  charac- 
ter a  lease,  we  do  not  see  that  the  decision 
of  that  point  either  way  affects  the  question 
on  which  we  are  to  pass.  That  question  is, 
whether  the  railroad   company   exceeded   its 


powers  in  making  the  contract,  by  whatever 
name  it  may  be  called,  so  that  it  is  void. 

It  is,  perhaps,  as  well  to  consider  this  ques- 
tion in  the  order  of  its  presentation  by  the 
learned  counsel  for  plaintiffs,  upon  whom  the 
burden  of  showing  the  error  of  the  circuit 
court  devolved  as  well  as  the  duty  of  proving 
one  of  the  following  propositions: 

1.  The  contract  was  within  the  powers 
granted  to  the  railroad  company  by  the  act  of 
the  New  Jersey  legislature  under  which  it 
was  organized. 

2.  That  if  this  be  not  established,  the  lease 
was  afterwards  ratified  and  approved  by  an- 
other act  of  that  legislature. 

3.  That  if  both  these  propositions  are  found 
to  be  untenable,  the  contract  became  an  ex- 
ecuted agreement  under  which  the  rights  ac- 
quired by  plaintiffs  should  be  legally  respect- 
ed. 

The  authority  to  make  this  lease  is  placed 
by  counsel  primarily  in  the  following  lan- 
guage of  the  thirteenth  section  of  the  com- 
pany's charter: 

"That  it  shall  be  lawful  for  the  said  com- 
pany, at  any  time  during  the  continuance  of 
its  charter,  to  make  contracts  and  engage- 
ments with  any  other  corporation,  or  with  in- 
dividuals, for  the  transporting  or  conveying 
any  kinds  of  goods,  produce,  merchandise, 
freight,  or  passengers,  and  to  enforce  the  ful- 
fillment of  such  contracts." 

This  is  no  more  than  saying:  "You  may  do 
the  business  of  carrying  goods  and  passen- 
gers, and  may  make  contracts  for  doing  that 
business.  Such  contracts  you  may  make  with 
any  other  corporation  or  with  individuals." 
No  doubt  a  contract  by  which  the  goods  re- 
ceived from  railroad  or  other  carrying  com- 
panies should  be  carried  over  the  road  of  this 
company,  or  by  which  goods  or  passengers 
from  this  road  should  be  carried  by  other 
railroads,  whether  connecting  immediately 
with  them  or  not,  are  within  this  power,  and 
are  probably  the  main  object  of  the  clause. 
But  it  is  impossible,  under  any  sound  rule  of 
construction,  to  find  in  the  language  used  a 
permission  to  sell,  lease,  or  transfer  to  others 
the  entire  road  and  the  rights  and  franchises 
of  the  corporation.  To  do  so  is  to  deprive  the 
company  of  the  power  of  making  those  con- 
tracts which  this  clause  confers,  and  of  per- 
forming the  duties  which  it  implies. 

In  Ashbury  Railway  Carriage  &  Iron  Co.  v. 
Riche  (decided  in  the  house  of  lords  in  1875> 
L.  R.  7  H.  L.  6.53,  the  memorandum  of  asso- 
ciation, which,  as  Lord  Cairns  said,  stands 
under  the  act  of  1862  in  place  of  a  legislative 
charter,  thus  described  the  business  which 
the  company  was  authorized  to  conduct:  "The 
objects  for  which  this  company  is  established 
are  to  make,  sell,  or  lend  on  hire  railway- 
carriages  and  engines,  and  all  kinds  of  rail- 
way plant,  fittings,  machinery,  and  rolling- 
stock;  and  to  carrj'  on  the  business  of  me- 
chanical engineers  and  general  contractors;  to 
purchase  and  sell  as  merchants  timber,  coal. 


CORPORATIONS. 


847 


metals,  or  other  materials;  and  to  buy  and 
sell  any  such  materials  on  commission  or  as 
agents."  This  company  purchased  a  conces- 
sion for  a  railroad  in  Belgium,  and  entered 
into  a  contract  for  its  construction,  on  which 
it  paid  large  sums  of  money.  The  company 
was  sued  afterwards  on  its  agreement  with 
Riche,  the  contractor,  and  the  contract  was 
held  valid  in  the  exchequer  chamber  by  a 
majority  of  the  judges,  on  the  ground  that 
while  it  was  in  excess  of  the  power  conferred 
on  the  directors  by  the  memorandum,  it  had 
been  made  valid  by  ratification  of  the  share- 
holders, to  whom  it  had  been  submitted. 

The  house  of  lords  reversed  this  judgment, 
holding  unanimously  that  the  contract  was 
beyond  tlie  powers  conferred  by  the  memo- 
randum above  recited,  and  being  beyond  the 
powers  of  the  association,  no  vote  of  the 
shareholders  whatever  could  make  it  valid. 
The  case  is  otherwise  important  in  its  rela- 
tion to  the  one  before  us,  but  it  is  cited  here 
for  its  parallelism  in  the  construction  of  the 
clause  defining  the  powers  of  the  company. 

If  a  memoi-audum  which  describes  the  par- 
ties as  engaging  in  furnishing  nearly  all  the 
materials,  machinery,  and  rolling-stock  which 
enter  into  the  construction  of  a  railroad  and 
its  equipments,  and  then  empowers  them  to 
carry  on  the  business  of  mechanical  engineers 
and  general  contractors,  cannot  autliorize  a 
contract  to  build  a  railroad,  surely  the  author- 
ity to  build  a  railroad  and  to  contract  for  car- 
rying passengers  and  goods  over  it  and  other 
roads  is  no  authority  to  lease  it,  and  with  the 
lease  to  part  with  all  its  powers  to  another 
company  or  to  individuals.  We  do  not  think 
there  is  anything  in  the  language  of  the  char- 
ter which  authorized  the  making  of  this 
agreement. 

It  is  next  insisted,  in  the  language  of  coun- 
sel, that  though  this  may  be  so,  "a  corporate 
body  may  (as  at  common  law)  do  any  act 
which  is  not  either  expressly  or  impliedly  pro- 
hibited by  its  charter;  although  where  the 
act  is  unauthorized  by  the  charter  a  share- 
holder may  enjoin  its  execution,  and  the  state 
may,  by  proper  process,  forfeit  the  charter." 

We  do  aot  concur  in  this  proposition.  We 
take  the  general  doctrine  to  be  in  this  country, 
though  there  may  be  exceptional  cases  and 
some  authorities  to  the  contrary,  that  the 
powers  of  corporations  organized  under  legis- 
lative statutes  are  such  and  such  only  as 
those  statutes  confer.  Conceding  the  rule  ap- 
plicable to  all  statutes,  that  what  is  fairly  im- 
plied is  as  much  granted  as  what  is  expressed, 
it  remains  that  the  charter  of  a  corporation  Is 
the  measure  of  its  powers,  and  that  the  enu- 
meration of  these  powers  implies  the  exclu- 
sion of  all  others. 

This  class  of  subjects  has  received  much 
consideration  of  late  years  in  the  English 
courts,  and  counsel  have  relied  largely  on  the 
decisions  of  those  courts.  Among  the  eases 
cited  by  both  sides  is  East  Anglian  Ry.  Co.  v. 
Eastern  Counties  Ky.  Co.,  11  C.  B.  775. 


In  that  case  the  Eastern  Counties  Railway 
Company  had  made  a  contract  In  which, 
among  other  things,  It  covenanted  to  take  a 
lea.se  of  seveial  other  railroads  whose  compa- 
nies had  Introduced  into  parliament  a  bill  for 
consolidation  under  the  name  of  East  Anglian 
Railways  Company,  and  to  assume  the  pay- 
ment of  the  parliamentary  expenses  of  this 
act  of  consolidation. 

This  covenant  was  held  void  as  beyond 
the  power  conferred  by  the  charter.  "They 
cannot,"  said  the  court,  "engage  in  a  new 
trade,  because  they  are  incorporated  only 
for  the  purpose  of  making  and  maintaining 
the  Eastern  Counties  Railway.  What  addi- 
tional power  do  they  acquire  from  the  fact 
that  the  undertaking  may  in  some  way  bene- 
fit their  line?  Whatever  be  their  object  or 
prospect  of  success,  they  are  still  but  a 
corporation  for  the  purpose  only  of  making 
and  maintaining  the  Eastern  Counties  Rail- 
way; and  if  they  cannot  embark  in  new 
trades  because  they  have  only  a  limited  au- 
thority, for  the  same  reason  they  can  do 
nothing  not  authorized  by  their  act  and  not 
within  the  scope  of  their  authority."  This 
case,  decided  in  1851,  was  afterwards  cited 
with  approval  by  the  lord  chancellor  in  ls.57 
in  delivering  the  opinion  of  the  house  of 
lords  in  Eastern  Counties  Ry.  Co.  v.  Hawkes, 
5  H.  L.  Cas.  331;  and  it  is  there  stated  that 
it  was  also  acted  on  and  recognized  in  the 
exchequer  chamber  in  McGregor  v.  Deal  & 
Dover  Ry.  Co.,  22  Law  J.  Q.  B.  69.  IS  Q. 
B.  G18.  Both  these  cases  are  cited  approv- 
ingly in  the  opinion  of  Lord  Cairns  in  the 
Ashbury  Case  on  appeal  in  the  house  of 
lords. 

This  latter  case,  as  decided  in  the  excheq- 
uer chamber  (L.  R.  9  Exch.  224).  is  much 
relied  on  by  counsel  for  plaintiffs  here  as 
showing  that,  though  the  contract  may  be 
ultra  vires  when  made  by  the  directors,  it 
may  be  enforced  if  afterwards  ratified  by 
the  shareholders  or  if  partly  executed. 

But  In  the  house  of  lords,  where  the  case 
came  on  appeal,  this  principle  was  over- 
ruled unanimously  in  opinions  delivered  by 
Lord  Chancellor  Cairns,  Lords  Selbome, 
Chelmsford,  Hatherly,  and  O'Hagan,  and  the 
broad  doctrine  established  that  a  contract 
not  within  the  scope  of  the  powers  con- 
feiTod  on  the  corporation  cannot  be  made 
valid  by  the  assent  of  every  one  of  the 
shareholders,  nor  can  It  by  any  partial  per- 
formance become  the  foundation  of  a  right 
of  action. 

It  would  be  a  waste  of  time  to  attempt 
to  examine  the  American  cases  on  the  sub- 
ject, which  are  more  or  less  conflicting,  but 
we  think  we  are  warranted  in  saying  that 
this  latest  decision  of  the  house  of  lords 
represents  the  decided  preponderance  of  au- 
thority, both  in  this  country  and  in  England, 
and  is  based  upon  sound  principle. 

There  is  another  principle  of  equal  impor- 
tance .and  equally  conclusive  against  the  va- 


348 


CAPACITY  OF  PARTIES. 


Udity  of  this  contract,  which,  if  not  coming 
exactly  within  the  doctrine  of  ultra  vires 
as  we  have  just  discussed  it,  shows  very 
clearly  that  the  railroad  company  was  with- 
out the  power  to  make  such  a  contract. 

That  principle  Is  that  where  a  corporation, 
like  a  railroad  company,  has  granted  to  it 
by    charter   a   franchise    intended    in    large 
measure  to  be  exorcised  for  the  public  good, 
the  due  performance  of  those  functions  being 
the  consideration  of  the  public  grant,   any 
contract  which  disables  the  corporation  from 
performing    those    functions,    which    under- 
takes, without  the  consent  of  the  state,  to 
transfer    to    others    the   rights   and    powers 
conferred  by  the  charter,  and  to  relieve  the 
grantees   of  the   burden   which   it  imposes, 
is  a  violation  of  the  contract  with  the  state, 
and  is  void  as  against  public  policy.    This 
doctrine  is  asserted  with  remarkable  clear- 
ness in  the  opinion  of  this  court,  delivered  by 
Mr.  Justice  Campbell,  in  New  York  &  M.  L. 
R.   Co.   V.   Winans,   17   How.  30.     The   cor- 
poration in  that  case  was  chartered  to  build 
and  maintain  a  railroad  in  Pennsylvania  by 
the  legislature  of  that  state.     The  stock  in 
it   was   taken  by    a   Maryland   corporation, 
called  the  Baltimore  and  Susquehanna  Rail- 
road Company,  and  the  entire  management 
of  the  road  was  committed  to  the  Maryland 
company,    which   appointed  all   the   officers 
and  agents  upon  it,  and  furnished  the  roll- 
ing   stock.      In    reference   to   this    state    of 
things,  and  its  effect  upon  the  liability  of 
the  Pennsylvania  corporation  for  infringing 
a  patent  of  the  defendant  in  error,  Winans, 
this  court  said:     "This  conclusion  [argument] 
implies   that   the   duties   imposed   upon   the 
plaintiff  by  the  charter  are  fulfilled  by  the 
construction  of  the  road,  and  that  by  alienat- 
ing its  right  to  use,  and  its  powers  of  con- 
trol and  supervision,   it  may  avoid   further 
responsibility.     But   those   acts    involve   an 
overturn  of  the  relations  which  the  charter 
has  arranged  between  the  corporation  and 
the  community.     Important  franchises  were 
conferred  upon  the  corporation  to  enable  it 
to  provide  facilities  for  communication  and 
intercourse,  required  for  the  public  conven- 
ience.    Corporate  management  and  control 
over  these   were  prescribed,   and  corporate 
responsibility  for  tlieir  insufficiency  provided 
as   a    remuneration   to   the   community    for 
their  grant.     The  corporation  cannot  absolve 
itself   from  the  performance  of   its  obliga- 
tions without  the  consent  of  the  legislature. 
Beman  v.  Rufford,  1  Sim.  (N.  S.)  550;  Winch 
v.  Birkenhead,  L.  &  C.  J.  Ry.  Co.,  13  Eng. 
Law  &  Eq.  506." 

And  in  the  case  of  Black  v.  Delaware  &  R. 
Canal  Co.,  22  N.  J.  Eq.  130,  Chancellor  Zab- 
riskie  says:  "It  may  be  considered  as  set- 
tled that  a  corporation  cannot  lease  or  alien 
any  franchise,  or  any  property  necessary 
to  perform  its  obligations  and  duties  to  the 
state,  without  legislative  authority."  Id.  399. 
For  this   he   cites   some  ten  or  twelve  de- 


cided cases  in  England  and  in  this  country. 
This  brings  us  to  the  proposition  that  the 
legislatiu-e  of  New  Jersey  has  given  its 
consent  by  an  act  which  amounts  to  a  rati- 
fication of  this  lease. 

That  act  is  entitled  "A  supplement  to  the 
act  entitled  'An  act  to  incorporate  the  Mill- 
ville  and  Glassboro  Railroad  Company,"  ap- 
proved April  10,  1867;  and  its  only  purpose 
was  to  regulate  the  rates  at  which  freight 
and  passengers  should  be  carried.  It  reads 
as  follows: 

"That  it  shall  be  unlawful  for  the  direct- 
ors, lessees,  or  agents  of  said  railroad  to 
charge  more  than  three  and  a  half  cents 
per  mile  for  the  carrying  of  passengers,  and 
six  cents  per  ton  per  mile  for  the  carrying 
of  freight  or  merchandise  of  any  descrip- 
tion, unless  a  single  package,  weighing  less 
than  one  hundred  pounds;  nor  shall  more 
than  one-half  of  the  above  rate  be  charged 
for  carrying  any  fertilizing  materials,  either 
in  their  own  cars  or  cars  of  other  companies 
running  over  said  railroad:  provided,  that 
nothing  contained  in  this  act  shall  deprive 
the  said  railroad  company,  or  its  lessees,  of 
the  benefits  of  the  provisions  of  an  act  en- 
titled 'An  act  relative  to  freights  and  fares 
on  railways  in  the  state,'  approved  March 
4,  1858,  and  applicable  to  all  other  railroads 
in  this  state." 

It  may  be  fairly  inferred  that  the  legisla- 
ture knew  at  the  time  the  statute  was  passed 
that  plaintiffs  were  running  the  road,  and 
claiming  to  do  so  as  lessees  of  the  corpora- 
tion. It  was  not  important  for  the  purpose 
of  the  act  to  decide  whether  this  was  done 
under  a  lawful  contract  or  not  No  inquiry 
was  probably  made  as  to  the  terms  of  that 
lease,  as  no  information  on  that  subject 
was  needed. 

The  legislature  was  determined  that  who- 
ever did  run  the  road  and  exercise  the 
franchises  conferred  on  the  company,  and 
under  whatever  claim  of  right  this  was  done, 
should  be  bound  by  the  rates  of  fare  es- 
tablished by  the  act  Hence,  without  under- 
taking to  decide  in  whom  was  the  rigLit  to 
the  control  of  the  road,  language  was  used 
which  included  the  directors,  lessees,  and 
agents  of  the  railroad. 

The  mention  of  the  lessees  no  more  im- 
plies a  ratification  of  the  contract  of  lease 
than  the  word  "directors"  would  imply  a 
disapproval  of  the  contract.  It  is  not  by 
such  an  incidental  use  of  the  word  "lessees" 
in  an  effort  to  make  sure  that  all  who  col- 
lected fares  should  be  bound  by  the  law, 
that  a  contract  unauthorized  by  the  charter, 
and  forbidden  by  public  policy,  is  to  be  made 
valid  and  ratified  by  the  state. 

It  remains  to  consider  the  suggestion  that 
the  contract,  having  been  executed,  the  doc- 
trine of  ultra  vires  is  inapplicable  to  the 
case.  There  can  be  no  question  that,  in 
many  instances,  where  an  invalid  contract 
which  the  party  to  it  might  have  avoided 


CORPORATIONS. 


84"J 


or  refused  to  perform,  has  been  fully  per- 
formed on  both  sides,  whereby  money  has 
been  paid  or  property  chanj^ed  hands,  the 
courts  have  refused  to  sustain  an  action 
for  the  recovery  of  the  property  or  the  mon- 
ey so  transferred. 

In  regard  to  corporations  the  rule  has 
been  well  laid  down  by  Comstock,  C.  J.,  in 
Parish  v.  Wheeler,  22  N.  Y.  4»4,  that  the 
executed  dealings  of  corporations  must  be 
allowed  to  stand  for  and  against  both  par- 
ties when  the  plainest  rules  of  good  faith 
require  it. 

But  what  is  sought  In  the  case  before  us 
Is  the  enforcement  of  the  unexecuted  part 
of  this  agreement  So  far  as  it  has  been 
executed,  namely,  the  four  or  five  years  of 
action  under  it,  the  accounts  have  been 
adjusted,  and  each  party  has  received  what 
he  was  entitled  to  by  its  terms.  There  re- 
mains unperformed  the  covenant  to  arbitrate 
with  regard  to  the  value  of  the  contract. 
It  is  the  damages  provided  for  in  that  clause 
of  the  contract  that  are  sued  for  in  this 
action.  Damages  for  a  material  part  of  the 
contract  never  performed;  damages  for  the 
value  of  a  contract  which  was  void.  It  is 
not  a  case  of  a  contract  fully  executed.  The 
very  nature  of  the  suit  Is  to  recover  dam- 
ages for  its  non-performance.  As  to  this  it 
Is  not  an  executed  contract. 

Not  only  so,  but  It  Is  a  contract  forbidden 
by  public  policy  and  beyond  the  power  of 


the  defendants  to  make.  Having  entered  In- 
to the  agreement,  it  was  the  duty  of  the 
company  to  rescind  or  abandon  it  at  the 
earliest  moment.  This  duty  was  independ- 
ent of  the  clause  in  the  contract  which  gave 
them  the  right  to  do  it  Though  they  de- 
layed its  performance  for  several  years,  it 
was  nevertheless  a  rightful  act  when  it  was 
done.  Can  this  performance  of  a  legal  duty, 
a  duty  both  to  stockholders  of  the  company 
and  to  the  public,  give  to  the  plaintiffs  a 
right  of  action?  Can  they  found  such  a 
right  on  an  agreement  void  for  want  of  cor- 
porate authority  and  forbidden  by  the  policy 
of  the  law?  To  hold  that  they  can  is,  in 
our  opinion,  to  hold  that  any  act  performed 
in  executing  a  void  contract  makes  all  its 
parts  valid,  and  that  the  more  that  is  done 
under  a  contract  forbidden  by  law,  the 
stronger  is  the  claim  to  Its  enforcement  by 
the  courts. 

We  cannot  see  that  the  present  case  comes 
within  the  principle  that  requires  that  con- 
tracts, which,  though  invalid  for  want  of 
corporate  power,  have  been  fully  executed, 
shall  remain  as  the  foundation  of  rights 
acquired  by  the  transaction. 

We  have  given  this  case  our  best  consid- 
eration on  account  of  the  importance  of  the 
principles  involved  In  its  decision,  and  after 
a  full  examination  of  the  authorities  we  can 
see  no  error  in  the  action  of  the  circuit 
court     Judgment  affirmed. 


a/- 


CAPACITY  OF  PAllTIES. 


u 


BRADLEY  v.  BALLARD. 

(55  III.  413.) 

Supreme  Court  of  Illinois.      Sept.  Term,   1870. 

Appeal  from  circuit  court.  Cook  county. 


LAWRENCE,  C.  J.  This  was  a  bill  in 
chanceiT  brought  bj'  Bradley  against  Bal- 
lard and  others,  for  the  purpose  of  enjoining 
the  prosecution  of  a  suit  pending  in  the  cir- 
cuit court  of  Cook  county,  against  a  coi-pora- 
tioa  called  "The  North  Star  Gold  and  Silver 
Mining  Company,"  in  which  complainant 
was  a  stockholder,  upon  certain  promissory 
notes  given  by  said  company,  and  also  to  can- 
cel certain  other  notes  not  yet  in  suit.  The 
court  sustained  a  demurrer  to  the  bill,  and 
the  complainant  not  asking  to  amend,  a  de- 
cree of  dismissal  was  entered. 

It  appears  by  the  averments  in  the  bill  that 
«arious  persons  associated  themselves  to- 
gether in  the  city  of  Chicago  in  the  year 
18GG,  and  filed  their  articles  of  organization 
in  the  circuit  court  of  Cook  county,  under  the 
general  incorporation  law,  whereby  they  be- 
came incoi-porated  under  the  title  above  stat- 
ed. The  statute  requires  the  certificate  to 
state  the  town  and  county  in  which  the  opera- 
tions of  a  company  thus  Incoi-porated  are  to 
be  carried  on,  and  the  certificate  of  this  com- 
pany stated  that  their  operations  were  to 
be  carried  on  in  the  city  of  Chicago,  in  the 
county  of  Cook  and  state  of  Illinois.  It  fur- 
ther appears  from  the  bill  that  the  company 
thus  organized  engaged  in  mining  in  the  ter 
ritory  of  Colorado,  and  in  the  prosecution  of 
that  work  borrowed  large  sums  of  money, 
for  which  the  notes  described  in  the  bill  were 
given,  except  some  that  are  alleged  to  have 
been  given  for  official  salaries.  It  is  not 
claimed  that  they  were  not  given  for  a  full 
and  fair  consideration,  but  their  cancellation 
Is  sought  upon  the  gi-ound  that  they  were 
given  for  money  borrowed  to  enable  the  com- 
pany to  prosecute  a  business  which  it  had  no 
IKiwer  to  prosecute,  and  that  this  purpose 
was  known  to  the  lenders  of  the  money.  It 
Is  insisted  that,  although  the  business  of  the 
corporation  was  mining,  yet,  by  the  terms  of 
its  certificate,  it  had  no  power  to  prosecute 
that  business  beyond  the  limits  of  the  city 
of  Chicago,  or  certainly  not  beyond  the  limits 
of  this  state. 

Whether  this  is  the  proper  construction  of 
the  statute  is  a  question  we  do  not  find  it 
necessary  to  decide.  Conceding  that  it  is, 
and  that  this  corporation  had  no  power  to 
engage  in  mining  in  Colorado,  we  are  still  of 
opinion  the  complainant  has  not,  by  his  bill, 
entitled  himself  to  relief.  He  became  a  stock- 
holder to  the  extent  of  $25,000,  and  from  the 
name  and  character  of  the  company  he  must 
have  known  it  was  organized  for  the  purpose 
of  mining  beyond  the  limits  of  this  state. 
He  subsequently  became  one  of  the  directors 
of  said  company,  and  it  is  a  legitimate  infer- 
ence from   the  bill  that  at  least  a  part  of 


these  debts  were  created  while  he  was  thus 
participating  in  the  control  of  the  company. 
There  is  no  pretence  in  the  bill  that  he  ever, 
in  any  mode,  objected  to  the  mining  opera- 
tions of  the  company,  in  Colorado,  or  to  the 
borrowing  of  money  therefor,  and  the  fair, 
and,  indeed  unavoidable  inference,  from  the 
nature  of  the  company,  the  connection  of 
complainant  with  it,  and  the  silence  of  the 
bill  in  this  regard,  is  that  he  did  not  object. 
On  what  ground,  then,  can  he  ask  a  court  of 
equity  to  enjoin  the  collection  of  these  notes? 

It  is  said  by  counsel  for  complainant,  that 
a  corporation  is  not  estopped  to  say,  in  its 
defence,  that  it  had  not  the  power  to  make 
a  contract  sought  to  be  enforced  against  it, 
for  the  reason,  that  if  thus  estopped,  its  pow- 
ers might  be  indefinitely  enlarged.  While 
the  contract  remains  unexecuted  on  both 
sides,  this  is  undoubtedly  true;  when,  under 
cover  of  this  principle,  a  corporation  seeks  to 
evade  the  payment  of  borrowed  money,  on 
the  ground  that,  although  it  had  power  to 
borrow  money,  it  expended  the  money  bor- 
rowed in  prosecuting  a  business  which  it  was 
not  authorized  to  prosecute,  it  is  pressing  the 
doctrine  of  ultra  vires  to  an  extent  that  can 
never  be  tolerated,  even  though  the  lender 
of  the  money  knew  that  the  corporation  was 
transacting  a  business  beyond  its  chartered 
powers,  and  that  his  money  would  be  used  in 
such  business,  provided  the  business  itself 
was  free  from  any  intrinsic  immorality  or  il- 
legality. 

Neither  is  it  correct  to  say  that  the  applica- 
tion to  corporations  of  the  doctrine  of  equi- 
table estoppel,  where  justice  requires  it  to 
be  applied,  as  when,  imder  a  claim  of  cor- 
porate power,  they  have  received  benefits  for 
which  they  refuse  to  pay,  from  a  sudden  dis- 
covery that  they  had  not  the  powers  they 
had  claimed,  can  be  made  the  means  of  en- 
abling them  indefinitely  to  extend  their  pow- 
ers. If  that  were  true.  It  would  be  an  in- 
superable objection  to  the  application  of  the 
doctrine,  even  for  the  purpose  of  preventing 
injustice  in  individual  cases.  But  it  is  not 
true.  This  doctrine  is  applied  only  for  the 
purpose  of  compelling  corporations  to  be  hon- 
est, in  the  simplest  and  commonest  sense  of 
honesty,  and  after  whatever  mischief  may 
belong  to  the  performance  of  an  act  ultra 
vires  has  been  accomplished.  But  while  a 
contract  remains  executory,  it  is  perfectly 
true  that  the  powers  of  corporations  cannot 
be  extended  beyond  their  proper  limits,  for 
the  purpose  of  enforcing  a  contract.  Not 
only  so,  but  on  the  application  of  a  stock- 
holder, or  of  any  other  person  authorized  to 
make  the  application,  a  court  of  chancery 
would  interfere  and  forbid  the  execution  of 
a  contract  ultra  vires.  So  too,  if  a  contract 
ultra  vires  is  made  between  a  corporation  and 
another  person,  and,  while  it  Is  yet  wholly 
unexecuted,  the  corporation  recedes,  the  oth- 
er contracting  party  would  probably  have  no 
claim  for  damages.  But  if  such  other  party 
proceeds  in  the  performance  of  the  contract. 


COHPORATIONS. 


851 


expending  his  money  and  his  labor  In  the 
production  of  values  which  the  coi-poration 
appropriates,  we  can  never  hold  the  cuiijora- 
tiou  excused  from  payment,  on  the  plea  that 
the  contract  was  beyond  its  power. 

Talie,  for  example,  the  case  of  a  corpora- 
tion chartered  to  build  a  railway  from  Chi- 
cago to  llock  Island.  Under  such  a  charter, 
the  company  would  have  no  power  to  build 
steamboats  for  the  pui-pose  of  running  a  line 
of  such  vessels  between  llock  Island  and  St 
Louis.  But  suppose  the  company,  notwith- 
standing the  want  of  power,  should  make  a 
contract  for  the  building  of  a  vessel,  and  it 
is  built  by  the  contractor,  and  accepted  and 
used  by  the  railway.  Could  any  court  per- 
mit the  corporation,  when  sued  for  the  value 
of  the  vessel,  to  excuse  itself  from  payment, 
on  the  ground  that,  although  it  has  and  uses 
the  steamer,  it  had  no  authority  to  do  so  by 
its  charter?  Or,  suppose  that  instead  of  hav- 
ing a  vessel  built  by  a  contractor  it  employs  a 
superintendent  to  build  it,  and  hires  me- 
chanics by  the  day.  Could  it  escape  the  pay- 
ment of  their  wages,  on  the  ground  that  it 
had  employed  them  in  a  work  ultra  vires  V 

In  cases  of  such  character,  courts  simply 
Bay  to  corporations:  You  cannot  in  this  case 
raise  the  question  of  your  power  to  make  the 
contract.  It  is  sufficient  that  you  have  made 
it,  and  by  so  doing  have  placed  in  your  cor- 
porate treasury  the  fruits  of  others'  labor, 
and  everj'  principle  of  justice  forbids  tliat 
you  be  permitted  to  evade  payment  by  an 
appeal  to  the  limitations  of  your  charter. 

We  are  aware  that  cases  may  be  cited  in 
apparent  conflict  with  the  principles  here  an- 
nounced, but  the  tendency  of  recent  decisions 
is  in  harmony  with  them.  While  courts  are 
incUned  to  maintain  with  vigor  the  limita- 
tions of  corporate  action,  whenever  it  is  a 
question  of  restraining  the  corporation  in  ad- 
vance from  passing  beyond  the  boundaries 
of  their  charters,  they  are  equally  inclined, 
on  tl)e  other  hand,  to  enforce  against  them 
contracts,  though  ultra  vires,  of  which  they 
have  received  the  benefit.  This  is  demand- 
ed by  the  plainest  principles  of  justice.  2 
Kent,  Comm.  (11th  Ed.)  p.  3S1,  note;  Zabris- 
kie  V.  Railroad  Co.,  23  How.  3S1:  Bissell  v. 
Raflroad  Co.,  22  N.  Y.  25S;  Cary  v.  Railroad 
Co.,  29  Barb.  35;  Parish  v.  Wheeler,  22  N. 
Y.  494;  De  Groff  v.  Thread  Co.,  21  N.  Y. 
124;  Argentl  v.  San  Francisco,  16  Cal.  255; 
McClner  v.  Railroad,  13  Gray,  124;  Chap- 
man V.  Railroad  Co.,  6  Ohio,  137;  Hall  v. 
In.surance  Co.,  32  X.  H.  297;  Railroad  Co. 
V.  Howard.  7  Wall.  413. 

If  tlie  complainant  in  this  case  had,  as  a 
stockholder,  asked  a  court  of  chanceiy  to 
enjoin  this  corporation  from  mining  in  Col- 
orado, it  would  have  examined  the  charter, 
and  if  it  had  arrived  at  the  conclusion  that 
such  mining  was  beyond  the  powers  derived 
from  filing  the  certificate  in  question,  under 


our  statute,  would  have  Issned  the  Injunc- 
tion. But  this  he  did  not  do.  On  the  con- 
trary, he  has  participated  in  the  work,  and 
so  long  as  there  was  hope  of  gain,  he  was 
willing  the  money  should  be  borrowed  by 
which  the  work  was  to  be  carried  forward. 
The  borrowing  of  the  money  was  not,  in 
itself,  an  act  ultra  vires,  nor  was  the  giving 
of  the  notes.  The  money  was  not  bon-owed 
to  be  used  for  an  illegal  or  immoral  puiT'Ose. 
The  lenders  have  been  guilty  of  no  violation 
of  law,  nor  wrong  of  any  kind.  The  corpora- 
tion has  received  their  money  and  used  it 
for  a  purpose,  which,  whether  ultra  vires  or 
not,  was  unquestionably  the  sole  ijurpose  for 
which  the  corporators  associated  themselves 
together,  and  for  which  this  complainant  be- 
came a  stockholder.  Justice  requires  the 
coi-poration  to  repay  the  money  it  has  thus 
borrowed  and  expended. 

What  we  have  said  appUes  only  to  private 
corporations,  organized  for  pecuniary  gain. 
If,  to  increase  their  profits  they  embark  in 
enterprises  not  authorized  by  their  charter, 
still,  as  to  third  persons,  and  when  neces- 
sary for  the  advancement  of  justice,  the 
stockholders  will  be  presumed  to  have  as- 
sented, since  it  is  in  their  power  to  restrain 
their  officers  when  they  transgress  the  lim- 
its of  their  chartered  authority.  But  munic- 
ipal corporations  stand  upon  a  different 
ground.  They  are  not  organized  for  gain, 
but  for  the  purpose  of  government,  and  debts 
illegally  contracted  by  their  officers  -annot 
be  made  binding  upon  the  taxpayers,  from 
the  presumed  assent  of  the  latter. 

There  are  some  vague  charges  in  the  bill 
of  conspiracy  between  the  holders  of  the 
notes  upon  which  suit  has  been  brought  and 
some  of  the  directors,  but  no  facts  are  al- 
leged showing,  or  tending  to  show,  any 
wrongful  or  fraudulent  intent.  The  alleged 
conspiracy  seems  merely  to  be  an  under- 
standing between  the  holders  of  the  notes 
and  the  majority  of  the  dirt-ctors,  by  which 
the  latter  will  allow  the  former  to  obtain 
judgment  on  their  notes,  and  we  do  not  per- 
ceive why  they  should  not.  If  the  complain- 
ant lias  had  the  misfortune  to  associate  him- 
self \\ith  p'^rsons  of  less  pectmiary  responsi- 
bility than  himself  for  the  purpose  of  carry- 
ing on  a  hazardous  business,  in  which  heavy 
debts  have  been  incurred,  it  is  a  misfortune 
of  which  the  courts  cannot  relieve  him.  mere- 
ly on  a  vague  and  general  charge  of  con- 
spiracy against  his  feUow  stockholders  or 
directors.  No  facts  are  alleged  in  this  bill 
which  can  be  made  the  foundation  of  relief. 
As  before  remarked,  the  counsel  of  appel- 
lant has  presented  his  case  simply  on  the 
question  of  corporate  power.  We  are  of 
opinion  the  demurrer  was  properly  sustained 
to  the  bill.    Decree  affirmed. 

Mr.   Justice   SCOTT  dissents. 


CAPACITY  OF  PARTIES. 


//T  UNION  BANK  v.  JACOBS. 

(6  Humph.  515.) 
Supreme  Court  of  Tennessee.    Sept  Term,  1845. 

On  the  28th  day  of  September,  1841,  Ja- 
cobs, as  president  of  the  Hiwassee  Railroad 
Company,  executed  a  note,  binding  that  com- 
pany to  pay  to  said  Jacobs  the  sum  of  $5,641, 
negotiable  and  payable  at  the  branch  of  the 
Union  Bank  at  Knoxville,  foiu-  mouths  after 
date.  The  note  was  indorsed  by  Jacobs  to 
Trautwine,  and  by  Trautwine  to  the  Union 
Bank,  and  delivei-ed  to  the  president  and  di- 
rectors of  the  bank,  and  discounted  by  the 
bank  for  the  benelit  of  the  Hiwassee  Com- 
pany. At  maturity,  the  note  was  protested, 
and  suit  brought  by  the  bank  against  Jacobs, 
as  indorser,  in  the  circuit  court  of  Knox  coun- 
ty. 

It  was  tried  by  Judge  Lucky  and  a  jury  at 
the  February  term,  1845.  He  charged  the 
jui-y  that  the  Hiwassee  Company  had  no 
power  to  borrow  money,  and  that  the  note 
given  in  execution  of  a  void  contract  was  null 
and  void  also. 

The  jury  returned  a  verdict  for  the  defend- 
ant, and  plaintiff  appealed. 

TURLEY,  J.  At  the  session  of  the  legis- 
lature of  the  state  of  Tennessee,  in  the  year 
1835-183G,  tlae  Hiwassee  Railroad  Company 
was  created  a  body  coi-porate,  with  perpetual 
succession,  with  power  to  sue  and  be  sued, 
plead  and  be  impleaded,  and  to  possess  and 
enjoy  all  the  rights,  privileges,  and  immuni- 
ties, with  power  to  make  such  by-laws,  ordi- 
nances, rules,  and  regulations,  not  inconsist- 
ent with  the  laws  of  this  state  and  the  Unit- 
ed States,  as  shall  be  necessary  to  the  well 
ordering  and  conducting  the  affairs  of  said 
company;  and  be  capable  in  law  of  pur- 
chasing, acceptmg,  selling,  and  conveying  es- 
tates, real,  personal,  and  mixed,  to  the  end, 
and  for  the  purpose  of  facilitating  the  inter- 
course and  transportation  from  Knoxville, 
East  Tennessee,  through  the  Hiwassee  dis- 
trict, to  a  point  on  the  southern  boundary  of 
Tennessee,  to  be  designated  by  commissioners 
as  the  most  practicable  route  to  intersect  the 
contemplated  raUroad  from  Augusta  to  Mem- 
phis. 

By  the  2d  section  of  the  act  of  incorporation 
the  capital  stock  ot  the  company  is  limited  to 
six  hundred  thousand  dollars,  in  shares  of  one 
hundred  doUars  each;  and  it  is  provided,  that, 
so  soon  as  four  thousand  shares  are  subscrib- 
ed, the  corporate  power  of  said  company  shall 
commence,  and  have  as  fuU  operation  as  if 
the  whole  of  the  shares  comprising  the  capi- 
tal stock  were  subscribed. 

By  the  4th  section  it  is  provided,  that  there 
shall  be  paid  on  each  share  subscribed,  but 
not  till  after  four  thousand  shares  shall  have 
been  subscribed,  such  sum  as  the  president 
and  directors,  or  a  majority  of  them,  may  di- 
rect, and  in  such  instalments,  not  exceeding 
one  fourth  of  the  subscription  in  any  one 
year:  Provided,  no  payment  shall  be  demand- 


ed until  at  least  thirty  days'  notice  shall  have 
been  given  by  the  said  president  and  directors 
in  the  newspapers  printed  in  the  towns  of 
Knoxville  and  Athens,  of  the  time  and  place 
of  payment;  and  if  any  subscriber  shall  fail 
or  neglect  to  pay  any  instalment  or  part  of 
said  subscription  thus  demanded,  for  thirty 
days  next  after  the  time  it  fell  due,  the  stock 
on  which  it  was  demanded,  together  with  the 
amount  paid  in,  may,  by  the  president  and 
directors,  or  a  majority'  of  them,  be  declared 
forfeited,  and,  after  due  notice,  shall  be  sold 
at  auction  for  the  benefit  of  the  company,  or 
they  may  waive  the  forfeiture  after  thu-ty 
days  default,  and  sue  the  stockholders,  at 
their  discretion,  for  the  instalments  due. 

By  the  13th  section,  the  president  and  di- 
rectors of  said  company  are  invested  with  all 
the  powers  and  rights  necessary  for  the  build- 
ing, constructing,  and  keepmg  in  repair  of  a 
raihoad  from  Knoxville,  East  Tennessee, 
through  the  Hiwassee  disti-ict,  to  a  point  on 
the  southern  boundary  of  Tennessee,  on  the 
nearest,  best,  and  most  practicable  route,— 
the  road  to  have  as  many  tracks  as  may  be 
deemed  necessary  by  the  board  of  directors, 
but  not  to  be  more  than  one  hundred  feet 
wide,  which  the  company  may  purchase,  or 
cause  tlie  same  to  be  condemned  for  the  use 
of  the  road,  or  any  less  breadth,  at  the  dis- 
cretion of  the  directors;  and  they  may  cause 
to  be  made,  or  contract  with  others  for  mak- 
ing of  said  road  or  any  part  thereof;  ajud 
they,  or  their  agents,  or  those  with  whom 
they  may  contract  for  making  any  part  of 
said  road,  may  enter  upon,  use,  and  exca- 
vate any  land  which  may  be  laid  out  for  the 
site  of  said  road,  for  the  erection  of  ware- 
houses, engine  arbors,  reservoirs,  booths,  sta- 
bles, offices,  and  mechanics'  shops,  or  other 
works  necessary  or  useftil  in  the  construction 
and  repair  thereof;  and  may  fix  scales  and 
weights,  build  bridges,  lay  rails,  make  em- 
bankments and  excavations;  may  use  any 
earth,  ground,  rock,  timber,  or  other  material 
which  may  be  wanted  for  the  construction 
and  repair  of  any  part  of  said  road;  and  may 
construct  and  acquire  all  necessary  steam- 
engines,  cars,  wagons,  and  carriages  for 
transportation  on  said  road  by  horses  or 
steam  power,  and  all  necessary  apparatus 
for  the  same. 

Sections  15  and  16  make  provision  for  con- 
pensation  and  payment  by  the  comijany  to 
individuals  for  land  or  other  property  appro- 
priated under  the  provisions  of  the  charter  to 
the  making  of  said  road,  and  incidental  in- 
juries done  by  reason  of  its  construction. 

These  are  all  the  provisions  of  the  charter 
that  need  be  adverted  to,  for  the  purpose  of 
investigating  the  questions  of  law  arising  in 
the  case.  Under  the  provisions  of  this  char- 
ter, the  company  was  legally  organized  and 
proceeded  to  construct  the  road;  much  work 
was  done  in  excavations,  embankments, 
building  bridges,  etc.,  and  much  money  ex- 
pended therefor,  and  in  the  payment  of  the 
!  salaries  of  the  different  officers  necessary  for 


CORPORATIONS. 


353 


the  snperlntondenre  thereof.  In  the  con- 
sti-uction,  the  couipany  became  indebted  to 
one  Kennedy  Lonergin,  a  contractor  for  yrad- 
inff  the  road,  in  the  sum  of  five  thousand 
dollars;  for  the  payment  of  which,  It  execut- 
ed, by  its  president,  its  promissory  note  to  S. 
D.  Jacobs,  negotiable  and  payable  at  the  of- 
fice of  discount  and  deposit  of  the  Union 
Bank  of  the  state  of  Tennessee  at  Knoxville; 
this  note  was  negotiated  by  S.  D.  Jacobs  to 
.loiin  C.  Trautwine,  and  by  him  to  the  Union 
Hank,  and  the  proceeds  passed  by  the  bank 
to  the  credit  of  Kennedy  Lonergin.  When 
the  note  fell  due,  it  was  protested  for  non- 
payment, and  due  notice  thereof  given  to  the 
indorsers,  Jacobs  and  Trautwine.  They  fail- 
ing to  pay,  suit  was  instituted  thereon  against 
S.  D.  Jacobs,  the  first  indorser,  in  the  circuit 
ccjurt  of  Knox  county,  and  the  same  was 
brought  to  trial  before  a  jury,  at  the  Febru- 
ary term  thereof,  1845,  when  the  circuit  judge 
charged  the  jury,  "that  the  note  was  drawn 
by  the  Hiwassee  Railroad  Company,  in  viola- 
tion of  Its  coi-porate  powers;  that  it  was, 
therefore,  null  and  void;  and  that  the  plain- 
tiffs were  not  entitled  to  recover."  Under 
this  charge,  a  verdict  was  retimied  in  favor 
of  the  defendant,  and  judgment  rendered 
thereon  against  the  plaintiffs,  to  reverse 
which,  a  writ  of  error  is  prosecuted  to  this 
court. 

It  is  contended  against  the  plaintiff's  right 
to  recover  that  there  is  no  power  given, 
either  expressly  or  by  necessary  implication, 
by  the  charter  to  the  Hiwassee  Railroad 
Company,  to  borrow  money  or  to  execute 
promissory  notes;  and  that,  therefore,  the 
note  executed  and  indorsed  to  the  bank  is 
void,  both  as  against  the  maker  and  indors- 
ers, and  that  no  action  can  be  maintained 
against  them  thereon. 

The  construction  of  the  powers  of  corpora- 
tions has  been  a  fruitful  source  of  litiga- 
tion, both  in  the  courts  of  Great  Britain  and 
the  United  States.  In  the  earlier  cases  they 
were  construc<l  with  great  strictness,  and 
a  stringent  rule,  as  to  the  mode  of  exercis- 
ing them,  enforced.  jNIr.  Story,  in  the  case 
of  Bank  of  Columbia  v.  Patterson,  7  Cranch, 
305,  says:  "Anciently  it  seems  to  have  been 
hold  that  corporations  could  not  do  any- 
thing without  deed.  13  Hen.  VIII.  12;  4  lien. 
VII.  G;  7  Hen.  VII.  9.  Afterwards,  the  rule 
seems  to  have  been  relaxed,  and  they  were 
for  convenience'  sake  permitted  to  act  in 
ordinary  matters  without  deed,  as  to  retain 
a  servant,  cook,  or  butler  (Plow.  91;  2  Sauud. 
395);  and  gradually  this  relaxation  widened 
to  embrace  other  objects  (Bro.  Corp.  51; 
3  Salk.  191;  3  Lev.  107).  At  length,  it  seems 
to  have  been  established,  that,  though  they 
could  not  contract  directly  except  under 
their  corporate  seal,  yet  they  might,  by 
mere  vote  or  other  corporate  act,  not  under 
their  corporate  seal,  appoint  an  agent  whose 
acts  and  contracts  within  the  scope  of  his 
authority  would  be  binding  on  the  cori">ora- 
tion.    3  P.  Wms.  419.     And  courts  of  equity, 

HOPK.  SEL.  CAS.  COXT.  —23 


in  this  respect,  seeming  to  follow  the  law 
have  decreed  a  specific  performance  of  au 
agreement  made  by  a  major  pan  of  a  cor- 
poration, and  eut<'r<(l  in  the  corporation 
books,  although  not  under  the  corporate 
seal.  1  Fonbl.  Eq.  305.  This  technical  doc- 
trine has  in  more  modem  times  been  en- 
tirely broken  down."  The  same  judge,  Id 
continuation  in  the  same  case,  observes: 
"The  doctrine  that  a  corporation  could  not 
contract  except  under  its  seal,  or,  in  other 
words,  could  not  make  a  promise,  if  it  had 
ever  been  fully  settled,  m\i>:t  have  been  pro- 
ductive of  great  mischief.  Indeed,  as  soon 
as  the  doctrine  was  established,  that  its 
regularly  appointed  agents  could  contract  ia 
their  name  without  seal,  it  was  impossible 
to  support  it;  for,  otherwise,  the  party  who 
trusted  such  contract  would  be  without 
remedy  against  the  corporation.  Accord- 
ingly, it  would  seem  to  be  a  sound  rule  of 
law,  that  whenever  a  corporation  is  acting 
within  the  scope  of  the  legitimate  purposes 
of  its  institution,  all  parol  contracts,  made 
by  its  authorized  agents,  are  express  prom- 
ises of  the  corfwration;  and  all  duties  im- 
posed upon  them  by  law,  and  all  benefits 
conferred  at  their  request,  raise  implied 
promises,  for  the  enforcement  of  which  an 
action  may  well  lie.  3  Brown  Ch.  2G2; 
Doug.  524;  3  Mass.  3G4;  5  Mass.  89,  491;  6 
Mass.  50."  Whatever  of  strictness  may  have 
existed  in  the  earlier  cases,  in  restricting 
their  power  of  contracting  to  the  express 
grant  of  authority,  has  been  also  greatly  re- 
laxed, and  the  doctrine  upon  the  subject 
been  made  more  conformable  to  reason  and 
necessity,  the  powers  granted  to  corpora- 
tions being  now  construed  like  all  other 
grants  of  power,  not  according  to  the  letter, 
but  the  spirit  and  meaning.  In  Ang.  &  A- 
Corp.  p.  192,  §  12,  it  is  said,  "A  corporation 
having  been  created  for  a  specific  purpose, 
can  not  only  make  no  contracts  forbidden 
by  its  charter,  which  is,  as  it  were,  the  law 
of  its  nature,  but  in  general  can  make  no 
contract  which  is  not  necessary,  either  di- 
rectly or  incidentally,  to  enable  it  to  an- 
swer that  purpose.  In  deciding,  therefore, 
whether  a  corporation  can  make  a  particu- 
lar contract,  we  'are  to  consider,  in  the  first 
place,  whether  its  chatter,  or  some  statute 
binding  upon  it,  forbids  or  permits  it  to 
make  such  a  contract;  and  if  the  charter 
and  valid  statutory  law  are  silent  upon  the 
subject,  in  the  second  place,  whether  the 
power  to  make  such  a  contract  may  not  be 
implied  on  the  part  of  the  corporation,  as 
directly  or  incidentally  necessary  to  enable 
it  to  fulfil  the  purpose  of  its  existence,  or 
whether  the  contract  is  entirely  foreign  to 
that  purpose.  In  genei-al,  an  express  au- 
thority is  not  indispensable  to  confer  upon 
a  corpora tioq  the  right  to  become  drawer, 
Indorser,  or  acceptor  of  a  bill  of  exchange, 
or  to  become  a  party  to  any  other  negoti- 
able paper.  It  is  sufficient,  if  it  be  implied 
as   the   usual  and  proper  means   to  accom- 


354 


CAPACITY  OF  PARTIES. 


plish  the  purposes  of  the  charter.  Chit. 
BiUs  (5th  Ed.)  17-21;  Baily,  BiUs  (5th  Ed.) 
p.  69.  c.  2,  §  7;  Story.  Bills  Exch.  p.  94, 
§  79.  In  the  case  of  Mum  v.  Commission 
Co.,  15  Johns.  52,  Spencer,  J.,  who  delivered 
the  opinion  of  the  court,  says:  'It  has  been 
strongly  urged,  that,  under  the  act  of  in- 
corporating this  company,  they  could  neith- 
er draw  nor  accept  bills  of  exchange.  Their 
power  is  undoubtedly  limited;  they  are  re- 
quired to  employ  their  stock  solely  in  ad- 
vancing money,  when  required,  on  goods 
and  articles  manufactured  in  the  United 
States,  and  the  sale  of  such  goods  and  ar- 
ticles on  commission.  The  acceptance  of  a 
bill  is  an  engagement  to  pay  money;  and 
the  company  may  agree  to  pay  or  advance 
money  at  a  future  day,  and  they  may  en- 
gage to  do  this  by  the  acceptance  of  a  bill. 
When  a  charter  or  act  of  incorporation  and 
valid  statutory  law  are  silent  as  to  what 
contracts  a  corporation  may  make,  as  a  gen- 
eral rule  it  has  power  to  make  all  such  con- 
tracts as  are  necessary  and  usual  in  the 
course  of  business,  as  means  to  enable  it  to 
attain  the  object  for  which  it  was  created, 
and  none  other.  The  creation  of  a  corpora- 
tion for  a  specific  purpose  implies  a  power 
to  use  the  necessai-y  and  usual  means  to 
effectuate  that  purpose.'  "  Ang.  &  A.  Corp. 
p.  200.  §  3. 

Mr.  Story,  in  his  treatise  on  Bills  of  Ex- 
change (page  95),  speaking  of  the  power  of 
corporations  to  draw,  indorse,  and  accept  bills 
of  exchange,  says:  "It  is  sufficient  if  it  be 
implied  as  a  usual  and  appropriate  means  to 
accomplish  the  objects  and  purposes  of  the 
charter.  But  when  the  drawing,  indorsing, 
or  accepting  such  bills  is  obviously  foreign 
to  the  purposes  of  the  charter,  or  repugnant 
thereto,  then  the  act  becomes  a  nullity,  and 
uot  binding  on  the  corporation." 

In  the  case  of  People  v.  Utica  Ins.  Co.,  15 
Johns.,  Thompson,  C.  J.,  who  delivered  the 
opinion  of  the  court,  says,  at  page  383,  "An 
Incorporated  company  has  no  rights  but  such 
as  are  specially  granted,  and  those  that  are 
necessary  to  carry  Into  effect  the  powers  so 
granted." 

In  the  case  of  Mott  v.  Hicks,  a  quantity 
of  wood  was  purchased  for  the  president 
and  directors  of  the  Woodstock  Glass  Com- 
pany by  Whitehead  Hicks,  the  president 
thereof,  for  which  he  executed  the  promis- 
sory note  of  the  company  at  six  months. 
It  appears,  from  a  reference  in  argument 
to  the  charter  of  the  company,  that  there 
was  no'  clause  authorizing  it  to  issue  bills 
or  notes,  or  making  such,  if  issued,  binding 
and  obligatory  upon  the  company;  yet  it 
was  held  by  the  court,  that  an  action  would 
lie  against  the  corporation  upon  the  note,  it 
having  been  executed  by  its  legally  author- 
ized agent,  acting  within  the  scope  of  the 
legitimate  purposes  of  such  corporation.  1 
Cow.  513. 

In  the  case  of  Hayward  v.  Pilgrim  Soc, 
21  Pick.  270,  it  was  held  that  the  tx-ustees 


of  a  society  incorporated  for  the  purposo  of 
building  a  monument,  in  virtue  of  their  au- 
thority to  manage  the  finances  and  property 
of  the  society,  were  held  competent  to  bind 
the  society  by  a  promissory  note  through 
the  agency   of  their  treasurer. 

These  authorities  fully  establish  the  pro- 
position, that,  in  the  construction  of  char- 
ters of  corporations,  the  power  to  contract, 
and  the  mode  of  contracting,  is  not  limited 
to  the  express  grant,  but  may  be  extended 
by  implication  to  all  necessary  and  proper 
means  for  the  accomplishment  of  the  pur- 
poses of  the  charter.  Now,  what  are  neces- 
sary and  proper  means?  Mr.  Story,  as  we 
have  seen,  says,  if  the  means  are  usual  and 
appropriate,  the  implication  of  power  arises. 
Story,  Bills,  95. 

Chief  Justice  Marshall,  in  the  case  of  Mc- 
Cullock  V.  State  of  Maryland,  4  Wheat.  413, 
says:     "But   the   argument  on   which   most 
reliance  is  placed,  is  drawn  from  the  peculi- 
ar language  of  this  clause  of  the  constitu- 
tion.    Congress  is   not  empowered  by  it  to 
make  all  laws  which  may  have  relation  to 
the    powers    conferred    on    the    government, 
but    such    only    as    may   be    necessary   and 
proper    for    carrying    them    into    execution. 
The  word  'necessary'  is  considered  as  con- 
trolling the  whole  sentence,  and  as  limiting 
the  right  to  pass  laws  for  the  execution  of 
the  granted   powers,  to   such  as  are   indis- 
pensable,   and    without    which    the    power 
would  be   nugatory.     That  it  excludes  the 
choice    of    means,    and    leaves    congress,    in 
each  case,  that  only   which  is   most  direct 
and  simple.    Is  it  true,  that  this  is  the  sense 
in    which    the    word    'necessary'    is    always 
used?     Does  it  always  import  "an  absolute 
physical  necessity,  so  strong  that  one  thing 
to  which  another  may  be  termed  necessary 
cannot  exist  without  that  other?     We  think 
it  does  not.     If  reference  be  had  to  its  use 
in  the  common  affairs  of  the  world,   or  in 
approved  authors,  we  find  that  it  frequently 
imports  no  more  than  that  one  thing  is  con- 
venient  or  useful   or   essential   to   another. 
To  employ  the  means  necessary  to  an  end, 
is   generally   understood   as   employing   any 
means  calculated  to  produce  the  end,  and 
not  as  being  confined  to  those  single  means, 
without   which   the  end   would   be   entirely 
unattainable.     Such  is  the  character  of  the 
human  mind,  that  no  word  conveys  to  it, 
in   all   situations,    one   single   definite   idea, 
and  nothing  is  more   common   than  to   use 
words  in  a  figurative  sense.     Almost  all  com- 
positions   contain    words    which,    taken    in 
their  rigorous  sense,  would  convey  a  mean- 
ing different  from   that   which  is  obviously 
intended.     It  is  essential   to  just   construc- 
tion, that  many  words,  which  import  some- 
thing excessive,  should  be  understood  in  a 
more  mitigated  sense,— in  that  sense  which 
common  usage  justifies.     The  word   'neces- 
sary' is  of  this  description.     It  has  no  fixed 

character    peculiar    to    itself.    It    admits    of 
all  degrees  of  comparison,  and  is  often  con- 


CORPORATIONS. 


855 


nected  with  other  words,  which  Increase  or 
diminish  the  impression  the  mind  rocoives 
of  the  urf^ency  it  imports.  A  thing  may  be 
nocossary,  very  necessary,  absolutely  or  in- 
dispensably necessary.  To  no  mind  would 
the  same  idea  be  conveyed  by  these  several 
phrases."  In  conclusion  upon  this  subject, 
he  says,  page  421,  same  case:  "We  admit, 
as  all  must  admit,  that  the  powers  of  the 
government  are  limited,  and  that  its  limits 
are  not  to  be  transcended.  But  we  think 
the  sound  construction  of  the  constitution 
must  allow  to  the  national  legislature  that 
discretion  with  respect  to  the  means  by 
which  the  powers  it  confers  are  to  be  car- 
ried into  execution,  Avhich  will  enable  that 
body  to  perform  the  high  duties  assigned  to 
it  in  the  manner  most  beneficial  to  the 
people.  Let  the  end  be  legitimate,  let  it 
be  within  the  scope  of  the  constitution,  and 
all  means  which  are  appropriate,  which  are 
plainly  adapted  to  that  end,  which  are  not 
prohibited,  but  consist  with  the  letter  and 
spirit  of  the  constitution,  are  constitu- 
tional." 

Now,  if  this  be  true  doctrine  In  relation 
to  the  constitution  of  the  United  States, 
surely  it  will  not  be  contended  that  a  more 
stringent  rule  will  be  applied  in  the  con- 
struction of  the  powers  of  a  corporation, 
than  is  applied  in  the  construction  of  the 
powers  of  congress  under  the  constitution 
of  the  United  States. 

To  apply  these  principles,  as  established 
by  the  authorities  cited,  to  the  case  un- 
der consideration.  The  Hiwassee  Railroad 
Company  is  chartered  to  construct  a  rail- 
road, a  thing  of  itself  necessarily  involving 
a  heavy  expenditure  of  money;  but  in  ad- 
dition thereto,  it  is  empowered  to  sue  and 
be  sued,  to  acquire  and  hold,  sell,  lease,  and 
convey  estates,  real,  personal,  and  mixed, 
which  necessarily  involves  the  power  of 
making  contracts  for  the  same.  How  shall 
these  contracts  be  made,  both  for  the  con- 
struction of  the  road  and  the  purchase  of 
the  property?  It  is  argued,  that  the  capi- 
tal stock  of  the  company  is  the  only  means 
provided  for  the  payment,  and  that  no  other 
can  be  resorted  to  for  that  purpose;  or,  in 
ether  words,  that  it  must  pay  cash  for 
eveiT  contract,  for  that  no  power  is  given, 
by  which  it  may  contract  upon  time;  for  if 
it  may  create  a  debt,  of  necessary  conse- 
quence it  may  create  written  evidences  of 
that  debt,  and  these  may  be  either  promis- 
sory notes  or  bills  of  exchange.  It  is  true, 
that  the  capital  stock  of  the  company  is 
the  source  from  whence  an  ultimate  pay- 
ment of  the  debts  of  the  company  must  be 
made,  but  to  hold  that  a  sufficient  amount 
of  this  stock  must  always  be  on  hand,  to 
pay  immediately  for  every  contract  made, 
would  be  destructive  of  the  operations  of 
the  company.  By  the  provisions  of  the 
charter,  not  more  than  one-fourth  of  the 
stock  shall  be  called  for  in  any  one  year, 
and  this  upon  thirty   days"   notice;    and   if, 


within  thirty  days  after  such  notice,  the 
amount  called  for  be  not  paid,  the  company 
is  authorized  to  take  steps  against  the  de- 
llnciuent  stockholders,  to  enforce  payment. 
Now,  it  is  obvious  that  it  never  was  intend- 
ed that  all  the  stock  should  be  paid  in  be- 
fore the  company  commenced  operations. 
The  early  completion  of  the  road  was  a  de- 
sirable object  for  commercial  purposes,  and 
can  it  be  pretended  that  the  expenditures 
of  the  company  were  to  be  limited  and  re- 
stricted to  the  amount  of  capital  actually 
paid  in  by  the  stockholders,  and  that  under 
no  circumstances  was  the  company  to  ex- 
ceed them?  If,  upon  failure  of  the  means 
on  hand,  the  stockiiolders  should  neglect  to 
pay  upon  a  proper  call,  are  the  works  to  be 
suspended  until  such  time  as  payments 
could  be  enforced?  Are  the  persons  who 
may  have  done  work  for  it,  and  for  which 
they  have  not  been  paid,  to  wait  the  slow 
process  of  the  law  before  they  can  receive 
satisfaction?  And  shall  the  company  not 
be  permitted  to  use  its  credit  in  such  emer- 
gency? It  is  so  argued  for  the  defendant 
This  construction  of  the  charter  would  be 
ruinous  in  its  consequences.  The  company 
might  be  compelled  to  suspend  all  opera- 
tions at  a  time  when  great  loss  would  result 
from  deterioration  to  unfinished  work,  and 
be  greatly  injured  also  in  its  credit. 

The  restriction  contended  for  is  too  refin- 
ed and  technical.  It  might  have  suited  the 
days  of  the  Year  Books,  when  it  was  held 
that  a  corporation  could  contract  for  noth- 
ing except  under  its  corporate  seal;  but  it 
is  strange  that  it  should  be  urged  at  this 
.day  of  enlightened  jurisprudence,  when  the 
substance  of  things  is  looked  to  rather  than 
forms.  A  corporation  is,  in  the  estimation 
of  law,  a  body  created  for  special  purposes, 
and  there  is  no  good  reason  why  it  should 
not,  in  the  execution  of  these  purposes,  re- 
sort to  any  means  that  would  be  necessary 
and  proper  for  an  individual  in  executing 
the  same,  unless  it  be  prohibited  by  the 
terms  of  its  charter,  or  some  public  law, 
from  so  doing. 

There  is  no  principle  which  prevents  a  cor- 
poration from  contracting  debts  within  the 
scope  of  its  action;  and,  as  has  been  ob- 
served, if  it  may  contract  a  debt,  it  neces- 
sarily may  make  provision  for  its  payment, 
by  drawing,  or  indorsing,  or  accepting  notes 
or  bills.  It  is  not  pretended  that  this  power 
extends  to  the  drawing,  indorsing,  or  accept- 
ing of  bills  or  notes  generally,  and  discon- 
nected from  the  purposes  for  which  the  cor- 
poration was  created. 

The  corporation,  in  the  present  case,  was 
indebted  to  one  of  its  conti-actors  for  work 
done  upon  the  road,  for  the  payment  of 
which  the  note  in  question  was  drawn.  This, 
upon  principle  and  authority,  was  a  usual 
and  appropriate  means  for  accomplishing  the 
object  and  purposes  of  the  charter,  viz.,  tl:e 
construction  of  the  road.  Not  only  do  aU 
the    elementary    writers    sustain    this    view 


356 


CAPACITY  OF  PARTIES. 


of  the  subject,  but,  as  we  have  seen,  there 
are  three  adjudicated  cases  in  courts  of  high 
authority  dii-ectly  in  its  favor,— the  case  of 
^lum  V.  Commission  Co.,  16  Johns.  52,  the 
case  of  Mott  v.  Hiclis,  1  Cow.  513,  and  the 
case  of  Hayward  v.  Pilgi'im  Soc.,  21  Pick. 
270. 

There  has  not  been  produced  a  single  case 
to  the  contrary.  The  cases  cited  relied  upon 
are  decided  upon  different  grounds  entirely. 
The  case  of  Broughton  v.  Manchester  &  Sal- 
ford  Waterworks,  3  Barn.  &  Aid.  1,  decides 
nothing  more  than  that  a  corporation,  not 
established  for  trading  purposes,  cannot  be 
acceptoi"s  of  a  bill  of  exchange,  payable  at 
a  less  period  than  six  months  from  the  date, 
because  such  a  case  falls  within  the  provi- 
sions of  the  several  acts  passed  for  the  pro- 
tection of  the  Bank  of  P^ngland,  by  which 
it  is  enacted,  that  it  shall  not  be  lawful  for 
any  bcdy  corporate  to  borrow,  owe,  or  take 
up  any  money  upon  their  bills  or  notes  pay- 
able at  demand,  or  at  any  less  time  than  six 
months  from  the  borrowing  thereof.  It  is 
true,  that  Baily,  J.,  in  his  opinion,  says: 
"There  being  no  power  expressly  given  to  the 
corporation  to  make  promissory  notes  or 
become  parties  to  bills  of  exchange,  I  should 
doubt  very  much  (even  if  the  bank  acts 
were  entirely  out  of  the  question)  whether 
such  corporation  would  have  any  power  to 
bind  itself  for  purposes  foreign  to  those  for 
which  it  was  originally  established;"  and 
Best,  J.,  in  his  opinion,  says,  "I  am  also 
of  opinion,  that  this  action  is  not  maintain- 
able, because  this  case  comes  within  that 
rule  of  law  by  which  corporations  are  pre- 
vented from  binding  themselves  by  contract, 
not  under  seal.  When  a  company,  like  the 
Bank  of  England,  or  East  India  Company, 
are  incorporated  for  the  purposes  of  trade, 
it  seems  to  result  from  the  very  object  of 
their  being  so  incorporated,  that  they  should 
have  power  to  accept  bills  or  issue  promis- 
sory notes;  it  would  be  impossible  for  either 
of  these  companies  to  go  on  without  accept- 
ing bills.  In  the  case  of  Stark  v.  Highgate 
Arch- Way  Co.,  5  Taunt.  792,  the  court  of 
common  pleas  seemed  to  think  that,  unless 
express  authority  was  given  by  the  act  es- 
tablishing the  company  to  make  promissory 
notes  eo  nomine,  a  corporation  could  not 
bind  itself  except  by  deed.  Now,  there  is 
nothing  in  the  act  of  parliament  establishing 
this  company,  which  authorizes  them  to 
bind  themselves  except  by  deed."  So,  the 
authority  of  this  case  for  the  defendant  rests 
Bolely  upon  the  dubitatur  of  Baily  and  the 
opinion  of  Best,  that  the  company  could 
only  bind  itself  by  deed.  How  much,  under 
these  circumstances,  it  is  worth,  need  not 
be  said. 

The  case  of  People  v.  Utica  Ins.  Co.,  15 
Johns,  358,  decides,  that,  since  the  act  to 
restrain  unincorporated  banking  associations 
(April  11,  1804,  re-enacted  April  6,  1813),  the 
right  or  privilege  of  carrying  on  banking 
operations  by  an  association  or  company,  is 


a  franchise  which  can  only  be  exercised  un- 
der a  legislative  grant;  that  a  corporation 
has  no  other  powers  than  such  as  are  specif- 
ically granted  by  the  act  of  incorporation,  or 
are  necessary  for  the  purposes  of  caiTying 
into  effect  the  powers  expressly  granted; 
and  that  the  act  to  incorporate  the  Utica  In- 
surance Company  does  not  authorize  the 
company  to  institute  a  bank,  issue  bills, 
discount  notes,  and  receive  deposits,  such 
powers  not  being  expressly  granted  by  the 
legislature,  and  not  being  within  their  in- 
tention, as  collected  from  the  act  of  incor- 
poration; and  that  the  company  having  as- 
sumed and  exercised  these  powers,  they  were 
held  to  have  usui-ped  a  franchise. 

It  is  scarcely  necessary  to  enter  into  an 
investigation,  to  show  the  ground  upon  which 
this  decision  rests.  Banking  privileges,  by 
an  association  or  company,  in  New  York, 
rest  upon  express  grant.  There  was  no  such 
grant  to  the  Utica  Insm-ance  Company,  and 
an  exercise  of  the  power  was  not  necessary 
and  proper  to  the  performance  of  the  pur- 
poses for  which  it  is  created,  but  wholly 
foreign  thereto. 

In  the  case  of  New  York  Firemen  Ins.  Co. 
V.  Ely,  2  Cow.  678,  it  is  held,  that  a  com- 
pany incorporated  for  the  purpose  of  insur- 
ance, and  forbidden  to  carry  on  any  other 
trade  or  business,  also  forbidden  to  exer- 
cise banking  powers,  with  a  clatise  in  the 
act  incorporating  them  enumerating  the  kind 
of  securities  upon  which  they  may  loan 
money,  but  not  including  promissory  notes 
in  such  enumeration,  have  no  power  to  loan 
moneys  upon  promissory  notes  or  any  se- 
curities other  than  those  especially  enumerat- 
ed. This  company  being  incorporated  for 
the  purpose  of  insurance  only,  the  discount- 
ing of  promissory  notes  would  have  been 
foreign  to  the  purpose  of  its  creation;  but, 
in  addition  thereto,  it  is  expressly  prohibited 
from  carrying  on  any  other  trade  or  busi- 
ness, or  exercising  banking  powers,  and  the 
kind  of  securities  upon  which  it  may  loan 
money  are  especially  enumerated,  promis- 
sory notes  being  excluded,  it  is  a  well-set- 
tled maxim  of  the  law,  the  "expressio  unius 
exclusio  est  alterius";— then,  for  many  rea- 
sons, this  company  had  no  power  under  its 
charter  to  discount  notes.  It  is  not  only  not 
given  expressly  or  by  implication,  but  upon 
every  principle  of  legal  construction  is  with- 
held. 

In  the  case  of  Life  Ins.  &  Fire  Ins.  Co. 
V.  Mechanics'  Fire  Ins.  Co.  of  New  York, 
7  Wend.  31,  it  is  held,  that  "a  corporation  au- 
thorized to  lend  money  only  on  bond  and 
mortgage  cannot  recover  money  lent  by  the 
corporation,  except  a  bond  and  mortgage  be 
taken  for  its  re-payment;  every  other  se- 
curity, as  well  as  the  contract  itself,  is  void, 
and  not  the  basis  of  action."  The  reason 
for  this  decision  is  obvious;  bond  and  mort- 
gage being  specified  as  the  securities  upon 
which  the  company  might  lend  money,  all 
others    were   considered   as   excluded,    upon 


CORPORATIONS. 


857 


the  principle  mentioned  above,  "Expressio 
unlus  excluslo  est  alterius." 

These  are  all  the  cases  relied  upon  by  the 
defendant  for  the  support  of  the  position  as- 
sumed by  him;  we  are  satisfied  that  they 
have  no  applicability  to  the  question,  and 
are  not  authority  in  this  case. 

We  are  then  of  opinion  (to  use  the  words 
of  Chief  Justice  Marshall,  in  the  case  of 
McCullock  V.  State  of  Maryland)  that  the 
end  proposed  by  the  Hiwassee  Railroad  Com- 


pany, in  executing  the  note  In  question,  was 
legitimate,  and  within  the  scope  of  its  char- 
ter; that  as  a  means  It  was  appropriate,  and 
plainly  adapted  to  that  end,  which  is  not 
prohibited,  but  consistent  with  the  letter 
and  spirit  of  the  charter,  and  therefore,  not 
void,  but  binding  and  effectual  upon  the 
company  and  the  Indorsers. 

Let  the  Judgment  of  the  circuit  court  be 
reversed,  and  the  case  be  remanded  for  a 
new  trlaL 


358 


REALITY  OF  CONSENT. 


3? 


FOSTER  V.  MACKINNON,  j^o 
CL.  R,  4  C.  P.  704.) 
Court  of  Common  Pleas.    July  5,  1869. 

BYLES,  J.  This  was  an  action  by  the 
plaintiff  as  indorsee  of  a  bill  of  exchange  for 
£3.000  against  the  defendant,  as  indorser. 
The  defendant  by  one  of  his  pleas  traversed 
the  mdorsement,  and  by  another  alleged  that 
the  defendant's  indorsement  was  obtained 
from  him  by  fraud.  The  plaintiff  was  a  hold- 
er for  value  before  maturity,  and  without 
notice  of  any  fraud. 

There  was  contradictory  evidence  as  to 
whether  the  indorsement  was  the  defend- 
ant's signature  at  all;  but,  according  to  the 
evidence  of  one  Callow,  the  acceptor  of  the 
bill,  who  was  called  as  a  witness  for  the 
plaintiff,  he,  Callow,  produced  the  bill  to  the 
defendant,  a  gentleman  advanced  in  life,  for 
him  to  put  his  signature  on  the  back,  after 
that  of  one  Cooper,  who  was  payee  of  the 
bill  and  first  indorser.  Callow  not  saying  that 
it  was  a  bill,  and  teUing  the  defendant  that 
the  instrument  was  a  guarantee.  The  de- 
fendant did  not  see  the  face  of  the  bill  at 
all.  But  the  bill  was  of  the  usual  shape,  and 
bore  a  stamp,  the  impress  of  which  stamp 
was  visible  at  the  back  of  the  bill.  The  de- 
fendant signed  his  name  after  Cooper's,  he, 
the  defendant  (as  the  witness  stated),  believ- 
ing the  document  to  be  a  guarantee  only. 

The  lord  chief  justice  told  the  jury  that, 
if  the  indorsement  was  not  the  defendant's 
signature,  or  If,  being  his  signature,  it  was 
obtained  upon  a  fraudulent  representation 
that  it  was  a  guarantee,  and  the  defendant 
signed  it  without  knowing  that  it  was  a  bill, 
and  under  the  belief  that  it  was  a  guarantee, 
and  if  the  defendant  was  not  guilty  of  any 
negligence  in  so  signing  the  paper,  the  de- 
fendant was  entitled  to  the  verdict.  The  jury 
found  for  the  defendant. 

A  rule  nisi  was  obtained  for  a  new  trial, 
first,  on  the  ground  of  misdirection  in  the 
latter  part  of  the  summing-up,  and,  secondly, 
on  the  ground  that  the  verdict  was  against 
the  evidence. 

As  to  the  first  branch  of  the  rule.  It  seems 
to  us  that  the  question  arises  on  the  traverse 
of  the  indorsement.  The  case  presented  by 
the  defendant  is  that  he  never  made  the  con- 
tract declared  on;  that  he  never  saw  the  face 
of  the  bill;  that  the  purport  of  the  contract 
was  fraudulently  misdescribed  to  him;  that, 
when  he  signed  one  thing,  he  was  told  and 
believed  that  he  was  signing  another  and  an 
entirely  different  thing;  and  that  his  mind 
never  went  with  his  act. 

It  seems  plain,  on  principle  and  on  author- 
ity, that,  if  a  blind  man,  or  a  man  who  can- 
not read,  or  who  for  some  reason  (not  imply- 
ing negligence)  forbears  to  read,  has  a  writ- 
ten contract  falsely  read  over  to  him,  the 
reader  misreading  to  such  a  degree  that  the 
written  contract  is  of  a  nature  altogether  dif- 
ferent from  the  contract  pretended  to  be  read 
from  the  paper  which  the  blind  or  illiterate 


man  afterwards  signs;  then,  at  least  if  there 
be  no  negligence,  the  signature  so  obtained  is 
of  no  force.  And  it  is  invalid  not  merely  on 
the  groimd  of  fraud,  where  fraud  exists,  but 
on  tlie  ground  that  the  mind  of  the  signer 
did  not  accompany  the  signature;  in  other 
words,  that  he  never  intended  to  sign,  and 
therefore,  in  contemplation  of  law,  never  did 
sign,  the  contract  to  which  his  name  is  ap- 
pended. 

The  authorities  appear  to  us  to  support  this 
view  of  the  law.  In  Thoroughgood's  Case,  2 
Coke.  9b,  it  was  held -that,  if  an  illiterate 
man  have  a  deed  falsely  read  over  to  him, 
and  he  then  seals  and  delivers  the  parch- 
ment, that  parchment  is  nevertheless  not  his 
deed.  In  a  note  to  Thoroughgood's  Case,  2 
Coke,  9b,  In  Eraser's  edition  of  Coke's  Re- 
ports, it  is  suggested  that  the  doctrine  is  not 
confined  to  the  condition  of  an  illiterate  gran- 
tor; and  a  ease  in  Keilwey's  Reports  (70  pi.  6), 
Is  cited  in  support  of  this  observation.  On 
reference  to  that  case,  it  appears  that  one  of 
the  judges  did  there  observe  that  it  made  no 
difference  whether  the  grantor  were  lettered 
or  unlettered.  That,  however,  was  a  case 
where  the  grantee  himself  was  the  defraud- 
ing party.  But  the  position  that  if  a  grantor 
or  covenantor  be  deceived  or  misled  as  to  the 
actual  contents  of  the  deed,  the  deed  does 
not  bind  him,  is  supported  by  many  authori- 
ties. See  Com.  Dig.  "Fait"  (B,  2);  and  is 
recognized  by  Bayley,  B.,  and  the  court  of 
exchequer,  in  the  case  of  Edwards  v.  Brown, 

1  Cromp.  &  J.  312.  Accordingly,  it  has  re- 
cently been  decided  in  the  exchequer  chamber 
that  if  a  deed  be  delivered,  and  a  blank  left 
therein  be  afterwards  improperly  filled  up  (at 
least,  if  that  be  done  without  the  grantor's 
negligence),  it  is  not  the  deed  of  the  grantor. 
Swan  V.  North  British  Australasian  Land  Co., 

2  Hurl.  «&  C.  175. 

These  cases  apply  to  deeds,  but  the  prin- 
ciple is  equally  applicable  to  other  written 
contracts.  Nevertheless,  this  principle,  when 
applied  to  negotiable  instruments,  must  be 
and  is  limited  in  its  application.  These  in- 
struments are  not  only  assignable,  but  they 
form  part  of  the  currency  of  the  country.  A 
qualification  of  the  general  rule  is  necessary 
to  protect  innocent  transferees  for  value. 
If,  therefore,  a  man  writes  his  name  aci'oss 
the  back  of  a  blank  bill-stamp,  and  part  with 
it,  and  the  paper  is  afterwards  improperly 
filled  up,  he  is  liable  as  indorser.  If  he  write 
it  across  the  face  of  the  bill,  he  is  liable  as 
acceptor,  when  the  instrument  has  once 
passed  into  the  hands  of  an  innocent  indorsee 
for  value  before  maturity,  and  liable  to  the 
pxtent  of  any  sum  which  the  stamp  wiU  cov- 
er. 

In  these  cases,  however,  the  party  signing 
knows  what  he  is  doing.  The  indorser  in- 
tended to  indorse,  and  the  acceptor  intended 
to  accept,  a  bill  of  exchange  to  be  thereafter 
filled  up,  leaving  the  amount,  the  date,  the 
maturity,  and  the  other  parties  to  the  bill 
undetermined. 


MISTAKE. 


359 


But  in  the  case  now  under  consideration 
the  defendant,  accordinfj  to  the  evidence,  if 
believed,  and  the  findin;,'  of  the  jury,  never 
intended  to  indorse  a  bill  of  exchauj^e  at  all, 
but  intended  to  sij,'n  a  contract  of  an  entirely 
different  nature.  It  was  not  his  design,  and, 
If  he  were  guilty  of  no  negligence,  it  was 
not  even  his  fault  that  the  instrument  he 
signed  turned  out  to  be  a  bill  of  exchange. 
It  was  as  if  he  had  written  his  name  on  a 
sheet  of  paper  for  the  purpose  of  franking  a 
letter,  or  in  a  lady's  album,  or  on  an  order 
for  admission  to  the  Temple  church,  or  on 
the  tly-leaf  of  a  book,  and  there  had  already 
been,  without  his  knowledge,  a  bill  of  ex- 
change or  a  promissory  note  payable  to  order 
inscribed  on  the  other  side  of  the  paper.  To 
make  the  case  clearer,  suppose  the  bill  or 
note  on  the  other  side  of  the  paper  in  each 
of  these  cases  to  be  written  at  a  time  subse- 
quent to  the  signature,  then  the  fraudulent 
misapplication  of  that  signature  to  a  ditlerent 
purpose  would  have  been  a  counterfeit  altera- 
tion of  a  writing  with  intent  to  defraud,  and 
would  therefore  have  amounted  to  a  forgery. 
In  that  case  the  signer  would  not  have  been 
bound  by  his  signature,  for  two  reasons: 
First,  that  he  never  in  fact  signed  the  writing 
declared  on;  and,  secondly,  that  he  never  in- 
tended to  sign  any  such  contract. 

In  the  present  case  the  first  reason  does  not 
apply,  but  the  second  reason  does  apply.  The 
defendant  never  intended  to  sign  that  con- 
tract, or  any  such  contract  He  never  intend- 
ed to  put  his  name  to  any  instrument  that 
then  was  or  thereafter  might  become  nego- 
tiable. He  was  deceived,  not  merely  as  to  the 
legal  effect,  but  as  to  the  actual  contents  of 
the  InstrumenL 


We  are  not  aware  of  any  case  in  which  the 
preci.se  question  now  before  us  has  arisen  on 
bills  of  exchange  or  promis.sory  notes,  or 
been  judicially  discus.sed.  In  the  case  of  Ing- 
ham V.  I'rimrose,  7  C.  B.  (N.  S.)  83;  28  L.  J. 
(C.  P.)  294,  and  iu  the  case  of  Nance  v.  Lary, 
5  Ala.  370,  cited  1  Tars.  Bills,  114,  note,— both 
cited  by  the  plaintiff, — the  facts  were  very  dif- 
ferent from  those  of  the  case  before  us,  and 
have  but  a  remote  bearing  on  the  question. 
But  in  Putnam  v.  Sullivan,  an  American  case, 
reported  in  4  Mass.  45,  and  cited  in  1  Pars. 
Bills,  p.  Ill,  note,  a  distinction  is  taken  by 
Chief  Justice  Parsons  between  a  case  where 
an  indorser  intended  to  indorse  such  a  note 
as  he  actually  indorsed,  being  induced  by 
fraud  to  indorse  it,  and  a  case  where  he  in- 
tended to  indorse  a  different  note,  and  for  a 
different  purpose.  And  th^  court  intimated 
an  opinion  that,  even  in  such  a  ca.se  as  that, 
a  distinction  might  prevail,  and  protect  the 
indorsee. 

The  distinction  in  the  ca.se  now  under  con- 
sideration is  a  much  plainer  one,  for  on  this 
branch  of  the  inile  we  are  to  assume  that  the 
indorser  never  intended  to  indorse  at  all,  but 
to  sign  a  contract  of  an  entirely  different  na- 
ture. 

For  these  reasons  we  think  the  direction  of 
the  lord  chief  justice  was  right 

With  respect,  however,  to  the  second 
branch  of  the  rule,  we  are  of  opinion  that  the 
case  should  imdergo  further  investigation. 
We  abstain  from  giving  oiu*  reasons  for  this 
part  of  our  decision  only  lest  they  should 
prejudice  either  party  on  a  second  inquiry. 

The  vule,  therefore,  will  be  made  absolute 
for  a  new  trial. 

Rule  absolute. 


SCO 


KEALITY  OF  CONSENT. 


:?3 


CTNDY   et   al 

(3  App.  Gas.  459.) 
House  of  Lords.     March  4,  1878 


LINDSAY   et   al.i    ,, 


Appeal  from  court  of  appeal. 

In  1S73,  one  Alfred  Blenkarn  hired  a  room 
at  a  corner  house  in  Wood  street,  Chcapside. 
It  had  two  side  windows  opening  into  Wood 
sti'eet,  but,  though  the  entrance  was  from 
Little  Love  Lane,  it  was  by  him  constantly 
described  as  37  Wood  street,  Cheapside.  His 
agreement  for  tliis  room  was  signed  "Alfred 
Blenkarn."  The  now  respondents,  Messrs. 
Lindsay  &  Co.,  were  linen  manufacturers, 
carrying  on  business  at  Belfast.  In  the  lat- 
ter part  of  1S73,  Blenkarn  wrote  to  the  plain- 
tiffs on  the  subject  of  a  purchase  from  them 
of  goods  of  their  manufacture — chiefly  cam- 
bric handkerchiefs.  His  letters  were  written 
as  from  ••37  Wood  street.  Cheapside,"  where 
he  pretended  to  have  a  warehouse,  but  in 
fact  occupied  only  a  room  on  the  top  floor, 
and  that  room,  though  looking  into  Wood 
street  on  one  side,  could  only  be  reached  from 
the  entrance  in  5  Little  Love  Lane.  The 
name  signed  to  these  letters  was  always 
signed  without  any  initial  as  representing  a 
Christian  name,  and  was,  besides,  so  written 
as  to  appear  "Blenkiron  &  Co."  There  was 
a  highly  respectable  firm  of  W.  Blenkiron  & 
Son,  carrying  on  business  in  Wood  street,  but 
at  number  123  Wood  street,  and  not  at  37. 
Messrs.  Lindsay,  who  knew  the  respectability 
of  Blenkiron  tS:  Son,  though  not  the  number  of 
the  house  where  they  carried  on  business, 
answered  the  letters,  and  sent  the  goods  ad- 
dressed to  '•Messrs.  Blenkiron  &  Co.,  37  Wood 
Street,  Cheapside,"  where  they  were  taken  iu 
at  once.  The  invoices  sent  with  the  goods 
were  always  addressed  In  the  same  way. 
Blenkarn  sold  the  goods  thus  fraudulently  ob- 
tained from  Messrs.  Lindsay  to  different  per- 
sons, and  among  the  rest  he  sold  250  dozen  of 
cambric  handkerchiefs  to  the  Messrs.  Cundy, 
who  were  bona  fide  purchasers,  and  who  re- 
sold them  in  the  ordina:-y  way  of  their  trade. 
Payment  not  being  made,  an  action  was  com- 
menced in  the  mayor's  com't  of  London  by 
Messrs.  Lindsay,  the  junior  partner  of  which 
firm,  Mr.  Thompson,  made  the  ordinary  affi- 
davit of  debt,  as  against  Alfred  Blenkarn, 
and  therein  named  Alfred  Blenkarn  as  the 
debtor.  Blenkarn's  fraud  was  soon  discov- 
ered, and  he  was  prosecuted  at  the  Central 
criminal  court,  and  convicted  and  sentenced. 
Messrs.  Lindsay  then  brought  an  action 
against  Messrs.  Cundy  as  for  unlawful  con- 
version of  the  handkerchiefs.  The  cause  was 
tried  before  Mr.  Justice  Blackburn,  who  left 
it  to  the  jury  to  consider  whether  Alfred 
Blenkarn,  with  a  fraudulent  intent  to  induce 
the  plaintiffs  to  give  him  the  credit  belonging 
to  the  good  character  of  Blenkiron  »&  Co., 
wrote  the  letters,  and  by  fraud  induced  the 
plaintiffs  to  send  the  goods  to  37  Wood  street 

1  Irrelevant  parts  omitted. 


—were  they  the  same  goods  as  those  bought 
by  the  defendants— and  did  the  plaintiffs  by 
the  affidavit  of  debt  intend,  as  a  matter  of 
fact,  to  adopt  Alfred  Blenkarn  as  their  debtor. 
The  firet  and  second  questions  were  answered 
in  the  affirmative,  and  the  third  iu  the  nega- 
tive. A  verdict  was  taken  for  the  defend- 
ants, with  leave  reserved  to  move  to  enter  the 
verdict  for  the  plaintiffs.  On  motion  accord- 
ingly, the  court,  after  argument,  ordered  the 
rule  for  entering  judgment  for  the  plaintiffs 
to  be  discharged,  and  directed  judgment  to  be 
entered  for  the  defendants.  1  Q.  B.  Div.  M8. 
On  appeal  this  decision  was  reversed,  and 
judgment  ordered  to  be  entered  for  the  plain- 
tiffs, Messrs.  Lindsay.  2  Q.  B.  Div.  96. 
This  appeal  was  then  brought. 

Sir  H.  S.  Giffard,  Sol.  Gen.,  Mr.  Benjamin, 
Q.  C,  and  B.  Francis  Williams,  for  appellants. 

The  question  here  is  whether  the  property 
Ln  the  goods  passed  from  the  respondents  to 
Blenkarn.     It  is  submitted  that  it  did. 

A  title  to  goods  may  be  acquired  even 
where  they  are  obtained  upon  false  pretences. 
Though  it  will  not  be  an  indefeasible  title, 
and  may  be  voidable,  it  wiU,  as  to  third  per- 
sons at  least,  be  good  till  it  has  been  avoided. 
It  must  in  some  sense  pass  the  property,  for 
if  it  did  not  it  may  be  doubtful  whether  a 
conviction  for  obtaining  the  goods  could  be 
sustained.  Here  it  is  clear  that  there  was  in 
the  first  instance  an  intention  on  the  part  of 
the  original  owner  that  the  property  should 
pass.  [LORD  PENZANCE:  But  was  it  not 
the  intention  that  it  should  pass  to  Blenkiron. 
but  not  to  Blenkarn?]  As  to  some  person  in 
Wood  street  the  intention  plainly  did  exist 
that  it  should  pass.  [LORD  PENZANCE: 
Is  there  no  distinction  between  the  case  of  a 
man  who,  being  deceived,  enters  into  a  con- 
tract, and  that  of  a  man  who,  being  also  de- 
ceived, does  not  enter  into  a  contract?]  The 
latter  was  the  case  of  Hardman  v.  Booth,  1 
Hurl.  &  C.  803,  so  much  relied  on  in  the  court 
below.  But  that  case  is  distinguishable  from 
the  present,  for  there  the  facts  shewed  dis- 
tinctly that  the  intention  was  to  contract  with 
Thomas  Gandell  &  Co.,  and  with  them  alone; 
and  the  firm  of  Edward  Gandell  <&  Todd  was 
a  different  firm,  and  carried  on  business  at  a 
different  place,  and  was  wholly  unknown  to 
the  plaintiffs;  and  Edward  Gandell,  having 
by  fraud  got  hold  of  the  goods  sent  to  the 
warehouse  of  Thomas  Gandell,  carried  them 
off  to  his  own  place,  and  so  disposed  of  them. 
Here  the  plaintiffs  themselves  sent  the  goods 
to  the  person  who  had  corresponded  with 
them,  and  who  did  carry  on  business  at  37 
Wood  street  The  goods  reached  that  desti- 
nation, and  were  delivered  there  according  to 
the  address  which  the  plaintiffs  had  put  upon 
them.  The  facts  of  the  two  cases  were  un- 
like, and,  without  in  the  least  doubting  the 
decision  in  that  case,  it  may  well  be  contend- 
ed not  to  be  applicable  here.  Here  the  orig- 
inal owner  allowed  tlie  goods  to  remain  in  tho 


MISTAKE. 


361 


hands  of  the  person  to  whom  he  had  sent 
them,  and  while  there  they  were  sold  to  the 
defendants,  who  were  bona  tide  purchasers 
for  value.  After  that  the  vendor  could  no 
longer  follow  them  as  his  own.  His  inten- 
tion had  been  to  transfer  them,  and  the  traus- 
fer  was  complete.  In  no  way  whatever  could 
the  case  be  compared  to  one  in  which  money 
or  a  bill  of  exchange  was  delivered  to  a  per- 
son for  a  particular  purpose,  and  he  used  It 
for  another,  and  so  could  give  no  title  what- 
ever to  a  third  person  to  whom  he  passed  it. 
Neither  was  this  a  delivery  to  B.,  who  stated 
hlu\self  to  be  the  agent  of  some  one  else, 
when  he  was  not  so.  It  was  a  delivery  to  B. 
himself.  Credit  was  therefore  given  to  him. 
It  was  given  to  Blenkani  &  Co.,  of  37  Wood 
street.  Then  again,  in  the  first  Instance,  Mr. 
Thompson,  one  of  the  partners  in  ^Messrs. 
Lindsay's  house,  made  an  affidavit  of  debt 
against  Alfred  Bleukarn,  which  shewed  that 
the  house  recognized  Blenkarn  as  the  debtor, 
and  the  transaction  as  one  of  a  sale.  That, 
though  not  conclusive  on  the  subject,  was  at 
least  strong  evidence  of  previous  intention. 
It  may  be  admitted  that  where  the  authority 
to  pai't  with  the  property  is  limited,  and  the 
property  is  parted  with  in  disregard  of  that 
limited  authority,  the  title  to  it  would  not  pass. 
Keg.  V.  Middleton,  L.  R.  2  Cr.  Cas.  3S.  But 
that  cannot  affect  this  case,  for  here  the 
goods  were  transmitted  by  the  owners  them- 
selves to  a  person  and  a  place  described  by 
themselves.  The  title  to  the  goods  was  for 
the  time  perfect  in  law,  and,  being  so,  the 
transfer  to  the  defendants  made  during  that 
time,  being  made  bona  fide,  could  not  be  im- 
peached. Pease  v.  Gloahec,  L.  R.  1  P.  C. 
L'l9.  Till  the  title  of  Blenkarn  was  disaf- 
(irmed  it  was  good,  and  the  property  dis- 
posed of  in  the  meantime  could  not  after- 
wards be  followed  in  the  hands  of  a  third 
person  who  had  honestly  purchased  it. 

Mr.  Wills,  Q.  C,  and  Mr.  Fullarton,  for  re- 
spondents. 

Where  the  circumstances  are  such  that  no 
contract  has  ever  arisen,  mere  delay  in  de- 
claring a  disaffirmance  cannot  affect  the  case. 
Kingsford  v.  Merry,  1  HurL  &  N.  503;  Boul- 
ton  V.  Jones,  2  Hurl.  &  N.  5G4.  See  In  re 
Reed,  3  Ch.  Dlv.  123;  Hardman  v.  Booth,  1 
Hurl.  &  C.  803.  Here  there  was  no  contract 
The  plaintiffs  did  not  know  of  the  existence 
of  two  firms  of  names  similar  to  each  other 
carrying  on  business  In  Wood  street.  They 
knew  only  of  Blenkii-on  &  Co.,  and  thouglit 
they  were  dealing  with  Blenkiron  &  Co.,  and 
sent  their  goods  to  that  firm.  But  Blenkiron 
&  Co.  knew  nothing  whatever  of  the  matter. 
There  was,  therefore,  no  contract  with  them. 
"NW^as  there  any  with  Blenkarn.  for  by  al 
fraud  in  using  the  name  of  other  persons  ha 
obtained  possession  of  goods  intended  for 
those  other  pei'sons,  and  not  for  him.  There, 
was.  therefore,  no  contract  with  him.  If  so, 
no  moment  existed  dming  which  a  title  to  the 


goods  could  be  given  to  the  defendants. 
Their  conversion  of  the  goods  was  conse- 
quently unlawful. 

CAIRXS,  L.  Ch.  My  lords,  you  have  in 
this  case  to  discharge  a  dutj-  which  is  always 
a  disagreeable  one  for  any  court,  namely,  to 
determine  as  between  two  parties,  both  of 
whom  are  perfectly  innocent,  upon  which  of 
the  two  the  consequences  of  a  fraud  prac- 
tised upon  both  of  them  must  fall.  My  lords, 
in  discharging  that  duty  your  lordshix)s  can  do 
no  more  than  apply  rigorously  the  settled  and 
well-known  rules  of  law.  Now,  with  regard 
to  the  title  to  personal  property,  the  settled 
and  well-known  rules  of  law  may,  I  take  it, 
be  thus  expressed:  By  the  law  oL cur  coun- 
try the  purchaser  of  a  chattel  takes  the  chat- 
tel, as  a  general  rule,  subject  to  what  may 
turn  out  to  be  certain  infirmities  In  the  title. 
If  he  purchases  the  chattel  in  market  overt, 
he  obtains  a  title  which  is  good  against  ail 
-the  world;  but  if  he  does  not  purchase  the 
chattel  in  market  overt,  and  if  it  turns  out 
that  the  chattel  has  been  found  by  the  person 
who  professed  to  sell  it,  the  purchaser  will 
not  obtain  a  title  good  as  against  the  real 
owner.  If  it  turns  out  that  the  chattel  has 
been  stolen  by  the  person  who  has  professed  to 
sell  it,  the  purchaser  will  not  obtain  a  title. 
If  it  turns  out  that  the  chattel  has  come  into 
the  hands  of  the  person  who  professed  to  sell 
it,  by  a  de  facto  contract,  that  is  to  say,  a 
contract  which  has  purported  to  pass  the 
property  to  him  from  the  owner  of  the  prop- 
erty, there  the  purchaser  will  obtain  a  good 
title,  even  although  afterwards  it  should  ap- 
pear that  there  were  circumstances  connected 
with  that  contract  which  would  enable  the 
original  owner  of  the  goods  to  reduce  it,  and 
to  set  it  aside,  because  these  circumstances 
so  enabling  the  original  owner  of  the  goods 
or  of  the  chattel  to  reduce  the  contract  and  to 
set  it  aside,  will  not  be  allowed  to  interfere 
with  a  title  for  valuable  consideration  obtain- 
ed by  some  third  party  during  the  interval 
while  the  contract  remained  unreduced. 

My  lords,  the  question,  therefore,  in  the 
present  case,  as  your  lordships  will  observe, 
really  becomes  the  very  short  and  simple  one 
which  I  am  about  to  state.  Was  there  any 
contract  which,  with  regard  to  the  goods  in 
question  in  this  case,  had  passed  the  prop- 
erty in  the  goods  from  the  Messrs.  Lindsay 
to  Alfred  Blenliarn?  If  there  was  any  con- 
tract passing  that  property,  even  although, 
as  I  have  said,  that  contract  might  afterwards 
be  open  to  a  process  of  reduction,  upon  the 
ground  of  fraud,  still,  in  the  meantime,  Blenk- 
arn might  have  conveyed  a  good  title  for 
valuable  consideration  to  the  present  appel- 
lants. 

Now,  my  lords,  there  are  two  observations 
bearing  upon   the   solution   of  that   question 
which  I  desire  to  make.    In  the  first  place,  if  ( 
the  property  in  the  goods  in  question  passed, 
it  could  only  pass  by  way  of  contract    There 


362 


KEALTTY  OF  CONSENT. 


is  nothing  else  wliicli  could  liave  passed  the 
property.  The  second  observation  is  this: 
Your  lordships  are  not  here  embarrassed  by 
any  conflict  of  evidence,  or  any  evidence 
whatever  as  to  conversations  or  as  to  acts 
done;  the  whole  history  of  the  whole  trans- 
action lies  upon  paper.  The  principal  par- 
ties concerned,  the  respondents  and  Blenk- 
arn,  never  came  in  contact  persouaUy;  ev- 
erything that  was  done  was  done  by  writing. 
What  has  to  be  judged  of,  and  what  the  jury 
in  the  present  case  had  to  judge  of  was  mere- 
ly the  conclusion  to  be  derived  from  that 
writing,  as  applied  to  the  admitted  facts  of 
the  case. 

Now,  my  lords,  discharging  that  duty  and 
answering  that  inquiry,  what  the  jurors  have 
found  is,  in  substance,  this:  It  is  not  neces- 
sary to  spell  out  the  words,  because  the  sub- 
stance of  it  is  beyond  all  doubt.  They  have 
found  that  by  the  form  of  the  signatures  to 
the  lettei-s  which  were  written  by  Blenkarn, 
by  the  mode  m  which  his  letters  and  his  ap- 
plications to  the  respondents  were  made  out, 
and  by  the  way  in  Avhich  he  left  uncorrected 
the  mode  and  form  in  which,  in  turn,  he  was 
addressed  by  the  respondents;  that  by  all 
those  means  he  led,  and  intended  to  lead,  the 
respondents  to  believe,  and  they  did  believe, 
that  the  person  with  whom  they  were  com- 
municating was  not  Blenkarn,  the  dishonest 
and  irresponsible  man,  but  was  a  well  known 
and  solvent  house  of  Blenkiron  &  Co.,  doing 
business  in  the  sam-^  street.  My  lords,  those 
things  are  found  as  matters  of  fact,  and  they 
are  placed  beyond  the  range  of  dispute  and 
controver.sy  in  the  case. 

If  that  is  so,  what  is  the  consequence?  It 
is  that  Blenkarn— the  dishonest  man,  as  I  call 
him— was  acting  here  just  in  the  same  way 
as  if  he  had  forged  the  signature  of  Blenk- 
iron &  Co.,  the  respectable  firm,  to  the  appli- 
cations for  goods,  and  as  if  when,  in  return, 
the  goods  we^e  forwarded  and  letters  were 


sent,  accompanying  them,  he  had  intercepted 
the  goods  and  intercepted  the  letters,  and 
had  taken  possession  of  the  goods,  and  of  the 
letters  which  were  addressed  to  and  intended 
for,  not  himself,  but  the  firm  of  Blenkiron  & 
Co.  Now,  my  lords,  stating  the  matter  short- 
ly in  that  way,  I  ask  the  question,  how  is  it 
possible  to  imagine  that  in  that  state  of 
things  any  contract  could  have  arisen  be- 
tween the  respondents  and  Blenkarn,  the  dis- 
honest man?  Of  him  they  knew  nothing,  and 
of  him  they  never  thought.  With  him  they 
never  intended  to  deal.  Their  minds  never, 
even  for  an  instant  of  time  rested  upon  him, 
and  as  between  him  and  them  there  was  no 
consensus  of  mind  which  could  lead  to  any 
agreement  or  any  contract  whatever.  As  be- 
tween him  and  them  there  was  merely  the 
bne  side  to  a  contract,  where,  in  order  to  pro- 
'duce  a  contract,  two  sides  would  be  required. 
With  the  firm  of  Blenkiron  &  Co.  of  course 
there  was  no  contract,  for  as  to  them  the 
matter  was  entirely  unknown,  and  therefore 
the  pretence  of  a  contract  was  a  failure. 

The  result,  therefore,  my  lords,  is  this: 
that  your  lordships  have  not  here  to  deal  with 
one  of  those  cases  in  which  there  is  de  facto 
a  contract  made  which  may  afterwards  be 
impeached  and  set  aside  on  the  ground  of 
fraud;  but  you  have  to  deal  with  a  case 
which  ranges  itself  under  a  completely  dif- 
ferent chapter  of  law,  the  case,  namely,  in 
which  the  contract  never  comes  into  exist- 
ence. My  lords,  that  being  so,  it  is  idle  to 
talk  of  the  property  passing.  The  property 
remained,  as  it  originally  had  been,  the  prop- 
erty of  the  respondents,  and  the  title  which 
was  attempted  to  be  given  to  the  appellants 
was  a  title  which  could  not  be  given  to  them. 

My  lords,  I  therefore  move  your  lordships 
that  this  appeal  be  dismissed  with  costs,  and 
the  judgment  of  the  court  of  appeal  affirmed. 

Judgment  appealed  from  affirmed,  and  ap- 
peal dismissed,  with  costs. 


MISTAKE. 


o63 


OUTURIEIi  et  al.  v.  HASTIE  et  aL 
(G  II.  L.  Cas.  (J73.) 
House  of  Lords.    June  27.  1856. 

The  plaintiffs  were  mercliauts  at  Smyrna; 
the  defendants  were  corn  factors  in  London; 
and  this  action  was  brought  to  recover  from 
them  the  price  of  a  cargo  of  Indian  corn, 
which  had  been  shipped  at  Salouica,  on 
board  a  vessel  chartered  by  the  plaintiffs  for 
a  voyage  to  England,  and  had  been  sold  in 
London  by  the  defendants  in  error,  upon  a 
del  credere  commission.  The  purchasei",  un- 
der the  circumstances  hereafter  stated,  had 
repudiated  the  contract. 

In  January,  1848,  the  plaintiffs  chartered  a 
vessel  at  ISaluulca,  to  bring  a  cargo  of  1180 
quarters  of  corn  to  England.  On  the  8th  of 
February  a  policy  of  insurance  was  effected 
on  "corn,  warranted  free  from  average,  un- 
less general,  or  the  ship  be  stranded."  On 
the  22d  of  that  uumth,  the  master  signed  a 
bill  of  lading,  makiug  the  corn  deliverable  to 
the  plaintiffs,  or  their  assigns,  "he  or  they 
paying  freight,  as  per  charter-party,  with 
primage  and  average  accustomed."  On  the 
L'od  February  the  ship  sailed  on  the  home- 
ward voyage.  On  the  1st  May,  1848,  Messrs. 
Bernouilli,  the  London  agents  of  the  plain- 
tiffs, and  the  persons  to  whom  the  bill  of 
lading  had  been  indorsed,  employed  the  de- 
fendants to  seU  the  cargo,  and  sent  them  the 
bill  of  lading,  the  charter-party,  and  the  pol- 
icy of  insurance,  asliing  and  receiving  there- 
on an  advance  of  £G00. 

On  the  15th  May  the  defendants  sold  the 
cargo  to  A.  B.  Callander,  who  signed  a  bought 
note,  in  the  following  terms:  "Bought  of 
Hastie  &  Hutchinson,  a  cargo  of  about  1,180 
(say  eleven  hundred  and  eighty)  quarters  of 
Salonica  Indian  corn,  of  fair  average  qual- 
ity when  shipped  per  the  Kezia  Pago.  Cap- 
tain Page,  from  Salonica;  bill  of  lading  dat- 
ed twenty-second  February,  at  27s.  (say 
twenty-seven  shillings)  per  quarter,  free  on 
board,  and  including  freight  and  insurance, 
to  a  safe  port  in  the  United  Kingdom,  the 
vessel  calling  at  Cork  or  Falmouth  for  or- 
ders; measure  to  be  calculated  as  custom- 
aiy;  payment  at  two  months  fi'om  this  date, 
or  in  cash,  less  discount,  at  the  rate  of  five 
per  cent,  per  annum  for  the  unexpired  time, 
upon  handing  sliippiug  documents." 

In  the  early  part  of  the  homeward  voyage, 
the  cargo  became  so  heated  that  the  vessel 
was  obliged  to  put  into  Tunis,  where,  after 
a  survey  and  other  proceedings,  regularly 
and  bona  fide  talcen,  the  cargo  was,  on  the 
22d  April,  unloaded  and  sold.  It  did  not  ap- 
pear that  either  party  knew  of  these  circum- 
stances at  the  time  of  the  sale.  The  con- 
ti-act  having  been  made  on  the  15th  of  May, 
Mr.  Callander,  on  the  23d  of  ^lay.  wrote  to 
Hastie  &  Hutchinson:  "I  repudiate  the  con- 
tract of  the  cargo  of  Indian  corn,  per  the 
Kezia  Page,  on  the  ground  that  the  cargo 
did  not  exist  at  the  date  of  the  contract,  it 


appearing  that  the  news  of  the  condemnation 
and  sale  of  this  cargo  at  Tunis,  on  the  22d 
April,  was  published  at  Lloyds,  and  other  pa- 
pers, on  the  12th  instant,  being  three  to  four 
days  prior  to  its  being  offered  for  sale  to  me." 

The  plaintiffs  afterwards  brought  this  ac- 
tion. The  declaration  was  in  the  usual  form. 
The  defendants  pleaded  several  pleas,  of 
which  the  first  four  are  not  now  material  to 
be  considered.  The  fifth  plea  was  that  be- 
fore the  sale  to  Callander,  and  whilst  the 
vessel  was  on  the  voyage,  the  plaintiffs  sold 
and  delivered  the  corn  to  other  persons,  and 
that  since  such  sale  the  plaintiffs  never  had 
any  property  in  the  corn  or  any  right  to  sell 
or  dispose  thereof,  and  that  Callander  on 
that  account  repudiated  the  sale,  and  refused 
to  perform  his  contract,  or  to  pay  the  price 
of  the  corn.  Sixthly,  that  before  the  defend- 
ants were  employed  by  the  plaintiffs,  the 
corn  had  become  heated  and  greatly  dam- 
aged in  the  vessel,  and  had  been  unloaded  by 
reason  thereof,  and  sold  and  disposed  of  by 
the  captain  of  the  said  vessel  on  account  of 
the  plaintiffs  at  Tunis,  and  that  Callander, 
for  that  reason,  repudiated  the  sale,  &c. 

The  cause  was  tried  before  Mr.  Baron  Mar- 
tin, when  his  lordship  ruled  that  the  contract 
imported  that  at  the  time  of  the  sale  the 
corn  was  in  existence  as  such,  and  capable 
of  delivery,  and  that,  as  it  had  been  sold  and 
delivered  by  the  captain  before  this  contract 
\\as  made,  the  plaintiffs  could  not  recover  in 
the  action.  He  therefore  directed  a  verdict 
for  the  defendants.  The  case  was  after- 
wards argued  in  the  court  of  exchequer  be- 
fore the  Lord  Chief  Baron,  Mr.  Baron  Parke, 
and  Mr.  Baron  Alderson,  when  the  learned 
judges  differed  in  opinion,  and  a  rule  was 
drawn  up  directing  that  the  verdict  found 
for  the  defendants  should  be  set  aside  on  all 
the  pleas,  except  the  sixth,  and  that  on  that 
plea  judgment  should  be  entered  for  the 
plaintiffs,  nou  obstante  veredicto.  That  the 
defendants  should  be  at  liberty  to  treat  the 
decision  of  the  court  as  the  ruling  at  ni'^' 
prius,  and  to  put  it  on  the  record  and  bring  a 
bill  of  exceptions.  8  Exch.40.  This  was  done, 
and  the  lord  chief  baron  sealed  the  bill  of  ex- 
ceptions, adding,  however,  a  memorandum 
to  the  effect  that  he  did  so  as  the  ruling  of 
the  court,  but  that  his  own  opinion  was  in 
opposition  to  such  ruling. 

The  case  was  argued  on  the  bill  of  excep- 
tions in  the  exchequer  chamber,  before  Jus- 
tices Coleridge,  Maule,  Cresswell,  Wlghtman, 
Wilhams,  Talfourd,  and  Crompton,  who  were 
unanimously  of  opinion  that  the  judgment  of 
the  court  of  exchequer  ought  to  be  reversed. 
9  Exch.  102.  The  present  writ  of  error  was 
then  brought 

The  judges  were  summoned,  and  Mr.  Baron 
Aldei-son,  Mr.  Justice  Wightman,  Mr.  Justice 
Cresswell,  Mr.  Justice  Erie,  Mr.  Justice  Wil- 
liams, Mr.  Baron  Martin,  Mr.  Justice  Cromp- 
ton, Mr.  Justice  Willes,  and  Mr.  Baron  Bram- 
well  attended. 


o64 


REALITY  or  CONSENT. 


Sir  F.  Thesiger  and  Mr.  James  Wilde,  for 
plaintiEfs  in  error. 

The  purchase  here  was  not  of  the  cargo 
absolutely  as  a  thing  assumed  to  be  in  ex- 
istence, but  merely  of  the  benefit  of  the  ex- 
pectation of  its  arrival,  and  of  the  securi- 
ties against  the  contingency  of  its  loss.  The 
purchaser  bought  in  fact  the  shipping  docu- 
ments, the  rights  and  interests  of  the  vendor. 
A  contract  of  such  a  kind  is  valid.  Paine  v. 
Meller,  G  Ves.  349;  Cass  v.  Ruddle,  2  Vern. 
2S0.  The  language  of  the  contract  implies 
ail  this.  The  representation  that  the  corn 
was  shipped  free  on  board  at  Salonica  means 
that  the  cargo  was  the  property  of,  and  at 
the  risk  of  the  shipper.  Cowasjee  v.  Thomp- 
son, 5  Moore,  P.  C.  165.  The  court  of  ex- 
chequer proceeded  on  the  words  of  this  con- 
tract, and  gave  the  correct  meaning  to  them. 
Mr.  Baron  Parke,  8  Exch.  54,  said:  "There 
is  an  express  engagement  that  the  cargo  was 
of  average  quality  when  shipped,  so  that  it 
is  clear  that  the  purchaser  was  to  run  the 
risk  of  all  subsequent  deterioration  by  sea 
damage  or  otherwise,  for  which  he  was  to  be 
Indemnified  by  having  the  cargo  fuUy  insur- 
ed; for  the  27s.  per  quarter  were  to  cover, 
not  merely  the  price,  but  all  expenses  of 
shipment,  freight,  and  of  insurance."  In  a 
contract  for  the  sale  of  goods  afloat  there 
are  two  periods  which  are  important  to  be 
regarded,  the  time  of  sale  and  the  time  of 
arrival.  If  at  the  time  of  the  sale  there  is 
any  thing  on  which  the  contract  can  attach, 
it  is  valid,  and  the  vendee  bound.  Barr  v. 
Gibson,  3  Mees.  &  W.  390.  The  goods  are 
either  shipped,  as  here,  "free  on  board,"  when 
it  is  clear  that  they  are  thenceforward  at  the 
risk  of  the  vendee;  or  they  are  shipped  "to 
arrive,"  which  saves  the  vendee  from  all  risk 
till  they  are  safely  brought  to  port.  John- 
son V.  Macdonald,  9  Mees.  &  W.  GOO.  The 
intention  of  the  parties  is  understood  to  be 
declared  by  different  terms  of  expression,  and 
the  judgment  of  the  exchequer  chamber  here 
really  violates  that  intention.  The  case  of 
Strickland  v.  Turner,  7  Exch.  208,  which 
was  referred  to  by  the  lord  chief  baron  (8 
Exch.  49),  is  not  in  point,  for  there  the  an- 
nuity, which  was  the  subject  of  the  sale, 
had  actually  ceased  to  exist  when  the  sale 
took  place.  There  was  nothing  whatever 
on  which  the  contract  could  attach;  and 
the  principles  therefore  on  which  all  con- 
tracts of  sale  must  proceed,  as  explained  and 
illusti-ated  by  Pothier  (Poth.  Cont.  pt.  1,  §  2, 
art.  1),  whose  definitions  of  a  sale  are  liter- 
ally adopted  by  Mr.  Chancellor  Kent  (2 
Kent,  Comm.  468),  applied  there,  but  they 
do  not  apply  here,  for  here  the  parties  were 
dealing  with  an  expectation,  namely,  the  ex- 
pectation of  the  arrival  of  the  cargo.  As 
Lord  Chief  Baron  Richards  said,  in  Hitch- 
cock v.  Giddings,  4  Price,  135,  "If  a  man 
will  make  a  purchase  of  a  chance,  he  must 
abide  by  the  consequences."  Here,  how- 
ever, the  chance  was  only  that  of  the  ar- 
rival of  the  cargo,  and  that  chance  was  cov- 


ered by  the  policy,  for  the  cargo  itself,  as 
stated  in  the  contract,  had  been  actually 
shipped.  Had  the  cargo  been  damaged  at 
the  time  of  this  contract,  the  loss  thereby 
arising  must  have  been  borne  by  the  pur- 
chaser. Suppose  the  corn  had  been  landed 
at  Tunis,  and  had  remained  in  the  ware- 
house there,  it  would  have  ceased  to  be  a 
cargo  in  the  strict  and  literal  meaning  of 
the  word,  but  the  purchaser  would  still  have 
been  bound  by  his  contract. 

The  court  of  exchequer  chamber,  admit- 
ting that  the  vendee  might  have  recovered 
an  average  loss  under  the  policy  on  this 
cargo,  said  that  he  could  not  have  recovered 
if  a  total  loss  had  occurred,  and  referred  to 
an  admission  to  that  effect  supposed  to  have 
been  made  by  the  present  Baron  Martin 
when  arguing  Sutherland  v.  Pratt,  11  Mees. 
&  W.  296.  That  admission  does  not  mean 
what  is  thus  supposed;  and  after  the  case 
of  Roux  V.  Salvador,  3  Bing.  N.  C.  2G6, 
where  there  was  a  total  loss,  and  the  plain- 
tiff recovered  on  the  policy,  it  is  difficult  to 
understand  how  such  an  opinion  could  be 
entertained.  A  technical  objection  arising 
on  the  form  of  the  policy  would  not  affect 
this  question.  The  purchaser's  right  on  this 
policy  woiild  have  been  complete.  1  Phil. 
Ins.  438;  1  Marsh.  Ins.  333;  and  March  v. 
Pigott,  5  Burrows,  2802. 

By  what  has  happened  here,  the  purchaser 
has  been  saved  the  payment  of  freight  Olier- 
boom  V.  Chapman,  13  Mees.  &  W,  230);  and 
Owens  V.  Dunbar,  12  Ir.  Law,  304,  shows 
that  he  would  have  been  bound  to  accept 
the  cargo.  The  contract  here  was  that  the 
cargo  was  shipped  "free  on  board."  To  that 
extent  the  vendor  was  bound,  but  he  was 
not  bound  by  any  further  and  implied  war- 
ranty.    Dickson  v.  Zizinia,  10  C.  B.  602. 

Mr.  Butt  and  Mr.  Bovill,  for  defendants  iu 
error,  were  not  called  on. 


CRANWORTH,  Ch.  My  lords,  this  case 
has  been  very  fully  and  ably  argued  on  the 
part  of  the  plaintiffs  in  error,  but  I  under- 
stand from  an  intimation  which  I  have  re- 
ceived that  all  the  learned  judges  who  are 
present,  including  the  learned  judge  who 
was  of  a  different  opinion  in  the  court  of 
exchoquec,  before  the  case  came  to  the  ex- 
chequer chamber,  are  of  opinion  that  the 
judgment  of  the  court  of  exchequer  cham- 
ber sought  to  be  reversed  by  this  writ  of 
error  was  a  correct  judgment,  and  they 
come  to  that  opinion  without  the  necessity 
of  hearing  the  counsel  for  the  defendants 
in  error.  If  I  am  correct  in  this  belief,  1 
will  not  trouble  the  learned  counsel  for  the 
defendants  in  error  to  address  your  lord- 
ships, because  I  confess,  though  I  should  en- 
deavor to  keep  my  mind  suspended  till  the 
case  had  been  fuUy  argued,  that  my  strong 
impression  in  the  course  of  the  argument 
has  been,  that  the  judgment  of  the  court  of 
exchequer  chamber  is  right.     I  should  there- 


MISTAKE. 


365 


fore  simply  propose  to  ask  the  learned  judges 
whether  they  u^ree  in  thinking  that  that 
judgment  was  right.  [The  judges  consulted 
together  for  a  few  minutes,  at  the  end  of 
which  time] 

Mr.  Baron  ALDERSON  said:  My  lords, 
her  majesty's  judges  are  unanimously  of 
opinion  that  the  judgment  of  the  exchequer 
chamber  was  right,  and  that  the  judgiucut 
of  the  court  of  exchequer  was  wroug;  and  I 
am  also  of  that  opinion  myself  now,  hav- 
ing been  one  of  the  judges  before  whom  the 
case  came  to  be  heard  in  the  court  of  ex- 
chequer. 

THE  LORD  CHANCELLOR.  My  lords, 
that  being  so,  I  have  no  hesitation  in  advis- 
ing your  lordships,  and  at  once  moving  that 
the  judgment  of  the  court  below  should  be 
affirmed.  It  is  hardly  necessary,  and  it  has 
not  ordinarily  been  usual,  for  your  lordships 
to  go  much  into  the  merits  of  a  judgment 
which  is  thus  unanimously  affirmed  by  the 
judges  who  are  called  in  to  consider  it,  and 
to  assist  the  house  in  forming  its  judgment. 
But  I  may  state  shortly  that  the  whole  ques- 
tion turns  upon  the  construction  of  the  con- 
tract which  was  entered  into  between  the 
pnrtics.  I  do  not  mean  to  deny  that  many 
plausible  and  ingenious  arguments  have  been 
pressed  by  both  the  learned  counsel  who 
have  addressed  your  lordships,  showing  that 
there  might  have  been  a  meaning  attached 
to  that  contract  different  from  that  which 
the  words  themselves  import.  If  this  had 
depended  not  merely  upon  construction  of 
the  contract  but  upon  evidence,  which,  if  I 
recollect  riglitly,  was  rejected  at  the  trial, 
of  what  morc-antile  usage  had  been,  I  should 


not  have  been  prepared  to  say  that  a  long- 
continued  mercantile  usage  interpreting  such 
contracts  might  not  have  been  sufficient  to 
warrant,  or  even  to  compel,  your  lordships  to 
adopt  a  different  construction.  But,  iu  the 
absence  of  any  such  evidence,  looking  to  the 
contract  itself  alone.  It  appears  to  me  clearly 
that  what  the  parties  contemplated— those 
who  bought  and  those  who  sold— was  that 
there  was  an  existing  something  to  be  sold 
and  bought,  and  if  sold  and  bought  then  the 
benefit  of  insurance  should  go  with  it  I  do 
not  feel  pressed  by  the  latter  argument, 
which  has  been  brought  forward  very  ably 
by  Mr.  Wilde,  derived  from  the  subject  of 
insurance.  I  think  the  full  benefit  of  the 
insurance  was  meant  to  go  as  well  to  losses 
and  damage  that  occurred  previously  to  the 
15th  of  May  as  to  losses  and  damage  that 
occurred  subsequently,  always  assuming 
that  something  passed  by  the  contract  of  the 
l.jth  of  May.  If  the  contract  of  the  IGth  of 
May  had  been  an  operating  contract,  and 
there  had  been  a  valid  sale  of  a  cargo  at 
that  time  existing,  I  think  the  purchaser 
would  have  had  the  benefit  of  insurance  iu 
respect  of  all  damage  previously  occurring. 
The  contract  plainly  imports  that  there  was 
something  which  was  to  be  sold  at  the  time 
of  the  contract,  and  something  to  be  pur- 
chased. No  such  thing  existing,  I  think  the 
court  of  exchequer  chamber  has  come  to  the 
only  reasonable  conclusion  upon  it,  and  con- 
sequently that  there  must  be  judgment  giv- 
en by  your  lordships  for  the  defendants  in 
error. 

.Judgment  for  the  defendants  in  error,  with 
costs. 


366 


c^^ 


REALITY  OF 
3 


IRWIN   V.   WILSON.     J-^ 
(15  N.  E.  209,  45  Ohio  St.  426.) 
Supreme  Court  of  Ohio.    Nov.  22,  1887. 

Error  to  circuit  court,  Hardin  county. 

The  original  suit  was  begun  in  the  common 
pleas  to  obtain  the  rescission  of  an  exchange 
of  lands  that  had  been  made  between  the 
parties,  on  the  ground  that  the  defendant  had 
made  fraudulent  representations  as  to  the  lo- 
cation, character  and  value  of  the  lands  giv- 
en by  him  in  exchange  for  those  of  the  plain- 
tiff. Judgment  was  rendered  in  favor  of  the 
defendant  on  the  issue  as  to  fraud,  and  the 
plaintiff  appealed  to  the  district  court,  then  in 
existence.  The  plaintiff,  by  leave  of  court, 
then  amended  his  petition,  so  as  to  aver  that 
there  was  a  mutual  mistake  as  to  the  loca- 
tion, chai-acter,  and  value  of  the  lands  ex- 
changed by  the  defendant  for  those  of  the 
plaintiff.  On  the  issues  made  as  to  this,  the 
case  was  subsequently  heard  and  determined 
by  the  circuit  court,  as  the  successor  of  the 
district  court.  It  made,  at  the  request  of  the 
plaintiff,  a  special  finding  of  facts,  and  ren- 
dered judgment  thereon  in  favor  of  the  de- 
fendant, dismissing  the  action  of  the  plaintiff. 
The  plaintiff  moved  the  court  to  set  aside  its 
finding  and  judgment  as  not  supported  by  the 
evidence;  and,  also,  as  not  supported  by  law. 
The  motion  was  overruled,  and  the  rulings 
of  the  court  in  this  regard  are  assigned  for 
error  here.  The  facts  as  found  by  the  court 
are  as  follows:  "(1)  That  on  the  fourteenth 
day  of  December,  1881,  the  plaintiff,  William 
S.  Invin,  was  the  owner  of  the  house  and  lot 
in  Kenton,  Ohio,  in  the  petition  described, 
wliich  was  worth  $1,700.  (2)  That  the  de- 
fendant, Joseph  H  Wilson,  was  at  said  date 
the  owner  of  the  land  described  in  the  peti- 
tion, being  80  acres  of  land  situate  in  the 
county  of  Monona,  in  the  state  of  Iowa.  (3) 
That  on  the  said  date  one  Isaac  H.  Wilson, 
who  was  the  father  and  agent  of  defendant, 
proposed  to  sell  and  exchange  said  80  acres 
of  land  in  Iowa,  to  and  with  plaintiff,  for 
said  house  and  lot  of  plaintiff,  which  said  80 
acres  of  land  said  Isaac  H.  Wilson  then  stat- 
ed had  been  taken  by  defendant  in  a  trade  of 
lands  at  $1,200;  that  he  had  never  been  in 
Iowa,  and  had  not  seen  the  land,  and  knew 
nothing  of  it,  but  that  one  Henry  Pugh,  he 
was  informed,  had  been  to  see  the  laud,  and 
Pugh,  he  was  informed,  said  it  was  good, 
dry  land,  and  within  three  to  four  miles  of 
the  county-seat  of  said  county  of  Monona,  in 
the  state  of  Iowa,  and  that  said  Henry  Pugh 
lived  near  Ada,  in  said  Hardin  county;  that 
on  the  seventeenth  day  of  December,  1881, 
said  agent  proposed  to  said  plaintiff  to  go 
and  see  and  inquire  of  said  Henry  Pugh  as 
to  the  location  and  quality  of  said  land  in 
Monona  county,  Iowa,  and  said  Isaac  H. 
Wilson,  did,  on  the  nineteenth  day  of  Decem- 
ber, 1881.  furnish  a  conveyance  for  that  pur- 
pose, and  he  and  plaintiff  did  go  to  the  house 
of  said  Henry  Pugh,  and  said  plaintiff  did 


CONSENT. 

then,  in  the  presence  of  said  Isaac  H.  Wil- 
son, make  inquiries  <fi  and  concerning  said 
land  in  Monona  county,  Iowa;  and  on  said 
day  the  said  Henry  Pugh  stated  to  the  said 
plaintiff,  in  the  presence  and  hearing  of  said 
Isaac  H.  Wilson,  that  he  had  seen  and  been 
upon  the  said  lands  of  defendant  in  Monona 
county,  Iowa,  in  the  month  of  October,  1879; 
that  the  same  were  about  four  miles  from 
the  county-seat  of  Monona  county,  Iowa; 
that  the  said  lands  were  good,  dry,  tillable 
lands;  that  there  was  improved  land  and 
com  growing  within  30  rods  of  the  same; 
that  the  said  land  was  worth  $10  per  acre, 
and  would  be  worth  more  now;  that  he  had 
gone  to  see  said  lands  for  Nicholas  High, 
who  was  a  former  owner  of  a  tract  of  which 
this  was  a  part,  and  he  had  never  seen  the 
plaintiff  and  had  never  spoken  to  said  agent, 
Isaac  H.  Wilson,  previous  to  the  interview; 
that  said  plaintiff  relied  upon  the  statements 
made  by  Pugh;  that  the  said  plaintiff,  the 
said  defendant,  and  the  said  Isaac  H.  Wil- 
son, agent,  were  entire  strangers  to  the  said 
Henry  Pugh.  (4)  That  neither  said  plaintiff, 
said  defendant,  nor  said  Isaac  H.  Wilson, 
ever  saw  said  lands  in  Monona  county,  Iowa, 
prior  to  the  date  of  said  exchange,  and  never 
since  that  date,  except  that  said  plaintiff 
went  to  see  the  same  in  May,  1882,  after  the 
commencement  of  this  suit.  (5)  That  on  the 
twenty-first  day  of  December,  1881,  the  said 
plaintiff  and  said  defendant  entered  into  a 
contract  in  writing  for  the  exchange  of  said 
lands,  of  which  contract  the  following  is  a 
copy: 

"  'December  21,  1881.  Article  of  agreement 
between  W.  S.  Irwin,  of  the  first  part,  and 
J.  H.  Wilson,  of  the  second  part,  wherein 
said  Irsvin,  of  the  first  part,  agi'ees  to  sell, 
and  has  sold,  to  J.  H.  Wilson,  of  the  second 
part,  the  property  he  now  lives  in,  being  the 
east  half  of  a  part  of  outlot  number  six,  in 
the  eastern  addition  to  the  town  of  Kenton, 
Ohio,  for,  and  in  the  consideration  of  nine- 
teen hundred  dollars  ($1,900)  paid  as  fol- 
lows, to-wJt:  Twelve  hundred  in  hand,  in 
80  acres  of  land  in  Iowa,  and  three  hundred 
and  fifty  dollars  ($350)  payable  April  1, 
1883,  with  one  year's  interest  at  six  per  cent., 
and  three  hundred  and  fifty  dollars  ($3.50) 
payable  April  1,  1884,  with  two  years'  inter- 
est at  six  per  cent.  Said  Wilson  to  have 
possession  of  said  property  on  or  before  the 
first  day  of  April,  1882;  said  property  to  be 
left  in  good  condition.  Wm.  S.  Irwin.  J.  H. 
Wilson.     Isaac  H.  Wilson,  Agent.' 

"Thereafter,  on  said  twenty-first  day  of 
December,  1881,  said  defendant,  Joseph  H. 
Wilson,  executed  and  delivered  to  plaintiff  a 
deed  of  conveyance  in  fee-simple  for  said 
80  acres  of  land  in  Monona  county,  Iowa, 
naming  in  said  deed  the  sum  of  $1,200  as 
the  consideration  therefor,  and  also  made 
and  delivered  to  plaintiff  his  two  notes  for 
$.3.50  each,  payable,  respectively,  April  1. 
1883,  and  April  1,  18.S4,  with  interest  thereon 
at  six  per  cent,  per  annum,  secured  by  mort- 


MISTAKE. 


367 


gage  on  said  Kenton  property;  and  at  the 
same  time  said  plaintiff  executed  and  de- 
livered to  said  defendant  a  deed  of  convey- 
ance for  said  liouse  and  lot  in  Kenton,  the 
consideration  named  in  said  deed  being  $1,- 
900.  (U)  That  said  Uenry  Pugii  did  not  see 
and  was  not  on  the  lauds  so  conveyed  by 
said  defendant  to  plaintiff  when  in  Monona 
county,  Iowa,  in  187'J,  or  at  any  other  time; 
that  the  land  seen  by  said  Puj;h  in  said 
county  of  Monona,  Iowa,  was  prairie,  and 
dry.  tillable  land,  and  within  iiu  to  30  rods 
of  growing  com  in  October,  1S7U,  and  that 
the  land  so  conveyed  by  defendant  to  said 
plaintiff  in  Monona  county,  Iowa,  was  wet, 
marshy  land  unlit  for  cultivation,  and  was 
not  worth  at  said  time  to  exceed  three  dol- 
lar's per  acre;  that  on  the  tweuty-flfth  day 
of  March,  1882,  the  said  plaintiff'  tendered  to 
said  defendant -a  deed  of  conveyance  duly 
executed  for  said  80  acres  of  land  in  Iowa, 
being  the  same  real  estate  before  that  time 
conveyed  to  him  by  defendant;  also  ten- 
dered to  defendant  the  said  notes  and  mort- 
gages so  executed  by  defendant  to  plaintiff, 
and  demanded  a  deed  of  conveyance  for  said 
house  and  lot  in  Kenton,  Ohio,  so  conveyed 
by  plaintiff  to  defendant;  which  tender  by 
said  plaintiff  and  conveyance  by  said  de- 
fendant were  then  refused  by  said  defend- 
ant, to  all  of  which  the  said  plaintiff  then 
and  there  excepted." 

The  answer  of  the  defendant,  among  other 
things,  contains  the  following  denials:  "De- 
fendant denies  the  averment  of  said  amend- 
ed petition  that  said  Pugh,  by  mistake  or  de- 
sign, had  not  seen  the  lands  described  in  de- 
fendant's deed,  and  denies  that  the  descrip- 
tion given  by  said  Pugh  was  erroneous  and 
untrue;  and  denies  that  there  was  any  mis- 
take as  to  the  identity  of  said  lands  on  the 
part  of  said  Pugh." 

William  Lawrence,  for  plaintiff  in  error. 
Howenstine  &  Sweet,  for  defendant  in  error. 

MINSHALL,  J.,  (after  stating  the  facts  as 
above.)  The  exchange  in  this  case  was  con- 
ducted on  behalf  of  the  defendant  by  his 
father  acting  as  his  agent.  But  this  can 
make  no  difference  as  to  the  rights  of  the 
plaintiff,  if  the  knowledge  and  acts  of  the 
agent  were  such  that  the  plaintiff  would  be 
entitled  to  a  rescission  had  the  party  acting 
as  agent  been  the  owner  of  the  land,  and 
acted  for  himself  in  effecting  the  exchange, 
instead  of  an  agent;  for  in  such  case,  the 
agent  personates  the  principal,  and,  as  to 
third  persons,  his  knowledge  and  acts  must 
be  regarded  as  those  of  the  principal.  Dun- 
lap,  Paley,  Ag.  259,  and  cases  cited  in  note  4. 
Any  other  rule  would  make  it  utterly  un- 
safe to  deal  with  one  acting  as  the  agent  of 
another.  From  the  facts  found  by  the  court 
it  appears  that  the  defendant,  being  the  own- 
er of  a  tract  of  land  in  the  state  of  Iowa, 
proposed,  by  his  agent,  to  exchange  it  for  the 
house  and  lot  of  the  plaintiff,  in  the  town  of 


Kenton.  Both  were  well  acquainted  with 
the  property  of  the  plaintiff;  but,  being  un- 
informed as  to  the  land  in  Iowa,  the  agent 
of  the  defendant  procured  a  conveyance,  and, 
at  his  suggestion,  he  ahd  the  plaintiff  went 
to  see  one  Pugh,  though  a  stranger  to  both 
of  them,  residiiyg  in  the  county  where  they 
did,  the  agfcuLsaying  that  he  understood  that 
Pugh^Avas  acquainted_with  the  land.  On  ar- 
riving at  Pugh's,  "he  informed  'fDr-m  that  he 
had  seen  the  land;  that  he  had  been  on  it 
the  year  before,  and  that  it  was  good,  dry, 
tillable  laud,  near  the  county-seat;  tiiat  it 
was  worth  $10  an  acre  when  he  saw  it.  and 
would  then  be  worth  more.  In  a  few  days 
afterwards,  the  agreement  for  the  exchange 
was  made,  and  executed  by  the  plaintiff,  con- 
veying his  house  and  lot  to  the  defendant, 
who  conveyed  to  the  plaintiff  his  laud  in 
Iowa  containing  SO  acres,  and  also  made  and 
delivered  to  the  plaintiff  two  notes  amount- 
ing to  $700,  secured  by  mortgage  on  the 
house  and  lot  conveyed  by  the  plaintiff,  as 
the  equivalent  of  the  supposed  difference  in 
the  value  of  the  lands  exchanged.  In  a  few 
months  afterwards,  the  plaiutiff  discovered 
that  the  land  in  Iowa  was  not  such  as  it  had 
been  described  by  I'ugh;  jthat_Jt_was_jiiifit 
for  cultij^Uon^^beiug^vet^jUid^  mn  rshy,  and 
worth  not  more  than  three  dollars  an  acre. 
The  error  arose  from  the  fact  that  Pugh  was  \ 
mistaken  in  the  owuerehip  of  the  land  he  had  ; 
seen;  the  land  he  had  seen  and  described  to, 
the  plaintiff'  and  the  agent  of  the  defendant, 
,was  such  as  he  had  described  it  to  be,  but 
"was  not  the  land  of  the  defeudant,  though 
he  thought  it  was.  The  mistake  was  in  the 
identity  of  the  land  seen  and  described  by 
Pugh.  Thereupon  the  plaintiff"  offered  to  re- 
scind, which  was  refused  by  the  defeudant. 
The  refusal  is  placed,  not  upon  the  ground 
that  he  cannot  be  restored  to  his  former  con- 
dition by  the  plaintiff,  but  that,  upon  the 
facts  as  found,  there  is  no  ground  for  rescis- 
sion; there  being,  as  claimed,  uo  mutual  mis- 
take, and  no  fraud  found  by  tlie  court. 
While  no  fraud  is  found  by  the  court,  does  it 
not,  however,  clearly,  if  not  necessarily,  fol- 
low from  the  circumstances  under  which  the 
exchange  was  made,  that  there  was  a  mu- 
tual mistake  of  the  parties  as  to  the  char- 
acter and  value  of  the  lands  in  Iowa?  We 
think  it  does.  Both  parties  were  in  ignorance 
as  to  the  true  character  of  the  land  of  the 
defendant.  If  it  had  been  otherwise,  the 
court  could  not  have  found  that  there  was 
no  fraud.  It  found  that  the  plaintiff  be- 
lieved and  relied  on  the  information  given 
by  Pugh;  and  if  the  defendiint,  by  his  agent, 
was  acting  in  good  faith,  he  must  have  done 
the  same  thing;  for  it  will  hardly  be  affirm- 
ed by  any  one  that,  under  the  circumstances 
of  this  case,  he  could  without  fraud  have  con- 
cluded the  exchange,  knowing  that  the  land 
was  not  such  as  it  had  been  described  by 
Pugh,  for  he  must  have  known,  if  he  knew 
anything,  that  the  plaiutiff  believed  what 
was  said  to  him  by  the  person  to  whom  he 


o6S 


KEALITY  or  CONSENT. 


had  taken  him  for  information.  He  know 
it  from  the  fact  that  the  plaintiff  concluded 
tho  agreement  for  an  exchange  on  the  basis 
of  that  information.  So  that,  under  the  cir- 
cumstances, it  would  bo  perilous  for  the  de- 
fendant to  claim  that  neither  he  nor  his 
agent  believed  the  statements  of  Pugh  as  to 
the  character  of  the  Iowa  land;  for,  if  that 
had  been  the  fact,  he  could  not  have  con- 
cluded the  exchange  on  the  basis  of  the  in- 
formation being  true,  without  perpetrating 
a  fraud  on  the  plaintitf,  whether  he  made 
any  positive  representations  or  not.  Pol. 
Co'nt.  (Wald's  Ed.)  429.  But  his  beUef  or 
disbelief  as  to  this  is  not  a  matter  of  mere 
argument,  for,  while  there  is  no  specific  find- 
ing on  the  question,  it  is  made  certain  by  the 
pleadings. 

In  answering  the  averments  Of  the  peti- 
tion, the  defendant  affirms  in  his  pleading 
that  the  description  given  of  the  land  by 
Pugh  was  not  untrue,  and  that  there  was 
no  mistake  in  the  identity  of  the  land  seen 
by  him.  Therefore,  unless  we  may  conclude 
that  he  had  one  belief  as  to  the  matter  when 
he  concluded  the  exchange,  and  another 
when  he  filed  his  answer, — a  thing  quite  im- 
possible if  not  absurd,— we  may  safely  con- 
clude that,  as  a  fact  apparent  on  the  record, 
he  had  the  same  belief  as  to  the  accuracy 
of  the  statements  made  by  Pugh  that  the 
plaintiff  had.  But  the  positive  findings  of 
the  court  are  that  Pugh  was  mistaken  as  to 
the  identity  of  the  lajid.  and  that  that  own- 
ed by  the  defendant  was  not  of  the  descrip- 
tion given  by  him.  So  that  the  only  ques- 
tion that  remains  is,  not  whether  there  was 
a  mutual  mistake  in  regard  to  the  land,  but 
whether  it  is  such  a  one  as  under  the  cir- 
cumstances entitles  the  plaintiff  to  a  rescis- 
sion. Here  we  must  observe  that  the  mis- 
take arose  not  from  a  mistalieu  opinion  of 
Pugh  as  to  the  character  of  the  defendant's 
lands;  for,  if  he  had  in  fact  seen  the  land, 
and  simply  erred  in  his  opinion  as  to  its 
character  and  value,  a  different  question 
might  have  been  presented.  It  is  a  matter 
of  common  knowledge  that  opinions  will  dif- 
fer in  this  regard;  and  the  plaintiff,  in  rely- 
ing on  the  statements  of  P.  as  to  the  quality 
of  the  defendant's  land,  might  be  held  as  as- 
suming the  possibility  of  a  mistake  in  his 
judgment  as  to  this.  But  Pugh  did  not  sec 
the  land  of  defendant;  he  was  nalstaken  in 
its  icTerilTty.  '  Such  errors  are  less  frequent 
than  thefOrmer;  and  a  fault  could  hardly  be 
imputed  to  any  one  in  not  anticipating  an 
error  of  this  kind.  2  Pom.  Eq.  Jur.  §  852. 
It  is  against  mistakes  of  this  character  tliat 
the  courts  have  been  most  prompt  to  relieve; 
and  not  only  for  the  reason  that  they  may 
happen  where  the  greatest  caution  is  ob- 
served, but  also,  that,  as  a  matter  of  law, 
where  they  do  occur,  no  real  contract  is 
formed.  Thus,  In  Wheadon  v.  Olds,  20 
Wend.  174,  a  sale  had  been  made  of  a  quan- 
tity of  oats  in  bulk,  upon  an  estimate  of  the 
quantity,  after  a  portion  had  been  measured. 


The  estimate  of  the  quantity  unmeasured 
was  made  by  a  comparison  of  the  measured 
with  the  unmeasured  pile,  and  the  purchaser 
agreed  to  t:ike  them  at  the  estimate,  "hit  or 
miss,"  as  to  quantity,  and  paid  for  them  at 
the  estimated  quantity.  The  oats  did  not 
hold  out  within  about  300  bushels  of  the 
quantity  estimated  and  paid  for.  It  was  aft- 
erwards discovered  that  a  mistake  had  been 
made  in  regai'd  to  the  quantity  measured, 
which  foiTQed  the  basis  of  the  estimate,  in 
counting  the  tallies  as  bushels,  instead  of 
half-bushels,  as  they  were  in  fact.  Upon 
these  facts  the  plaintiff  was  allowed  to  re- 
cover back  the  money  paid  for  the  entire 
quantity  which  he  did  not  receive.  The  case 
was  followed  in  Coon  v.  Smith,  29  N.  Y.  393, 
where  it  was  cited  as  showing  "the  length 
courts  will  go  in  disregard  of  contracts 
founded  in  a  mistake  of  material  facts,  and 
in  the  protection  of  rights  prejudiced  there- 
by." There  an  agreement  between  adjoining 
land-owners,  by  which  a  corner  had  been  er- 
roneously fixed  by  reason  of  a  miscount  of 
the  chain-men,  was  held  not  to  be  binding, 
although  it  had  been  acted  on  by  both  par- 
ties before  the  mistake  was  discovered.  The 
error  of  the  chain-men,  being  unknown  to  the 
parties,  invalidated  the  agreement  fixing  the 
comer.  So  in  Gardner  v.  Lane,  9  Allen,  492, 
W.  had  agreed  to  sell  G.  135  barrels  of  No.  1 
mackerel.  By  mistake  of  the  parties  in  mak- 
ing the  delivery,  some  two  mouths  after- 
wards, part  of  the  barrels  marked  to  indicate 
delivery  were  No.  3  mackerel,  and  part  were 
salt.  In  replevin  by  the  purchaser  against  a 
creditor  of  the  seller  who  had  levied  on  the 
property,  it  was  held  that  no  property  passed 
in  the  barrels  so  marked  by  mistake,  even 
as  to  those  containing  No.  3  mackerel;  the 
court  saying:  "They  are  not  included  with- 
in the  contract  of  sale;  the  vendor  has  not 
agreed  to  sell,  nor  the  vendee  to  purchase 
them;  the  subject-matter  of  the  contract  has 
been  mistaken,  and  neither  party  can  be 
held  to  an  execution  of  the  contract  to  which 
he  has  not  given  his  assent.  It  is  a  case 
where,  through  mutual  misapprehension,  the 
contract  of  sale  is  incomplete."  See,  also, 
the  same  case,  12  Allen,  39,  where  the  rul- 
ing, when  it  was  again  brought  before  the 
court,  was  adhered  to.  The  principle  of  these 
cases  is  quite  as  applicable  to  contracts  for 
the  sale  and  conveyance  of  land,  induced  by 
the  mutual  mistake  of  the  parties,  as  to  con- 
tracts concerning  personalty;  and  the  equi- 
table relief  of  rescission  will  be  granted, 
where  such  mistakes  have  intervened,  quite 
as  readily  in  the  one  case  as  in  the  other,  if 
not  more  so.  Pol.  Cont.  (Wald's  Ed.)  430. 
and  cases  cited  in  the  notes;  2  Pom.  Eq.  Jur. 
§  809;  Crowe  v.  Lewin,  95  N.  Y.  42G;  Law- 
rence V.  Staigg,  8  R.  I.  250;  Gilroy  v.  Alis, 
22  Iowa,  174;  Irick  v.  Fulton,  3  Grat  193; 
Barfield  v.  Price,  40  Cal.  535;  Knapp  v. 
Fowler,  30  Hun,  513;  Rhode  Island  v.  Mass- 
achusetts, 13  Pet.  23;  and  Mulvey  v.  King, 
39  Ohio  St.  491  (Upson,  J.,  495). 


MISTAKE. 


369 


In  the  case  presented  by  the  record  before 
us,  the  mistake  was  in  the  identity  of  the 
land  that  had  been  seen  and  described  by 
Puffh.  He  supjjo.sed  it  to  be  the  land  alxjut 
which  the  parties  were  contracting  and  de- 
sired information;  the  en-or  was  in  this,  and 
not  In  the  description  of  the  land  he  had 
seen;  hence  the  parties,  in  acting  upon  his 
information,  acted  upon  the  same  error  of 
fact;  and,  upon  principle,  the  case  is  not 
different  from  what  it  would  have  been  had 
they  gone  to  see  the  land  described  by  P., 
supposing  it  to  be  tlio  land  of  the  defendant; 
and  that  such  an  error  would,  on  the  ground 
of  mutual  mistake,  have  avoided  the  con- 
tract, is,  we  think,  too  plain  to  admit  of  a 
question.  In  treating  of  the  subject  of  mis- 
take, Mr.  Polloclv,  in  his  work  on  Contracts, 
observes:  "It  may  happen  that  there  does 
exist  a  common  intention,  which,  however, 
is  founded  on  an  assumption  made  by  both 
parties  as  to  some  matter  of  fact  essential 
to  the  agreement.  In  this  case  the  common 
intention  must  stand  or  fall  with  the  assump- 
tion on  which  it  is  founded.  If  the  assump- 
lion  is  wrong,  the  intention  of  the  parties  is 
from  the  outset  incapable  of  taking  effect. 
But  for  their  common  error  it  would  never 
liave  been  formed,  and  it  is  treated  as  non- 
existent. Here  there  Is  in  some  sense  an 
agreement,  but  It  is  nullified  in  its  inception 
by  the  nullity  of  the  thing  agreed  upon;  and 
it  Is  hardly  too  artificial  to  say  that  there  is 
no  real  agreement.  The  result  is  the  same 
as  if  the  parties  had  made  an  agreement  ex- 
pressly ^"Tvlitinna.1  on  the  existence  at  the 
lime  oTthe  supposed  state  of  facts;  which 
state  of  facts  not  existing,  the  agreement  de- 
stroys itself."  Pol.  Cont.  412.  See,  also, 
I-'onbl.  Eq.  marg.  p.  120;  Kerr,  Fraud  &  M.431. 
The  case  of  Crist  v.  Dice,  18  Ohio  St.  53U,  on 

UOPK.SEL.  CAS.  CONT. — 24 


which  much  reliance  Is  placed  by  counsel  for 
defendant  in  error,  is  plaiiriy  distinguishable 
from  this  one.  It  was  an  action  for  rescis- 
sion on  the  ground  of  fraud.  The  defendant 
claimed,  and  introduced  evidence  that, 
though  he  had  exhibited  to  the  plaintifif  a 
letter  from  a  stranger,  representing  the  land 
as  favorably  situated,  and  of  good  quality, 
and  stated  to  the  plaintiff  that  lie  liad  bought 
the  hmd  on  the  strength  of  this  description 
he  refused  to  vouch  for  its  truth,  and  advised 
the  plaintiff  to  go  and  see  for  himself.  Th6 
plaintiff  declined  to  take  the  trouble,  and 
agreed  to  make  the  exchange  at  his  own 
risk.  There  was  no  finding  of  facts,  and  the 
case  was  disposed  of  on  the  assumption  that 
the  court  below  may  have  believed  the  de- 
fendant's version;  and,  adopting  it,  the  plain- 
tiff had,  of  course,  no  ground  for  relief.  This 
sufliciently  distinguishes  the  case  from  the 
one  presented  by  this  record.  We  are  un- 
able to  perceive  upon  what  principle  of  jus- 
tice the  plaintiff  should  be  denied  the  relief 
he  asks.  The  information  upon  which  he 
acted  had  not  been  obtained  in  a  casual 
meeting  with  ilr.  Pugh.  The  defendant,  by 
his  agent,  having  suggested  that  P.  was  ac- 
quainted with  the  land,  and  taken  the  plain- 
tiff to  inquire  of  him  about  it,  is  estopped 
from  saying  that  P.  was  a  stranger,  and  he 
had  no  right  to  rely  on  what  he  said.  More- 
over, the  error  did  not  occur  from  any  bad 
faith  in  P.,  but  from  a  mistake  that  may 
happen  to  the  most  careful  of  men.  As  the 
mistake  arose  from  an  innocent  error  in  all 
the  parties,  natural  justice  forbids  that  the  loss 
of  one  arising  out  of  it  should  be  the  gain  of 
the  other. 

Judgment  reversed,  and  judgment  render- 
ed for  the  plaintiff  in  error,  rescinding  the 
exchange  made  by  the  parties. 


370 


REALITY  OF  CONSENT. 


0 


SHERWOOD  V.  TVALKER  et  al. 
(33  N.  W.  919,  66  Mich.  568.)^ 
Supreme  Court  of  Michigan.    July  7,  1887 


f 


7    '  Error  to  circuit  court,  Wayne  county;  Jen- 

nisou,  Judge. 

C.  J.  Reilly,  for  plaintiff.  Wm.  Aikman, 
Jr..  (D.  C.  Holbrooli,  of  counsel,)  for  de- 
fendants and  appellants. 

MORSE,  J.  Replevin  for  a  cow.  Suit 
commenced  in  justice's  court;  judgment  for 
plaintiff;  appealed  to  circuit  court  of  Wayne 
county,  and  verdict  and  judgment  for  plain- 
tiff in  that  court.  The  defendants  bring 
error,  and  set  out  25  assignments  of  the  I 
same.  ; 

The   main  controversy  depends  upon   the  j 
construction  of  a  contract  for  the   sale  of  ' 
the  cow.     The  plaintiff  claims  that  the  ti-  I 
tie  passed,  and  bases  his  action  upon  such 
claim.    The  defendants  contend  that  the  eon- 
tract  was  executory,  and   by  its  terms   no 
title  to  the  animal  was  acquired  by  plain- 
tiff.    The  defendants  reside  at  Detroit,  but 
are  in  business  at  Walkerville.  Ontario,  and 
have  a  farm  at  Greenfield,  in  Wayne  county, 
upon  which  were  some  blooded  cattle  sup- 
posed to  be  barren  as  breeders.     The  Walk- 
ers   are   importers   and   breeders   of   polled 
Angus  cattle.     The  plaintiff  is  a  banker  liv- 
ing at  Plymouth,  in  Wayne  county.    He  call- 
ed upon  the  defendants  at  Walkei-ville  for 
the   purchase   of   some    of  their   stock,    but 
found  none  there  that  suited  him.     Meeting 
one  of  the  defendants  afterwards,   he  was 
informed  that  they  had  a  few  head  upon  this 
Greenfield  farm.     He  was  asked  to  go  out 
and   look  at   them,   with   the   statement   at 
the  time  that  they   were  probably   barren, 
and  would  not  breed.     May  5.  1886,  plaintiff 
went  out  to  Greenfield,  and  saw  the  cattle. 
A  few  days  thereafter,  he  called  upon  one  of 
the  defendants  with  the  view  of  purchasing 
a  cow,   known  as   "Rose  2d   of  Aberlone." 
After  considerable  talk.  It  was  agreed  that 
defendants  would  telephone  Sherwood  at  his 
home  in  Plymouth  in  reference  to  the  price. 
The  second  morning  after  this  talk  he  was 
called  up  by  telephone,  and  the  terms  of  the 
sale  were  finally  agreed  upon.     He  was  to 
pay  five  and  one-half  cents  per  pound,  live 
weight,    fifty    pounds    shrinkage.     He    was 
asked   how    he   intended   to   take    the   cow 
home,   and  replied  that  be  might  ship  her 
from  King's  cattle-yard.     He  requested  de- 
fendants   to    confirm    the    sale    in    writing, 
which  they  did  by  sending  him  the  following 
letter:    "Walkerville,   May   15,   1886.     T.   C. 
Sherwood,    President,    etc.— Dear    Sir:     We 
confirm  sale  to  you  of  the  cow  Rose  2d  of 
Aberlone,   lot  56  of   our  catalogue,   at  five 
and  a  half  cents  per  pound,  less  fifty  pounds 
shrink.     We  inclose  herewith  order  on  Mr. 
Graham    for    the    cow.     You    might    leave 
check  with  him,  or  mail  to  us  here,  as  you 
prefer.     Yours,     truly,     Hiram     Walker     «& 


Sons."  Tlie  order  upon  Graham  Inclosed  In 
the  letter  read  as  follows:*  "Walkerville, 
May  15,  1886.  George  Graham:  You  will 
please  deliver  at  King's  cattle-yard  to  Mr. 
T.  C.  Sherwood,  Plymouth,  the  cow  Rose 
2d  of  Aberlone,  lot  56  of  our  catalogue. 
Send  halter  with  the  cow,  and  have  her 
weighed.  Yours,  truly,  Hiram  Walker  & 
Sons."  On  the  twenty-first  of  the  same 
month  the  plaintiff  went  to  defendants' 
farm  at  Greenfield,  and  presented  the  order 
and  letter  to  Graham,  who  informed  him 
that  the  defendants  had  instructed  him  not 
to  deliver  the  cow.  Soon  after,  the  plain- 
tiff tendered  to  Hiram  Walker,  one  of  the 
defendants,  $80,  and  demanded  the  cow. 
Walker  refused  to  take  the  money  or  deliver 
the  cow.  The  plaintiff  then  instituted  this 
suit.  After  he  had  secured  posses.sion  of 
the  cow  under  the  writ  of  replevin,  the 
plaintiff  caused  her  to  be  weighed  by  the 
constable  who  served  the  writ,  at  a  place 
other  than  King's  cattle-yard.  She  weighed 
1,420  pounds. 

When  the  plaintiff,  upon  the  trial  In  the 
circuit  court,  had  submitted  his  proofs  show- 
ing the  above  transaction,  defendants  moved 
to  strike  out  and  exclude  the  testimony  from 
the  case,  for  the  reason  that  it  was  irrelevant 
and  did  not  tend  to  show  that  the  title  to 
the  cow  passed,  and  that  it  showed  that  the 
contract  of  sale  was  merely  executory.     The 
coui't  refused  the  motion,  and  an  exception 
was  taken.    The  defendants  then  introduced 
evidence  tending  to  show  that  at  the  time 
of  the  alleged  sale  it  was  believed  by  both 
the  plaintiff  and   themselves  that  the  cow 
was  barren  and  would  not  breed;    that  she 
cost  $850,  and  if  not  barren  would  be  worth 
from  $750  to  $1,000;    that  after  the  date  of 
the  letter,  and  the  order  to  Graham,  the  de- 
fendants  were    informed    by   said    Graham 
that    in    his   judgment   the    cow    was    with 
calf,  and  therefore  they  instructed  him  not 
to  deliver  her  to  plaintiff,  and  on  the  twen- 
tieth of  May,  1S86,  telegraphed  to  the  plain- 
tiff what  Graham  thought  about  the  cow  be- 
I  ing  with  calf,  and  that  consequently  they 
I  could  not  sell  her     The  cow  had  a  calf  in 
I  the   month   of   October   following.     On    the 
j  nineteenth  of  May,  the  plaintiff  wrote  Gra- 
I  ham  as  follows:    "Plymouth,  May  19,  1886. 
!  Mr.   George   Graham,   Greenfield— Dear   Sir: 
I  have  bought  Rose  or  Lucy  from  Mr.  Walk- 
er, and  will  be  there  for  her  Friday  morning, 
nine  or  ten  o'clock.     Do  not  water  her  in  the 
morning.     Yours,    etc.,    T.    C.     Sherwood." 
Plaintiff  explained  the  mention  of  the  two 
cows  in  this  letter  by  te-stifying  that,  when 
be    wrote    this    letter,    the    order    and    let- 
ter of  defendants   were  at  his  house,  and, 
writing  in  a  hurry,  and  being  uncertain  as 
to  the  name  of  the  cow,  and  not  wishing  his 
cow   watered,   he  thought   it    would  do   no 
harm  to  name  them  both,  as  his  bill  of  sale 
would  show  which  one  he  had  purchased. 
Plaintiff  also  testified  that  he  asked  defend- 
ants to  give  him  a  price  on  the  balance  of 


MISTAKE. 


371 


thoir  herd  at  droonfifld,  as  a  Criond  thought  | 
of  buyiufi  some,  and  icroived  a  letter  dated  | 
May  17,  1S8G,  In  whirh  tliey  named  the  price  i 
of  five  cattle,  including   Lucy,  at  $00,   and  j 
Rose  2d  at  ."i^SO.     When  he  received  tlie  let-  | 
ter  he  called   defendants   up   by   telephone,  i 
and  asked  them   why  they  put  Rose  2d  in  | 
the  list,  as  he  had  already  purchased   her. 
They  replied   that  they   knew   he  had,   but 
thought  it  would  make  no  difference  if  plain- 
tiff   and    his   friend    concluded    to   take   the 
whole  herd. 

The  foregoing  is  the  substance  of  all  the 
testimony  in  the  case. 

The  circuit  judge  instructed  the  jury  that 
If  they  believed  the  defendants,  when  they 
sent  the  order  and  letter  to  plaintiff,  meant 
to  pass  the  title  to  the  cow,  and  that  the 
cow  was  intended  to  be  delivered  to  plain- 
tiff, it  did  not  matter  whether  the  cow  was  i 
weighed  at  any  particular  place,  or  by  any  } 
particular  person;  and  if  the  cow  was  weigh- 
ed afterwai'ds,  as  Sherwood  testified,  such 
weighing  would  be  a  sufficient  compliance 
with  the  order.  If  they  believed  that  de- 
fendants intended  to  pass  the  title  by  the 
writing,  it  did  not  matter  whether  the  cow 
was  weighed  before  or  after  suit  brought, 
and  the  plaintiff  would  be  entitled  to  recov- 
er. The  defendants  submitted  a  number  of 
requests  which  were  refused.  The  sub- 
stance of  them  was  that  the  cow.  was  never 
delivered  to  plaintiff,  and  TiTe^  title  to  her 
did  not  i)n?;s  Tiy  tlio  letter  and  order;  and 
that  uii(l(>r  tlio  contract,  as  evidenced  by 
these  writings,  the  title  did  not  pass  until 
the  cow  was  weighed  and  her  price  there- 
by determined;  and  that,  if  the  defendants 
only  agreed  to  sell  a  cow  that  would  not 
breed,  then  the  barrenness  of  the  cow  was 
a  condition  precedent  to  passing  title,  and 
plaintiff  cannot  recover.  The  court  also 
charged  the  jury  that  U  was  immaterial 
whether  the  cow  was  with  calf  or  not.  It 
will  therefore  be  seen  that  the  defendants 
claim  that,  as  a  matter  of  law,  the  title  to 
this  cow  did  not  pass,  and  that  the  circuit 
judge  erred  in  submitting  the  case  to  the 
jury,  to  be  determined  by  them,  upon  the 
intent  of  the  parties  as  to  whether  or  not 
the  title  passed  with  the  sending  of  the  let- 
ter and  order  by  the  defendants  to  the  plain- 
tiff. 

This  question  as  to  the  passing  of  title  Is 
fraught  with  difficulties,  and  not  always 
easy  of  solution.  An  examination  of  the 
multitude  of  cases  bearing  upon  this  subject, 
with  their  infinite  variety  of  facts,  and  at 
least  apparent  conflict  of  law.  ofttimes  tends 
to  confuse  rather  than  to  enlighten  the  mind 
of  the  inquirer.  It  is  best,  therefore,  to  con- 
sider always,  in  cases  of  this  kind,  the  gen- 
eral principles  of  the  law,  and  then  apply 
them  as  best  we  may  to  the  facts  of  the 
case  in  hand. 

The  cow  being  worth  over  $."0,  the  con- 
tract of  sale,  in  jjrder  to  be  valid,  must  be 
one  where  the  purchaser  has  received  or  ac- 


cepted a  part  of  the  goods,  or  given  some 
thing  in  earnest,  or  in  part  payment,  or 
where  the  seller  has  signed  some  note  or 
memorandum  in  writing.  How.  St.  §  GISO. 
Here  there  was  no  actual  delivery,  nor  any- 
thing given  in  payment  or  in  earnest,  but 
there  was  a  sufficient  memorandum  signed 
by  the  defendants  to  take  the  case  out  of 
the  statute,  if  the  matter  contained  in  such 
memorandum  is  sufficient  to  constitute  a 
completed  sale.  It  is  evident  from  the  let- 
ter that  the  payment  of  the  purchase  price 
was  not  intended  as  a  condition  precedent 
to  the  passing  of  the  title.  Mr.  Sherwood 
Is  given  his  choice  to  pay  the  money  to 
Graham  at  King's  cattle-yards,  or  to  send 
check  by  mail. 

Nor  can  there  be  any  trouble  about  the 
delivery.  The  order  instructed  Graham  to 
deliver  the  cow,  upon  presentation  of  the 
order,  at  such  cattle-yards.  But  the  price 
of  the  cow  was  not  determined  upon  to  a 
certainty.  Before  this  could  be  ascertained, 
from  the  terms  of  the  contract,  the  cow  had 
to  be  weighed;  and.  by  the  order  inclosed 
with  the  letter,  Graham  was  instructed  to 
have  her  weighed.  If  the  cow  had  been 
weighed,  and  this  letter  had  stated,  upon 
such  weight,  the  express  and  exact  price 
of  the  animal,  there  can  be  no  doubt  but 
the  cow  would  have  passed  with  the  sending 
and  receipt  of  the  letter  and  order  by  the 
plaintiff.  Payment  was  not  to  be  a  concur- 
rent act  with  the  delivery,  and  therein  this 
case  differs  from  Case  v.  Dewey,  ,55  Mich. 
IIG,  20  N.  W.  817,  and  21  N.  W.  911.  Also. 
in  that  case,  there  was  no  written  memo- 
randum of  the  sale,  and  a  delivery  was  nec- 
essary to  pass  the  title  of  the  sheep;  and 
it  was  held  that  such  delivery  could  only 
be  made  by  a  surrender  of  the  possession  to 
the  vendee,  and  an  acceptance  by  him.  De- 
livery by  an  actual  transfer  of  the  property 
from  the  vendor  to  the  vendee,  in  a  case  like 
the  present,  where  the  article  can  easily  be 
so  transferred  by  a  manual  act,  is  usually 
the  most  significant  fact  in  the  transaction 
to  show  the  intent  of  the  parties  to  pass  the 
title,  but  it  never  has  been  held  conclusive. 
Neither  the  actual  delivery,  nor  the  absence 
of  such  delivery,  will  control  the  case,  where 
the  intent  of  the  parties  is  clear  and  mani- 
fest that  the  matter  of  delivery  was  not  a 
condition  precedent  to  the  passing  of  the 
title,  or  that  the  delivery  did  not  carry  with 
It  the  absolute  title.  The  title  may  pass,  If 
the  parties  so  agree,  where  the  statute  of 
frauds  does  not  interpose  without  delivery, 
and  property  may  be  delivered  with  the  un- 
derstanding that  the  title  shall  not  pass 
until  some  condition   is  performed. 

And  whether  the  parties  intended  the  ti- 
tle should  pass  before  delivery  or  not  Is 
generally  a  question  of  fact  to  be  deter- 
mined by  the  jury.  In  the  case  at  bar  the 
question  of  the  intent  of  the  parties  was 
submitted  to  the  jury.  This  submission  was 
right,  unless  from  the  reading  of  the  letter 


372 


REALITY  OF  CONSENT. 


and  the  order,  and  all  the  facts  of  the  oral 
bargaining  of  the  parties,  it  is  perfectly 
clear,  as  a  matter  of  law,  that  the  intent  of 
the  parties  was  that  the  cow  should  be 
weighed,  and  the  price  thereby  accurately 
determined,  before  she  should  become  the 
property  of  the  plaintiff.  I  do  not  think 
that  the  intent  of  the  parties  in  this  case  is 
a  matter  of  law,  but  one  of  fact.  The 
weighing  of  the  cow  was  not  a  matter  that 
needed  the  presence  or  any  act  of  the  de- 
fendants, or  any  agent  of  theirs,  to  be  well 
or  accurately  done.  It  could  make  no  dif- 
ference where  or  when  she  was  weighed,  if 
the  same  was  done  upon  correct  scales,  and 
by  a  competent  person.  There  is  no  pre- 
tense but  what  her  weight  was  fairly  ascer- 
tained by  the  plaintiff.  The  cow  was  spe- 
cifically designated  by  this  writing,  and  her 
delivery  ordered,  and  it  cannot  be  said,  iu  my 
opinion,  that  the  defendants  intended  that 
the  weighing  of  the  animal  should  be  done 
before  the  delivery  even,  or  the  passing  of 
the  title.  The  order  to  Graham  is  to  deliver 
her,  and  then  follows  the  instruction,  not 
that  he  shall  weigh  her  himself,  or  weigh 
her,  or  even  have  her  weighed,  before  de- 
livery, but  simply,  "Send  halter  with  the 
cow,  and  have  her  weighed." 
I  It  is  evident  to  my  mind  that  they  had 
perfect  confidence  in  the  integrity  and  re- 
pponsibility  of  the  plaintiff,  and  that  they 
jconsidered  the  sale  perfected  and  completed 
when  they  mailed  the  letter  and  order  to 
plaintiff.  They  did  not  intend  to  place  any 
conditions  precedent  in  the  way,  either  of 
payment  of  the  price,  or  the  weighing  of 
the  cow.  before  the  passing  of  the  title. 
They  cared  not  whether  the  money  was  paid 
to  Graham,  or  sent  to  them  afterwards,  or 
whether  the  cow  was  weighed  before  or 
after  she  passed  into  the  actual  manual 
grasp  of  the  plaintiff.  The  refusal  to  deliver 
the  cow  grew  entirely  out  of  the  fact  that, 
before  the  plaintiff  called  upon  Graham  for 
her,  they  discovered  she  was  not  ban-en,  and 
therefore  of  greater  value  than  they  had 
sold   her  for. 

The  following  cases  in  this  court  support 
the  instruction  of  the  court  below  as  to  the 
intent  of  the  parties  governing  and  con- 
trolling the  question  of  a  completed  sale, 
and  the  passing  of  title:  Lingham  v.  Eg- 
gleston,  27  Mich.  324;  Wilkinson  v.  Holiday, 
3.3  Mich.  3SG;  Grant  v.  Merchants'  &  Manu- 
facturers' Bank,  3.5  Mich.  527;  Carpenter  v. 
Graham,  42  Mich.  194,  3  N.  W.  974;  Brewer 
V.  Salt  Ass'n,  47  Mich.  534,  11  N.  W,  370; 
Whitcomb  v.  Whitney,  24  Mich.  486;  Byles 
V.  Colier,  54  Mich.  1,  19  N.  W.  505;  Scottcn 
V,  Sutter,  37  Mich.  527,  532;  Ducey  Lumber 
Co.  V.  Lane,  58  Mich.  520,  525,  25  N.  W. 
568;  Jenkinson  v.  Monroe,  61  Mich.  454,  28 
N.  W.  663. 

It  appears  from  the  record  that  both  par- 
ties supposed  this  cow  was  barren  and 
would  not  breed,  and  she  was  sold  by  the 
pound  for  an  insignificant  sum  as  compared 


with  her  real  value  if  a  breeder.  She  was 
evidently  sold  and  purchased  on  the  relation 
of  her  value  for  beef,  unless  the  plaintiff 
had  learned  of  her  true  condition,  and  con- 
cealed such  knowledge  from  the  defendants. 
Before  the  plaintiff  secured  possession  of 
the  animal,  the  defendants  learned  that  she 
was  with  calf,  and  therefore  of  great  value, 
and  undertook  to  rescind  the  sale  by  re- 
fusing to  deliver  her.  The  question  arises 
whether  they  had  a  right  to  do  so.  The 
circuit  judge  ruled  that  this  fact  did  not 
avoid  the  sale  and  it  made  no  difference 
whether  she  was  barren  or  not.  I  am  of  the 
opinion  that  the  coui-t  erred  in  this  holding. 
I  know  that  this  is  a  close  question,  and 
the  dividing  line  between  the  adjudicated 
cases  is  not  easily  discerned.  But  it  must 
be  considered  as  well  settled  that  a  party 
who  has  given  an  apparent  consent  to  a  con- 
tract of  sale  may  refuse  to  execute  it,  or  he 
may  avoid  it  after  it  has  been  completed, 
if  the  assent  was  founded,  or  the  contract  , 
tuade,  upon  the  mistake  of  a  material  fact,  ' 
—such  as  the  subject-matter  of  the  sale,  the 
price,  or  some  collateral  fact  materially  in- 
ducing the  agreement;  and  this  can  be  done 
when  the  mistake  is  mutual.  1  Benj.  Sales, 
§§  605.  606;  Leake,  Cont.  339;  Story,  Sales, 
(4th  Ed.)  §§  377,  148.  See,  also.  Cutis  v. 
Guild,  57  N.  Y,  229;  Harvey  v.  Harris,  112 
Mass.  32;  Gardner  v.  Lane,  9  Allen,  492,  12 
Allen,  44;  Huthmacher  v.  Harris'  Adm'rs, 
38  Pa.  St.  491;  Byers  v.  Chapin,  28  Ohio  St. 
300;  Gibson  v.  Telkie,  37  Mich.  380,  and 
cases  cited;  Allen  v.  Hammond,  11  Pet.  63- 
71. 

If  there  is  a  difference  or  misapprehension 
as  to  the  substance  of  the  thing  bargained 
for;  if  the  thing  actually  delivered  or  re- 
ceived is  different  in  substance  from  the 
thing  bargained  for,  and  intended  to  be  sold, 
—then  there  is  no  contract;  but  if  it  be  only 
a  difference  in  some  quality  or  accident, 
even  though  the  mistake  may  have  been  the 
actuating  motive  to  the  purchaser  or  seller, 
or  both  of  them,  yet  the  contract  remains 
binding.  "The  difficulty  in  every  case  is  to 
determine  whether  tlie  mistake  or  misap- 
prehension is  as  to  the  substance  of  the 
whole  contract,  going,  as  it  were,  to  the  root 
of  the  matter,  or  only  to  some  point,  even 
though  a  material  point,  an  error  as  to 
which  does  not  affect  the  substance  of  the 
whole  consideration."  Kennedy  v.  Panama, 
etc..  Mail  Co.,  L.  R.  2  Q.  B.  580,  587.  It  has 
been  held,  in  accordance  with  the  principles 
above  stated,  that  where  a  horse  is  bought 
under  the  belief  that  he  is  sound,  and  both 
vendor  and  vendee  honestly  believe  him  to 
be  sound,  the  purchaser  must  stand  by  his 
bargain,  and  pay  the  full  price,  unless  there 
was  a  warranty. 

It  seems  to  me,  however,  in  the  case  made 
by  this  record,  that  the  mistake  or  misap- 
prehension of  the  parties  went  to  the  whole 
substance  of  the  agreement.  If  the  cow 
was  a  breeder,  she  was  worth  at  least  $750; 


MISTAKE. 


If  barren,  she  was  worth  not  over  $80.  The 
parties  would  not  have  ni:ule  the  contract  of 
sale  except  upon  the  underslandinf;  and  be- 
lief that  she  was  incapable  of  breeding,  and 
of  no  use  as  a  cow.  It  is  true  she  Is  now 
the  identical  animal  that  they  thought  her 
to  be  when  the  contract  was  made;  tliere  is 
no  mistalie  as  to  the  identity  of  the  creature. 
Yet  the  mistake  was  not  of  the  mere  quality 
of  the  animal,  but  went  to  the  vei-y  nature 
of  the  thing.  A  barren  cow  is  substantially 
a  different  creature  than  a  breeding  one. 
There  is  as  much  difference  between  them 
for  all  purposes  of  use  as  thore^  is  between 
an  ox  and  a  cow  that  is  capable  of  breeding 
and  giving  milk.  If  the  mutual  mistake  had 
simply  related  to  the  fact  whether  she  was 
with  calf  or  not  for  one  season,  then  it  might 
have  been  a  good  sale,  but  the  mistake  af- 
fected the  character  of  the  animal  for  all 
time,  and  for  her  present  and  ultimate  use. 
She  was  not  in  fact  the  animal,  or  the  kind 
of  animal  the  defendants  intended  to  sell  or 
the  plaintiff  to  buy.  She  was  not  a  barren 
cow,  and,  if  this  fact  had  been  known,  there 
would  have  been  no  contract    The  mistake 


affected  the  substance  of  the  whole  consid- 
eration, and  It  must  be  considered  that 
there  was  no  contract  to  sell  or  sale  of  the 
cow  as  she  actually  was.  The  thing  sold 
and  bought  had  in  fact  no  existence.  She 
was  sold^as^  beef  creature  would  be  soIdT" 
she  is  in  fact  a  breeding  cow,  and  avalua- 
ble_ojQe.  The  cOTirt  should  have  instructed 
the  jury  that  if  they  found  that  the  cow 
was  sold,  or  contracted  to  be  sold,  upon  tlie 
understanding  of  both  parties  that  she  was 
bairen,  and  useless  for  the  purpose  of 
breeding,  and  that  in  fact  she  was  not  bar- 
ren, but  capable  of  breeding,  then  the  de- 
fendants had  a  right  to  rescind,  and  to  re- 
fuse to  deliver,  and  the  verdict  should  be  in 
their  favor. 

The  judgment  of  the  court  below  must  be 
reversed,  and  a  new  trial  granted,  with  costs 
of  this  court  to  defendants. 

CAMPBELL,  C.  J.,  and  CHAMPLIN,  J., 
concurred- 

SHERWOOD,  J.,  delivered  a  dissenting 
opinion. 


REALITY  OF  CONSENT. 


OSBURN    et    al.    v.    THROCKMORTON. 

(18  S.  E.  285,  90  Va.  311.) 

Supreme  Court  of  Appeals  of  Virginia.    Nov., 
1893. 

Appeal  from  circuit  court,  Loudoun  coun- 
ty;   James  Keith,  Judge. 

Bill  by  James  B.  Throckmorton  to  enjoin 
one  Osbum,  trustee,  and  others  from  seUing 
certain  property  under  a  deed  of  trust. 
From  a  decree  for  complainant,  defendants 
appeaL     AffiLnned. 

John  M.  Orr,  for  appellants.  Ed.  Nichols 
and  Alexander  &  Tibbs,  for  appeUee. 

LACY,  J.  This  is  an  appeal  from  two  de- 
crees of  the  circuit  court  of  Loudoun  coun- 
ty, rendered  respectively  at  the  January 
term,  1S91,  and  the  October  term,  1891.  The 
bill  was  filed  in  this  case  in  December.  1890, 
to  enjoin  Osbiuni,  trustee,  from  selling  a 
tract  of  land  in  Loudoun  coimty,  conveyed 
to  him  as  trustee  by  deed  dated  March  8, 
1876,  executed  by  James  B.  Throckmorton 
and  EUza  J.  Throckmorton,  his  wife,  to  se- 
cure the  paymi^nt  to  Joseph  Lodge  of  the 
debt  therein  mentioned  of  $2,000,  due  by  note 
executed  by  the  said  James  B.  Throckmorton, 
dated  March  8,  1876.  The  gi-oimd  stated  in 
the  bill  \ipon  which  the  injunction  Is  sought 
is  as  follows:  The  said  Joseph  Lodge  died 
in  the  year  1877,  after  having  made  his  will, 
by  which  said  Osbum,  trustee,  was  appoint- 
ed the  executor  of  the  same.  That  during 
the  first  year  of  said  executor's  administra- 
tion of  said  estate  the  said  $2,000  was  fully 
settled,  and  was  charged  in  his  executorial 
account  as  settled  and  collected,  and  the  ac- 
count confirmed  more  than  10  years  before, 
and  the  said  bond  evidencing  said  debt  was 
surrendered  to  the  debtor  as  paid.  But  the 
trust  deed  executed  to  secure  the  same  by 
inadvertence  was  not  released,  though  dis- 
charged in  fact,  and  no  trust  remained  to  be 
executed  by  said  trustee.  That,  nevertheless, 
the  said  Osbum,  trustee,  had  advertised  the 
said  land  for  sale,  as  was  shown  by  copy 
of  advertisement  exhibited  with  the  bill, 
reciting  in  the  said  advertisement  that  the 
said  debt  secured  by  the  said  dee<I  w:is  now 
the  property  of  the  appellant  Annie  E. 
Throckmorton  under  the  provisions  of  the  said 
Lodge's  wUl,  of  which  he  is  the  executor. 
The  complainant  averred  that  the  will  of 
Lodge  contained  no  such  provision,  and  that, 
being  the  executor  of  the  Lodge  will,  Os- 
bum, trustee,  was  disqualified  from  acting 
as  trustee  under  the  deed.  The  injunction 
was  awarded  by  the  judge  of  the  Loudoun 
county  circuit  court  in  accordance  with  the 
prayer  of  the  bill  in  December,  1890.  At 
the  January  term,  1891,  of  the  said  court, 
the  defendant  Osbum,  trustee,  demurred  to 
the  bill  for  want  of  equity,  and  for  want 
of  Mrs.  Annie  E.  Throckmorton  as  a  party, 
she  being  a  proper  party,  and  anirwered:  That 
he  admitted  that  the  debt  was  due  by  James 


B.  Throckmorton,  and  note  given  and  SGCiu*ed 
by  trust  deed,  as  stated  in  the  bill,  con- 
veying the  said  tract  of  land  to  him  as  trus- 
tee. That  Lodge  died,  and  made  his  will, 
and  appointed  him  executor  thereof,  etc., 
as  charged  in  the  bill;  but  denied  that  the 
said  debt  had  been  paid,  and  the  bond  de- 
livered as  settled  to  the  debtor,  stating  that 
he,  as  trustee,  had  been  required  by  Annie 
E.  Throckmorton,  the  owner  of  the  debt  se- 
cured under  the  said  deed,  to  execute  the 
same  by  the  sale  of  the  said  land.  Tliat  it 
is  true  that  the  will  of  Lodge  did  not  men- 
tion the  said  debt,  and  provide  that  it  should 
be  paid  to  Annie  E.  Throckmorton,  but  that 
it  became  her  property  under  the  said  will, 
her  mother,  ]Mary  A.  Humphrey,  being  en- 
titled to  a  portion  of  his  estate  mider  the 
will;  and  that  she  had  died,  and  left  three 
childi-en,  to  wit,  Abner  Edward  Humphrey, 
Virginia,  wife  of  Volney  Osbum,  and  said 
Annie,  then  the  wife  of  Mason  Throckmorton, 
son  of  said  James  B.  Throckmorton,  the  com- 
plainant; and  that  said  Annie  E.  was  en- 
titled to  one-third  of  the  said  legacy  to  her 
mother,  which,  rmder  the  laws  of  Virginia, 
in  July,  1877,  was  her  separate  property. 
That  under  the  distribution  of  the  estate  this 
bond  in  question  was  allotted  to  the  children 
of  Mary  C.  Humphrey,  and  was  then  allot- 
ted to  Annie  E.,  and  received  by  her  hus- 
band. Mason  Throckmorton,  and  taken  in- 
to his  possession,  and  his  (Osburn's)  con- 
nection with  the  said  bond  as  executor 
ceased  when  he  assented  to  this  legacy,  and 
he  had  no  further  concern  with  it,  and  was, 
therefore,  not  disqualified  by  reason  of  his 
being  executor  from  acting  as  trustee  to  ex- 
ecute the  said  trust,— and  moved  the  dis- 
solution of  the  injunction  awarded  in  the 
case.  A  decree  in  the  said  court,  rendered 
on  the  22d  day  of  October,  1890,  in  a  cause 
in  the  said  court  between  IMason  Throck- 
morton and  his  wife,  whereby  a  divorce  a 
vinculo  matrimonii  was  granted  the  husband 
against  the  said  Annie,  his  wife,  was  ex- 
hibited with  the  said  answer;  and  at  the 
January  term,  1891,  a  decree  was  rendered 
in  the  said  cause,  whereby  the  demurrer 
to  the  bill  was  overruled,  and  on  his  mo- 
tion leave  was  given  the  plaintiff,  James 
B.  Throckmorton,  to  amend  his  bill,  malving 
Annie  E.  Throckmorton  a  party  defendant 
thereto,  which  was  filed  accordingly;  and 
It  was  set  forth  by  way  of  amendment  that 
the  whole  of  the  said  $2,000  bond  did  not 
pass  to  said  Annie  as  her  S'hare,  but  that 
$827.05  was  in  excess  of  her  share,  and  was 
due  to  the  said  Abner  Edward,  and  he  paid 
this  to  liim  by  a  new  bond  for  that  amount, 
with  security,  which  was  accepted  by  said 
Abner,  and  surrendered  on  his  part  The 
residue  belonged  to  Annie.  The  bill  then 
states  how,  in  detail,  the  debt  was  paid  to 
Mason,  about  which  Annie  was  consulted 
with  reference  to  the  payment  of  the  said 
debt  to  her  huslxind  by  a  conveyance  to  him 
of   property    and    land,    and    that    the    said 


MISTAKE. 


375 


settlement  made  December  25,  1ST8,  was 
with,  her  knowled;?e,  and  had  her  approval 
and  consent,  and  he  (the  complainant)  had 
never  heard  from  her  a  word  of  dissent  or 
disapproval  until  about  the  time  the  land 
was  advoitised  for  sale.  Tliat  up  to  1SS5 
the  relations  of  Mason  and  Annie  to  each 
other  as  husband  and  wife  were  such  as  are 
usual  between  hiLsband  and  wife.  That  in 
1878  Mason  bou.^'lit  a  tract  of  land  worth 
$1,000,  and  had  the  deed  made  to  his  said 
wife,  without  her  knowledge  until  he  in- 
formed her,  which  is  still  here;  and  he  gave 
her  largo  sums,  stated  in  the  bill,  exceeding, 
with  the  said  land,  the  amount  received  In 
the  said  Lodge  debt  by  hor  husband.  In  1S90, 
Mason  and  Annie  were  divorced,  and  Annie 
recpiired  to  pay  the  costs.  That  there  had 
been  a  complete  settlement  between  him  and 
Mason,  with  which  Annie  had  remained  satis- 
fied until  the  disagreement  between  her  and 
her  husband.  Annie  answered,  and  made 
general  denials  of  consent  on  her  part  to 
the  delivery  to  hor  husband  of  hei*  property 
in  question,  and  emphasizes  her  ignorance 
of  her  rights  under  tlie  act  of  4th  of  Apnl, 
1877,  known  as  the  "Married  Woman's  Act," 
and  that  the  said  act  made  this  property  her 
separate  estate.  But  In  the  evidence  it  Is 
shown  that  she  knew  all  about  it,  and  was 
a  party  to  its  delivery  to  her  husband,  and 
to  the  piu-chase  of  the  Thro<'kmorton  place, 
subject  to  liens  on  it,  belonging  to  her  hvis- 
band's  mot-her.  And  in  her  deposition  she 
admits  that  she  knew  that  it  was  handed 
to  her  husband,  and  on  cross-examination 
that  she  gave  her  consent  to  its  investment 
in  the  farm,  and  that  she  was  present  at 
tlie  division  of  the  Ijodge  estate  and  delivery 
of  the  J.  B.  Throckmorton  note  to  her  hus- 
band. In  the  suit  of  Throckmorton  v.  Throck- 
morton, referred  to  above,  and  decided  in 
this  court  April  10,  1890,  which  was  a  suit 
between  the  said  Mason  and  Annie,  his  wife, 
for  divorce  a  vinculo  matrimonii,  and  report- 
ed in  86  Va.  7GS,  11  S.  E.  289,  the  said 
Annie  asserted  her  claims  against  her  hus- 
band for  large  sums  of  money  belonging  to 
her,  amounting  to  $10,000,  which  he  had  re- 
ceived for  her,  and  which  sums  included  the 
debt  in  question  here,  as  she  says  in  her 
deposition  in  this  case.  In  that  suit  her 
claim  was  decided  against  her,  and  her  hus- 
band was  divorced  at  her  costs. 

The  first  qiiestion  we  are  to  consider  is  the 
effect  of  this  transfer  of  her  rights  by  the 
married  woman  to  her  husband,  and  con- 
senting to  its  investment  in  a  particular 
manner,  or  to  its  use  by  him.  Can  the  trans- 
action be  avoided  iipon  the  ground  that  she 
was  ignorant  of  the  law  affecting  the  sub- 
ject? If  upon  the  mere  ground  of  Iguoritnce 
of  the  law  men  were  admitted  to  overhaul 
or  extingmsh  their  most  solemn  contracts. 
and   especially  those  which  have  been  exe- 


cuted by  a  compli.-te  performance,  there 
would  be  much  embarrassing  litigation  in  aU 
judicial  ti-ibunals,  and  no  small  danger  of  in- 
justice from  the  nature  and  difficulty  of  the 
proper  proofs.  Lyon  v.  Richmond,  2  Johns. 
Ch.  51,  00;  Shotwell  v.  Murray,  1  Johns.  Ch. 
512;  Storrs  v.  Barker,  0  Johns.  Ch.  109,  170, 
Story,  Eq.  Jur.  §  111.  The  presumption  is, 
that  every  person  Is  acquainted  with  his  own 
rights,  provided  he  has  had  a  reasonable  op- 
portunity to  know  them;  and  nothing  can  be 
more  liable  to  abuse  than  to  permit  a  person 
to  reclaim  his  proi)crty  upon  the  mere  pre- 
tense that  at  the  time  of  parting  with  it  he 
was  ignorant  of  the  law,  acting  on  his  title. 
Proctor  V.  ThraU,  22  Vt  202.  Ignorance  of 
the  law  does  not  affect  agreements  in  com-ts 
of  equity,  nor  excuse  from  the  legal  conse- 
quences of  particular  acts.  1  FonbL  Eq.  c. 
2,  §  7,  note  2;  1  Madd.  Ch.  Pr.  60;  Hunt  v. 
Rousmaniere,  1  Pet  1,  15,  10;  1  Story,  Eq. 
Jur.  §§  112,  113,  115,  116.  A  married  woman 
possessed  of  separate  property,  as  to  which 
she  has  a  general  right  of  disposal,  may  be- 
stow it  upon  her  husband  as  well  as  upon  a 
stranger,  and  coiirts  of  equity  will  sanction 
such  disposition  when  made  by  the  wife. 
Story,  Eq.  Jur.  §§  1395-1397.  And,  as  was 
said  by  this  court  in  Beecher  v.  Wilson,  M 
Va.  813,  G  S.  E.  209,  the  married  woman's  act 
of  April  4,  1877,  does  not  prevent  a  wife 
from  giving  her  property  to  her  husband  if 
she  pleases;  nor  docs  it  abrogate  the  pre- 
sumption that  under  circumstances  such  as 
obtained  in  this  case  she  has  done  so.  (Opin- 
ion by  Fauntleroy,  J.) 

It  is  further  insisted  by  the  appellee  that 
the  decree  of  the  circuit  court  perpetually 
enjoining  the  sale  is  right  for  another  rea- 
son. In  the  divorce  siiit  of  Throckmorton  v. 
Throckmorton,  supra,  the  question  as  to  prop- 
erty riglits  of  the  wife  was  raised,  and  "by 
the  decree  in  that  cause  they  were  disposed 
of  by  the  decree  of  absolute  divorce,  without 
settling  the  property  rights,  and  the  rights 
of  pi'operty  were  left  where  they  were  at 
the  date  of  the  decree.  Porter  v.  Porter,  27 
Grat  509.  These  rights  certainly  might  have 
been  disposed  of  in  the  divorce  suit,  and  so 
the  matter  is  res  adjudicata.  Campbell  v. 
Campbell,  22  Gntt.  606;  Findlay  v.  Trigg, 
83  Va.  543,  3  S.  E.  142.  The  debt  in  contro- 
versy having  been  fully  paid  and  discharged, 
tlie  appellee  is  entitled  to  hold  the  land  free 
and  released  from  the  lien  of  the  trust  deed; 
and  It  was  the  duty  of  the  creditor  within  90 
days  to  have  entered  upon  the  margin  of  the 
book  where  such  deed  is  recorded  a  release 
thereof,  under  our  statute,  and  for  failure  to 
do  so  he  Is  liable  to  a  fine  of  $20.  Code  Va. 
§  2498.  There  was  no  error  in  the  decree  of 
the  circuit  court  complained  of,  and  appealed 
from  here,  and  the  same  is  aflirmed. 

FAUNTLEROY,  J.,  dissenting. 


EEALITY  OF  CONSENT. 


^  ///PECrLE'S   BANK   OF   CITY   OF   NEW 
YORK  ^.  BOGART. 

(81  N.  Y.  101.) 

Court  of  Appeals  of  New  York.    June  1,  ISSO. 

John  Clinton  Gray  and  Luther  R.  Marsh, 
foi-  appellant  William  Allen  Butler,  for  re- 
spondents. 

ANDREWS,  J.  The  plaintiff  is  a  banking 
corporation,  organized  under  the  banking  laws 
of  this  state,  carrying  on  business  in  the  city 
of  New  York.  The  defendants  compose  the 
firm  of  Orlando  M.  Bogart  &  Co.,  note-brokers 
and  dealers  in  commercial  paper,  also  caiTy- 
ing  on  business  Ln  that  city.  The  action  is 
brought  to  recover  of  the  defendants  $34,453.- 
83.  the  sum  paid  b.v  the  plaintiff  on  the  pur- 
chase from  the  defendants  on  the  20th,  21st 
and  22d  days  of  July,  1875,  of  certain  accep- 
tances of  Duncan,  Sherman  &  Co.,  a  banking 
and  commission  firm  in  the  city  of  New  York, 
of  drafts  drawn  upon  them  by  one  Alexander 
Burgess,  dated  at  New  York,  July  19,  1875, 
payable  three  months  after  date.  Duncan, 
Sherman  &  Co.  failed  on  the  27th  of  July,  and 
the  plaintiff,  on  the  day  of  the  maturity  of  the 
paper,  tendered  it  back  to  the  defendants  and 
demanded  tlie  repayment  of  the  money  paid  on 
the  purchase,  claiming  to  rescind  the  contract 
for  the  fraud  of  the  defendants.  The  fraud 
alleged  is  that  the  defendants  concealed  from 
the  plaintiff  the  knowledge  possessed  by  them 
in  respect  to  the  paper,  viz.:  that  the  drawer 
was  a  salaried  clerk  in  the  employment  of 
Duncan,  Sherman  &  Co.,  having  no  other  busi- 
ness relations  with  the  firm  than  as  such  clerk, 
and  that  the  acceptances  were  purchased  by 
the  defendants  directly  from  the  acceptors. 

The  evidence  shows  that  the  defendants,  for 
several  years  prior  to  the  transaction  in  ques- 
tion, had  been  accustomed  to  purchase  from 
Duncan,  Sherman  &  Co.,  their  acceptances  of 
paper  drawn  by  Burgess,  and  selling  it  in  the 
market.  The  transactions  of  this  character 
were  frequent,  and  the  plaintiff  purchased 
large  amounts  of  the  paper  from  the  defend- 
ants, and  also  from  other  brokers.  TThe  de- 
fendants, on  the  19th  of  July,  1875,  purchased 
of  Duncan.  Sherman  &  Co.  .?70,000  of  this 
paper,  paying  therefor  the  nominal  amount 
less  their  commissions,  and  interest  to  the 
maturity  of  the  paper  at  the  rate  of  five  and 
one-half  per  cent,  per  annum.  In  pursuance 
of  their  custom  to  notify  their  customers  of 
what  paper  they  had  for  sale,  they  immediate- 
ly sent  a  written  notice  to  the  plaintiff  to  the 
effect  that  they  had  for  sale  acceptances  of 
Duncan.  Sherman  &  Co..  and  stilting  the  price 
they  had  paid,  and  the  price  for  which  they 
would  sell  the  paper,  which  was  a  small  ad- 
vance upon  their  parchase.  The  plaintiff's 
president  came  to  the  defendants'  office  and 
purchased  $15,000  of  the  paper.  The  next 
day  he  applied  to  purchase  $15,000  more.  The 
defendants  having,  in  the  meantime,  sold  the 
whole  amount  of  the  $70,000  of  paper  pur- 


chased on  tlie  19th.  purchased  on  the  20th,  of 
Duncan,  Sherman  &  Co.,  $30,000  more  of  simi- 
lar paper  from  which  they  supplied  the  addi- 
tional $15,000  desired  by  the  plaiutiff,  and  on 
the  succeeding  day  the  plaintiff's  president 
purchased  another  acceptance  of  the  same 
character  for  $5,000,  which  he  selected  from 
a  large  number  of  securities  of  other  parties 
which  the  defendants  had  for  sale.  There 
was  no  represeutation  of  any  kind  made  by 
the  defendants  to  the  plaintiff  on  the  sale  of 
the  acceptances  beyond  what  was  implied  in 
the  offer  to  sell  acceptances  of  Duncan,  Sher- 
man &  Co.  The  plaintiff's  president  made  no 
inquiry  as  to  their  origin,  character  or  consid- 
eration. It  is  to  be  assumed  that  the  defend- 
ants knew  that  the  drafts  were  not  drawn 
against  funds  and  that  they  were  issued  by 
Duncan,  Sherman  &  Co.,  as  a  means  of  bor- 
rowing money  (for  that  is  the  clear  import  of 
the  transaction),  and  that  the  plaintiff  had  no 
knowledge  of  these  circumstances.  But  there 
is  no  evidence  whatever  that  the  defendants 
had  any  knowledge  or  information  that  Dun- 
can, Sherman  &  Co.  were  in  embarrassed  pe- 
cuniary circumstances.  The  evidence  is  un 
disputed  that  for  many  years,  and  up  to  the 
day  of  their  failure,  the  firm  of  Duncan,  Sher- 
man &  Co.  enjoyed  the  highest  financial  credit 
and  standing.  The  confidence  of  the  defend- 
ants in  their  solvency  is  indicated  by  their 
purchasing  Duncan,  Sherman  &  Co.'s  paper  in 
large  amounts  on  their  own  accoimt,  and  al- 
though they  purchased  for  sale  and  not  for 
investment,  yet  they  took  the  risk  of  their 
solvency,  between  the  time  of  the  purchase 
and  the  resale.  The  plaintiff,  in  purchasing 
the  paper  from  the  defendants,  relied  upon 
the  credit  of  the  acceptors,  as  is  manifest 
from  the  circumstances.  The  plaintiff's  presi- 
dent or  officers  did  not  know  the  drawer,  and 
had  purchased  the  same  description  of  paper 
on  previous  occasions,  and  neither  at  the  time 
of  the  transaction  in  question  nor  before,  did 
they  make  any  inquiry  to  ascertain  the  draw- 
er's identity  or  responsibility.  The  plaintiff 
took  the  paper  without  the  indorsement  of  the 
sellers,  and  made  no  inquiry  and  exacted  no 
warranty.  The  plaintiff's  president  was  well 
acquaintf  tl  with  the  commercial  credit  of  Dun- 
can, Sherman  &  Co.,  and  upon  that,  and  that 
alone,  did  he  rely  in  purchasing  the  paper. 

We  are  of  opinion  that  the  plaintiff  failed 
to  establish  a  case  which  would  have  justified 
the  jury  in  finding  that  the  defendants  com- 
mitted a  fraud  ui  the  sale  of  the  paper.  The 
fact  that  the  defendants  offered  to  sell  the 
paper,  and  did  sell  it  as  acceptances  of  Dun- 
can, Sherman  &  Ck>.  was  not  we  think,  a 
representation  that  it  was  business  paper, 
drawn  against  funds  or  credits  of  the  drawer, 
in  the  hands  of  the  drawees,  or  in  the  ordi- 
nary course  of  business  transactions  between 
them.  The  paper  had  all  the  essential  requi- 
sites of  accepted  bills  of  exchange.  The  draw- 
er and  drawees  were  different  parties,  and 
upon  the  transfer  of  the  paper  by  Duncan, 
Sherman   &   Co.,   both   became   liable   to   the 


FRAUD. 


377 


bolder  upou  distinct  and  independent  con- 
tracts. Prima  facie,  every  accepuiuce  affords 
a  presuuipLion  of  funds  of  the  drawer  in  tlie 
liands  of  tlie  acceptor,  and  of  an  approprlallon 
of  these  funds  for  the  use  of  the  drawer  (lia- 
borg  V.  Peyton,  2  Wheat  3S5).  and  upon  this 
presumption  remedies  are  administered.  The 
acceptance  is  evidence  of  money  had,  received 
by  the  acceptor  foi  the  use  of  the  holder,  and 
an  action  for  money  had  and  received  will  lie 
in  his  favor  against  the  acceptor,  and  he  can- 
not defeat  the  actiou  by  proof  tliat  he  acceptr 
od  without  funds.  Story,  J.,  in  the  case  cited, 
referring  to  the  presumption  that  the  bili  is 
drawn  against  funds,  says:  "The  case  may 
indeed  be  otherwise,  and  then  the  acceptor 
pays  the  debt  of  the  drawer,  but  as  between 
liimself  and  the  payee,  it  is  not  a  collateral 
but  an  original  and  direct  undertalcing."  Ac- 
ceptances without  fmlds,  or  accommodation 
acceptances,  are  certainly  not  unusual  com- 
mercial transactions,  and  this  must  be  well 
understood  among  commercial  men.  In  Re 
Hammond,  G  De  Gex,  M.  &  G.  G99,  the  Lord 
.Tustice  Knight  Bruce  says:  "Now  I  do  not 
think  that  the  mere  circumstance  of  a  man 
parting  with  a  bill,  without  saying  this  is  an 
accommodation  bill  amounts  to  an  implied 
representation  that  it  is  not  an  accommoda- 
tion bill;  I  am  not  aware  of  any  sufficient 
reason  or  authority  for  so  extensive  a  prop- 
osition." The  law  on  the  sale  of  commercial 
paper  implies  a  warranty  on  the  part  of  the 
vendor  of  title  and  that  the  instrument  is 
genuine  (Littauer  v.  Goldman,  72  N.  Y.  506. 
See,  also,  Lobdell  v.  Baker,  1  Mete.  [Mass.] 
193);  and  also  as  stated  by  Judge  Story,  that 
the  vendor  "has  no  knowledge  of  any  facts 
which  prove  the  instrument  if  originally  valid 
to  be  worthless  eitlier  by  failure  of  the  maker, 
or  by  its  being  already  paid,  or  otherwise  to 
have  become  void  or  defunct."  Story,  Prom. 
Notes,  §  118.  But  no  case  has  been  cited  sup- 
porting the  proposition  that  there  is  any  im- 
plied warranty  or  representation  on  the  part 
of  the  vendor  of  a  bill  valid  in  the  hands  of 
the  indorsee,  that  it  was  drawn  against  funds, 
or  that  it  was  not  accommodation  paper.  The 
bills  in  question  were  acceptances,  and  In  law 
and  fact  instruments  of  the  description  of 
these  offered  for  sale  by  the  defendants,  and 
purchased  by  the  phiintiff. 

In  the  absence  then  of  any  representation 
by  the  defendants  in  respect  to  the  origin  or 
consideration  of  the  bills,  the  remaining  ques- 
tion is,  whether  the  defendants  were  under  a 
legal  duty  to  inform  the  plaintiff  at  the  time 
of  sale,  of  the  circumstances  under  which  they 
were  made.  The  general  proposition  is  as- 
serted by  the  learned  counsel  for  the  plaintiff, 
that  the  holder  of  negotiable  paper  who  knows 
a  material  fact  affecting  its  market  value,  and 
who  sells  it  for  fiill  value  without  disclosing 
such  fact,  is  liable  to  the  purchaser  for  the 
amount  paid  for  the  paper,  if  after  the  discov- 
ery of  the  suppression,  the  purchaser  elects  to 
rescind  the  sale.  But  the  proposition  asserted 
is  broader  than  the   recent  authorities   war* 


rant  The  law  requires  disclosure  to  be  made 
only  when  there  is  a  duty  to  make  it,  aucf 
this  duty  is  not  raised  by  the  mere  circum- 
stance that  the  undisclosed  fact  is  material, 
and  is  known  to  the  one  party  and  not  to  the 
other,  or  by  the  additional  cireum.stance  that 
the  party  to  whom  it  is  known  knows  that  the 
other  party  is  acting  in  ignorance  of  it.  It 
must  be  assumed  on  this  appeal,  that  if  at 
the  time  of  the  purchase  of  the  paper  it  had 
been  known  in  the  community  that  Duncan, 
Sherman  &  Ck>.  wtre  selling  their  own  ac- 
ceptances in  the  market  it  would  have  created 
suspicion  and  affected  their  credit,  and  that 
the  plaintiff  would  not  have  pur  hased  it  But 
the  fact  that  Duncun.  Sherman  &:  Co.  were 
borrowing  under  disguise  would  at  most  be 
ground  of  suspicion  of  pecuniary  embarrass- 
ment. The  borrowing  of  money  by  men  en- 
gaged in  large  transactions,  as  Duncan,  Sher- 
man &  Co.  were,  as  bankers  and  dealers  in 
cotton  on  their  own  account,  and  on  commis- 
sion, is  certainly  not  unusual,  and  this  al- 
though the  borrowers  may  be  persons  of  large 
means,  and  the  fact  that  they  borrowed  by 
methods  which  would  not  disclose  that  they 
were  borrowers  would  not  necessarily  be  In- 
consistent with  good  faith  or  solvency.  It 
might  be  inconsistent  with  both,  and  it  may 
have  been  in  this  case.  But  the  question  is, 
were  the  defendants  under  a  duty  to  com- 
municate the  discrediting  facts  within  their 
knowledge,  in  the  absence  of  tiny  inquiry  Id 
resi>ect  to  the  origin  of  the  paper,  and  when 
the  means  of  information  were  accessible  to 
the  purchaser,  and  was  their  omission  to  do 
this  an  actionable  fraud,  they  having  done 
nothing  to  mislead  or  divert  inquiry,  and  aU 
that  they  did  being  to  offer  the  paper  for  sale? 
We  are  of  opinion  that  the  law  did  not  cast 
upon  them  the  duty  of  such  disclosure.  The 
defendants  were  in  the  attitude  of  vendors  of 
paper  purchased  and  owned  by  them.  The 
plaintiff  was  seeking  investment  for  its  fimd.<i, 
and  became  the  purchaser  of  the  paper  in  re- 
liance on  the  judgment  of  its  officers  as  to  its 
value.  There  was  no  relation  of  trust  or  con- 
fidence between  the  )arties.  If  the  plaintiff's 
president  in  buying  the  paper  thought  of  the 
subject  at  all,  and  believed  that  the  bUls  were 
draw'n  against  funds,  the  mistaken  belief  was 
not  induced  by  any  act  or  statement  of  the 
defendants,  and  they  were  under  no  legal  ob- 
ligation to  volunteer  to  inform  him  that  the 
fact  was  otherwise.  Attwood  v.  Small,  6 
Clark  &  F.  232,  443-447;  Smith  v.  Hughes. 
L.  R.  6  Q.  B.  597.  It  was  held  in  Nichols  v. 
Pinner.  IS  N.  Y.  295.  23  N.  Y.  264.  that  the 
mere  omission  of  a  purchaser  of  goods  on  cred- 
it to  disclose  his  insolvency  to  the  vendor,  in 
the  absence  of  any  attempt  to  defraud,  is  not 
such  a  concealment  as  will  avoid  the  sale; 
and  yet  the  fact,  if  known  to  the  seller,  would 
affect  his  credit  Judge  Selden.  In  his  opinion 
in  that  case,  says:  "It  has  never,  that  I  am 
aware  of,  been  held  that  a  purchaser  is  bound 
when  no  questions  are  put  to  him  in  regard  to 
It  to  disclose  his  own  pecuniary  condition  and 


378 


EEALITY  or  CONSEJ^T. 


means  of  payment.  If  he  makes  no  false 
statements,  and  resorts  to  no  acts  or  con- 
trivances for  the  purpose  of  misleading  the 
vendor,  it  is  not  I  think  a  fraud,  to  say  noth- 
ing on  the  subject"  See,  also,  Dambmann  v. 
Schulting,  75  N.  Y.  55.  "The  general  rule," 
says  Story,  "both  of  law  and  equity,  in  re- 
spect to  concealments,  is  that  mere  silence 
with  regard  to  a  material  fact  which  there  is 
no  legal  obligation  to  divulge  will  not  avoid  a 
contract,  although  it  operates  to  the  injurj'  of 
the  party  from  whom  it  is  concealed."  Story, 
Cont.  §  516,  See,  also.  Benj.  Sales,  338,  and 
cases  cited.  The  case  of  Brown  v.  Montgom- 
ery, 20  N.  Y.  287,  was  a  case  of  the  sale  of  a 
post-dated  check  of  a  party  whose  paper  had 
gone  to  protest  on  the  day  the  sale  was  made, 
which  was  known  to  the  vendor's  agent  who 
made  the  sale,  but  who  did  not  disclose  the 
fact  to  the  purchaser.     The  paper  had  become 


worthless  by  the  sudden  failure  of  the  draw- 
ers, and  the  court  held  that  the  duty  of  dis- 
closure rested  upon  the  holder  of  the  check 
under  the  circumstances  of  that  case.  That 
case  furnishes  no  support  to  the  claim  of  the 
plaintiff  in  this.  Caveat  emptor  is  the  rule 
of  the  common  law,  fotmded  upon  wise  policy, 
"to  induce  vigilance  and  caution,  and  to  pre- 
vent opportunities  for  deceit,  which  lead  to 
litigation,  by  casting  upon  every  man  the  re- 
sponsibilities of  his  own  contracts,  and  to  bur- 
den him  with  the  consequences  of  his  careless 
mistake."  Story,  Cont.  §  517.  We  are  of  opin- 
ion that  this  rule  is  applicable  to  this  case, 
and  that  the  plaintiff,  neither  upon  the  facts 
proved,  or  offered  to  be  proved,  was  entitled 
to  recover. 

The  judgment  should  therefore  be  affirmed. 

All  concur  except  RAPALLO,  J.,  not  voting. 

Judgment  affirmed. 


rnAUD. 


879 


LOMERSON  V.  JOHNSTON. 

(20  Atl.  675.  47  N.  J.  Eq.  312.) 

Cfturt  of   Errors  and   Appeals  of   New   Jersey. 
Nov.  18,  18'JO. 

Aopeal  from  the  court  of  chancery.  The 
folio vviiif;  is  the  decree  of  the  vice-chancel- 
lor: "This  cause  coining  on  to  be  heard 
before  the  court,  in  the  presence  of  Daniel 
Vliet,  solicitor,  and  J.  G.  Shif)inan  &  Son, 
of  counsel  with  the  coniplain;int,  and  of 
William  H.  Morrow,  of  counsel  with  de- 
fendant, Margaret  Johnston,  and  the  bill 
of  complaint,  answer,  and  replication 
having  been  read,  and  the  court  having 
heard  the  evidence  of  the  witnesses  on  the 
part  of  the  complainant,  and  of  said  de- 
fendant, and  heard  the  argument  of  the 
respective  counsel,  and  having  considered 
the  same,  and  it  appearing  to  the  court 
that  the  said  defendant,  Margaret  John- 
ston, was  at  the  time  of  the  execution  of 
the  mortgage,  dated  July  7,  A.  D.  1883, 
to  the  complainant,  and  particularly  de- 
scribed in  the  cornplainant's  bill  of  com- 
plaint, a  married  woman,  and  that  the 
said  mortgage  was  given  to  secure  an  in- 
debtedness of  Levi  S.  Johnston,  her  hus- 
band, to  the  said  complainant,  for  mon- 
eys which  he  held  in  trust,  and  for  the  pa^'- 
ment  of  which  he,  the  said  complainant, 
was  one  of  the  sureties  of  the  said  Levi  S. 
Johnston,  and  which  moneys  he,  the  said 
Levi  S.  Johnston,  had  wasted;  and  it  fur- 
ther appearing  that  the  said  complainant, 
by  saying  to  said  defendant,  Margaret 
Johnston,  that,  in  the  use  of  said  trust 
funds,  her  husband  had  been  guilty  of  em- 
bezzlement, and  could  be  put  in  jail, 
therefore  he  had  exercised  an  undue  press- 
ure on  her.  and  had  thereby  destroyed 
her  free  agency,  so  that,  in  the  execution 
and  acknowledgment  of  the  said  mort- 
gage, she  did  not  act  according  to  her  own 
freewill;  and  it  also  appearing  that  the 
lands,  upon  which  it  is  by  the  said  com- 
plainant claimed  that  the  said  mortgage 
is  a  lien,  was  and  is  the  property  of  the 
said  defendant,  Margaret  Johnston,  and 
that  the  said  complainant  is  not  entitled 
to  the  relief  by  him  sought,  in  and  by  his 
said  bill  of  complaint, — it  is  thereupon  on 
this  2d  day  of  October,  A.  D.  1S88.  ordered, 
adjudged,  and  decreed  by  the  chancellor 
of  the  state  of  New  Jersey  that  the  said 
mortgage  so  mentioned  and  described  in 
the  said  bill  of  complaint  was  procured  to 
be  executed  and  acknowledged  by  the  said 
Margaret  Johnston  by  such  undue  press- 
ure exercised  upon  her  by  the  said  com- 
plainant aforesaid,  as  to  destroy  her  free 
agency  of  the  same,  in  the  execution  and 
acknowledging  the  same,  and  the  said 
mortgage  is  null  and  void,  and  that  the 
said  complainant  is  not  entitled  to  the  re- 
lief by  him  sought  in  and  by  his  said  bill 
of  complaint;  and  that  the  said  bill  of 
complaint  be  and  the  same  is  hereby  dis- 
missed, with  costs." 

./.  G.  iSIiipmau,  for  appellant.  W.  H. 
Morrow  and  George  M.  Robeson,  for  re- 
spondent. 


GARRL'^ON,  J.  We  agree  with  thelearned 
vice  chancellor,  who  lieard  this  cause,  in 
all  of  his  conclusions  upon  the  testimony. 
The  case  shows  in  th<'  clearest  manner 
that  Lomerson,  the  appellant,  b<'ing  in- 
volved with  Mr.  Johnston,  as  surety  and 
indorser,  visited  Mrs.  Jcjhnston  for  the 
purpose  of  securing  himself  against  loss 
through  the  husband  by  obtaining  fiom 
the  wife  a  mortgage  upon  the  house  left  to 
her  by  her  father.  The  case  furthcrshows, 
and  the  vice-chancellor  so  finds,  that,  in 
attaining  this  object.  Lomerson  uiatle  to 
Mrs.  Johnston  a  number  of  staterm-nts, 
all  tending  to  excite  in  her  mind  the  liveli- 
est apprehensions  that  her  husband  was 
about  to  be  lodged  in  jail  for  debt.  The 
court  of  chancery  by  its  decree  set  aside  the 
mortgage  thus  obtained,  considering  that 
it  was  executed  under  a  species  of  dun-ss. 
With  the  result  reached  we  agree,  resting 
our  decision,  however,  upon  the  ground 
that  it  is  inequitable  to  permit  the  com- 
plainant to  retain  a  security*  for  the  hus- 
band's debt  obtained  by  allowing  a  false 
ap[)rehension  as  to  the  husband  s  danger 
to  affect  the  mind  of  the  wife.  That  this 
apprehension  was  the  sole  consideration 
for  the  wife's  compliance  is  not  more  clear 
than  that  the  efticient  element  of  that  ap- 
prehension,— namely,  the  belief  in  the  im-- 
minence  of  the  anticipated  arrest, — was 
not  only  false,  but  was  so  to  the  knowl- 
edge of  Lomerson. 

In  order  to  establish  a  case  of  false  rep- 
resentation, it  is  not  necessary  that  some- 
thing which  is  false  should  have  been  stat- 
ed as  if  it  was  true.  If  the  presentation 
of  that  which  is  true  creates  an  impression 
which  is  false  it  is,  as  to  him,  who,  seeing 
the  misai)prehension,  seeks  to  profit  by  it, 
a  case  of  false  representation.  In  the  pres- 
ent instance  Mrs.  Johnston  naturally 
gathered  from  the  statements  made  to 
her  by  Lomerson  that  her  husband  had 
committed  crimes  for  which  he  not  only 
could  and  would  be  imprisoned,  but  that 
his  arrest  was  at  hand.  The  imminence 
of  the  danger  was  the  sole  motive  for  the 
execrlion  of  the  mortgage.  In  any  other 
view  of  the  transaction  her  haste  is  incom- 
prehensible. Notwithstanding  the  impor- 
tance of  the  demand  made  upon  her.  she 
took  no  time  to  reflect,  held  no  consulta- 
tion with  her  friends,  sought  no  advice. 
Her  one  object  was  to  act  quickly,— to  be 
beforehand.  And  yet  this  notion  of  the 
imminence  of  her  husband's  arrest  was 
just  the  one  part  of  the  impression  pro- 
duced upon  her  mind  by  Lomerson's  state- 
ments which  was  false,  and  which  he 
knew  to  be  false.  From  this  time  on.  the 
case  becomes  one  of  false  representation, 
not  because  falsehoods  were  stated  as  if 
they  were  facts,  but  because  the  state  of 
mind  produced  falsely  represented  the 
facts.  To  take  advant.-ige  o(  such  a  state 
of  mind  is  to  profit  by  a  false  representa- 
tion. . 
The  decree  below  is  affirmed,  with  costs. 


EEALITT  or  COX^EXT. 


GORDON  V.  PARMELEE  et  al.  (2  cases). 

(2  Allen,  212.) 

Supreme  Judicial   CJourt  of  Massachusetts. 
Berkshire.    Sept.  Term,  1861. 

Two  actions  of  contract,  tried  and  argrued 
together,  on  promissory  notes  given  by  the 
defendants  in  payment  for  a  farm  and  a 
detached  piece  of  woodland. 

At  the  trial  in  the  superior  court,  before 
Rockwell.  J.,  it  appeared  that  the  bargain  for 
the  land  was  made  upon  the  premises,  and 
that  the  defendants  had  viewed  the  same 
with  reference  to  the  purchase,  and  passed 
over  the  wood  lot  at  several  times  before  the 
purchase,  in  different  directions.  The  defend- 
ants offered  to  show  that  the  treaty  for  the 
purchase  was  made  when  the  land  was  cov- 
ered with  snow,  and  that  the  plaintiffs  false- 
ly represented  that  the  farm  was  of  a  soil, 
and  a  capacity  for  productiveness  and  the 
keeping  of  stock,  greatly  superior  to  what  it 
was  in  fact;  and  that  they  had  no  means  of 
judging  of  the  same  except  from  the  repre- 
sentations of  the  plaintiffs,  on  which  they  re- 
lied, and  were  thereby  induced  to  make  the 
purchase;  but  the  evidence  was  excluded. 
They  also  offered  to  show  that  the  wood  lot 
was  so  rough  and  uneven  that  its  actual  ex- 
tent could  not  be  seen  from  any  point,  and 
that  the  plaintiffs  falsely  pointed  out  bound- 
aries as  the  true  ones  which  included  lands 
of  adjoining  owners,  and  falsely  represented 
that  a  portion  thereof  lying  under  a  ledge, 
and  so  situated  that  no  judgment  as  to  its 
quantity  approaching  correctness  could  be 
formed  by  inspection,  contained  fifty  acres, 
knowing  that  in  fact  it  only  contained  twenty- 
eight  acres.  The  defendants  claimed  a  right 
to  recoup  in  damages  for  all  these  false  rep- 
resentations; but  the  court  ruled  that  they 
conld  recoup  only  for  the  value  of  the  land 
lying  between  the  boundaries  pointed  out  and 
the  true  bounds,  and  not  for  false  representa- 
tions as  to  the  number  of  acres,  and  if  no 
false  representations  were  made  as  to  the 
boundaries,  no  deduction  should  be  made  from 
the  notes. 

The  plaintiffs  offered  in  evidence  the  dec- 
laration in  an  action  brought  by  the  defend- 
ant Parmelee  against  the  plaintiffs,  to  re- 
cover damages  for  certain  specified  false  rep- 
resentations alleged  to  have  been  made  by 
them  in  selling  this  land,  and  afterwards 
discontinued,  for  the  purpose  of  showing  that 
the  claim  then  made  by  Parmelee  was  less 
than  the  claim  now  set  up  by  him.  This 
was  objected  to,  unless  it  should  also  be 
«hown  that  Parmelee  dictated  or  had  knowl- 
ecjge  of  the  precise  allegations  contained  in 
the  declaration;  but  the  court  allowed  the 
evidence  to  be  introduced. 

The  Jury  returned  a  verdict  for  the  plain- 
tiffs, and  the  defendants  alleged  exceptions. 

J.  E.  Field,  for  plaintiffs.  L  Sumner  &  H. 
L.  Dawes,  for  defendants. 


BIGELOW,  C.  J.  The  alleged  false  state- 
ments concerning  the  productiveness  of  the 
land  and  its  capacity  to  furnish  support  for 
cattle  constituted  no  defence  to  the  notes. 
They  fall  within  that  class  of  affirmations 
which,  although  known  by  the  party  mak- 
ing them  to  be  false,  do  not,  as  between  ven- 
dor and  vendee,  afford  any  ground  for  a 
claim  of  damages  either  in  an  action  on  the 
case  for  deceit  or  by  way  of  recoupment  in 
a  suit  to  recover  the  purchase  money.  They 
come  within  the  principle  embodied  in  the 
maxim  of  the  civil  law,  "Simplex  commenda- 
tio  non  obligat."  Assertions  concerning  the 
value  of  property  which  is  the  subject  of  a 
contract  of  sale,  or  in  regard  to  its  qualities 
and  characteristics,  are  the  usual  and  ordi- 
nary means  adopted  by  sellers  to  obtain  a 
high  price,  and  are  always  understood  as  af- 
fording to  buyers  no  ground  for  oitiitting  to 
make  inquiries  for  the  purpose  of  ascertain- 
ing the  real  condition  of  the  property.  Af- 
firmations concerning  the  value  of  land,  or  its 
adaptation  to  a  particular  mode  of  culture,  or 
the  capacity  of  the  soil  to  produce  crops  or 
support  cattle,  are,  after  all,  only  expressions 
of  opinion  or  estimates  founded  on  judgment, 
about  which  honest  men  might  well  differ 
materially.  Although  they  might  turn  out 
to  be  erroneous  or  false,  they  furnish  no  evi- 
dence of  any  fraudulent  intent.  They  relate 
to  matters  which  are  not  peculiarly  within 
the  knowledge  of  the  vendor,  and  do  not  in- 
volve any  inquii'y  into  facts  which  third  per- 
sons might  be  unwilling  to  disclose.  They 
are,  strictly  speaking,  gratis  dicta.  The  ven- 
dee cannot  safely  place  any  confidence  in 
them;  and  if  he  does,  he  cannot  make  use  of 
his  own  want  of  vigilance  and  care  in  omit- 
ting to  ascertain  whether  they  were  true  or 
false  as  the  basis  of  his  claim  for  damages  in 
reduction  of  tiie  amount  which  he  agreed  to 
pay  for  the  property. 

The  representations  concerning  the  quanti- 
ty of  land  which  formed  the  subject  of  the 
contract  owme  within  the  same  principle.  The 
vendors  pointed  out  to  the  vendees  the  true 
boundaries  of  the  land  which  they  sold.  This 
fact  is  established  by  the  verdict  of  the  jury 
under  the  instructions  which  were  given  at 
the  trial.  The  defendants  had  therefore  the 
means  of  ascertaining  the  precise  quantity  of 
land  included  within  the  boundaries.  They 
omitted  to  measure  it,  or  to  cause  it  to  be 
surveyed.  By  the  use  of  ordinary  vigilance 
and  attention,  they  might  have  ascertained 
that  the  statement  concerning  the  number 
of  acres,  on  which  they  placed  reliance,  was 
false.  They  cannot  now  seek  a  remedy  for 
placing  confidence  in  affirmations  which,  at 
the  time  they  were  made,  they  had  the  means 
and  opportunity  to  verify  or  disprove.  Sugd. 
Vend.  6,  7;  Scott  v.  Hanson,  1  Sim.  13;  Med- 
bury  V.  Watson,  6  Mete.  (Mass.)  24G;  Brown 
V.  Castles.  11  Gush.  '.US. 

The  declaratif  n  in  the  former  suit  was  right- 
ly admitted.     It  was  in  the  nature  of  an  ad- 


FllAUD. 


381 


mission  by  the  defendants  of  the  nature  and 
amount  of  damages  which  they  claimed  of 
the  present  plaintiffs  in  reduction  of  the 
amount  due  on  the  notes.  The  declaration 
was  not  a  mere  tecluiical  statement  of  a 
cause  of  action  by  an  attorney,  but  It  con- 
tained specific  averments  of  the  representa- 


tions which  the  defendants  alleged  to  be 
false,  and  which  must  liave  been  derived  from 
them.  It  was  therefore  the  statement  of 
their  a^'ent,  while  employed  and  acting  within 
the  scope  of  his  agency.  Currier  v.  Silloway. 
1  Allen,  19. 
Exceptions  overruled. 


\ 


REALITY  OF  CONSENT. 


SHELDON  V.  DAVIDSON. 
f55  x\,  W.  IGl.  So  Wis.  138.) 


Snpreme  Court  of  Wisconsin.     May  2,  1893. 


Appeal  from  superior  court,  Milwaukee 
county;  R.  N.  Austin,  Judge. 

Action  by  John  H.  Sheldon  against  Agnes 
Davidson  to  recover  damages  for  failure  to 
give  plaintiff  possession  of  a  building  stand- 
ing on  premises  leased  by  plaintiff  from 
defendant  There  was  judgment  for  defend- 
ant on  a  demurrer  to  the  complaint,  and 
plaintiff  apijeals.    Affirmed. 

Austin  &  Hamilton,  for  appellant.  Miller, 
Noyes  &  Miller,  for  respondent. 

OICTON,  J.  This  is  »n  appeal  from  an 
order  sustaining  a  demurrer  to  the  com- 
plaint, on  the  ground  that  it  does  not  state 
facts  sufficient  to  constitute  a  cause  of  ac- 
tion. The  complaint  alleges  substantially  the 
following  facts:  The  defendant,  on  the  16th 
day  of  March,  1891,  leased  to  the  plaintiff 
the  south  half  of  lot  3,  in  block  60,  in  the 
Fourth  ward  of  the  city  of  Milwaukee,  for 
the  term  of  five  years,  at  a  rent  of  $600 
per  year,  payable  In  monthly  installments 
the  1st  of  each  month,  the  firet  payment  to 
be  made  on  the  1st  day  of  May  following. 
On  the  front  part  of  said  lot  there  was  a 
brick  dwelling  house  and  stare,  and  it  was 
agreed  that  the  plaintiff,  the  lessee,  should 
expend  in  improving  said  buildings  the  sum 
of  $1,000.  It  was  in  said  lease  agreed  that 
the  same  should  not  take  effect  as  to  the 
east  60  feet  of  said  lot  xmtll  a  certain  lease 
then  in  effect  between  the  defendant,  as 
lessor,  and  one  John  Veidt,  should  terminate, 
on  the  10th  day  of  September,  1891.  On 
said  60  feet  there  was  a  bam  standing.  A 
copy  of  the  lease  is  appended  to  the  com- 
plaint It  is  alleged  in  the  complaint  that 
by  the  terms  of  said  lease  the  plaintiff  "was 
to  have  the  use,  benefit,  and  occupation  of 
the  said  premises,  and  the  aforesaid  build- 
ings." There  is  no  such  stipidation  in  said 
lease.  If  there  had  been,  it  would  have 
embraced  the  bam  on  said  east  (JO  feet 
The  plaintiff  made  due  inquiry  of  the  de- 
fendant as  to  the  terms  and  conditions  of 
said  lease  between  the  defendant  and  said 
Veidt  and  the  defendant,  with  intent  to 
deceive  and  defraud  the  plaintiff,  and  for 
the  purpose  of  inducing  him  to  sign  Said 
lease,  falsely  and  fraudulently  concealed 
from  this  plaintiff  the  fact  that  the  bam 
standing  upon  the  said  east  60  feet  of  said  lot 
was  not  tiie  property  of  said  defendant,  but 
was  the  property  of  said  Veidt,  and  that 
the  plaintiff  could  not  obtain  i)os.session 
thereof  on  the  10th  day  of  September  next 
ensuing,  and  falsely  represented  to  the  plain- 
tiff, and  for  the  purpose  of  inducing  the 
plaintiff  to  execute  said  lease,  that  he  could 
have  possession  of  said  60  feet  and  the 
Btable  standing  thereon  on  and  after  Sep- 
teiiilxT  luth  next  ensuing.  "The  plaintiff, 
relying   upon   the  said    representations,    was 


thereby  induced  to  sign  the  aforesaid  lease, 
and  did  so  sign  it  within  a  few  days  there- 
after." The  said  representations  were  false, 
in  that  by  the  terms  of  said  lease  from  the 
defendant  to  the  Siiid  Veidt,  which  was  to 
expire  on  the  10th  day  of  September,  1891, 
the  said  bam  was  to  become  the  property 
of  the  said  Veidt,  and  he  was  to  have  the 
pri\ilege  of  removing  the  same,  which  the 
defendant  well  knew.  At  the  expiration  of 
said  lease  between  the  defendant  and  said 
Veidt,  said  Veidt  removed  said  bam  from 
said  premises,  and  the  defendant  has  I'efused 
to  restore  the  same,  or  compensate  the  plain- 
tiff therefor.  By  reason  of  the  premises 
the  plaintiff  was  damaged  $1,000.  The 
gravamen  of  the  complaint  is  the  fraudulent 
concealment  of  the  fact  that  the  building  on 
the  east  60  feet  of  the  lot  was  not  the  prop- 
erty of  the  defendant,  but  was  the  property 
of  Veidt,  the  lessee;  and  the  false  representa- 
tion that  the  plaintiff  could  have  po.ssession 
of  the  said  60  feet,  and  the  stable  standing 
thereon,  on  and  after  September  10th  next 
ensuing. 

1.  As  to  the  concealment  as  a  cause  of 
action.  That  bam  on  the  60  feet  must  have 
been  placed  there  by  the  tenant,  Veidt,  tem- 
porarily for  his  own  use,  with  the  privilege 
of  removal  at  the  end  of  his  term,  and  was 
never  a  part  of  the  realty.  It  could  not 
have  been  so  attached  to  the  soil  as  to  be- 
come a  part  of  the  realty.  If  it  had  been, 
the  plaintiff  would  have  been  entitled  to  it 
by  the  terms  of  his  lease,  and  he  could  have 
prevented  its  removal.  We  conclude,  there- 
fore, that  the  bam  was  a  tenant's  fixture  In 
fact  as  well  as  by  the  terms  of  the  Veidt 
lease,  and  removable  by  him  during  his 
term.  The  Veidt  lease  is  referred  to  in  the 
plaintiff's  lease.  The  plaintiff  does  not  state 
that  he  did  not  know  all  about  that  lease, 
and  all  about  the  character  of  that  build- 
ing na  having  been  placed  there  by  the  ten- 
ant, and  removable.  He  states  only  that  he 
inqtiired  of  the  defendant  about  the  terms 
and  conditions  of  that  lease,  and  does  not 
state  whether  the  defendant  told  him  what 
they  were  or  not.  He  does  not  state  that 
the  defendant  knew,  or  had  reason  to  know, 
that  h»i,  the  plaintiff,  wsis  ignorant  of  the 
fact  that  the  defendant  did  not  own  the 
bam.  The  defendant  might  well  have  sup- 
posed that  the  plaintiff  knew  the  terms  of 
that  lease  referred  to  in  his  own  lease,  and 
the  character  of  the  bam  as  a  fixture  was 
open  to  common  observation.  But  more  ma- 
terial than  even  this  is  the  absence  of  any 
averment  that  the  plaintiff  was  Induced  to 
sign  the  lease  by  such  fraudulent  conceal- 
ment. It  states  merely  that  the  conceal- 
ment was  for  the  purpose  of  inducing  him  to 
do  so,  but  fails  to  sUite  that  he  was  actually 
induced  to  do  so  by  it  It  is  very  clear  that 
there  are  not  sufficient  allegations  tn  the 
complaint  to  make  the  fraudulent  conceal- 
ment a  cause  of  action. 

2.  As  to  the  false  representation  that  the 
plaintiff  "could  have  possession  of  said  east 


FRAUD. 


CO  feet,  and  the  sUible  stoncUng  thereon,  on 
and  after  September  10th  next  ensuing." 
The  pliiintiff  did  have  possession  of  tlie  GO  j 
fet't,  so  that  such  part  of  the  representation 
at  least  was  not  false.  As  to  the  other  part 
of  tlie  repre.'^entation,  It  relates  to  a  future 
event,  and  is  not  of  an  existing  fact  or  of 
a  past  event,  and  tliert  fore  is  not  actional 
hie  if  such  event  should  not  occur.  It  Is  a 
mere  cplnJcn,  prediction,  or  promise  of  a 
future  condition  of  things,  upon  which  the 
plaintiff  had  no  right  to  relj'.  In  Morrison 
V.  Koch,  32  Wis.  254,  the  representation  was 
that  a  certain  daiu  "would  always  in  tlie 
future  continue  to  furai.sh  the  full  amount  of 
the  power  conveyed."  Mr.  Justice  Lyon  &iid 
In  the  opinion:  "It  seems  quite  clear  that  no 
charge  of  fraud  can  be  pre<licated  upon  it. 
At  most  tliere  was  a  mere  expression  of 
opinion  that  m  the  future  the  conditions  on 
wliich  the  water  supply  depended  would  re- 
main favorable  to  a  continuance  of  the  sup- 
ply. It  is  wanting  In  all  the  essential  ele- 
ments which  con.stitute  a  fraud."  In  Pat- 
terson V.  Wright,  G4  Wis.  289,  25  N.  W.  Rep. 
10,  the  representation  was  th:it  the  party 
"said  or  promised  that  he  would  pay  a  cer- 
tain sum  of  money  as  a  cou.sideration  of 
and  to  induce  the  giving  of  certain  notes, 
and   upon    which   they    were   obtained."    It 


was  held  "that  tlie  representation  must  re- 
late to  a  present  or  past  stale  of  facts,  and 
that  reUef  as  for  deceit  cannot  be  obtained 
for  the  nonperformance  of  a  promise  or 
other  statements  looking  to  the  future;"  cit- 
ing the  above  case;  Bigelow,  Trauds,  11,  12; 
and  Fenwick  v.  Grimes,  5  Cranch,  C.  C. 
439.  In  Maltby  v.  AusUn,  G5  Wis.  527,  27 
N.  W.  Rep.  102,  the  representation  was  "of 
the  value  of  a  certain  tract  of  land,"  and 
In  Prince  v.  Overholser,  75  Wis.  040,  44  N. 
W.  Rep.  775,  it  was  "that  a  certiin  bounty 
land  warrant  would  locate  any  kind  of  gov- 
ernment land,"  and  neither  was  held  action- 
able. The  principle  has  become  elementary 
In  respect  to  ail  representations  relating  to 
the  future,  and  as  mere  expressions  of 
opinion.  This  representiition  Is  not  fraudu- 
lent or  actionable  for  both  reasons.  It  re- 
lates to  a  future  event,  and  is  a  mere  opinion, 
viz.  "that  the  plaintiff  could  have  posse.ssion 
of  the  building  on  the  east  00  feet  of  the  lot 
on  and  after  September  10th  next  ensuing." 
This  statement  was  made  before  March  16, 
1891.  This  disposes  of  all  the  pretended  de- 
ceit or  fraud  alleged  In  the  complaint  The 
deniuiTer  was  properly  sustained.  The  or- 
der of  the  superior  court  Is  affirmed,  and  the 
cause  remanded  for  further  proceedings  ac- 
cording to  law. 


REALITY  OF  CONSENT. 


STIMSON  V.   HELrS   et   al. 

(10  Pae.  290,  y  Colo.   33.) 

Supreme  Court  of  Colorado.    Feb.  26.  1886. 


Appeal  from  county  court,  Boulder  county. 
The  complaint   sets   out   that   on   the  sixth 
day  of  October,  ISSl,  William  Stimson  leased 
to  the  defendants  in  error  the  S.  W.  ^4  of  sec- 
tion 21,  in  township  1,  range  70  west,  in  said 
county,  for  the  period  of  four  years  and  six 
mouths,  for  the  pm-pose  of  mining  for  coal, 
under  the  conditions  of  said  lease;  that  they 
had  no  knowledge    of    the  location    of  the 
boimd;ii-y  lines  of  said  tract  at  the  time  of 
the  leasing,  and  that  they  so  informed  Stim- 
son, the  defendant  in  the  case;   that  they  re- 
quested Stimson  to  go  with  them  and  show 
them  the  boundary  lines;  that  the  defendant, 
pretending  to  know  the  lines  bounding  said 
land,  and  their  exact  locality,  went  then  and 
there  with  plaintiffs,  and  showed  and  pointed 
out  to  them  what  he  said   was  the  leased 
land,    and   the  boundary   lines   thereof,    es- 
pecially the  north  and  south  lines  thereof; 
that   plaintiffs   not  then  knowing  the  lines 
bounding  said  laud,  nor  the  exact  location 
thereof,  and  relying  upon  what  the  defendant 
then  and  there  pointed  out  to  them  as  the 
leased  land,  and  the  lines  thereof,  then  and 
there  proceeded  to  work  on  the  land  pointed 
out,  and  sank  shafts  for  mining  coal  thereon, 
and   made  simdry   improvements  thereon,— 
made  buildings,  laid  tracl      etc.;  that  all  the 
said   work  was   done  and  labor  performed 
and  improvements  made  on  the  land  pointed 
out  by  defendant  to  plaintiffs  as  the  leased 
land,   and  that  plaintiffs,  relying  upon  the 
statements  of  defendant  as  aforesaid,   and 
not  knowing  otherwise,  believed  they  were 
performing  the  work,  and  making  all  the  im- 
provements on  the  land  they  had  so  leased, 
which  they  did  by  direction  of  the  defend- 
ant;   that  while  they  were  working  on  the 
said  land  Stimson  was  frequently  present, 
and  told  the  plaintiffs  they  were  on  his  land, 
and  received  royalty  from  ore  taken  there- 
from;   that  about  April  10,  1882,  they  were 
notified  to  quit  mining  on  said   ground  by 
the  Marshall  Coal  Mining  Company;  that  the 
land  belonged  to  said  company;  that  none  of 
the    said  improvements   were  put   on    said 
leased  land;    and  that  they  were  compelled 
to  quit  work  and  mining  thereon;    that  the 
improvements  made  by  them  were  w^orth  $2,- 
000;    that    Stimson   falsely   represented    to 
them  other  and  different  lines  than  the  time 
boundaries  of  said  premises,  and  sliowed  and 
pointed  out  to  them  other  and  different  lands 
than  the  lands  leased  them,  and  thereby  de- 
ceived them,  and  damaged  them,  in  the  sum 
of  $2,000.    Issue  joined,  and  trial  to  the  court. 
Motion  by  defendant's  counsel  for  judgment 
on   the    pleadings,   and    evidence    overruled. 
Judgment  for  the  plaintiffs  in  the  sum  of 
$2,000,  and  costs. 

Wright  &  Oriffin,  for  appellant.    G.  Berk- 
ley, for  appellees. 


ELBERT,  J.  The  law  ho'.ds  a  contracting 
party  liable  as  for  fraud  on  his  express  rep- 
resentations concerning  facts  material  to  the 
ti-eaty,  the  truth  of  which  he  assumes  to 
know,  and  the  tnith  of  which  is  not  known 
to  the  other  contracting  pai-ty,  where  the 
representations  were  false,  and  the  other 
party,  relying  upon  them,  has  been  misled 
to  his  injiu-y.  Upon  such  representations  so 
made  the  contracting  party  to  whom  they 
are  made  has  a  right  to  rely,  nor  is  there  any 
duty  of  investigation  cast  upon  him.  In 
such  a  case  the  law  holds  a  party  bound  to 
know  the  truth  of  his  representations.  Big- 
elow.  Fraud,  57,  GO,  63,  67,  68,  87;  Kerr, 
Fraud  &  M.  54  et  seq.;  3  Wait,  Act.  &  Def. 
4?.(').  This  is  the  law-  of  this  case,  and,  on  the 
evidence,  warranted  the  judgment  of  the 
court  below. 

The  objection  was  made  below,  and  is  re- 
newed here,  that  the  complaint  does  not  state 
sufficient  facts  to  constitute  a  cause  of  ac- 
tion. Two  points  are  made:  (1)  That  the 
complaint  does  not  allege  that  the  defendant 
knew  the  representations  to  be  false;  (2> 
that  it  does  not  allege  intent  to  defraud. 

It  is  not  necessary,  in  order  to  constitute 
a  fraud,  that  the  party  who  makes  a  false 
representation  should  know  it  to  be  false. 
He  who  makes  a  representation  as  of  his 
own  knowledge,  not  knowing  whether  it  be 
true  or  false,  and  it  is  in  fact  untrue,  is 
guilty  of  fraud  as  much  as  if  he  knew  it  to 
be  untrue.  In  such  a  case  he  acts  to  his 
own  knowledge  falsely,  and  the  law  imputes 
a  fraudulent  intent.  Kerr,  Fraud  &  M.  54  et 
seq.,  and  cases  cited;  Bigelow,  Fraud,  63» 
84,  453;  3  Wait,  Act  &  Def.  438  et  seq.;  2 
Estee,  Pr.  394  et  seq.  "Fraud"  is  a  term 
which  the  law  applies  to  certain  facts,  and 
w^here,  upon  the  facts,  the  law  adjudges 
fraud,  it  is  not  essential  that  the  complaint 
should,  in  terms,  allege  it.  It  is  sufficient  if 
the  facts  stated  amount  to  a  case  of  fraud. 
Kerr,  Fraud  &  M.  366  et  seq.,  and  cases 
cited;  2  Estee,  PI.  423.  The  complaint  in 
this  case  states  a  substantial  cause  of  ac- 
tion, and  is  fully  supported  by  the  evidence. 
The  action  of  the  county  com-t  in  refusing 
to  allow  the  appellant  to  appeal  to  the  dis- 
trict court  after  he  had  given  notice  of  an  ap- 
peal to  this  court,  and  time  had  been  given  in 
which  to  perfect  it,  cannot  be  assigned  as 
error  on  this  record.  If  it  was  an  error,  it 
was  error  not  before,  but  after,  the  final 
judgment  from  which  this  appeal  is  taken. 

The  judgment  of  the  court  below  is   af- 
firmed. 


[Note  from  10  Pac.  Rep.  292.] 

A  contract  seciirod  by  false  and  fraudulent 
rcDFOsentations  cannot  be  enforced.  Mills  v. 
Collins,  67  Iowa,  164,  25  N.  W.  Hep.  109. 

A  court  of  equity  will  decree  a  rescission  of 
a  conlract  obtained  by  the  fraudulent  represen- 
tations or  conduct  of  one  of  the  parties  thereto, 
on  the  complaint  of  the  other,  when  it  satis- 
factorily appears  tliat  the  party  seeking  tJtie 
rescission  has  been  uiisled  in  regard  to  a  ma- 


FRAUD. 


^85 


terial  matter  by  such  representation  or  conduct, 
to  his  injury  or  projmlice.  But  wlicn  tlie  facts 
are  known  to  both  parties,  and  each  acts  on  his 
own  judfjraent,  the  court  will  not  rescind  the 
contract  because  it  may  or  does  turn  out  that 
the}',  or  cither  of  tlieiu,  were  mistaken  as  to 
the  lepal  effect  of  the  facts,  or  the  rrziits  or  ob- 
ligations of  tlie  parties  tliereunder,  and  particu- 
larly when  such  mistake  can  in  no  way  injuri- 
ously aH'cct  the  right  of  the  jjarly  complaining 
under  the  contract,  or  prevent  him  from  obtain- 
ing and  receiving  all  the  benefit  contemplated 
by  it,  and  to  which  he  is  entitled  under  it.  See- 
ley  V.  Keed,  25  Fed.  Kep.  3G1. 

When,  by  false  representations  or  misrep- 
resentations, a  fraud  has  been  committed,  and 
by  it  «he  complainant  has  been  injured,  the  gen- 
eral principles  of  equity  jurisprudence  afford  a 
remedy.  Singer  Manuf'g  Co.  v.  Yarger,  12 
Fed.  Rep.  437.  See  Chandler  v.  Childs,  42 
Mich.  128,  3  N.  W.  Rep.  297;  Cavender  v. 
Robenson,  33  Kan.  G2G,  7  Pac.  Rep.  152. 

When  no  damage,  present  or  prospective,  can 
result  from  a  fraud  practiceil,  or  false  repre- 
sentations or  misrepresentation  made,  a  court 
of  equity  will  not  entertain  a  petition  for  relief. 
Dunn  V.  Remington,  9  Neb.  82,  2  N.  W,  Rep. 
230. 

A  person  is  not  at  liberty  to  make  positive 
assertions  about  facts  material  to  a  transaction 
unless  he  knows  them  to  be  true:  and  if  a 
statement  so  made  is  in  fact  false,  the  as- 
sertor  cannot  relieve  himself  from  the  imputa- 
tion of  fraud  by  pleading  ignorance,  but  must 
resiwnd  in  damages  to  any  one  who  has  sus- 
tained loss  by  acting  in  reasonable  reliance  upon 
such  assertion.  Lynch  v.  Mercantile  Trust  Co., 
18  Fed.  Rep.  48G. 

Equity  will  not  relieve  a,gainst  a  misrepre- 
sentation, unless  it  be  of  some  material  matter 
constituting  some  motive  to  the  contract,  some- 
thing in  regard  to  which  reliance  is  placed  by 
one  party  on  the  other,  and  by  w-hich  he  was 
actually  misK^l,  and  not  merely  a  matter  of 
opinion,  open  to  the  inquiry  and  exauiiuatiou 
of  both  parties.  Buckner  v.  Street,  15  Fed. 
Rep.  365. 

False  representations  may  be  a  ground  for 
relief,  though  the  person  making  them  believes 
them  true,  if  the  person  to  whom  they  were 
made  relied  upon  them,  and  was  induced  there- 
by to  enter  into  the  contract.  Seeberger  v.  Ho- 
bcrt,  55  Iowa,  75G,  8  N.  W.  Rep.  482. 

Fraudulent  representations  or  misrepresenta- 
tions are  not  ground  for  relief,  where  they  are 
immaterial,  even  thou'.vh  thev  be  relied  upon. 
Hall  v.  Johnson.  41  Mich.  286.  2  N.  W.  Rep. 
55.  See,  to  same  effect,  Lvnch  v.  Mercantile 
Trust  Co.,  18  Fed.  Rep.  48G;  Seeberger  v.  IIo- 
hert,  55  Iowa,  7.5G,  S  X.  W.  Rep.  482. 

In  fraudulent  representation  or  misrepresenta- 
tion the  injured  parties  may  obtain  relief,  even 
though  they  did  not  suppose  every  statement 
made  to  them  literallv  true.  Heineman  v.  Stei- 
ger,  54  Mich.  232,  19" N.  W.  Rep.  9G5. 

Where  the  vendor  honestly  expresses  an  in- 

HOPK.  SEL.  CAS.  COUT.  —25 


correct  opinion  us  to  the  amount,  quality,  an<l^ 
value  of  the  goods  he  dis|K)ses  of  in  a  sale  of 
his  business  and  good-will  thereof,  and  the 
purchaser  sees  or  knows  the  property,  or  has  an 
oiiporlunity  to  know  it,  no  action  for  false  r  j>- 
n-scntations  will  lie.  Collins  v.  Jackson,  54 
Mir-h.  ISG.  in  N.  W.  Rep.  947. 

.Mere  "dealing  talk"  in  the  sale  of  g  ods,  ir  - 
less  accomiiaiiicd  by  some  arlilice  to  deceive 
the  purchaser  or  throw  him  off  his  guard,  or 
some  concealment  of  intrinsic  defects  not  easily 
detected  by  ordinary  care  and  diligence,  does 
not  amount  to  misrepresentation.  Revnolds  v. 
Palmer,  21  Fed.  Rep.  433. 

False  statements  made  at  the  time  of  the 
sale  by  the  vendor  of  chattels,  with  the  fraud- 
ulent intent  to  induce  the  purchaser  to  accept 
an  inferior  article  as  a  superior  one,  or  to  give 
an  exorbitant  and  unjust  i)rice  therefor,  will 
n-nder  such  purchase  voidable;  but  such  false 
statement  must  be  of  some  matter  affecting  the 
character,  quantity,  quality,  value,  or  title  of 
such  chattel.  Bank  v.  Yocum,  11  Neb.  328,  9 
N.  W.  Rep.  84. 

A  statement  recklessly  made,  without  knowl- 
edge of  its  truth,  is  a  false  statement  knowing- 
ly made,  within  the  settled  rule.  Cooper  v. 
Schlcsinger,  111  U.  S.  148,  4  Sup.  Ct.  Rep.  3G0. 

Whether  or  not  omission  to  communicate 
known  facts  will  amount  to  fraudulent  repre- 
sentation depends  upon  the  circumstances  of 
the  particular  case,  and  the  relations  of  the 
parties.     Britton  v.  Brewster,  2  Fed.  Rep.  IGO. 

Where  a  vendor  conceals  a  material  fact, 
which  is  substantially  the  consideration  of  the 
contract,  and  which  is  peculiarly  within  his 
knowledge,  it  is  fraudub^nt  misrepresentation. 
Dowling  V.  Lawrence,  58  W^is.  282,  IG  N.  W. 
Rep.  5.52. 

Evidence  of  fraudulent  representations  must 
be  clear  and  convincing.  Wickham  v.  More- 
house, 16  Fed.  Rep.  324. 

Where  a  man  sells  a  business,  and  the  con- 
tract of  sale  contained  a  clause  including  all 
right  to  business  done  by  certain  agents,  evi- 
dence that  the  seller  was  willing  to  engage  in 
the  same  business  with  such  agents  is  not  proof 
of  fraud  in  making  the  contract.  Tavlor  v. 
Saurman,  110  Pa.  St.  3,  1  Atl.  Rep.  40. 

It  was  recently  held  by  the  supreme  court  of 
Indiana,  in  the  case  of  Cook  v.  Churchman,  104 
Ind.  141,  3  N.  E.  Rep.  759,  that  where  money 
is  obtained  under  a  contract,  any  fraudulent 
representations  employed  by  a  party  thereto  as 
a  means  of  inducing  the  loan  to  be  made,  if 
otherwise  proper,  are  not  to  be  excluded  be- 
cause of  the  statute  of  frauds;  also  that  where 
parol  representations  are  made  regarding  the 
credit  and  ability  of  a  third  person,  with  the  in- 
tent that  such  third  person  shall  obtain  money 
or  credit  thereon,  the  statute  of  fraud  applies, 
and  no  action  thereon  (?au  be  maintained,  al- 
though the  party  making  the  representations 
may  have  entered  into  a  conspiracy  with  such 
person  with  the  expectation  of  obtaining  some 
incidental  benefit  for  himself. 


386 


REALITY  OF  COXsEXT. 


COBB  T.  HATFIELD. 

l/y  (46  N.  Y.  533.) 

^/  Conrt  of  Appeals  of  New  York.     1S71. 

Action  for  the  recovery  of  $1,000  and  in- 
terest paid  by  the  plaintiff  to  the  defendants, 
upon  the  purchase  of  an  interest  in  an  oil 
property  in  Penn.sylvania,  upon  the  ground 
that  the  purchase  had  been  induced  by  the 
false  and  fraudulent  representations  of  the 
defendants  as  to  the  character,  yield,  and 
value  of  the  property.  Judgment  for  plain- 
tiff reversed. 

John  H.  Reynolds,  for  appellant  WiUiam 
C.   Ruger,   for  respondents. 

ALLEN,  J.  Under  the  complaint  the  plain- 
tiff might  have  treated  the  action  as  in  case 
for  the  recovery  of  damages  for  the  alleged 
fraud;  and  in  such  action  no  return  of  prop- 
erty received  from  the  defendants,  or  other 
act  restoring  the  defendants  to  the  condition 
they  occupied  before  making  the  contract, 
would  have  been  necessary  as  a  condition 
precedent  to  maintiiining  the  action.  But 
upon  the  trial  the  plaintiff  expressly  re- 
pudiated the  contract,  and  claimed  to  recov- 
er the  money  advanced  and  paid,  as  upon 
a  rescission  of  the  contract,  and  at  the  close 
of  the  evidence  on  his  part,  tendered  to 
the  defendants,  and  offered  to  cancel  the  as- 
signment and  transfer,  and  claimed  to  re- 
cover in  the  action  the  consideration  paid 
and  interest,  "solely  upon  the  groimd  of  a 
resci-ssion  of  the  contract"  for  the  alleged 
fraudulent  representations  of  the  defend- 
ants. The  recovery  was  had  for  the  money 
paid  and  interest  thereon.  The  judge  char- 
ged the  jury  that  what  had  been  done  was 
Kufficient  to  entitle  the  plaintiff  to  maintain 
the  action,  that  It  was  a  sufficient  rescission 
of  the  contract.  It  is  somewhat  questionable 
whether  the  point  upon  which  the  supreme 
court  reversed  the  judgment  and  granted  a 
new  trial  was  properly  taken.  No  question 
was  made  at  the  trial  as  to  the  necessity  of 
an  immediate  rescission  of  the  contract  upon  a 
discovery  of  the  fraud;  and  the  judge  at  circuit 
did  not  rule  and  was  not  called  upon  to  rule 
in  respect  to  the  time  at  which  the  plaintiff 
should  have  rescinded  the  contract,  and  re- 
stored or  tendered  to  the  defendants  what 
he  had  received.  His  attention  was  not  called 
to  that  question,  and  non  constat,  that  had 
the  question  been  directly  raised,  the  plaintiff 
might  not  have  shown  an  earlier  revocation 
than  'was  shown  at  the  trial.  The  judge 
only  passed  upon  the  character  and  quality 
of  the  acts  relied  upon  as  a  rescission,  and 
not  as  to  their  timely  and  seasonable  perform- 
ance. 

But  passing  this,  a  fatal  error  was  commit- 
ted on  the  trial  in  the  exclusion  of  evidence 
offered  by  the  defendants.  The  assignment 
and  transfer  to  the  plaintiff  was  of  an  undi- 
vided share  or  interest  in  certain  property, 
and  entitled  him  to  a  proportionate  number 


of  shares  of  the  capital  stock  in  the  "Collins 
Oil  Company,"  an  incorporated  association, 
when  the  corporation  should  be  fuUy  organ- 
ized and  prepared  to  issue  stock  certificates. 

The  capital  stock  of  the  corporation  repre- 
sented the  interests  of  the  proprietors  of  the 
property,  of  whom  the  plaintiff  became  one 
by  his  purchase  of  the  defendants;  and  when 
he  should  receive  his  stock  certificate,  that, 
rather  than  the  assignment  and  transfer  from 
the  defendants,  would  represent  and  evidence 
his  ownership  of  the  property  and  interests 
purchased.  The  corporation  was  organized 
and  stock  certificates  were  issued  to  the  own- 
ers in  October,  1865.  The  defendants  of- 
fered to  show  that  the  plaintiff  applied  at  the 
office  of  the  company  for  his  stock,  and  that  it 
was  delivered  to  him  in  fulfillment  of  the 
contract  of  purchase  from  the  defendants, 
and  that  he  had  accepted  it  and  kept  it,  and 
had  Aever  returned  it  or  canceled  it,  or  of- 
fered so  to  do.  The  evidence  was  excluded 
upon  objection  by  the  plaintiff. 

It  was  said  by  both  counsel,  and  such  would 
seem  to  be  the  fact  from  the  evidence,  that 
the  plaintiff  received  his  stock  certificate  aft- 
er the  commencement  of  this  action.  If  so. 
It  was  necessarily  after  he  had  knowledge  of 
the  fraud  of  which  he  complains;  arid  the 
act  was  a  ratification  and  affirmance  of  the 
contract.  He  could  not  wfth  knowledge  of 
the  fraud  which  had  been  practiced  upon 
him,  take  any  benefit  under  the  contract,  or 
change  the  condition  of  the  property,  the 
subject-matter  of  the  contract,  and  then  re- 
pudiate the  contract.  The  taking  of  a  benefit 
Is  an  election  to  ratify  it,  and  concludes  him. 
He  cannot  be  allowed  to  deal  with  the  sub- 
ject-matter of  the  contract  and  afterward 
disaffirm  it.  The  election  is  with  the  party 
defrauded  to  afllrm  or  disaffirm  the  contract; 
but  he  cannot  do  both.  Masson  v.  Bovet,  1 
Denio,  69.  By  accepting  the  stock  certificate 
he  elected  to  abide  the  purchase.  But  If  the 
certificate  of  stock  was  received  before  the 
commencement  of  the  action,  and  before  the 
plaintiff  had  knowledge  of  the  fraud,  he  was 
bound,  upon  a  rescission  of  the  contract,  to 
restore  to  the  defendants  all  that  he  had  re- 
ceived from  them,  and  all  that  he  had  acquir- 
ed imder  it;  to  place  the  defendants  in  statu 
quo  as  near  as  practicable.  The  law  not  only 
requires  a  disaffirmance  of  the  contract  at  the 
earliest  practicable  moment  after  discovery  of 
the  cheat,  but  a  return  of  all  that  has  been 
received  under  it,  and  a  restoration  of  the 
other  party  to  the  condition  in  which  he 
stood  before  the  contract  was  made. 

To  retain  any  part  of  that  which  has  been 
received  upon  the  contract,  is  incompatible 
with  its  rescission.  Masson  v.  Bovet,  supra; 
Voorhees  v.  Earl,  2  Hill,  288;  Hogan  r. 
Weyer,  5  Hill,  389. 

The  contract  although  fraudulent  was  not 
Ipso  facto  void,  but  only  void  at  the  election 
of  the  plaintiff,  and  a  return  of  what  he 
had  received  under  it.  Where  a  party  had 
parted  with  goods  for  the  note  of  a  third  per* 


FRAUD. 


387 


son  upon  the  fraudulent  representations  of  the 
purchaser  as  to  the  solvency  of  the  maker, 
and  had  recovered  a  judjj;ment  upon  the  note, 
the  court  held  that  he  could  not  rescind  the 
sale  without  tendering  an  assignment  of  the 
judgment.     Baker  v     Robbins,    2   Denio,    loO. 

The  evidence  offered  was  material  upon 
the  question  of  aflinnance  of  the  contract, 
as  well  as  in  respect  to  the  acts  uecessarj'  on 
the  part  of  the  plaintilT  to  a  rescission  of  It, 
and  upon  the  right  of  the  plaintiff  to  recover 
the  money  paid,  and  should  have  been  ad- 
mitted. If  the  fact  had  been  proved,  as  of- 
fered, that  the  plaintiff  had  received  and 
kept  his  certificates  of  stock,  a  transfer  or 
deliverj'  of  these  certificates,  or  a  tender  to 
the  defendants,  was  necessary  to  a  complete 
rescission  of  the  contract,  and  the  evidence 
offered  was  competent  and  material.  It  fol- 
lows that  the  order  granting  a  new  trial 
must  be  affirmed  and  judgment  absolute  giv- 
en for  the  defendants. 

This  is  a  fit  ease  to  aUude  to  the  hazardous 
practice  which  is  becoming  so  general  of  risk- 
ing an  appeal  to  this  court  from  an  order 
granting  a  new  trial,  with  a  stipulation  made 
necessary  by  statute,  tliat  in  case  the  order 
is  affirmed,  judgment  absolute  shall  be  given 
against  the  party  appealing.  There  is  but 
n  single  class  of  cases,  and  the  individual 
cases  coming  witliin  it  are  rare,  in  which 
this  course  can  prudently  be  adopted.  It  is 
only  proper  and  admissible,  when  the  sole 
question  that  can  be  presented  upon  the  rec- 
ord relates  to  and  will  determine  the  merits 
of  the  controversy  imembarrassed  by  inci- 
dental questions  affecting  the  trial,  but  not 
necessarily  decisive  of  the  true  merits  of  the 


litigation.  If  every  fact  that  can  affect  't^c 
result  has  been  upon  the  trial  adjudged  fa^ 
vorably  to  the  party  against  whom  the  new 
trial  has  been  granted,  and  no  exceptions 
have  been  taken  to  the  admission  or  rejection 
of  evidence,  or  to  the  rulings  upon  minor  or 
Incidental  questions  In  the  progress  of  the 
trial,  which,  if  well  taken,  will  entitle  the 
exceptant  to  a  new  trial;  in  other  words,  if 
the  objections  and  exceptions  taken  at  the 
trial  and  to  the  recovery  cannot  be  obviated 
upon  a  second  trial,  but  the  verdict  and  judg- 
ment must  nece.s.sarily  be  adverse  to  the  par- 
ty against  whom  the  new  trial  has  been  grant- 
ed, if  the  order  and  decision  stand,  an  appi-al 
from  the  order,  with  the  stipulation  for  judg- 
ment absolute  in  case  the  order  is  sustained, 
may  be  advisable.  But  ordinarily,  as  in  this 
case,  there  are  exceptions,  which,  if  well  tak- 
en, will  entitle  the  unsuccessful  party  to  a 
new  trial,  but  the  decision  of  which  will  not 
finally  or  necessarily  determine  the  merits 
of  the  action  or  the  rights  of  the  parties;  and 
in  such  cases  the  exceptions  must  be  clearly 
frivolous  to  justify  the  hazard  of  an  appeal 
from  the  order  granting  a  new  trial,  with  the 
consent  to  a  judgment  absolute  upon  an  af- 
firmance of  the  order.  The  decisions  of  the 
questions  presented  by  the  re(;ord  in  this  case 
were  not  necessarily  fatal  to  the  plaintiff,  but 
they  are  made  so  by  the  appeal  from  tbe  or- 
der and  the  giving  of  the  ordinary  statutory 
stipulation,  and  the  plaintiff  loses  the  benefit 
of  a  second  trial. 

The  order  must  be  affirmed,  and  judgment 
absolute  for  the  defendants. 

AH    concur. 

Order  affirmed. 


358     n  EEALITY  OF  COXSEXT. 

ROWLEY  et  al.  v.  BIGELOW  et  al.i 


(12  Pick.  307.) 

Supreme  Judicial  Court  of  Massachusetts.    Suf- 
folk and  Nantucket.    March  19,  1832. 
Trover  for  627  bushels  of  yellow  corn,  val- 
ued at  55  cents  a  bushel. 

At  the  trial,  before  Wilde,  J.,  it  was  proved 
by  the  plaintiffs,   that  on  the  24 tb  of  May, 
1S30,  the  corn  belonged  to  them  and  was  in 
their  possession,  in  the  city  of  New  York,  on 
board  the  sloop  [Milan,  of  which  S.  Dunning, 
one  of  the  plaintiffs,  was  master,  and  that  it 
was    measured    and    delivered  on  board  the 
schooner  Lion.    Tney  alleged  that  one  William 
X.    Martin,    a    merchant   there,   fraudulently 
obtained   possession   of  it   by   pretending   to 
purchase  it  for  cash;  and  it  was  proved  that 
on  the  25th  of  May  he  shipped  it  on  board  the 
Lion,  consigned  to  the  defendants  at  Boston, 
and  tliat  the  vessel  sailed  in  the  afternoon  of 
that  day  for  Boston.     On  the  26tb,  Dunning, 
having    ineffectually    demanded  payment  for 
the  corn,  at  Martin's  counting-house,  proceed- 
ed to  Boston  to  reclaim  it    He  reached  Bos- 
ton before  the  arrival  of  the  Lion,  and  on  the 
20th  gave  notice  to  the  defendants,  to  whom 
by  Martin's  orders  the  corn  was  to  be  deliver- 
ed, that  Martin  had  fraudulently  obtained  it 
from  the  plaintiffs,  and  that  they  intended  to 
repossess     themselves     of    it    On    the   30th, 
when  the  Lion  had  arrived  in  Boston  harbour, 
Dunning  boarded  her  and  demanded  of  the 
master  possession  of  the  corn,  giving  him  no- 
tice that  Martin  had  obtained  it  fraudulently 
from  the  plaintiffs.    The  master  notwithstand- 
ing delivered  it  to  the  defendants;  after  which 
Dunning  demanded  it  of  them  and  tendered 
them  any  freight  or  charges  which  they  had 
paid.    They  refused  to  deliver  the  corn,  and 
thereupon  the  suit  was  commenced. 

In  order  to  establish  the  fraud  on  tne  part 
of  Martin,  tbe  plaintiffs  relied  on  the  deposi- 
tions of  C.  A.  Jackson  and  others,  merchants 
in  Xew  York,  who  testified  tii;it  Martin  had 
made  similar  purchases  of  thorn  about  the 
same  time,  and  under  circumstances  tending 
to  show  that  he  was  insolvent,  and  that  he 
knew  it  and  had  no  reasonable  expectation  of 
paying  for  the  merchandise  according  to  his 
contract  The  defendants  objected  to  the  ad- 
mission of  these  depositions,  but  the  judge 
permitted  them  to  be  read  to  the  jury. 

The  defendants,  to  establish  their  right  to 
hold  the  corn  against  the  plaintiffs,  offered 
in  evidence  a  bill  of  lading,  dated  May  17th, 
1S30,  signed  by  the  master  of  the  Lion,  pur- 
porting to  be  for  2000  bushels  of  yellow  corn 
shipped  by  Martin  and  consigned  to  the  de- 
fendants; also  an  invoice  corresponding  to 
the  bill  of  lading  and  purporting  to  be  for 
2000  bushels  of  corn  consigned  to  the  de- 
fendants for  sale  on  the  shipper's  account, 
and  signed  by  Martin;  also  a  letter  from 
Martin  to  the  defendants  dated"  May  17th 
(to  which  the  bill  of  lading  and  invoice  were 


1  Irrelevant  parts  omitted. 


annexed)  advising  that  he  valued  on  them 
in  favor  of  Heniy  Bennett  for  .$1000,  at  ten 
days'  sight,  and  directing  them,  if  he  had 
valued  too  much  on  this  shipment,  to  charge 
it  to  some  previous  one,  there  being  an  ex- 
isting account  between  Martin  and  the  de- 
fendants. And  it  was  proved  that  a  bill 
drawn  accordingly  by  Martin,  was  accepted 
by  the  defendants  on  the  20th  of  May  and 
paid  by  them  at  maturity. 

There  was  no  evidence  that  the  defendants 
had  any  knowledge  of  the  fraudulent  con- 
duct of  Martin,  but  it  appeared  that  they 
received  the  biU  of  lading  and  invoice  and 
accepted  the  draft  in  the  usual  course  of 
business. 

Upon  this  evidence  the  judge  ruled,  that 
the  defendants  had  a  good  title  to  the  prop- 
erty notwithstanding  the  fraudulent  conduct 
of  Martin,  and  notwithstanding  the  bill  of 
lading  had  been  signed  before  the  corn  was 
shipped;  to  which  the  plaintiffs  excepted. 

A  verdict  was  taken  for  the  defendants 
by  consent;  and  if  the  whole  court  should 
be  of  opinion  that  they  had  a  valid  title  to 
the  corn,  under  the  invoice  and  bill  of  lad- 
ing, judgment  was  to  be  rendered  upon  the 
verdict;  but  if  the  court  should  be  of  opinion 
that  the  ruling  was  wrong,  the  verdict  was 
to  be  set  aside  and  the  defendants  defaulted, 
unless  the  court  should  also  be  of  opinion 
that  the  depositions  above  mentioned  were 
improperly  admitted;  in  which  case  a  new 
trial  was  to  be  granted. 

Fletcher  and  W.  J.  Hubbard,  for  plaintiffs. 
Curtis,  for  defendants. 

SHAW,  C.  J.  The  first  question  arising  in 
this  cause  is,  whether  the  depositions  of 
Jackson  and  others,  under  the  circumstan- 
ces, ought  to  have  been  admitted  as  compe- 
tent. These  were  generally  persons,  of 
whom  Martin  had  made  similar  purchases, 
of  like  articles,  about  the  same  time,  and 
under  circumstances  tending  to  show  that 
he  was  insolvent  and  had  no  reasonable  ex- 
pectation of  paying  for  the  merchandise  ac- 
cording to  his  contract 

The  objection  to  this  evidence  is  placed 
on  two  grounds,  first,  that  these  persons 
having  similar  claims  of  their  own,  some 
of  which  are  pending  here,  they  have  an 
interest  in  establishing  the  fraud  which 
they  are  called  to  prove;  and  secondly,  that 
the  transactions  being  res  inter  alios,  have 
no  tendency  to  prove  the  fact  in  issue  in  this 
particular  case. 

But  in  our  opinion,  the  objection  cannot 
be  sustained  upon  eitlier  ground.  As  to  the 
first,  it  is  quite  clear,  that  the  verdict  and 
judgment  in  this  case  would  not  be  evidence 
in  either  of  theirs;  that  their  interest  is  in 
the  question  and  subject  matter  and  not  in 
the  event  of  the  suit,  and  therefore  that  the 
objection,  such  as  it  is,  goes  to  the  credit  and 
not  to  the  competency  of  the  witnesses.  As 
to  the  other  objection,  we  think  this  evidence- 


FRAUD. 


889 


has  a  direct  and  material  boarins  upon  the 
fact  in  issue.  It  tends  to  show,  th.it  at  the 
time  this  ostensible  purchase  was  ni:ide,  Mar- 
tin was  insolvent,  that  he  knew  he  was  in- 
solvent, that  he  had  no  reasonable  ground 
to  believe  that  he  could  pay  the  cash  and  did 
not  expect  or  intend  to  pay  tlie  casli  for  the 
merchandise  which  ho  purchased,  and  so  that 
he  obtained  the  goods,  by  false  pretenses. 
The  fact  of  insolvency,  of  his  knowledge  of 
his  insolvency,  and  that  he  had  no  expecta- 
tion or  Intenlion  of  paying  for  the  corn  iu 
question,  is  a  material  fact  and  the  principal 
fact  In  controversy  on  which  tbis  case  rests, 
and  Is  material  to  tbe  issue.  The  evidence 
Ijears  upon  the  question  quo  animo,  the  in- 
tent, the  fraudulent  purpose. 

2.  It  is  ne.xt  contended  ou  the  part  of  the 
plaintiffs,  that  no  property  passed  by  the 
fraudulent  purchase  of  Martin,  from  tbe  plain- 
tiffs to  him,  so  as  to  enable  him  to  make  a 
title  to  tlie  defendants. 

The  evidence  clearly  shows  that  there  was 
a  contract  of  sale  and  an  actual  deliveiy  of 
the  goods,  by  their  being  placed  on  board  a 
vessel,  pursuant  to  his  order;  and  this  deliv- 
ery was  unconditional,  unless  there  was  an 
implied  condition  arising  from  the  usage  of 
the  trade  that  tbe  delivery  was  to  be  consid- 
ered revocable,  unless  the  corn  should  be  paid 
for,  pursuant  to  the  contract  and  to  such 
usage.  This  contract  and  delivery  were  sutli- 
oient  in  law  to  vest  the  propertj'  in  Martin, 
and  make  a  good  title,  if  not  tainted  by  fraud. 
But  being  tainted  by  fraud,  as  between  the 
immediate  parties,  tbe  sale  was  voidable,  and 
the  vendors  might  avoid  it  and  reclaim  tbeir 
property.  But  it  depended  upon  them  to 
avoid  it  or  not.  at  their  election.  They  might 
treat  the  sale  as  a  nullity  and  reclaim  their 
!::;>od.s;  or  affirm  it  and  claim  the  price.  And 
»:i;-:".s   m?^   be  imagined,    where   the   vendor. 


notwithstanding  such  fraud,  practised  on  him, 
might,  in  cou.sequence  of  obtaining  security, 
by  attachment  or  otherwise,  prefer  to  affirm 
the  sale.  The  consequence  therefore  is,  that 
such  sale  is  voidable,  but  not  absolutely  void. 
The  consent  of  the  vendor  is  given  to  the 
transfer,  but  that  consent  being  induced  by 
false  and  fraudulent  representations,  it  is  cou- 
traiy  to  justice  and  right,  that  the  vendor 
should  suffer  by  It,  or  that  the  fraudulent  pur- 
chaser should  avail  himself  of  it;  and  upon 
this  ground,  and  for  tbe  benefit  of  the  vendor 
alone,  the  law  allows  him  to  avoid  it. 

The  difference  between  the  case  of  property 
thus  obtained,  and  property  obtained  by 
felony,  is  obvious.  In  tbe  latter  case,  no 
right  either  of  property  or  possession  is  ac- 
quired and  the  felon  can  convey  none. 

We  take  the  rule  to  be  well  settled,  that 
where  there  is  a  contract  of  sale,  and  an  ac- 
tual delivery  pursuant  to  It,  a  title  to  the  prop- 
erty passes,  but  voidable  and  defeasible  as  be- 
tween tbe  vendor  and  vendee,  if  obtained  by 
false  and  fraudulent  representations.  The 
vendor  tberefore  can  reclaim  bis  property-  a.s 
against  tbe  vendee,  or  any  other  person  claim- 
ing under  him  and  standing  upon  his  title, 
but  not  against  a  bona  fide  purchaser  without 
notice  of  the  fraud.  The  ground  of  exception 
in  favor  of  tbe  latter  is,  tbat  he  purchased  of 
one  having  a  possession  under  a  contract  of 
sale,  and  with  a  title  to  tbe  property,  tbough 
defeasible  and  voidable  on  the  ground  of 
fraud;  but  as  tbe  second  purcha.ser  takes 
without  fraud  and  without  notice  of  the  fraud 
of  the  first  purchaser,  he  takes  a  title  freed 
from  the  taint  of  fraud.  Parker  v.  Patrick, 
5  Term  R.  175.  The  same  rule  holds  in  re- 
gard to  real  estate.  Somes  v.  Brewer.  2  Pick. 
1S4. 

•         •••••• 

Judgment  on  tbe  verdict 


,so  ^^ 


V^ 


EEAUTY  OF  CONSENT 
MALLORT  V.  LEACH. 


(35  Vt.  156.) 


Supreme  Court  of  Vermont.    Rutland.    Feb. 
Term,  1862. 

Case.  The  declaration  set  forth  that  the 
plaintiff  was  the  owner  of  fifty  shares  of 
the  capital  stock  of  the  Franklin 
♦Minino;  Company,  of  the  true  value  'IS? 
and  situation  whereof  she  was  ig- 
norant, and  had  no  means  of  accurA.te  in- 
formation, and  that  the  defendant  under- 
took, at  her  request,  to  ascertain  and  com- 
municate to  her  the  value  of  such  stock; 
that  said  stock  was  worth  thirteen  hun- 
dred dollars,  which  the  defendant  ascer- 
tained, but  that  he,  contriving  and  intend- 
ing to  defraud  the  plaintiff,  and  to  obtain 
said  stock  from  her  at  much  less  than  its 
just  value,  did  not  communicate  to  the 
plaintiff  or  inform  her  of  its  true  value  or 
the  facts  in  relation  thereto,  but  fraud- 
ulentlyconcealcd  and  suppressed  thesame, 
and  fraudulently  induced  the  plaintiff  to 
believe  that  the  said  stock  was  of  much 
less  value  than  it  really  was,  and  also 
falsely  represented  that  the  same  was  oi 
much  less  value  than  it  really  was;  and 
also  falsely  represented  that  the  same  was 
about  to  be  subject  to  a  large  assessment, 
when  in  fact,  and  as  the  defendant  well 
knew,  said  assessment  was  only  tw"o  dol- 
lars upon  a  share;  that  by  means  thereof 
the  defendant  then  and  there  induced  the 
plaintiff  to  transfer  to  him  (and  for  his 
benefit, )the  said  stock  for  the  sum  of  two 
hundred  and  seventy-five  dollars  paid  her 
therefor  by  him,  being  much  less  than  its 
real  value  as  aforesaid;  that  the  plaintiff 
believed  and  relied  upon  said  representa- 
tions, and  was  wholly  ignorant  of  the 
facts  so  concealed  and  suppressed  by  the 
defendant  as  aforesaid,  and  of  the  true 
value  of  said  stock,  and  supposed  that  the 
defendant  had  fully  communicated  to  her 
his  knowledge  on  the  subject:  and  that 
she  therefore  did  transfer  said  stock  to  the 
defendant,  and  for  his  benefit,  for  said  last 
mentioned  sum  and  no  more;  and  that 
the  defendant  received  and  converted  the 
same  to  his  own  use,  and  immediately  sold 
the  same  for  the  sum  of  thirteen  hundred 
dollars  ;  and  that  thereby  the  plaintiff  took 
the  whole  value  of  said  stock  over  and 
above  the  sum  of  two  hundred  and  seven- 
ty-five dollai's,  to  wit:  ten  hundred  and 
twenty-five  dollars. 

Linsley  &  Prout  and  E.  J.  Phelps,  for 
plaintiff'  I).  Roberts,  E.N.  P>riggs,  and  D. 
E.  Jsichdison,  for  defendant. 

ALDIfS.J.  I.  As  to  the  alleged  variance, 
it  may  be  observed  that  it  consists  in 
averring  the  injury  occasioned  by  the 
plaintiff's  fraud  to  be  greater  than  it  was 
proved  to  be.  But  in  the  averment  of 
damages  it  is  not  necessary  to  be  exact; 
and  the  proof  need  not  sustain  the  allega- 
tions in  this  respect. 

II.  The  parol  evidence  was  admissible 
aa  tending  to  show  the  fraud — not  as 
qualifying  the  written  contract.  It  tend- 
ed to  show  a  special  confidence  and  rela- 
tion between  the  parties,  in  regard  to  this 
business,  and,  if  proved,  to  the  satisfac- 
tion of  the  jury,  to   have  existed   in   the 


outeet,  and  to  have  continued  to  the  time 
of  the  re-purchase  b^-  the  defendant,  must 
materially  have  given  character  to  both 
the  defendant's  words  and  silence,  as  in- 
tended to  induce  the  plaintiff  to  act  under 
a  delusion.  This  leads  us  to  the  main 
point,  viz.:  the  testimony  on  the  part  of 
the  plaintiff,  and  the  charge  of  the  court 
in  regard  to  it. 

The  testimony  of  the  plaintiff  tended  to 
show,  that  the  defendant,  in  advising  her 
to  buy  the  fifty  shares  of  mining  stock, 
professed  to  act  as  her  friend,  from  a  de- 
sire to  invest  her  money  so  as  to  make  her 
inde])endent,  and  in  a  mode  that  was  to 
be  kept  secret  from  all  but  her  father  and 
mother,  and  with  his  own  guarantee  that 
she  should  get  back  her  money  and  at 
least  twenty  per  cent,  interest.  He  told 
her  that  as  he  was  interested  in  the  stock 
he  would  keep  her  informed  as  to  its  situ- 
ation and  value,  and  that  he  should  go  to 
the  mines  in  June,  IbifiO.  This  declaration 
of  the  defendant  is  to  be  considered  in  con- 
nection with  the  fact  that  by  the  written 
contract  she  was  to  decide  on  the  1st 
July,  1S59,  to  keep  or  to  sell  her  stock. 
That  such  language  would  strongly  tend 
to  beget  confidence  and  trust  in  the  de- 
fendant, and  lead  the  plaintiff  to  rely 
•166  upon  his  advice,  and  to  be  *guided 
by  it  on  his  expected  return  from 
the  mines  in  June,  1850,  is  obvious.  This 
must  have  been  the  purpose  for  which  he 
thus  advised  her;  and  we  think  he  must 
have  been  aware  of  the  effect  that  it  pro- 
duced on  her  mind  at  that  time.  Now  if 
this  relation  of  trust  and  confidence  con 
tinned  from  December,  1857,  when  she 
bought  the  stock,  to  July,  1S59,  when  she 
sold  it  to  the  defendant,  and  he  at  the  time 
of  his  purchase  knew  that  she  thus  trust- 
ed in  and  relied  upon  his  friendship  and  ad- 
vice in  this  matter,  it  was  clearly  his  duty 
to  tell  her  of  its  real  value,  and  it  was  a 
fraud  to  take  advantage  of  her  ignorance 
and  buy  it  at  about  a  quarter  of  its  mar- 
ket price.  But  if  during  this  period  of  time 
this  relation  of  confidence  ceased  to  exist, 
and  alienation  and  distrust  had  taken  its 
place,  then  it  is  obvious  that  he  could  not 
have  supposed  she  was  relying  upon  his 
friendship  and  advice  in  this  business,  and 
was  not  under  obligation  to  give  her  in- 
formation in  regard  to  the  value  of  her 
stock. 

There  was  testimony  on  the  part  of  the 
defendant  tending  to  establish  this  state 
of  facts.  The  fraud  of  the  defendant  (if 
any)  consisted  in  taking  advantage  of  the 
confidence  which  he  knew  the  plaintiff  put 
in  him,  and  which  he  had  sought  to  win; 
but  if  she  had  lost  her  confidence  in  him, 
he  could  no  longer  take  advantage  of  it. 

The  court  distinctly  stated  to  the  jury 
that  no  obligation  rested  upon  the  defend- 
ant by  virtue  of  the  contract  to  inform 
her  of  the  real  value  of  the  stock.  To 
have  required  that  would  have  been  to 
add  a  new  clause  to  the  contract.  The 
court  then  proceeded  to  refer  to  those  cir- 
cumstances which  gave  rise  to  a  relation 
of  trust  and  confidence  betv.ecnthe  parties 
In  this  matter,  and  made  it  the  duty  of  the 
defendant  to  inform  her  of  what  he  knew 
as  to  the  value  of  the  stock,  and  then  said 
to  the  jury,  "because  he  had  placed   him- 


FllAUD. 


391 


self  iu  such  a  relation  it  would  be  a  fraud 
In  liim  to  receive  back  tlie  stock  without 
giviiip:  her  the  knowie(l;;e  he  possesKcd." 
Tliis  put  the  case  cle.-irly  on  the  ground  of 
fraud  in  takinj?  advaiitnfj^e  of  a  confidence 
he  had  souf^ht,  and  which  he  knew  was 
placed  in  him. 

The  doubt  we  have  felt,  In  rej^ard  to  the 
correctness  of  the  charjj^e  in  this  respect, 
is  whether  tlie  court  siiirR-iently  called  the 
attention  of  tlie  jury  to  the  fact  tliat 
this  relation  of  confidence  *iniist  ex-  *167 
ist  between  the  parties  at  the  time  of 
the  re-purchase  by  the  defendant,  and  to 
tliose  circumstances  shown  on  the  part  of 
the  defendant  tending?  to  prove  that  the 
relation  had  ceased  to  exist.  AVe  have 
carefully  examined  the  exceptions  on  this 
point,  and  can  not  but  regret  that  the 
statement  in  this  respect  is  not  more  sat- 
isfactory. It  does  not  appear  that  tlie  de- 
fendant in  his  requests  to  the  court  called 
their  attention  to  this  part  of  the  defence, 
or  made  any  request  in  regard  to  it.  The 
defendant's  evidence  was  admitted.  The 
court  treated  the  promise  of  tlie  defend- 
antto  inform  hurof  thesituation  and  value 
of  thestock  from  limetotimeas  aeontinn- 
ing  promise,  and  seem  to  carry  theidea  that 
the  plaintiff  must  havecontinued  torely  on 
it.  Asthereis  no  direct  request  to  charge  in 
regard  to  this  part  of  the  defence,  and  as 
no  exception  was  taken  on  the  ground  of 
an  omission  in  this  respect;  and  as  It 
would  have  been  the  duty  of  the  defendant 
to  have  called  the  attention  of  the  court 
to  tins  point,  if  not  sufliciently  referred  to 
in  the  ch^irge,  and  as  the  general  tenor  of 
the  charge  seems  to  require  that  the  con- 
fidence should  have  existed  at  the  time  of 
the  re-sale,  we  think  we  should  not  be  jus- 
tified in  opening  the  case  on  this  ground. 

The  defendant  further  claims  that  the 
charge  of  the  court  in  regard  to  the  rep- 
resentation made  by  the  defendant,  that 
there  was  about  to  be  a  large  assessment 
made  upon  tlie  stock,  was  incorrect.  The 
substance  of  the  charge  is, — if  the  defend- 
ant said  this  with  a  view  to  mislead  the 
I»laintiff  as  to  the  value  of  the  stock — if 
the  fact  was  calculated  to  depreciate  its 
value  and  to  induce  her  to  sell  at  a  price 
less  than  the  value,  and  she  was  thereby 
deceived  and  induced  to  sell,  he  would  be 
liable  unless  he  disclosed  his  knowledge  of 
facts  tending  to  enhance  its  value. 

1.  This  does  not  assume  as  matter  of 
law.  that  the  fact  would  depreciate  its 
value  and  induce  her  to  sell.  That  ques- 
tion is  left  to  the  jury.  It  is  obvious  that 
ordinarily  an  assessment  of  •2.")  per  cent,  up- 
on stock,  unexi)lained,  would  lead  the 
holder  to  suspect  something  migiit  be 
wrong;  especially  if  it  was  not  expected 
by  stockholders  that  such  an  additional 
payment  was  to  be  made.  So  if  the  hold- 
er of  the  stock  was  a  poor  person,  and  un- 
able without  trouble  and  incon ven- 
ules icnce  to  raise  the  sum  assessed,  it 
*would  tend  to  induce  such  person 
to  sell  the  stock.  We  think  the  evidence 
admissible  as  tending  to  show  that  the 
defendant  made  declarations  which  he 
must  have  been  aware  would  embarrass 
the  plaintiff  and  lead  her  to  wish  to  part 
with  her  stock. 

It   was  telling  the  truth,   but  not  the 


whole  truth.  It  was  telling  it  in  a  man- 
ner to  produce  the  effect  of  a  falsehood. 
The  defendant  must  have  felt  that  what 
he  said  would  depress  the  plaintiff's  esti- 
mate of  herstock — would  lead  hertotiiink 
its  value  much  less  than  it  was;  and  he 
knew  she  was  ignorant  of  its  true  value. 
Now  he  migiit  be  silent — migiit  say  noth- 
ing; but  he  had  no  right  t<j  produce  a  de- 
lusion by  his  language',  and  kiujwingly  take 
advaiitaj;e  of  it  f(jr  Ills  own  benefit.  This 
was  not  fair  dealing,  and  was  very  prop- 
erly characterized  in  the  charge  of  the 
court. 

HI,  It  is  furtherclaimed  that  the  receipt 
by  the  plaintiff  of  the  amount  of  the  note 
given  f(jr  the  stock,  after  she  knew  of  the 
fraud,  was  a  ratification  of  the  contract, 
so  that  she  can  not  now  sue  for  the  deceit. 

Let  us  consider  what  the  rights  of  the 
parties  were  wlien  the  defendant  had  by 
fraud  procured  a  transfer  of  the  stock  to 
himself. 

1.  As  to  the  defendant  it  is  obvious  that 
he  could  not  take  advantage  of  his  own 
wrong — he  could  not  rescind  the  contract, 
but  was  bound  by  it  to  pay  the  note. 

2.  As  to  the  plaintiff,  as  fraud  avoided 
the  contract,  she  had  the  right,  if  she  saw 
fit,  upon  discovery  of  the  fraud,  to  treat 
the  contract  as  wholly  at  an  end — to  re- 
turn to  the  defendant  his  note  and  de- 
mand a  re-conveyance  of  the  stock.  This 
would  been  to  rescind  or  disafhrm  the 
contract.  If  she  thought  that  thestock 
would  continue  to  advance  in  value  and 
remain  a  highly  profitable  investment. she 
might  have  deemed  it  for  her  interest  to 
have  back  the  stock  ;  and,  in  order  to  ac- 
complish this,  she  should  have  given  no- 
tice immediately  to  the  defendant  that  she 
disafhrmed  the  contract  and  demanded 
back  her  stock.  But  she  was  not  bound 
to  do  this.  She  might  claim  what  was 
due  her  by  contract,  and  also  rely  upon 
her  right  to  recover  her  damages  for  the 
amount  of   which  she  had   been  defrauded 

—  which  would  be  the  difference  be- 
*1G9    tweeu     what    the     defendant     had 

•^agreed  to  pay  her  for  the  stock  and 
its  true  value.  In  such  case  she  would 
have  ratified  the  contract,  but  would  not 
have  thereby  waived  her  claim  to  dam- 
ages. 

The  fallacy  of  the  defendant's  claim  is 
this:  that  it  supposes  a  ratification  of 
the  contract  to  be  a  waiver  of  the  right  to 
recover  damages.  Not  at  all.  The  plain- 
tiff has  the  right  to  hold  the  defendant  to 
his  contract,  and,  also,  to  recover  of  him 
comjiensation  for  the  injury  occasioned  by 
his  fraud.  How  can  the  defendant  com- 
plain of  this?  It  is  but  making  the  plain- 
tiff good.  It  can  not  injure  the  difend- 
ant,  or  deprive  him  of  any  defence,  or  im- 
pair any  right. 

If  the  plaintiff  had  seen  fit  to  rescind  the 
contract,  but  had  waited  an  tinreasonable 
time  before  giving  notice, —pondering  ui)on 
the  fluctuations  and  chances  of  the  market 
before  making  a  decision — the  defendant 
might  perhaps  say  witli  justice  that  such 
delay  tended  to  deprive  him  of  his  reason- 
able opportunity  to  sell,  and  that  he  might 
well  suppose  she  had  concluded  to  ratify  the 
sale  and  ask  not  forherstock.  but  only  for 
damages.     Her  right  to  her  damages  was 


39: 


llEALITY  OF  COXSEXT. 


perfect  when  the  fraud  was  committtd. 
It  is  a  risrht  not  Icijally  to  be  extiuj?uished 
but  by  cbuipensation  or  by  voluntary  re- 
lease. To  infer  a  release  of  the  damage 
from  her  receiving  payment  of  the  nolo 
would  be  putting  an  unreasonable  con- 
struction on  the  act.  She  thereby  takes 
wliat  the  defendant  agreed  to  pay,  aud 
neither  claims  nor  relinquishes  her  rights 
growing  out  of  the  fraud. 

The  case  cited  by  tlie  defendant  from  9 
B.  &  C.  59.  only  shows  thHt  though  the 
vendor  of  goods  sold  through  fraud  and 
upon  a  credit  might  sue  in  trover  for  the 
goods  before  the  credit  expires,  yet  if  he 
proceed  upon thecontractof  sale  he  cannot 
sue  till  the  credit  lias  expired.  The  princi- 
ple of  that  case  does  not  conflict  with  the 
plaintiffs  right  to  recover  his  damages 
after  receiving  payment  of  the  note.  When 
he  sues  upon  the  contract  he  must  be 
bound  by  it,  but  when  damage  results 
from  the  fraud  beyond  what  he  can  recov- 
er by  contract,  he  can  also  recover  in  an 
action  on  the  case  for  the  deceit. 

In  2  Pars,  on  Contracts  27S,  in  a  note, 
it  is  said,  "If  a  party  defrauded  brings  an 
action  on  the  contract  to  enforce  it,  he 
thereby  waives  the  frauds  and  aflfirms 
the  contract."  The  *authorities  cit-  *170 
ed  to  sustain  this  are  5  M.  &  AV.  83, 
and  24  Wendell  74. 

In  Selway  v.  Fogg,  5  M.  &  W.  83,  the  ac- 
tion was  assumpsit  for  work  in  carting 
away  rubbish.  The  plaintiff,  induced  by 
the  fraudulent  representations  of  the  de- 
fendant as  to  the  depth  of  the  rubbish, 
agreed  to  do  the  work  lor  £15,  which  had 
been  paid  him.  He  sought  by  this  action 
to  recover  for  the  value  of  his  work  above 
the  £15.  It  appeared  that  the  plaintiff 
had  knowledge  of  the  circumstances  indic- 
ative of  the  fraud  before  the  work  was 
finished.  Upon  the  trial,  Abinger,  C.  B., 
was  of  the  opinion,  that  the  question  of 
fraud  was  not  open  to  the  plaintiff  in  the 
present  action,  although  it  might  be  the 
subject  of  complaint  in  another.  Upon 
hearing  in  the  Exchequer,  Abingkk,  C.  B., 
said  "a  party  can  not  be  bound  by  an  im- 
plied contract  when  he  has  made  a  specific 
contract  which  is  avoided  by  fraud.  If  he 
repudiate  the  contract  on  the  ground  of 
Iraud,  as  he  maydo.he  has  a  remedybyan 
action  for  deceit.  "  So  far  the  opinion  stands 
upon  solid  ground,  and  was  required  for 
the  decision  of  the  case.  But  when  the  Chief 
Baron  proceeds  to  say  "secondly,  the 
plaintiff  had  full  knowledge  of  all  thatcon- 
stituted  the  fraud,  during  the  work,  and 
as  soon  as  he  knew  it  he  should  have  dis- 
continued tlie  work  and  repudiated  the  con- 
tract, or  he  must  be  bound  by  its  terms," 
if  he  means,  that  the  plaintiff  could  not 
in  such  ca.se  recover  for  the  damage  he 
suffered  from  the  fraud  in  an  action  for 
the  deceit,  he  says  what  was  not  required 
for  the  decision,  and  what  we  deem  unten- 
able as  a  rule  of  law.  Consider  in  what 
a  position  the  plaintiff  is  put  by  the  ap- 
plication of  such  a  rule.  He  proceeds  with 
his  work  till  it  is  in  part  done,  and  then 
discovers  "circumstances  indicative  of 
fraud."  He  maybe  fully  convinced  tiiat 
he  has  been  defrauded,  and  yet  feel  great 
doubt  that  he  can  prove  it.  He  says  to 
himself,  ''If  I  proceed  and   finish  the  work 


I  shall  be  entitled  in  any  event  to  the  con- 
tract price.  If  I  stop  and  fail  to  prove 
fraud,  I  can  not  recover  forthe  work  I  have 
done.  If  I  proceed  and  finish  the  work 
and  still  shall  be  able  to  prove  fraud,  why 
should  1  not  be  entitled  to  recover  the  full 
value  of  all  my  work;  why  should  I  be 
bound  to  a  contract  price  to  which  mj' con- 
sent was  procured  through  fraud?  How 
does  my  going  on  with  the  work 
*171  ^injure  the  defendant,  or  purge  his 
fraud?  If  he  has  been  guilty  of 
fraud  he  knows  it,  and  needs  no  notice 
from  me  to  put  him  on  restitution."  If, 
however,  the  going  on  with  the  contract 
injures  the  defendant's  rights,  or  puts  him 
in  a  worse  condition  than  he  would  be  by 
rescission,  then  the  plaintiff  ought  not  to 
go  on,  but  to  stop  and  give  notice.  But 
the  defendant  can  not  justly  claim  it  as 
his  right,  not  to  have  the  work  done  at 
all  unless  he  can  have  the  advantage  of 
his  fraud,  and  get  it  done  for  less  than 
its  fair  value.  When  he  agreed  to  have 
the  whole  work  done,  and  decided  to  try 
to  get  it  done  for  less  than  its  value 
through  fraud,  he  should  have  consid- 
ered that  the  plaintiff  might  not  discover 
the  fraud  till  the  whole  work  was  done; 
or  might,  if  he  did  discover  it,  doubt  his 
ability  to  prove  it,  and  so  reasonably  go 
on  and  finish  the  work ;  and  yet,  in  either 
case,  it  would  be  flagrant  fraud  in  him  to 
pay  onlv  the  contract  price. 

The  S\  &  S.  R.  R.  Co.  v.  Row,  24  Wend. 
74,  was  where  the  defendant,  before  com- 
mencing the  work,  knew  of  the  alleged 
fraud,  and  had  all  the  knowledge  as  to  the 
fact  said  to  be  misrepresented  that  the 
plaintiff  had,  and  could  not  have  relied  on 
such  representation.  The  court  say,  "if 
the  truth  had  not  been  discovered  till  after 
the  performance  of  the  contract  had  been 
commenced,  a  different  question  would 
have  been  presented. " 

In  Kimball  v.  Cunningham,  4  Mass.  502, 
the  question  was  whether  the  defrauded 
party,  who  had  aflirmed  the  contract, 
could  retain  in  his  possession  personal 
property,  a  part  of  the  consideration, 
which  by  the  contract  was  to  pass  to  the 
other,  Held  that  the  contract,  if  affirmed, 
was  affirmed  as  a  whole,  and  that  tlie  de- 
fendant was  liable  in  trover  for  the  prop- 
ertv  so  withheld.  It  also  appeared  in  the 
case  tliat  the  defendant  had  sued  for  his 
damages  from  the  fraud  in  an  action  on 
the  case.  The  court  say,  by  this  action  it 
is  clear  he  has  made  his  election  to  con- 
sider the  contract  as  subsisting,  and  to 
recover  damages  for  the  breach  of  it. 

If  so,  the  fraud  was  not  waived  in  the 
sense  of  waiving  the  right  to  recover  dam- 
ages for  it. 

In  Campbell  v.  Fleming,  1  Ad.  &  El.  40, 
the  plaintiff  sought  in  an  action  of  as- 
suwjtait  to  recover  the  price  he  had  paid 
forshares  in  a  mining  company  which 
he  had  been  induced  to  buy  *by  *172 
fraudulent  representations.  After 
knowledgeof  thefraud  heconsolidated  the 
shares  with  other  property  in  a  new  com- 
pany, and  bad  sold  shares  in  the  new 
company.  Held,  that  such  sales  of  the 
new  shares,  after  knowledge  of  the  fraud, 
was  an  affirmance  of  the  contract,  so 
that  he  could  not  sue  for  and-  recover  back 


FRAUD. 


393 


his  purchase  11101103'.  The  decision  does 
not  touch  the  point  that  he  could  not  re- 
cover, in  an  action  for  the  deceit,  tbfe  dam- 
apres  he  Ruffored  by  it. 

The  whole  subject  Is  well  considered  in 
Whitney  v.  Allaire,  4  Denior>54;  and  the 
court  say:  '"riiere  is  no  principle  or  au- 
thority showiiifj:  that  where  a  person  has 
been  defrauded  by  another  in  iiiakin;jj  an 
executory  contract,  a  subsequent  perform- 
ance of  it  on  his  part,  even  with  iinowl- 
edge  of  the  fraud,  acquired  subsequent  to 
the  inakinc:  and  ijrcvious  to  the  perform- 
ance, bars  iiiiii  of  any  remedy  for  liis  dam- 
a^es  for  the  fraud.  The  party  defrauded, 
by   performing   his   part   of  the  contract 


with  knowledf^e  of  the  fraud,  i.s  deemed  to 
have  ratified  it,  and  is  precluded  thereby 
from  subsequently  disatlirminj?  it.  That 
Is  the  extent  of  the  rule.  His  ri^ht  of  ac- 
tion for  the  fraud  remains  unaffected  by 
Buch  performance.  I'.ut  having  gone  on 
after  discovering  the  fraud,  he  cannot  aft- 
erwards disaflirm  the  bargain,  or  sue  for 
the  consideration."  The  priuciule  and  its 
reason  apply  to  this  case.  Upon  this  sub- 
ject see  Long  on  Sales,  219.  240;  2  Kent's 
Com.4sO;  ?,  Frost.  (N.H.)  .-j2U:  10  Ind.  4.30; 
the  remarks  of  Siikrma.n,  J.,  in  14  Conn. 
424-425;  .".  .McLean,  170,  Fed.Cas.  .No.  6.;i4S; 
9Cush.  200. 

Judgment  afflrmed. 


894 


^ 


REALITY  OF  CONSENT 
(^0 


BROWN  V.  PIERCE.i     ^^J-/ 

(7  Wall.  205.)  Jf^ 

Supreme    Court    of    th(>    United    States.      Dec, 
1S6S. 

Error  to  the  supreme  court,  Nebraska  tern-  1 
tory. 

Brown  filed  his  bill  in  September,  1860,  In 
the  court  below  agaiust  three  persons,  Pierce, 
Morton,  and  Weston,  alleging  that  In  the 
spring  of  1S5T,  he  settled  upon  and  improved 
a  tract  of  land  near  Omaha;  that  he  erected 
a  house  on  the  tract  and  continued  to  occupy 
it  until  August  10th,  1S57,  when  he  entered 
the  tract  under  the  pre-emption  laws  of  the 
United  States;  that  Pierce  claimed  the  land 
by  virtue  of  the  laws  of  an  organization 
known  as  the  Omaha  Claim  Club;  that  this 
organization,  consisting  of  very  numerous 
armed  men,  sought  to,  and  did  to  a  great  ex- 
tent, control  the  disposition  of  the  public 
lands  in  the  vicinity  of  Omaha  in  1857,  in 
defiance  of  the  laws  of  the  United  States; 
that  it  frequently  resorted  to  personal  vio- 
lence in  enforcing  its  decrees;  that  the  fact 
was  notorious  in  Omaha,  and  that  he.  Brown, 
was  fully  advised  in  the  premises;  that  as 
soon  as  he  had  acquired  title  to  the  land, 
Pierce,  together  with  several  other  members 
of  the  club,  came  to  his  house  and  demanded 
of  him  a  deecTof 'tB6  land,  threatening  to  take 
^  life  by  hanging  him,  or  putting  him  in 
the  Missouri  river,  if  he  did  not  coiiiply  with 
tleTIemanUrtKat  the  club  had  posted  hand- 
bills calling  the  members  together  to  take  ac- 
tion against  him;  and  that  knowing  all  this, 
and  in  great  fear  of  his  life,  he  did,  on  the 
10th  of  August,  1S57,  convey  the  land  by  deed 
to  Pierce;  that  he.  Brown,  received  no  con- 
sideration whatever,  for  the  ccmveyance;  that 
fi-om  the  date  of  his  settlement  upon  said  land, 
until  the  time  of  filing  the  bill,  he  had  contin- 
ued to  keep  possession  either  actually  or  con- 
structively; that  Morton  claimed  an  interest 
in  the  premises  by  virtue  of  a  judgment  lien, 
and  that  Weston  also  made  some  claim. 

The  prayer  was,  that  the  deed  might  be  de- 
clared void,  and  Pierce  be  decreed  to  recon- 
vey,  and  for  general  relief. 

The  bill  was  taken  pro  confesso  as  to  all 
the  defendants,  except  Morton,  who  answered. 
This  answer,  stating  that  he,  Morton,  was 
not  a  resident  of  the  territory,  and  had  no 
knowledge  or  information  about  the  facts  al- 
leged in  the  bill,  but  on  the  contrary  was  an 
utter  stranger  to  them,  and  therefore  could  not 
answer  as  to  any  belief  concerning  them, — 
set  forth  that  on  the  28th  August,  1857,  Pierce 
was  "the  owner  and  in  posses.sion  of,  and  oth- 
erwise, well  seized  and  entitled  to,  as  of  a 
good  and  indefeasible  estate  of  inheritance  in 
fee  simple,"  the  tract  in  controversy;  that 
being  so,  and  representing  himself  to  be  so, 
and  having  need  of  money  in  business,  he 
applied  to  him,  Morton,  to  borrow  the  same, 

>  Irrelevant  parts  omitted. 


and  that  he,  Morton,  being  Induced  by  rea- 
son of  the  representation,  and  also  by  the- 
possession,  and  believing  that  he.  Pierce, 
was  the  owner,  he  was  thereby  induced  to 
lend,  and  did  lend  to  him  $6,000,  on  the  per- 
sonal security  of  him.  Pierce;  that  before  the 
fiUng  of  this  bill  by  Brown,  he,  Morton,  had 
obtained  judgment  against  Pierce  for  $3400, 
part  of  the  loan  yet  impaid;  that  this  judg- 
ment was  a  lien  on  the  lands;  and  that  as 
he,  Morton,  was  informed  and  believed,  if  he 
could  not  obtain  his  money  from  this  land, 
he  would  be  whoUy  defrauded  out  of  it. 

The  answer  further  stated  that  the  defend- 
ant was  informed  and  believed  that  Brown, 
the  complainant,  entered  upon  the  lands  as 
the  tenant  of  Pierce,  and  that  the  suit  by  the 
complainant  was  being  prosecuted  in  viola- 
tion of  the  just  rights  of  Pierce,  as  well  as  of 
him,  Morton. 

There  was  no  replication.  Proofs  were  tak- 
en by  the  complainant,  and  they  showed  to 
the  entire  satisfaction  of  the  court  that  all 
the  matters  alleged  in  the  bill  and  not  denied 
by  the  answers,  were  true.  There  thus  seem- 
ed no  doubt  as  to  the  truth  of  all  the  facts 
set  out  in  the  bill. 

The  court  below  declared  Brown's  deed 
void,  and  decreed  a  reconveyance  from  Pierce 
to  him,  and  that  neither  Morton  nor  Weston 
had  any  lien  on  the  premises.  Morton  now 
brought  the  case  here  for  review. 


Carlisle  &  Woolworth,  for  appellant 
ick  &  Briggs,  contra. 


Red- 


Mr.  Justice  CLIFFORD  delivered  the  opin- 
ion of  the  court 

Representations  of  the  complainant  were, 
that  on  the  tenth  of  August,  1857,  he  ac- 
quired a  complete  title  to  the  premises  de- 
scribed in  the  bill  of  complaint,  imder  the 
pre-emption  laws  of  the  United  States,  and 
that  thereafter,  on  the  same  day,  he  was  com- 
pelled, through  threats  of  personal  violence 
and  fear  of  his  life,  to  convey  the  same, 
without  any  consideration,  to  the  principal 
respondent  Framed  on  that  theory,  the  bill 
of  complaint  alleged  that  the  first-named  re- 
spondent was  at  that  time  a  member  of  an 
unlawful  association  in  that  territory,  called 
the  Omaha  Claim  Club,  and  that  he,  accom- 
panied by  three  or  four  other  persons  belong- 
ing to  that  association,  came  to  'his  house  a 
few  days  before  he  perfected  t^is  right  of  pre- 
emption to  the  land  in  question,  and  told  the 
complainant  that  if  he  entered  the  land  under 
his  pre-emption  claim,  he  must  agree  to  deed 
the  same  to  him,  and  added,  that  unless  he 
did  so,  he,  the  said  respondent  and  his  asso- 
ciates, would  take  his  life;  and  the  complain- 
ant further  alleged,  that  the  same  respondent, 
accompanied,  as  before,  by  certain  other 
members  of  that  association,  came  again  to 
his  house  on  the  day  he  perfected  his  pre- 
emption claim,  and  repeated  those  threats  of 
personal  violence,  and  did  other  acts  to  lOr 


DURESS. 


395 


tlmlflato  him,  and  Induce  him  to  believe  that  ' 
thc3'   would  cavvy  out  their  throats  if  he  re- 
fused to  execute  tlie  deed  as  required. 

Based  upon  those  allejcation.s,  the  charge  is 
that  the  complainant  was  put  in  duress  by 
those  threats  and  acts  of  intimidation,  and 
that  he  sigrned  and  executed  the  deed,  and 
conveyed  the  land  by  means  of  those  threats 
and  certain  acts  of  intimidation,  and  through 
fear  of  hLs  life,  and  without  any  considera- 
tion; and  he  prayed  the  court  that  the  con- 
veyance might  be  decreed  to  be  inoperative 
and  vtiid,  and  that  the  grantee  might  be  re- 
quired to  reconvey  the  same  to  the  complain- 
ant. 

*  •  •         *  •  •  • 

Argument  to  show  that  a  deed  or  other 
written  obligation  or  contract,  procured  by 
means  of  duress,  is  inoperative  and  void,  Is 
hardly  required,  as  the  proposition  is  not  de- 
nied by  the  respondent  Actual  violence  is 
not  necessary  to  constitute  duress,  even  at 
common  law,  as  understood  in  the  parent 
countx'y,  because  consent  is  the  very  essence 
of  a  contract,  and,  if  there  be  compulsion, 
there  is  no  actual  consent,  and  moral  compul- 
sion, such  as  that  produced  by  threats  to  take 
life  or  to  inflict  great  bodily  harm,  as  well  as 
that  produced  by  imprisonment,  is  everywhere 
regarded  as  sufficient,  in  law,  to  destroy  free 
agency,  without  which  there  can  be  no  con- 
tract, because,  in  that  state  of  the  case,  there 
is  no  consent 

Duress,  in  its  more  extended  sense,  means 
that  degree  of  constraint  or   danger,  either 
,   actually  inflicted  or  threatened  and  impond- 
.    ing,  which  is  sufficient,  in  severity  or  in  ap-  j 
\  prehension,  to  overcome  the  mind  and  will  of/ 
\a  person  of  ordinary  firmness. 

Text-writers  usually  divide  the  subject  into 
two  classes,  namely,  duress  per  minas  and 
duress  of  imprisonment  and  that  classiflca- 
tion  was  uniformly  adopted  in  the  early  his- 
tory of  the  common  law,  and  is  generally  pre- 
served in  the  decisions  of  the  English  courts 
to  the  present  time,  2  Inst  482;  2  Rolle, 
Abr.  124. 

Where  there  is  an  arrest  for  an  improi)er 
purpose,  without  just  cause,  or  where  there 
is  an  arrest  for  a  just  cause,  but  without  law- 
ful authority,  or  for  a  just  cavise,  but  for  an 
unlawful  purjiose,  even  though  under  proper 
process,  it  may  be  construed  as  duress  of  im- 
prisonment; and  if  the  person  arrested  exe- 
cute a  contract  or  pay  money  for  his  release, 
he  may  avoid  the  contract  as  one  procured  by 


duro,ss,  or  may  recover  back  the  money  in  an 
action  for  money  had  and  received.  Richard- 
son V.  Duncan,  3  N.  H.  508;  Watkins  v. 
IJaird,  G  ^Lass.  511;  Strong  v.  Graunis,  20 
Barb.  124. 

Second  class,  duress  per  minas,  as  defined 
at  common  law,  is  where  the  party  enters 
into  a  contract  (1)  for  fear  of  loss  of  life;  (2) 
for  fear  of  loss  of  limb;  (3)  for  fear  of  may- 
hem; (4)  for  fear  of  imprisonment;  and  many 
modern  decisions  of  the  courts  of  that  coun- 
try still  restrict  the  operations  of  the  rule 
within  those  limits.  3  Bac,  Abr.  tit  "Du- 
ress," 252. 

They  deny  that  contracts  procured  by  men- 
ace of  a  mere  battery  to  the  person,  or  of 
trespass  to  lauds,  or  loss  of  goods,  can  be 
avoided  on  that  account,  and  the  reason  as- 
signed for  this  qualification  of  the  rule  is, 
that  such  threats  are  held  not  to  be  of  a  na- 
ture to  overcome  the  mind  and  will  of  a  firm 
and  prudent  man,  because  it  is  said  that  if 
such  an  injury  is  inflicted,  sufficient  and  ade- 
quate redress  may  be  obtained  in  a  suit  at 
law. 

Cases  to  the  same  effect  may  be  found  also 
in  the  reports  of  decisions  in  this  country, 
and  some  of  our  text-writers  have  adopted 
the  rule,  tliat  it  is  only  where  the  threats  ut- 
tered excite  fear  of  death,  or  of  great  bodily 
harm,  or  unlawful  imprisonment,  that  a  con- 
tract, so  procured,  can  be  avoided,  because, 
as  such  courts  and  authors  say,  the  persou 
threatened  with  slight  injurj-  to  the  penson. 
or  with  loss  of  property,  ought  to  have  suffi- 
cient resolution  to  resist  such  a  threat,  and  tu 
rely  upon  the  law  for  his  remedy. 

On  the  other  hand,  there  are  many  Amer- 
ican decisions,  of  high  authority,  which  adopt 
a  more  liberal  nile,  and  hold  that  contracts 
procured  by  threats  of  battery  to  the  persou, 
or  the  destruction  of  property,  may  be  avoid- 
ed on  the  ground  of  duress,  because  in  such 
a  case  there  is  nothing  but  the  form  of  a  con- 
tract, without  the  substance. 

But  the  case  under  consideration  presents 
no  question  for  decision  which  requires  the 
court  to  determine  which  class  of  those  cases 
is  correct,  as  they  all  agree  in  the  rule  that  a 
contract  procured  through  fear  of  loss  of  life, 
produced  by  the  threats  of  the  other  party  to 
the  contract,  wants  the  essential  element  of 
consent,  and  that  it  may  be  avoided  for  du- 
ress, which  is  sufficient  to  dispose  of  the  pres- 
ent controversy. 


896 


REALITY  OF  CONSENT. 


SFAIDS  V.  BARRETT  et  aL» 

(57  111.  2S9.)  ^ 


■z^'^ 


Supreme    Court    of    Illinois.    September    Term, 
1870. 

Appeal  from  t±ie  superior  court.  Cook  coun- 
ty;   Joseph  E.  Gary,  Judge. 

Sleeper  &  Wbiton,  for  appellant  Henry  S. 
Monroe,  for  appeUees. 

THORNTON,  J.  The  question  presented 
in  this  case,  as  to  the  sufficiency  of  the  dec- 
lai-ation,  will  be  considered  as  on  motion  'xs. 
ai-rest  of  judgment. 

The  demurrer  was  properly  sustained  to 
the  second  count  It  is  nothing  more  than  a 
count  in  slander,  based  upon  an  alleged  libel- 
lous affidavit  filed  in  a  legal  proceeding. 
Whatever  is  said  or  written  in  such  proceed- 
ing, pertinent  and  material  to  the  matter  in 
controversy,  is  privileged,  and  no  action  can 
be  maintained  upon  it  1  HiL  Torts.  344; 
Warner  v.  Paine,  2  Sandf.  195;  Garr  v.  Sel- 
den,  4  N.  Y.  91. 

The  first  count  alleges  that  the  plaintiff  was 
a  dealer  in  oysters,  and  doing  a  large  and 
lucrative  business,  and  was  indebted  to  ap- 
pellees for  transportation,  &c,  in  the  sum  of 
§1,000,  which  he  was  able  and  willing  to 
pay;  and  that  they,  maliciously  intending  to 
injure  him  and  deprive  him  of  his  business, 
procured  Barrett,  one  of  appellees,  to  make 
an  affidavit  and  that  he  did  make  an  affida- 
vit that  plaintiff  was  indebted  to  the  express 
company  in  the  sum  of  5;2,996.30,  for  trans- 
portation, &c.,  and  that  he  had  fraudtilently 
conveyed  and  assigned  his  property,  and  was 
about  fraudulently  to  conceal,  assign,  or 
otherwise  dispose  of  his  property,  so  as  to 
hinder  and  delay  his  creditors;  and  that  ap- 
pellees then  filed  said  affidavit  with  the  clerk 
of  the  circuit  court  of  Cook  coimty,  and  ob- 
tained a  writ  of  attachment,  and  procured 
the  levy  thereof  upon  .^5,000  worth  of  oysters, 
and  deprived  the  plaintiff  of  possession,  and 
neglected  to  take  care  of  them,  by  reason 
whereof  they  became  of  no  value. 

The  declaration  further  alleges  that  it  was 
not  true  that  the  plaintiff  had  fraudulently 
conveyed  or  assigned,  or  intended  to  conceal 
and  assign,  his  property,  so  as  to  hinder  and 
delay  his  creditors;  that  he  was  not  indebt- 
ed in  the  amount  mentioned  In  the  affidavit; 
and  that  the  same  was  false  and  fraudulent, 
and  well  known  to  be  so  by  appellees;  and 
that  they,  wickedly  and  maliciously  intend- 
ing to  injure,  and  extort  a  large  sum  of 
money  from,  him  (nearly  $2,000  more  than 
was  due  upon  a  fair  accounting),  refused  to 
permit  the  oysters  to  be  delivered  to  him,  ex- 
cept on  the  payment  of  the  sum  in  the  affi- 
davit mentioned;  and  that  he,  under  protest 
and  to  save  his  property  from  utter  ruin,  paid 
the  same,  not  knowing  that  the  oysters  had 

1  Irrelevant  parts  omitted. 


sustained   serious    injury,    by   reason   of   the 
carelessness  of  appellees. 

To  this  count,  the  geneial  issue  and  a  spe- 
cial plea  of  release  were  liled. 

To  the  special  plea  the  plaintiff  replied  non 
est  factum,  and  that  the  release  was  ob- 
tained by  duress  of  property.  A  demurrer 
was  interposed  to  the  special  replication, 
which  was  sustained,  and  the  plaintiff  abided. 
Three  questions  are  raised  by  the  record, 
and  in  the  argument:  First.  Is  the  special 
replication  a  good  defense?  Second.  Is  not 
the  plaintiff  restricted  to  his  remedy  on  the 
attachment  bond?  Third.  Is  the  count  bad, 
on  motion  in  arrest,  for  omitting  to  aver  the 
termination  of  the  suit  and  the  want  of 
probable  cause? 

Upon  the  first  question  the  authorities  dif- 
fer. All  promises  made  and  contracts  en- 
tered into,  where  there  is  duress  of  the  per- 
son, may  be  avoided.  The  reason  is,  that 
the  person  is  induced  to  do  the  act  by  re- 
straint of  his  liberty,  or  menace  of  bodily 
harm.  But  it  has  been  held  that  an  agree- 
ment, made  under  duress  of  goods.  Is  not 
void,  and  that  the  person  thus  circumstanced 
must  exeit  himself  and  resist  the  compul- 
sory influence,  when  his  property  is  in  dan- 
ger. We  cannot  appreciate  the  difference. 
Liberty  and  life  are  justly  dear  to  all  men, 
and  so  is  the  exclusive  right  to  possess,  dis- 
pose of,  and  protect  from  destruction,  our 
property.  We  cannot  .fOi£gLet_.t±La-iactJ;hat 
the,  desire  for  property  is  a  stro.og.^afi<I- pre- 
dominant characteristic  of  man,  in  organized 
society.'  An  act  done,  prompted  by  this  de- 
sire to  preserve,  and  impelled  by  fear  of 
the  destruction  of  goods,  is  not  volimtary.  It 
is  an  act  of  compulsion.  In  Pashay  v.  Fergu- 
son, 5  Hill,  158,  Bronson,  J„  said:  "I  en- 
tertain no  doubt  that  a  contract  procured  by 
threats,  or  the  destruction  of  property-,  may 
be  avoided  on  the  ground  of  duress.  It 
wants  the  voluntary  assent  of  the  party  to 
be  bound  by  it.  Why  should  the  wrong-doer 
derive  advantage  from  his  tortious  act?" 

Consent  is  of  the  essence  of  all  contracts. 
Without  it  there  may  be  the  shadow,  but  not 
'  the  substance.  Money  paid,  as  the  only 
means  to  recover  the  possession  of  property 
to  which  the  party  is  entitled;  or,  money  paid 
to  obtain  possession  of  goods,  where  wrong- 
fully taken,  may  be  recovered  back.  Steph. 
N.  P.  1,  3.58;  Chase  v.  Dwinal,  7  Me.  134; 
Gates  V.  Hudson,  6  Exch.  34G;  Nelson  v. 
Suddarth,  1  Hen.  &  M.  350.  If  money  could 
be  recovered  back,  under  the  circumstances, 
why  is  not  the  release  void?  It  was  not  ob- 
tauied  with  the  consent  intended  by  the  law. 
Property,  which  required  especial  care,  had 
been,  by  fraud,  perjury  and  extortion,  wrong- 
fully taken;  was  of  a  perishable  nature,  and 
rapidly  going  to  destruction.  The  party  hav- 
ing possession  refused  to  surrender  on  pay- 
ment of  the  actual  indebtedness,  but  demands 
more  than  double  the  sum  due,  and  in  addi- 
tion thereto  a  release  for  all  damages  for  the 


DURESS. 


397 


wrongful  acts,— for  the  maliclons  violation 
of  right  and  law.  It  would  be  a  scandal  to 
a  court  of  Justice  If  a  release  priven  under 
such  circumstances  could  not  be  avoided. 
We  think  the  special  replication  a  sood  au- 
iiW-T  to  the  plea,  and  that  the  demurrer  should 


have  been  overruled.     Nelson  v.  Suddarth,  1 

Hen.  &.  M.  350;    Sasportas  v.  Jennings,  1  Bay. 

470;    Collins  v.  Westbcrry,  2  Bay,  2il;    Bane 

V.  Detrlck,  52  UL  19. 

•  ••••• 

Judgment  reversed. 


398 


KEALITY  or  CONSENT. 


ROBINSON  V.  GOULD.i 
(11  Gush.  55.) 


U^^ 


Supreme  .ludidal  Court  of  Massachusetts.    Sof 
folk  and  Nantucket-    March  Term,  1853. 

Assumpsit  upon  a  promissory  note,  dated 
August  24th,  1S51,  payable  to  the  plaintiff 
on  demand.  The  main  ground  of  defence 
was  duress  and  a  want  of  consideration.  At 
the  ti-ial  in  the  court  of  common  pleas,  be- 
fore AYells,  C.  J.,  the  defendant  offered  evi- 
dence tending  to  prove  that,  the  present 
plaintiff  having  a  noteagainst  oneGreenough, 
a  writ  against  him  was  given  to  a  constable, 
who  went  to  Greenough's  house  to  get  se- 
curity, or  to  arrest  him,  and  that  the  note  in 
suit  was  given  to  release  said  Greenough 
from  arrest  until  the  following  Tuesday. 
There  was  also  some  evidence  tending  to 
show  that  said  note  was  given  as  collateral 
security  that  said  Greenough  should  pay  the 
plaintiff  the  amount  of  his  claim,  on  or  be- 
fore the  following  Tuesday,  and  that  the 
proceedings  for  collecting  the  same  should 
be  suspended  until  that  time,  but  that  said 
Greenough  had  not  paid  said  indebtedness. 
It  was  admitted  that  the  constable  had  no 
legal  right  to  serve  said  writ  against  Green- 
ough, and  the  defendant  requested  the  pre- 
siding judge  to  i-ule  that  if  said  constable 
having  no  legal  right  to  serve  said  writ,  im- 
/  prisoned  said  Greenough,  and  threatened  to 
V  and  was  about  to  arrest  him,  and  thereby 
I  the  defendant  was  led  to  give  this  note,  it 
1  would  be  void;  and  that  if  said  constable  did 
V  not  disclose  to  the  defendant  what  he  knew 
touching  said  note  first  sued  on,  or  misled 
the  defendant,  to  think  he  was  becoming 
bail  merely,  this  note  would  be  void.  The 
judge  declined  so  to  instruct  the  jury,  but 
instructed  them  that  the  note  was  prima 
facie  evidence  of  a  debt  to  the  amount  speci- 
fied in  the  same,  and  that  the  burden  of 
proof  was  on  the  defendant  to  impeach  It; 
that  it  was  for  the  jury  to  decide,  in  view  of 
all  the  evidence,  as  to  the  agreement  made 
by  the  parties,  to  carry  out  which  the  note 
in  suit  was  given;  that  if  the  agreement  was, 
that  in  consideration  of  giving  the  note,  the 
constable  should  forbear  to  arrest  the  said 
Greenough,  or  should  release  him  if  arrest- 
ed, or  if  the  note  was  agreed  to  be  taken  as 
a  substitute  for  a  bail  bond,  in  either  of 
these  cases  as  the  constable  was  not  author- 
ized to  serve  the  writ,  the  note  would  be 
void;  but  if  the  note  was  given  as  collateral 
security  that  the  said  Greenough  should  pay 
the  first  note  by  the  next  Tuesday,  and  that 
the  plaintiff  should  give  credit  and  forbear 
asking  or  attempting  to  enforce  payment  on 
the  first  mentioned  note  until  the  said  Tues- 
day, and  the  plaintiff  did  give  said  credit  un- 
til said  time,  and  the  said  Greenough  omitted 
to  make  payment  on  that  day,  then  the  said 
note  was  valid  to  the  extent  of  the  amount 


1  Irrelevant  parts  omitted. 


of  the  first-mentioned  note,  and  interest,  and 
tliat  it  would  not  invalidate  the  note  to  prove 
that  the  same  was  given  in  consequence  of 
a  threat  to  arrest  the  said  Greenough,  if  the 
first-mentioned  note  was  not  secured,  or  by 
actually  arresting  him  on  said  writ,  if  the 
plaintiff's  agent  and  the  constable  supposed 
the  arrest  was  legal. 

The  jury  were  requested  to  find  specially 
whether  any  arrest  was  made,  and  they_ 
found  there  was  not.  The  verdict  was  for 
the  plaintiff  for  the  amount  of  the  first  note 
and  interest,  and  the  defendant  filed  his  ex- 
ceptions. 

J.  W.  Richardson,  for  plaintiff.  C  M.  EUis, 
for  defendant, 

BIGELOW,  J.  The  general  rule  of  law  Is 
well  established,  on  reasons  of  justice  and 
sound  policy,  that  contracts,  m  order  to  be 
valid  and  binding,  must  be  the  result  of  the 
free  assent  of  the  parties.  Therefore  duress, 
either  of  actual  imprisonment  or  per  minas, 
constitutes  a  good  defence  to  an  action  on  a 
contract  in  behalf  of  those  from  whom  con- 
tracts have  been  thus  extorted.  Duress  by 
menaces,  which  is  deemed  sufficient  to  avoid 
contracts,  includes  a  threat  of  imprisonment, 
inducing  a  reasonable  fear  of  loss  of  liberty. 
2  Rol.  Abr.  124;  2  Inst.  482,  483;  Bac  Abr. 
"Duress,"  A;  20  Am.  .Jur.  24;  Chit.  Cont. 
168.  It  is  also  well  settled  that  the  duress, 
which  will  avoid  a  contract,  must  be  offered 
to  the  party  who  seeks  to  take  advantage  of 
it.  This  was  early  adjudged  in  Mantel  v. 
Gibbs,  1  Brownl.  64,  where,  to  an  action  of 
debt,  brought  on  an  obligation,  the  defend- 
ant pleaded  that  a  stranger  was  imprisoned 
until  the  defendant,  as  surety  for  the  stran- 
ger, made  the  bond.  This  was  held  a  bad 
plea.  The  same  principle  is  laid  down  in 
Hanseombe  v.  Standing,  Cro.  Jac.  187,  where 
it  was  held  that  none  shall  avoid  his  own 
bond  for  the  imprisonment  or  danger  of  any 
other  than  of  himself  only,  and  although 
the  bond  be  avoidable  as  to  the  one,  yet  it 
is  good  as  to  the  other.  Wayne  v.  Sands,  1 
Freem.  351;  Shep.  Touch.  62;  McClintick  v. 
Cummins,  3  McLean,  158,  Fed.  Cas.  No.  8,- 
699. 

And  certainly  this  distinction  rests  on 
sound  principle.  He  only  should  be  allowed 
to  avoid  his  contract,  upon  whom  the  un- 
lawful restraint  or  fear  has  operated.  The 
contract  of  a  surety,  if  his  own  free  act,  and 
executed  without  coercion  or  illegal  menace, 
should  be  held  binding.  The  duress  of  his 
principal  cannot  affect  his  free  agency  or  In 
any  way  control  his  action.  It  may  excite 
his  feelings,  awaken  his  generosity,  and  in- 
duce him  to  act  from  motives  of  charity  and 
benevolence  towards  his  neighbor;  but  these 
can  furnish  no  valid  ground  of  defence 
against  his  contract,  which  he  has  entered 
into  freely  and  without  coercion. 

The  case  at  bar  falls  very  clearly  within 


DURESS. 


a99 


this  principle.  The  defendant  was  put  un- 
der no  restraint;  no  threats  were  made  to 
him.  His  principal  may  have  been  coerced 
to  apply  to  the  defendant  to  be  bis  surety, 


but  there  is  nothing  In  the  case  which  tenda 

to  show  any  duress  towards  the  defendanL 

•  ••••• 

EJiceptlons  overruled. 


400 


REALITY  OF  CONSENT. 


IP 


,  ^  FAIRBAXKS  v.  SNOW.       ^7^'^/ 

>  (13  N.  E.  596,  145  Mass.  153.)  ^  ^ 

Supreme   Judicial   Court  of   Massachusetts. 
Worcester.    October  20,  1887. 

W.  S.  B.  Hopkins  and  StiUman  Haynes,  for 
plaintiflf.  Norcross,  Haxtwell  &  Baker,  for 
defendant, 

HOLiMES,  J.  This  is  an  action  upon  a  prom- 
issory note  made  by  the  defendant  and  her 
husband  to  the  order  of  the  plaintiff.  The  de- 
fendant alleges  that  her  signature  was  obtain- 
ed by  duress  and  threats  on  the  part  of  her 
husband.  The  judge  below  found  for  the  plain- 
tiff, it  would  rather  seem  on  the  ground  that, 
whether  there  was  duress  or  not,  the  defend- 
ant had  ratified  the  note,,  which  there  seems  to 
have  been  evidence  tending  to  show  that  she 
did.  See  Morse  v.  Wheeler,  4  Allen,  570;  Rau 
V  Yon  Zedlitz,  132  Mass.  164.  But,  as  this 
may  not  be  quite  clear,  we  proceed  to  consider 
the  only  exception  taken  by  the  defendant, — 
the  judge's  refusal  to  rule  that,  if  the  defend- 
ant  signed  the  note  under  dtu^lfe,  it  was_  150- 
material  whether  the  plaintiff  knew  when  he 
received  the  note  that  It  was  so  signed.  The 
exception  is  to  this  refusal.  No  doubt,  if  the 
defendant's  hand  had  been  forcibly  taken 
and  compelled  to  hold  the  pen  and  write  her 
name,  the  signature  would  not  have  been 
her  act,  and  if  the  signature  had  not  been  her 
act,  for  whatever  reason,  no  contract  would 
have  been  made,  whether  the  plaintiff  knew 
the  facts  or  not.  There  still  Is  sometimes 
shown  an  inclination  to  put  all  cases  of  du- 
ress upon  this  ground.  Barry  v.  Society,  59 
X.  Y.  5§7,  591.  But  duress,  like  fraud,  only 
becomes  material,  as  such,  on  the  footing  that 
a  contract  or  conveyance  has  been  made  which 
the  party  wishes  to  avoid.  It  is  well  settled 
that  when,  as  usual,  the  so-called  "duress" 
consists  only  of  threats,  and  does  not  go  to 
the  height  of  such  bodily  compulsion  as  turns 
the  ostensible  party  into  a  mere  machine,  the 
contract  Ls  only  voidable.  Foss  v.  Hildreth, 
10  Allen,  26,  80;  Vinton  v.  King,  4  Allen.  561, 
565;  Lewis  v.  Bannister,  16  Gray,  500;  Fish- 
er V.  Shattuck,  17  Pick.  252;  Worcester  v. 
Eaton,  13  Mass.  371,  375;  Dimcan  v.  Scott, 
1  Camp.  100;  Whelpdale's  Case,  3  Coke,  241; 
1  Bl.  Coram.  130;  Clark  v.  Pease,  41  N.  H. 
414.  This  rule  neces-sarily  excludes  from 
the  common  law  the  often  recurring  notion, 
just  referred  to,  and  much  debated  by  the 
civilians,  that  an  act  done  under  compulsion 
is  not  an  act,  in  a  legal  sense.  Tamen  Coactus 
Volui,  D  4,  2,  25,  §  5.  See  1  Windscbeid,  Pan- 
dextien,  §  80. 

Again,  the  ground  upon  which  a  contract  is 
voidable  for  duress  is  the  same  as  in  the 
case  of  fraud,  and  Is  that,  whether  It  springs 
from  a  fear  or  a  belief,  the  party  has  been 
subjected  to  an  Improper  motive  for  action. 
See  Rodliff  v.  Dallinger,  141  Mass.  1,  4  N. 
E.  805;  Stiff  v.  Keith,  143  Mass.  224,  9  N. 
E.  577.  But,  if  duress  and  fraud  are  so  far 
alike,  there  seems  to  be  no  sufficient  reason 


why  the  limits  of  their  operation  should  be 
different.  A  party  to  a  contract  has  no  con- 
cern with  the  motives  of  the  other  party  for 
making  it.  If  he  neither  knows  them  nor  is 
responsible  for  their  existence.  It  is  plain 
that  the  unknown  fraud  of  a  stranger  would 
not  prevent  the  plaintiff  from  holding  the 
defendant.  Master  v.  MiUer,  4  Term  R.  320, 
338;  Masters  v.  Ibberson,  8  C.  B.  100; 
Sturge  V.  Starr,  2  Mylne  &  K.  195;  Pulsford 
V,  Richards,  17  Beav.  87,  95. 

The  authorities  with  regard  to  duress,  how- 
ever, are  not  quite  so  clear.  It  is  said  in 
Thoroughgood's  Case,  5  Coke,  241,  that,  "if  a 
stranger  menace  A.  to  make  a  deed  to  B.,  A. 
shall  avoid  the  deed  which  he  made  by  such 
threats,  as  well  as  if  B.  himself  had  threaten- 
ed him,  as  it  is  adjudged,  45,  B  3,  6a."  Shep. 
Touch.  61,  is  to  like  effect.  See,  also,  Fowler 
V.  Butterly,  78  N.  Y.  68.  But  in  43  Y.  B.  E 
3,  6  pi.  15,  which  we  suppose  to  be  the  case 
referred  to.  It  was  alleged  that  the  imprison- 
ment was  by  the  procurement  of  the  plain- 
tiff; and  we  know  of  no  distinct  adjudication 
of  binding  authority  that  threats  by  a  stran- 
ger, made  without  knowledge  or^riyKy'af  the 
partjj__are._good  ground  for  avoiding  a  con- 
tract induced_by  them.  In  Keilway,  154a.  pi. 
3,~"'The~^efendant  in  debt  pleaded  that  he 
made  the  obligation  to  the  plaintiff  by  dinress 
of  imprisonment  (on  the  part)  of  a  stranger, 
and  the  opinion  of  Rede  and  others  was  that 
this  is  not  a  plea  without  making  the  obligee 
party  to  this  duress."  In  Taylor  v.  Jaques, 
106  Mass.  291,  294,  It  was  said  that  the  de- 
fendant bad  to  prove  that  he  signed  the  note 
"under  .a  reasonable  and  well-grounded  belief, 
derived  from  the  conduct  and  declarations  of 
the  plaintiffs,  that  if  he  did  not  sign  It  he 
would  be  arrested."  See,  also,  Green  v.  Scran- 
age,  19  Iowa,  461,  460;  Talley  v.  Robinson's 
Assignee,  22  Grat.  888;  Bazemore  v.  Freeman, 
58  Ga.  276.  Loomis  v.  Ruck,  56  N.  Y.  462, 
was  decided  on  the  ground  that,  if  the  non- 
negotiable  note  in  suit  was  in  the  first  in- 
stance a  contract  between  the  plaintiff  and 
the  defendant,  it  was  obtained  through  the 
agency  of  tiie  defendant's  husband  in  such  a 
way  as  to  make  the  plaintiff  answerable  for 
his  conduct.  Moreover,  the  older  writers  liken- 
ed duress  to  infamcy,  and  took  a  distinction 
between  feoffments,  etc.,  by  the  party's  own 
hand,  and  acts  done  by  letter  of  attorney,  re- 
garding the  latter  as  wholly  void.  2  Co.  Inst 
483;  Finch,  Law,  102.  It  has  been  held  in 
New  York  and  some  other  states,  as  well  as 
in  England,  that  a  power  of  attorney  given  by 
an  infant  Ls  void.  Fonda  v.  Van  Home,  15 
Wend.  631;  Knox  v.  Flack,  22  Pa.  St.  337; 
Saunderson  v.  Marr,  1  H.  Bl.  75.  And  If  this 
analogy  were  followed  the  contracts  in  all 
the  New  York  cases  which  we  have  cited 
would  be  void  by  the  law  of  that  state  for 
want  of  a  personal  delivery  by  the  defendant 
to  the  plaintiff.  There  may  be  still  other 
explanations   of   the   decisions. 

In  the  present  case  it  does  not  appear  who 
delivered  the  note,  and  does  not  clearly  ap- 


DURESS. 


401 


pear  that  the  defendant  did  not  deliver  It 
herself.  If  anj-  question  of  authority  were 
open,  it  would  have  to  be  noticed  that  in 
Massachusetts  the  distinction  as  to  power  of 
attorney  has  been  so  limited,  if  not  whoily 
done  away  with,  with  regard  to  infants,  that 
It  would  be  doubtful,  at  least.  If  it  could  have 

H0PK.8ELuCA8.C0NT. — 28 


any  application  to  the  rnse  at  bar.  Whitney 
V.  Dutch,  14  Mass.  -iiiT,  -VjS;  Welch  v.  Wolcli, 
103  Mass.  5G2;  Moley  v.  Brine.  120  Mass.  324. 
Ilowever  the  law  m.iy  stand  olsewherf.  we 
are  of  opinion  that  the  rulin;;  rt.tiuc'.-;''^d  waa 
wrong  upon  principle  and  authority.  Exf  p- 
tion  overrulid. 


REALITY  OF  CONSENT. 


COWEE  V.  CORNELL. 
(75  N.  Y.  9L) 

Court  of  Appeals  of  New  York.  Nov.  12.  1S78. 
Appeal  from  order  of  the  general  term  of 
the  supreme  comt  in  the  Third  judicial  de- 
partment, reversing  a  judgment  entered  upon 
the  report  of  a  referee. 

Plaintiff  made  a  claim  against  the  estate  of 
Latham  Cornell,  of  whose  will  defendants 
were  the  executore,  for  interest  upon  a  prom- 
issory note  executed  by  the  deceased.  This 
claim  \j-as  rejected,  and  was  referred  by  stip- 
ulation. 

The  facts,  as  stated  by  the  referee,  are  in 
substance  as  follows: 

Latham    Cornell,    the    deceased,    was    the 
grandfather  of  Latham  C.  Strong.     He  was 
possessed  of  large  property,  consisting  of  real 
estate  and  of  personal  property  invested  in 
stocks,  bonds  and  other  securities.     He  died 
in  1S7G  at  the  age  of  ninety-five.     For  four 
years   prior   to   his   death  he   was   partially 
blind.      From  July,    1871,  until  the  time   of 
his  death,   his  grandson  at  his  request  at- 
tended to  his  affairs,  writing  his  letters,  look- 
ing after  his  banking  business  and  liis  rents, 
making  out  his  bills,  cutting  off  his  coupons, 
readiug  to  him,  and  on  occasions  going  away 
from   home  to  transact  other  business.     In 
July,  1S71,  Cornell  gave  to  Strong  a  deed  of 
two  adjoining  houses  in  the  city  of  Ti-oy, 
valued   at   about   $o2,000,   in   one   of   which 
houses  the  grandfather  lived  until  the  time 
of  his  death.     The  grandson  moved  into  the 
adjoining  house  in  the  spring  of  1872,  and 
resided   there   until   after   his   grandfather's 
death.     During  the  time  that  the  two  thus 
lived  in  adjoining  residences,   they  were  in 
daily  conference  upon  business  matters  of  the 
old  gentleman,  in  the  house  occupied  by  the 
grandson.     The   grandson    with    his   family 
consisting  of  live  persons,  during  all  this  time 
lived  at  the  sole  expense  of  the  grandfather, 
and  claims  to  have  received,  in  addition  to 
the  note  in   suit,   as  gifts  from  his   grand- 
father, .$30,000  in  government  bonds  and  the 
assignment  of  a  mortgage  for  about  $1,700. 
At  what  particular  time  it  is  claimed  these 
gifts  were  made  is  not  in  evidence.    Mr.  Cor- 
nell made  his  will  in  1871,  providing  a  legacy 
of  $15,000   for  Mr.    Strong.      In   the    fall  of 
1872,  Mr.  Strong  expressed  a  desire  to  go  in- 
to business  for  himself  and  to  be  independent 
of  his  grandfather,  and  actually  was  in  ne- 
gotiation with  different  persons  in  Troy  and 
New  York  with  a  view  of  forming  business 
associations.     Mr.  Cornell  became  uneasy  at 
the   prospect   of   losing   the   services   of   his 
grandson  and  caused  him  to  be  written  for 
to  come  home.     Mr.   Strong  came  back  to 
Troy,  and  his  grandfather  said  to  him  then, 
as  he  had  previously  said,  that  he  wanted 
him  to  give  up  his  ideas  of  leaving  and  to 
devote  his  whole  time  to  the  business  of  his 
grandfather,     ilr.  Cornell  further  said  that 
he  had  no  one  else  to  look  after  his  business, 
and  frequently  said  that  there  was  money 


enough  for  all  of  them.  :Mr.  Strong  innne- 
diately  abandoned  his  business  projects  and 
devoted  his  whole  time  and  attention  to  his 
grandfather's  business,  until  the  death  of  the 
latter.  After  this  Mr.  Cornell  sent  for  his 
legal  advisers  and  proposed  to  alter  his  will 
so  as  to  make  provision  to  compensate  his 
grandson  for  having  devoted  himself  to  his 
business.  What  provision  was  intended  is 
not  disclosed  by  the  evidence.  The  lawyers 
advised  that  his  will  be  left  unaltered,  and 
that  he  take  some  other  way  of  compen- 
sating his  grandson.  Mr.  Cornell  gave  to  Mr. 
Strong  the  note  in  question.  It  is  as  follows; 
"$20,000.  Troy,  April  1,  1873.  Five  yeaif 
after  date  I  promise  to  pay  Latham  L.  C. 
Strong,  or  order,  $20,000,  for  value  received, 
with  interest  yearly.     L.  Cornell." 

The  note  was  on  a  printed  form,  the  name 
of  the  payee  being  printed  "Latham  Cornell." 
The  note  was  filled  up  in  the  handwriting  of 
the  maker,  but  in  stilking  out  with  his  pen 
the  name  of  the  payee  he  left  the  word 
"Latham"  and  afterwards  interlined  the  full 
name,  "L.  C.  Strong."  Annexed  to  the  note 
was  a  stub  with  some  printed  forms,  on 
which  Mr.  Cornell  wrote:  "Troy,  April  1st, 
1873,  L.  C.  Strong,  $20,000  at  five  years,  to 
make  the  amount  the  same  as  Chas.  W. 
Cornell."  The  stub  was  on  the  note  when  it 
was  delivered  to  the  payee,  but  was  torn  off 
by  him  before  it  was  transferred  to  the  plain- 
tiff; and  there  is  no  evidence  that  the  plain- 
tiff ever  knew  of  the  existence  of  the  stub. 
The  stub  and  note  were  taken  from  a  blank 
book  which  belonged  to  decedent.  No  pay- 
ment of  interest  was  made  upon  the  note  . 
during  the  lifetime  of  the  maker-.  The  ref- 
eree found  that  the  note  was  given  for  a 
valuable  consideration.  INIr.  Strong  sold  the 
note  to  the  plaintiff  for  $19,000,  taking  his 
note,  pajable  in  one  year  after  date.  What 
that  date  was  has  not  been  disclosed.  Mr. 
Strong  testified  at  the  trial  that  he  still  held 
the  note.  Mr.  Strong  was  one  of  the  execu- 
tors. 
Further  facts  are  stated  in  the  opinion. 

Irving  Browne,  for  appellant  John  Thomp- 
son, for  respondents. 

HAND,  J.  The  counsel  for  respondents 
suggested  at  the  close  of  his  argument  be- 
fore us  that  there  was  no  evidence  of  a  de- 
livery of  the  note  to  Strong,  the  payee,  and 
the  finding  of  delivery  by  the  referee  was 
entirely  unsupported.  He  does  not  however 
make  this  a  point  in  his  printed  brief,  and 
did  not  present  it  strenuously  or  with  any 
emphasis  in  his  oral  remarks. 

It  is  true  that  the  evidence  in  this  respect 
was  not  very  satisfactory.  Ordinarily  the 
possession  and  production  of  the  note  by  the 
payee  will  raise  a  presumption  of  delivery 
to  him.  But  this  presumption  must  be  very 
much  weakened  when  the  possession  is 
shown  not  to  precede  the  possession  of  all 
the  maker's  papers  and  effects  by  the  payee 


UNDUE  INFLUENCE. 


403 


as  executor,  when  tlie  note  appears  to  liave 
been  all  in  the  handwritinj,'  of  the  maker 
and  to  have  been  talcen  with  a  stub  attached, 
also  in  his  handwriting',  from  a  bank  book 
belonj^inj?  to  him,  and  when  installments  of 
interest  falling  due  in  the  maker's  life-time 
were  not  paid  and  although  years  elapsed 
after  they  so  became  due  bef;;re  his  death 
there  is  no  proof  of  any  demand  of  ...i  m  by 
the  paj'ee  or  recognition  of  liability  by  the 
deceased.  I  am  not  prepared  to  say  however 
that  these  circumstances  absolutely  destroy 
the  presumption  from  possession  and  produc- 
tion of  the  instrument.  While  some  evidence 
on  the  part  of  the  plaintiff,  showing  that  the 
note  had  been  delivered  to  Strong  in  his 
grandfather's  life-time,  or  at  least  negativ- 
ing the  idea  that  Strong  found  it  in  the  bank- 
l)Ook  or  among  the  papers  of  the  deceased 
when  he  took  possession  of  them  as  executor, 
could  probably  have  been  easily  produced  if 
consistent  with  the  fact,  yet  we  cannot  hold 
Its  absence  conclusive  against  the  plaintiff 
upon  this  point,  upon  the  record  as  it  stands. 
No  motion  for  judgment  or  to  dismiss  was 
made  on  this  ground  by  the  respondents  al- 
though the  trial  was  in  other  respects  treated 
by  the  counsel  on  both  sides  as  one  before  a 
referee  appointed  in  the  ordinary  way  to 
hear  and  determine  and  direct  judgment  as 
in  an  action,  and  we  cannot  say  but  that  if 
the  plaintiff  had  been  notified  of  such  an  ob- 
jection, the  evidence  would  have  been  sup- 
plied. The  finding  of  the  delivery  by  the 
referee  was  not  even  excepted  to.  although 
there  were  exceptions  to  the  finding  of  con- 
sideration. Under  these  circumstances  we 
must,  I  think,  assume  an  acquiescence  in  the 
truth  of  the  finding  by  the  respondents  for 
reasons  known  to  them,  and  which  if  dis- 
closed would  probably  be  entirely  satisfac- 
tory. 

The  majority  of  the  general  term  put  their 
reversal  of  the  judgment  upon  the  ground 
that  it  conclusively  appeared  from  the  stub 
attached  that  the  note  was  intended  as  a 
gift  and  was  without  consideration.  In  this 
I  am  unable  to  concur. 

The  referee's  finding  that  the  note  was  de- 
livered not  as  a  gift  but  for  a  valuable  con- 
sideration has  some  evidence  to  support  it,  in 
the  proof  of  the  services  rendered  by  Strong 
to  the  deceased,  and  his  abandonment  of  a 
profession  at  the  request  of  the  deceased,  in 
the  intention  expressed  by  the  latter  to  make 
some  compensation  for  those  services,  and 
the  conversation  had  with  his  counsel  not 
very  long  before  the  date  of  this  note,  in 
which  he  was  dissuaded  from  making  this 
compensation  by  will  and  advised  to  do  it 
while  alive,  to  which  he  assented.  What  ap- 
pears upon  the  stub  is  not  in  my  opinion 
conclusive  against  this  result. 

There  Is  perhaps  difficulty  in  giving  any 
entirely  satisfactory  construction  to  this 
memorandum  made  by  the  deceased;  but  the 
interpretation  of  the  general  term  seems  to 
my  mind  inconsistent  with  the  known  facts 


-  of  the  case.  Strong  certainly  had  had  and 
I  the  deceased  knew  that  be  had  had  property 
of  the  value  of  $32,0(j<j  given  him  before  the 
date  of  this  note,  and  perhajis  $30,000  more 
in  bonds.  The  $'J(J,000  note  could  not  have 
been  therefore  as  the  general  terra  supposes, 
a  gift  to  make  him  equal  in  gifts  with  his 
cousin  Charles,  to  whom  only  ;j-J0,0U0  had 
been  given  in  all. 

But  not  only  do  the  circumstances  show 
that  the  memorandum  could  not  mean  that 
this  gift  of  the  $20,000  to  Strong  would 
make  him  equal  in  gifts  to  Charles,  but  the 
memorandum  itself  does  not  say  so.  Its 
language  is  "to  make  the  amount  the  same 
as  Chas.  W.  Cornell."  While,  as  has  al- 
ready been  said,  there  is  probably  insuper- 
^able  ditficulty  in  discovering  precisely  all 
that  the  deceased  meant  by  this  expression, 
its  intrinsic  sense  is  merely  that  the  amount 
of  this  note,  $20,000,  is  so  fixed  to  make  it 
the  same  as  an  amount  possessed  in  some 
way  by  Charles,  and  this  is  consistent  with 
both  amounts  being  gifts,  or  the  one  being 
fixed  upon  in  the  testator's  mind  as  a  fair  com- 
pensation for  Strong's  services  and  at  the 
same  time  equal  to  an  amount  he  had  given 
or  intended  to  give  to  Charles.  On  the  whole 
I  think  this  memorandum  was  a  piece  of 
evidence  to  be  submitted  with  the  other  evi- 
dence to  be  considered  by  the  referee  on  the 
question  of  fact.  Ills  decision  upon  all  this 
evidence  cannot  be  disturbed  by  this  court. 

The  same  may  be  said  of  the  proof  of 
large  gifts  to  Strong  either  all  before,  or 
some  before  and  some  after  the  date  of  the 
note. 

The  reversal  by  the  general  term  Is  not 
stated  to  be  upon  the  facts,  and  on  the  argu- 
ment it  was  conceded  bj-  the  counsel  for  the 
respondents  to  be  upon  the  law  merely.  It 
may  be  that  a  finding  upon  all  the  evidence 
that  the  note  was  without  consideration  and 
a  gift  would  not  be  disturbed,  and  would  be 
held  by  us  as  not  unauthorized  by  the  evi- 
dence. On  the  other  hand,  we  cannot  accede 
to  the  proposition  that  a  finding  to  the  con- 
trary, such  as  has  been  made  by  the  referee 
here,  must  by  reason  of  the  contents  of  tliis 
stub  or  other  testimony  be  reversed  as  er- 
roneous in  law. 

It  follows  that  except  as  bearing  upon  un- 
due influence,  and  the  relations  of  parties 
hereafter  considered,  the  inadequacy  of  the 
services  or  the  extravagance  of  the  compen- 
sation are  not  material.  That  was  a  matter 
purely  of  agreement  between  Strong  and  the 
deceased,  and  with  which  the  court  will  not 
interfere  under  ordinary  circumstances. 
Earl  V.  reck,  04  N.  Y.  597;  Worth  v.  Case. 
42  N.  Y.  302;  Johnson  v,  Titus,  2  Hill.  GOO. 
Although  the  consideration  of  a  promissory 
note  is  always  open  to  investigation  between 
the  original  parties  (and  we  agree  with  the 
court  below  that  the  plaintiff  here  has  no 
better  position  than  Strong  himself),  yet  as 
pointed  out  by  the  chief  judge  in  Earl  v. 
Peck,  supni,  mere  inadequacy  in  value  of  the 


404 


REALITY  OF  COXSEXT. 


thing  bought  or  paid  for  is  never  intended 
by  the  legal  expression,  "want  or  failure  of 
consideration."  This  only  covers  either  total 
worthlessuess  to  all  parties,  or  subsequent 
destruction,  partial  or  complete. 

Assuming  then,  as  I  think  we  must,  that 
tbere  was  no  error  as  matter  of  law  in  the 
finding  of  the  referee  that  this  note  was 
given  for  a  valuable  consideration,  and  that 
the  adequacy  of  that  consideration  is  some- 
thing with  which  we  have  no  concern  If  the 
parties  dealt  on  equal  terms,  the  only  point 
remaining  to  consider  is  the  relations  exist- 
ing between  the  deceased  and  Strong  at  the 
date  of  the  note. 

It  is  insisted  strenuously  by  the  learned 
counsel  for  the  respendeuts  that  these  were 
such  as  to  call  for  the  application  of  the  doc; 
trine  of  constructive  fraud,  and  threw  upon 
the  plaintiff  the  burden  of  proving  not  only 
that  the  deceased  fully  understood  the  act, 
but  that  he  was  not  induced  to  it  by  any  un- 
due influence  of  Strong,  and  that  the  latter 
took  no  unfair  advantage  of  his  superior  in- 
fluence or  knowledge. 

The  court  below  were  hardly  correct  In  the 
suggestion  that  the  plaintiff  conceded  this 
burden  to  be  upon  himself,  and  for  that  rea- 
son, instead  of  resting  upon  the  statement  of 
consideration  in  the  note,  gave  evidence  in 
opening  his  case  of  an  actual  consideration; 
for  this  may  have  been  done  to  show  in  the 
first  instance  that  the  note  was  not  a  gift 
and  hence  void  under  the  law  applicable  to 
gifts.  Indeed  it  appears  from  the  findings 
and  refusals  to  find,  and  the  opinion  of  the 
referee,  that  such  was  not  the  theory  upon 
which  the  action  was  tried  or  decided. 

We  return  then  to  the  question  whether 
this  case  was  one  of  constructive  fraud.  It 
may  be  stated  as  universally  true  that  fraud 
vitiates  all  contracts,  but  as  a  general  thing 
it  is  not  presumed  but  must  be  proved  by 
the  party  seeking  to  relieve  himself  from  an 
obligation  on  that  ground.  Whenever,  how- 
ever, the  relations  between  the  contracting 
parties  appear  to  be  of  such  a  character  as 
to  render  it  certain  that  they  do  not  deal  on 
terms  of  equality,  but  that  either  on  the  one 
side  from  superior  knowledge  of  the  matter 
derived  from  a  fiduciary  relation,  or  from 
overmastering  influence,  or  on  the  other  from 
weakness,  dependence  or  trust  justifiably  re- 
posed, unfair  advantage  in  a  transaction  Is 
rendered  probable,  there  the  burden  is  shift- 
ed, the  transaction  is  presumed  void,  and  It 
is  incumbent  upon  the  stronger  party  to  show 
affirmatively  that  no  deception  was  practiced, 
no  undue  infiuence  was  used,  and  that  all 
was  fair,  open,  voluntary  and  well  under- 
stood. This  doctrine  is  well  settled.  Hunt, 
J.,  Nesbit  V.  Lockman,  34  N.  Y.  167;  Story, 
Eq.  Jur.  §  311;  Sears  v.  Shafer,  6  N.  Y.  268; 
Huguenin  v.  Basely,  13  Ves.  105,  14  Ves. 
273,  and  15  Ves.  180;  Wright  v.  Proud,  13 
Ves.  138;  Harris  v.  Tremenheere,  15  Ves.  40; 
Edwards  v.  Myrick,  2  Hare,  60;  Hunter  v. 
Atkins,  3   Mylne  &  K.   113.    And   this   is   I 


think  the  extent  to  which  the  well-consider- 
ed cases  go,  and  is  the  scope  of  "constructive 
fraud." 

The  principle  referred  to,  it  must  be  re- 
membered, is  distinct  from  that  absolutely 
forbidding  a  purchase  by  a  trustee  or  agent 
for  his  own  benefit  of  the  subject  of  a  trust, 
and  charging  it  when  so  purchased  with  the 
trust.  That  amounts  to  an  incapacity  in  the 
fiduciary  to  purchase  of  himself.  He  cannot 
act  for  himself  at  all,  however  fairly  or  inno- 
cently, In  any  dealing  as  to  which  he  has 
duties  as  trustee  or  agent.  The  reason  of 
this  rule  Is  subjective.  It  removes  from  the 
trustee,  with  the  power,  all  temptation  to 
commit  any  breach  of  trust  for  his  own  ber.e- 
fit  But  the  principle  with  which  wo  are 
now  concerned  does  not  absolutely  forbid  the 
dealing,  but  it  presumes  it  unfair  and  fraud- 
ulent unless  the  contrary  is  affirmatively 
shown. 

Tills  doctrine,  as  has  been  said,  is  well 
settled,  but  there  Is  often  great  difficulty  lit 
applying  It  to  particular  cases. 

The  law  presumes  In  the  case  of  guardian 
and  ward,  trustee  and  cestui  que  trust,  at- 
torney and  client,  and  perhaps  physician 
and  patient,  from  the  relation  of  the  parties 
Itself,  that  their  situation  is  unequal  and  of 
the  character  I  have  defined;  and  that  rela- 
tion appearing  itself  throws  the  burden  upon 
the  trustee,  guardian  or  attorney  of  showing 
the  fairness  of  his  dealings. 

But  while  the  doctrine  is  without  doubt  to 
be  extended  to  many  other  relations  of  trust, 
confidence  or  inequality,  the  trust  and  con- 
fidence, or  the  superiority  on  one  side  and 
weakness  on  the  other,  must  be  pi'oved  in 
each  of  these  cases;  the  law  does  not  pre- 
sume them  from  the  fact  for  Instance  that 
one  party  Is  a  grandfather  and  old,  and  the 
other  a  grandson  and  young,  or  that  one  is 
an  employer  and  the  other  an  employe. 
The  question  as  to  parties  so  situated  Is  a 
question  of  fact  dependent  upon  the  circum- 
stances In  each  case.  There  is  no  presump- 
tion of  Inequality  either  way  from  these  rela- 
tions merely. 

In  the  present  case  It  cannot  be  said  that 
the  fact  that  the  deceased  employed  Strong 
as  his  clerk  to  read  and  answer  his  letters 
and  cut  oft"  his  coupons,  and  make  out  his 
bills,  or  as  his  bailiff  to  collect  his  rents,  or 
that  at  this  time  he  was  old  and  of  defective 
vision,  or  that  Strong  lived  near  him  and 
was  his  grandson,  taken  separately  or  to- 
gether raise  a  conclusive  presumption  of  law 
that  their  situation  was  unequal,  and  that 
dealings  between  them  as  to  compensation 
for  these  services  were  between  a  stronger 
and  a  weaker  party,  a  fiduciary  In  hac  re 
and  the  party  reposing  confidence.  These 
relations  as  a  matter  of  fact  may  have  led 
to  or  been  consistent  with  controlling  influ- 
ence on  the  part  of  the  grandson,  or  childish 
weakness  and  confidence  on  the  part  of  the 
grandfather,  but  this  was  to  be  shown,  and 
is   not   necessarily   derivable   or   presumable 


UNDUE  INFLUENCE. 


405 


from  the  relations  thomsolves,  as  In  the  case 
of  trustee,  attorney  or  guardian. 

From  these  relations  and  the  large  gifts 
shown  from  the  deceased  to  Strong,  and 
from  the  extravagant  amount  of  the  com- 
pensation in  the  note,  it  is  very  possible  the 
referee  might  have  found  as  a  fact  the  ex- 
istence of  weakness  on  tlie  one  side,  or  un- 
due strength  on  the  other,  which  rendered 
applicable  the  doctrine  of  constructive  fraud, 
and  threw  upnu  the  plaintiff  the  burden  of 
disproving  such  fraud.  These  circunisiauces 
may  have  well  been  of  a  character.  If  not 
sufficient  to  shift  the  presumption,  at  least 
to  authorize  a  setting  aside  of  a  contract 
without  any  decisive  proof  of  fraud,  but  up- 
on the  slightest  proof  that  advantage  was 
taken  of  the  relation,  or  of  the  use  of  "any 
arts  or  stratagems  or  any  undue  means  or 
the  least  speck  of  imposition."  Wholan  v. 
AVhelan,  3  Cow.  53S,  Lord  Eldon,  L.  C;  Har- 
ris V.  Trenienheere,  15  Ves.  40,  Lord  Brough- 
am; Hunter  v.  Atkins,  3  Mylne  .S:  K.  135. 

But  the  referee  not  only  has  not  found  as 
fact  any  inequality  in  the  situation  of  the 
deceased  and  Strong,  but  refused  to  find  as 
a  matter  of  law  Its  existence,  and  there  is 
really  no  evidence  whatever  of  any  arts  or 


stratagems  or  "speck  of  Imposition"  on  the 
part  of  Strong  as  to  this  note. 

We  are  not  permitted  to  supply  these  find- 
ings even  if  we  thought  them  proper  for  the 
referee  to  make,  nor  can  we  sustain  a  re- 
versal of  the  original  judgment  upon  facts 
not  found  and  not  necessarily  Inferable  from 
uncontradicted  evidence  in  the  case,  the  gen- 
eral term  not  having  In  any  way  Interfered 
with  the  findings  of  the  referee. 

On  tlie  whole  therefore  we  reach  the  con- 
clusi(in  that  there  was  no  good  reason  for 
disturbing  the  judgment  of  the  referee. 
This  large  claim  upon  the  estate  of  the  de- 
ceased is  not  so  clearly  justified  and  explain- 
ed in  the  evidence  as  we  could  have  wished, 
and  the  circumstances  are  such  as  to  compel 
this  court  to  look  upon  the  case,  if  not  with 
suspicion,  certainly  with  anxiety,  yet  after 
careful  examination  we  can  find  no  material 
error  in  the  original  decision. 

Tlie  order  granting  a  new  trial  must  be 
reversed  and  judgment  for  plaintiff  affirmed, 
with  costs. 

All   concur,   except    MILLER    and    EARL. 
J.T.,  absent. 
Judgment  accordingly. 


REALITY  OF  COXSENT. 


McPAKLAXD   ct   al.   v.   LARKIN. 

(39  N.  E.  609,  155  111.  M.) 

Supreme  Coort  of  Illinois.     Jan.   15,   1895. 

Appeal  from  circuit  court.  Cook  county; 
Lorin  C.  Collins,  Judge. 

Bill  by  Margaret  Larkin  against  James  Mc- 
Parland  and  others  to  set  aside  a  deed.  Com- 
plainant obtained  a  decree.  Defendants  ap- 
peal.    Affirmed. 

M.  J.  Dimne,  for  appellants,  W.  J.  English, 
for  appellee. 

PER  CURIAM.  In  March,  1880,  James 
Fitzgerald  died,  seised  in  fee  of  lots  72,  73, 
74,  and  75,  of  sublot  or  block  42,  in  Canal 
Ti-ustees'  subdivision  of  section  33,  township 
40  N.,  range  14  E.  of  the  third  P.  M.,  in  Cook 
county,  111.,  which  lots,  with  the  cottage 
thereon,  constituted  the  family  homestead, 
and  left,  surviving  him,  as  his  children  and 
heirs  at  law,  Edward  Fitzgerald.  Mary  Ann 
McPurland,  and  Margaret  Fitzgerald,  the 
latter  then  a  minor  of  16  yeare,  who,  after 
atL'iining  majority,  married  one  Lai'kin,  and 
is  the  complainant  (appellee)  in  this  Gise. 
The  decedent  also  left,  as  his  widow,  Bridget 
Fitzgerald,  stepmother  of  said  children.  And, 
in  addition  to  said  realty,  he  also  left  $2,000, 
life  insurance,  payable  to  his  children.  James 
McParland,  husband  of  the  daughter  Mary 
Ann.  was  duly  appointed  administrator  of  the 
estate  and  giiardian  of  the  person  and  proper- 
ty of  said  minor  child.  In  consideration  of 
$1,100,  the  widow  relinquished  her  award, 
dower,  and  homestead  rights,  the  money  for 
this  pm-pose  being  advanced,  it  seems,  by  the 
children  Edward  and  Mary  Ann  out  of  their 
share  of  the  insurance  money,  who  were  to 
be  reimbursed  for  the  proportion  thereof  fall- 
ing upon  Margaret,  out  of  the  latter's  one- 
third  interest  in  the  estate.  The  estate  being 
somewhat  involved  in  debt,  means  were  de- 
vised for  paying  the  indebtedness  without 
sale  of  the  realty.  Edward  and  Mary  Ann 
each  advanced  a  third,  the  other  third  being 
advanced  out  of  said  minor's  estate,  by  order 
of  the  probate  court.  In  1880,  Edward  sold 
and  conveyed  his  one-third  interest  in  the 
realty  to  his  sister  Mary  Ann  for  the  sum  of 
$980.  The  minor,  Margaret,  until  her  mar- 
riage to  Larkin,  in  June,  1882,  made  her  home 
with  her  sister,  Mrs.  McParland,  and  her  hus- 
band, who  occupied  the  premises.  They,  it 
would  seem,  stood  in  loco  parentis  to  the 
minor.  They  cared  for  her  as  though  she 
was  their  child,  sending  her  to  school,  etc.; 
no  charges  for  board,  clothing,  and  otJier 
necessaries,  at  the  times  they  were  furnished, 
being  made.  On  February  24,  1882,  six  days 
after  attaining  her  majority,  Margaret  exe- 
cuted a  deed  purporting  to  convey  to  her  sis- 
ter, Mary  Ann  McParland,  her  one-third  in- 
terest in  said  real  estate,  at  which  time  she 
was  paid  a  small  sum  of  money.  This  deed, 
as  alleged  in  the  bill,  was  procured  by  decep- 
tion   and    undue    influence    exei'ted    by    hei" 


guardian,  James  McParland,  over  her,  and 
without  knowledge  on  her  part  of  her  rights 
in  the  premises,  or  of  what  was  due  her  out 
of  the  estate  of  her  father;  and  that  said 
deed  was  executed  solely  relying  upon  her 
g-uardian,  in  whom  she  had  gi'cat  confidence; 
and  that,  in  fact,  she  was  not  aware  of  hav- 
ing conveyed  away  her  interest  until  a  short 
time  before  the  filing  of  her  bill.  The  sister, 
Mrs.  McParland,  testified  that  she  tried  to 
take  her  mother's  place  towards  complainant, 
and  that  the  latter  looked  up  to  her  as  such, 
and  the  evidence  tends  sti'ongly  to  show  that 
complainant  looked  to  her  guardian  as  taking 
the  place  of  her  father.  The  guardian  did 
not  make  his  final  report  until  the  25th  of 
^lay,  following  the  making  of  said  deed;  so 
that,  in  effect,  the  guardianship  continued 
until  long  after  the  making  thereof.  Gilbert 
V.  Guptill,  43  lU.  112;  Schouler,  Dom.  ReL 
§  382. 

It  is,  however,  contended  that  the  deed 
was  made  with  full  knowledge  of  all  the 
facts,  six  days  after  complainant  had  arrived 
at  her  majority,  without  undue  influence,  and 
for  a  good  and  sufficient  consideration,  and 
its  validity  is  not  therefore  to  be  questioned. 
It  will  be  readily  admitted  that,  if  the  par- 
ties wei*e  dealing  at  arm's  length,  fraud  must 
be  shown  to  justify  setting  aside  the  deed. 
Bau-d  V.  Jackson,  98  111.  78;  Warrick  v.  Hull, 
102  111.  280.  And  it  may  be  generally  said 
that  where  the  guardianship  had  terminated, 
and  the  influence  of  the  guardian  upon  the 
ward  has  ceased,  so  that  they  can  be  said  to 
stand  upon  an  equality,  transactions  between 
them  will  be  regarded  as  binding.  Schouler, 
Dom.  Rel.  §  389.  "But  such  transactions  are 
always  to  be  regarded  with  suspicion.  And 
where  the  influence  still  continues,  as  if  the 
ward  be  a  female  or  a  pereon  of  weak  under- 
standing, and  the  guardian  continues  to  con- 
trol the  property  or  to  furnish  a  home,  the 
court  is  strongly  disposed  to  set  aside  the 
bargain  altogether."  But  these  observations 
have  but  little,  if  any,  bearing  here,  as  in  this 
case  the  relation  of  the  guardian  and  ward 
had  not  been  legally  dissolved.  In  such  case, 
as  said  by  Mr.  Pomeroy  (2  Eq.  Jur.  961),  "the 
relation  is  so  intimate,  the  dependence  so 
complete,  the  influence  so  gx'eat,  that  any 
transactions  between  the  two  parties,  or  by 
the  giiardian  alone,  through  which  tlie  guard- 
ian obtains  a  benefit,  entered  into  while  the 
relation  exists,  are  in  the  highest  degree  sus- 
picious. The  presumption  against  them  is 
so  strong  that  it  is  hardly  possible  for  them 
to  be  sustained."  So,  in  Gillett  v.  Wiley,  126 
111.  325,  19  N.  E.  287,  where  the  guardian  pro- 
cm'ed  his  ward,  after  the  latter  (a  young 
man)  had  attained  his  majority,  to  sign  a  re- 
ceipt in  full  for  all  money  which  came  into 
his  hands  as  guardian,  the  ward  not  '-eading 
the  paper  or  acquainting  himself  with  Its  con- 
tents, but  relying  solely  on  the  statement  of 
his  guardian  as  to  its  character  and  purport, 
it  was  held  that  the  transaction  was  void, 
even  as  against  a  surety  upon  such  guarttlan's 
bond,  who  had  Uiken  a  mortgage  on  the  lat- 


UNDUE  INFLUENCE. 


ter's  land  as  indemnity  against  loss  as  surety. 
And  it  was  there  said:  "Ordinarily,  one  hav- 
ing the  moans  of  information  as  to  the  con- 
tents of  a  paper  executed  by  him  will  •  •  • 
bo  held  to  have  known  the  contents,  and  will 
not  bo  permitted  to  assort  his  ignorance  of  its 
contents  to  avoid  responsibility  according  to 
Its  real  import  Here,  however,  the  sign- 
ing of  this  receipt  was  the  act  and  will 
of  the  guardian,  rather  than  that  of  appel- 
lee. Courts  will  watch  settlements  of  guard- 
ians with  their  wards,  or  any  act  or  transac- 
tiou  between  them  affecting  the  estate  of  the 
ward,  with  great  jealousy.  From  the  conti- 
dontial  relation  between  the  parties  it  will  bo 
presumed  that  the  ward  was  acting  under  the 
influence  of  the  guai'dian,  and  all  transac- 
tions between  them  prejudicially  affecting  the 
interests  of  the  ward  will  be  held  to  be  con- 
structively fraudulent  Carter  v.  Tice,  120 
111.  277,  11  N.  E.  529.  The  doctrine  is  tlius 
stated  in  1  Story,  Eq.  Jur.  §  317:  Where  the 
guardianship  has,  in  fact,  ceased  by  the  ma- 
jority of  the  ward,  the  courts  'will  not  permit 
ti"ansactions  between  guardians  and  wards 
to  stand,  even  when  they  have  occurred  aft(>r 
the  minority  has  ceased,  and  the  relation 
thereby  actually  ended,  if  the  intermediate 
period  be  short,  unless  the  circumstances 
demonstrate,  in  the  highest  sense  of  the  term, 
the  fullest  deliberation  on  the  part  of  the 
ward,  and  the  most  abundant  good  faith  on 
the  part  of  the  guardian;  for.  in  all  such 
cases,  the  relation  is  still  considered  as  hav- 
ing an  undue  influence  upon  the  mind  of  the 
ward,  and  as  virtually  subsisting,  especially 
if  all  the  duties  attaching  to  the  situation 
have  not  ceased;  as  if  the  accounts  between 
the  parties  have  not  been  fully  settled,  or  if 
the  estate  still  remains,  in  some  sort,  undi^r 
the  control  of  the  guardian.'  " 

Here  the  ward  was  a  female,  barely  past 
the  age  of  18  years,  practically  without 
knowledge  or  experience  in  business  affairs. 
The  peculiar  interests  of  the  guardian  were 
opposed  to  her  own.  His  wife  then  owned 
tlie  other  two-thirds  of  the  realty  in  question, 
and  by  this  deed  was  acquiring  the  third  be- 
longing to  the  ward.  The  ward  was  induced 
to  execute  a  deed,  prepared  by  the  guardian 
for  her  signature,  for  an  inadequate  consid- 
eration, greatly  less  than  the  real  value  of  her 
interest,  unless  there  be  taken  into  considera- 
tion her  prior  support  and  maintenance  in 
her  sister's  family.  True,  the  presumption 
of  undue  influence  of  the  guardian  is  attempt- 
ed to  be  overthrown  by  proof.  But  as  said 
in  the  case  just  quoted  from:  "The  presump- 
tion of  influence  on  the  part  of  the  guardian, 
and  tlie  dependence  of  the  ward,  continues 
after  the  legal  condition  of  guardianship  has 
ended;  and  transactions  between  them  dur- 
ing the  continuance  of  the  presumed  influence 
of  the  guardian  will  be  .set  aside,  unless 
shown  to  liave  been  the  deliberate  act  of  the 
ward,  after  full  knowledge  of  her  rights.  In 
all  such  cases  the  burden  rests  heavily  upon 
the  guardian  to  prove  the  circumstances  of 
knowledge,  and  free  consent  on  the  part  of 


407 
\ 
the  ward,  good  faith,  and  absence  of  in- 
fluence, which  alone  can  overcome  the  pre- 
sumption." It  is  not  necessary  in  such  cases 
that  actual  and  Intentional  fraud  be  estab- 
lished. It  is  suirifiout  when  the  parties  sus- 
tained the  relation  of  guardian  and  ward, 
that  the  former  has  gained  some  advantage 
by  the  transaction  with  his  ward,  to  throw 
the  burden  of  proving  good  faith  and  ab- 
sence of  influence,  and  of  knowledge  and  free 
consent  of  the  ward,  upon  the  guardian. 
This  we  are  not  prcp:ired,  att/yr  the  most 
careful  consideration  of  the  evidence,  to  say 
has  boon  done,  and  the  decree  of  the  chancel- 
lor setting  aside  the  deed  mu.st  be  afllrmed. 
Nor  can  It  make  the  slightest  difference  that 
the  conveyance  was  made  to  the  wife  of  the 
guardian,  under  whom  he  sub.sequontly  ac- 
quired title.  As  already  seen,  both  the  hus- 
band and  wife  stood  in  the  relation  of  parents 
to  complainant,  while  the  husljand  was 
guardian.  The  relations  precluded  their  de- 
riving advantage  from  the  ward,  and  it  was 
his  duty  to  protect  her  estate  from  spoliation 
from  whatever  source. 

It  is  next  insisted  that  in  respect  of  the  !?S60, 
which  constituted  the  consideration  for  the 
deed,  the  court  should,  by  its  decree,  have  re- 
quired return  by  the  ward  of  the  amoimt,  or 
a  sale  of  the  ward's  interest  in  the  premise;* 
to  pay  it,  as  a  condition  upon  which  the  dee^ 
should  be  canceled.  This  contention  is  with- 
out merit  It  is  true  that  in  case  of  sale  and 
conveyance  of  land  by  the  ward  to  the  guard- 
ian, where  the  ward  afterwards  elects  to  re- 
pudiate the  transaction,  and  seeks  in  equity 
to  have  the  deed  set  aside,  he  must  do  equi- 
ty, and  pay  back  to  the  guardian  the  amount 
received,  or  else  suffer  a  decree  charging  his 
land  with  sale  to  satisfy  the  same.  Wick- 
iser  v.  Cook.  85  111.  68.  But  such  is  not  the 
case  here.  By  the  findings  of  tlie  master,  ap- 
proved by  the  court,  large  sums  of  money 
were  found  due  tlie  ward  from  the  guardian, 
and  in  the  settlement  of  which  the  court  by 
its  decree,  credited  the  guai'dian  with  the 
above  amount,  which  was  equivalent  to  a 
payment  in  money.  It  would  be  useless  for 
the  court  to  make  the  consideration  paid  a 
charge  on  the  ward's  land  when,  by  an  ad- 
justment of  the  amounts  duo  between  them, 
it  could,  and  in  fact  should,  be  deductod- 
There  was  no  occasion  for  such  an  order 
when  the  guardian  could  be  paid  by  simply 
deducting  it  from  the  amount  owing  to  the 
ward. 

It  is  further  insisted  that  appellee  should 
take  her  interest  in  the  property  as  it  was  at 
the  date  of  the  deed;  that  all  improvement 
made  thereon  belonged  to  the  appellants,  sub- 
ject to  the  right  of  appellee  to  obtain  title 
thereto  by  contribution  of  her  share  of  the 
cost  or  present  value  thereof;  and  the  doc- 
trine in  respect  of  tenants  in  common — that, 
where  one  tenant  makes  improvements  on  the 
premises  held  by  tlicm  In  common,  the  court, 
in  making  partition,  should  require  due  com- 
pensation therefor,  from  the  other  tenants  to 
be  made — is  invoked  in  support  of  this  view. 


408 


REALITY  OF  COXSEXT. 


The  court  found  that  Mary  Ann  McParland, 
grantee  in  the  deed,   "was  not  an  innocent 
purchaser  of  said  real  estate,  but  was  charged 
with  and  had  full  knowledge  of  the  fiduciary 
relation  existing,  at  the  time  of  said  contiact 
and  sale  of  said  real  estate,  between  the  com- 
plainant   and    the   guardian,    her    husband." 
This  finding  Is  unquestionably  sustained  by 
the  proof.     The  grantee  was  bound  to  know 
that  her  husband,  the  guardian,  had  no  au- 
thority, except  by  order  of  the  probate  court, 
to  do  otherwise  than  protect,  care  for,  and 
preserve    the    estate    for    the    benefit    of    his 
ward,  until  the  latter  attained  majority  or  he 
was  legally  discharged  from  his  office.     She 
was  bound  to  know  the  fallibility  of  her  ti- 
tle, and  that,  under  the  circumstances,  it  was 
defeasible  on  attainment  of  the  ward's  ma- 
jority, at  the  latter's  election,  and  to  know, 
as   above   shown,    that   the   ti-ansactions   be- 
tween the  guardian  and  ward  culminatiug  in 
the  making  of  said  deed  by  the  latter  to  her 
were   liable  to  be  declared    fraudulent   and 
void.     She  was  bound  to  know  that  it  was 
the  guardian's  duty  to  keep  the  premises  in 
good  repair,  and  render  them  available  as  a 
means  of  revenue  for  tlie  benefit  of  the  ward, 
and   to   this   end,    with   the  sanction   of    the 
court,   to  use  the  ward's  cash  in  his  hands 
for    that    purpose    within    reasonable    limits. 
These  principles  are  familiar.     But  she  was 
a:iso  bound   to  know  that  he  could  not,   by 
vu-tue  of  guardianship,  and  without  any  or- 
der from  any  competent  tribunal,  erect  build- 
ings upon  the  land  or  make  expensive  per- 
manent improvements  thereon.     And   it  has 
been   held   that  where   the   guardian   makes 
advancement  of    money   for    such    purpose, 
without  any  order  of  court,  he  is  remediless. 
Schoiiler,  Dom.  Rel.  §  351;    Hassard  v.  Rowe, 
11  Barb.  22;  Bellinger  v.  Shafer,  2  Sandf.  Ch. 
293.     Such,  however,  has  not  been  as  yet  tlie 
holding  of  this  court  in  such  case.    But  by 
section   24.   c.    64,    Rev.    St.,   it   is   provided: 
"The  guardian  may,  by  leave  of  the  county 
court,  mortgage  the  real  estate  of  the  ward 
for  a  term  of  years  not  exceeding  the  minori- 
ty of  the  ward,  or  in  fee;   but  the  time  of  the 
maturity  of  the  indebtedness  secured  by  such 
mortgage  shall  not  be  extended  beyond   the 
time  of  minority  of  the  ward."     In  passing 
upon  this   section   (then   section   134   of   the 
statute   of   wills),   this   court,    in   Merritt   v. 
Simpson,  41  HI.  391,  where  the  guardian  had 
mortgaged  land  of  his  ward  in  fee,  beyond 
the  period  of  minority,  for  money  which  was 
used  in  erecting  a  brick  store  on  the  prem- 
ises, which  brought  a  large  rental,  held  that 
such  mortgage  was  nugatory  and  void  as  far 
as  the  interests  of  the  ward  were  involved. 
A.nd  it  seems  to  be  generally  held  that  the 
guardian  cannot  ordinarily  execute  a  mort- 
gage which  will  be  operative  as  a  lien  on 
the  ward's  land  beyond  the  term  of  minority, 
and  the  ward,  on  reaching  majority,  elects  to 
disaffirm   it,   and  that  the   only   safe  course 
for  the  guardian  to  pursue  is  to  first  secure 
the  order  of  court  authorizing  the  mortgage. 
If  there  be  some  statutory  provision  permit- 


ting It     1    Jones,    Mortg.    102b;    Schouler, 
Dom.  ReL  §  352;  and  cases  in  notes. 

It  would  therefore  necessarily  foUow  that 
Mary  Ann  McParland,  not  being  an  innocent 
purchaser,  but  having  taken  her  deed  with 
full  knowledge  of  the  guardianship  and  in- 
firmity of  her  title,  was  bound  to  know  that 
the  mortgaging  of  said  property  for  the  pur- 
pose of  making  improvements  thereon  was, 
as  to  the  interest  of  the  ward,  wholly  un- 
authorized, and  done  at  her  peril.  She  is 
entitled  to  no  more  protection  m  equity  than 
the  guardian  himself  would  be  had  he  taken 
the  deed  in  his  own  name  instead  of  his  wife's. 
The  legal  and  logical  effects  are  the  same. 
With  such  knowledge,  she  cannot  be  permitted 
to  take  advantage  of  that  which,  in  legal 
contemplation,  is  her  own  wrong,  to  bm-den 
the  estate  of  the  ward.  And  no  good  reason 
exists  why  the  ward,  might  not,  after  attain- 
ing majority,  demandL,  as  in  case  where  the 
guardian  himself  has  placed  unauthorized 
burdens  and  improvements  upon  the  estate, 
to  be  placed  in  statu  quo.  Schouler,  Dom.  Rel. 
§  348.  But  the  court  may,  in  the  exercise  of 
its  equity  powers,  protect  indebtedness  in- 
curred for  improvements  upon  the  ward's  es- 
tate, upon  the  theory  that  the  estate  has  been 
benefited  and  the  ward  received  an  advantage 
thereby.  Id.  §  351;  Hood  v.  Bridport,  11 
Eng.  Law  &  Eq.  271;  Jackson  v.  Jackson,  1 
Grat.  143;  1  Atk.  489.  And  this  the  court  did 
by  finding  the  appellee  to  be  entitled  to  a  one- 
third  interest  in  the  premises,  subject  to  the 
lien  of  the  trust  deeds  thereon,  which  had 
been  given  to  make  said  improvements,  after 
the  execution  of  the  deed. 

As  to  the  improvements  made  upon  the  old 
house  during  appellee's  minority,  and  without 
any  authority  from  the  probate  court,  appel- 
lee electing  to  repudiate  all  liabiirty  therefor, 
the  court  held  rightfully,  we  think,  that  the 
interest  of  the  ward  should  not  be  inaam- 
■  bered  or  chargeable  therewith,  but  that  appel- 
lant and  his  wife,  having  placed  such  improve- 
ments in  violation  of  the  trust,  were  not,  in 
equity,  entitled  to  recompense  for  the  same. 
The  court,  however,  decreed  that  appellants 
should  be  allowed  to  remove  the  old  cottage, 
which  had  been  remodeled  and  improved, 
from  the  premises  within  four  months,  and, 
in  default  thereof,  that  the  same  should  be- 
come part  thereof.  Of  this  ruling  we  think 
appellants  have  no  right  to  complain.  These 
Improvements  were  placed  upon  said  prem- 
ises, and  the  interest  of  appellee  wrongfully 
burdened  to  pay  for  the  same.  Appellants 
took  the  risk,  and  made  such  improvements 
with  knowledge  that  they  wei'e  doing  so 
wrongfully,  and  without  the  shadow  of  au- 
thority from  any  competent  source. 

Numerous  objections  are  made  to  the  mas- 
ter's report  and  the  decree  of  the  court,  as  to 
various  amounts  charged  to  appellant  as 
guardian,  etc  An  extended  review  and  discus- 
sion here  of  the  account  as  made  out  by  tho 
master,  and  the  items  thereof,  would  be  a  use- 
less task.  The  principal  objection  seems  to 
be  that  the  court  erred  in  charging  the  de- 


UNDUE  INFLUENCE. 


409 


fondant  Jamos  McParland  with  the  rental 
value  of  that  part  of  the  premises  upon  which 
the  old  house  was  situated  and  occupied  by 
said  Mary  Ann  McParland,  as  a  hoinostcad 
for  herself  and  family.  And  the  doctrine  of 
compensation  botwoon  tenants  in  common  is 
aj^ain  Invoked,  and  the  claim  made  tliat,  for 
use  and  occupation  of  the  premises,  one  ten- 
ant in  common  is  not  liable  to  account  to  his 
cotenants.  As  we  have  just  seen,  counsel 
contended  that  one  cotenant  should  be  recom- 
pensed, by  proper  conti'ibution  from  the  oth- 
ers, for  improvements  made  upon  the  estate. 
And  yet  the  contention  is  in  effect  made  that, 
thouffh  such  tenant  may  have  compensation 
for  improvements,  he  will  not  be  chargeable 
by  his  cotenant  with  the  rents  or  rental  value 
of  the  premises  occujiied  by  him,  to  the  exclu- 
sion of' the  others.  The  Engli-sh  rule  is  that 
the  tenant  shall  be  liable  to  account  to  his 
cotenants  in  common  only  for  what  he  re- 
ceives, not  what  he  takes,  more  than  comes 
to  his  just  share.  In  the  leadinj?  case  on  this 
subject,  of  Henderson  v.  Eason,  17  Adol.  & 
E.  (N.  S.)  701,  718,  Lord  Cottonham  held 
that  he  was  not  liable  to  account  for  issues 
and  profits  derived  by  such  exclusive  occu- 
pancy. Such,  however,  is  not  the  law  of  this 
state.  By  section  1,  c  2,  Rev.  St,  it  is  pro- 
vided that,  where  a  tenant  "shall  take  and 
use  the  profits  or  benefits"  of  the  estate  in 
greater  proportion  than  his  or  her  interest, 
such  tenant  shall  account  therefor  to  his  co- 
tenants,  eta  And  this  court,  in  Woolley  v. 
Schrader,  116  111.  39,  4  N.  E.  G58,  in  passing 
upon  this  question  and  construing  the  statute, 
after  commenting  upon  the  English  case  above 
cited,  admitted  the  doctrine  of  that  case  to 
be  the  prevailing  rule  of  decision  in  this  coun- 
try, but  said:  "Yet,  by  the  express  terms  of 
our  own  act,  the  tenant  is  required  to  account 
to  his  cotenants  for  benefits,  as  well  as  profits; 
and  we  fail  to  perceive  any  difficulty  in  giv- 
ing effect  to  this  provision  of  the  statute  that 
may  not  arise  in  any  case  whei'e  the  value  of 
anji;hing  is  to  be  ascertained  from  opinions 
of  witnesses  or  extrinsic  circumstances,  par- 
ticularly in  a  case  like  the  one  before  us.  The 
farm  in  question  belonged  to  four  children, 
'share  and  share  alike.'  It  would,  as  shown 
by  the  proofs,  have  readily  rented  to  others  at 
$ol5  per  annum.  *  ♦  *  Appellant,  instead 
of  letting  the  place  to  others,  and  collecting 
annually  that  amount  of  money  as  rental,  and 
paying  over  to  his  brothers  and  sisters  their 
respective  shares,  appropriated  tlie  entire 
farm  to  himself.  To  the  extent  of  their  inter- 
est, it  was,  in  effect,  appropriating  to  his 
own  use  that  amount  of  money  belonging  to 
them;  and  the  question  is,  shall  he  account 
for  it?  We  have  no  hesitancy  in  saying  he 
shall."  So,  here,  appellant  and  his  wife,  from 
the  date  of  making  his  final  account  as  gu;ird- 
ian,  have  been  in  the  exclusive  possession 
and  control  of  said  homestead  premises,  as  a 
family  home,  until  tlie  death  of  said  Mary 
Ann  McParland  and  her  daughter  Catharine, 
after  which  the  husband  and  father,  appellant 


James  McParland,  continued  In  such  posses- 
sion and  control;  and  there  can  be  no  ques»- 
tion  that  the  court  held  correctly  in  charging 
appellant  with  what  was  found  to  be  the 
reasonable  rental  value  tliereof. 

It  is  also  insisted  that  the  report  of  the 
master  and  finding  of  the  court  as  to  tlie 
value  of  the  premises,  of  the  Improvemont-s, 
rents,  etc.,  were  contrarj'  to  the  clear  prepon- 
derance of  the  evidence.  After  a  careful  ex- 
amination of  this  testimony,  and  a  consider- 
ation of  the  business,  experience,  character, 
and  means  of  knowledge  of  witnesses,  we  are 
unable  to  concur  with  this  view.  The  wit- 
nesses produced  on  each  side  were  numerous, 
and  very  many  of  them  upon  the  part  of  the 
defendants  were  experts,  real-estate  agents, 
some  of  them  knowing  nothing  personally  of 
the  particular  location,  surroundings,  and  ai>- 
pearance  of  the  premises,  and  who  based  their 
opinions  on  transfers  and  sales  of  property 
theretofore  made  along  the  street  or  in  the 
neighborhood  of  the  premises  in  question. 
Complainant's  witnesses  were  mainly  real- 
estate  agents  having  their  places  of  business 
not  far  distant  from  the  premises,  and  owners 
of  property  in  the  neighborhood,  whose  trans- 
actions in  the  sales  and  exchange  of  realty 
had  made  them  familiar  with  the  market 
value  of  land  in  that  vicinity.  And,  as  is 
not  unusual  in  such  cases,  there  axe,  in  some 
particulars,  considerable  contradictory  esti- 
mates and  opinions;  but  upon  the  whole  we 
are  not  prepared  to  say  that  the  court  was 
not,  upon  the  whole  of  the  evidence,  fully  war- 
ranted in  finding  as  it  did.  Indeed,  as  against 
the  testimony  of  those  witnesses  produced  on 
behalf  of  defendants  who  were  merely  ex- 
perts, having  no  personal  knowledge  or  obser- 
vation respecting  the  locus  in  quo,  but  basing 
their  value  solely  on  the  records  as  to  sales 
made  along  the  street,  the  court  would  be 
amply  justified  in  relying  upon  the  testimony 
of  witnesses  for  the  complainant  who  wore 
aU,  it  seems,  not  without  some  personal  knowl- 
edge of  the  premises,  and  many  of  them 
familiar  with  them  for  many  years;  and  this 
upon  the  cleai-est  principles  of  expediency  and 
sound  policy. 

Other  objections  were  made,  a  discussion  of 
which  would  not  be  profitable  here.  They 
have  aU  been  practically  disposed  of  in  what 
has  been  said.  TMiile  the  accounting  before 
the  master  is  somewhat  complicated,  and  the 
findings  by  him  and  the  court  thereon  no/ 
as  clear  as  might  be,  yet  a  careful  and  stu- 
dious examination  of  the  record  has  convinced 
us  that  substantial  justice  has  been  done; 
and  while  we  are  not  entirely  satisfied  that 
the  court  was  warranted  in  entering  the  de- 
cree against  complainant  for  .595.25,  and  mak- 
ing the  same  a  charge  against  the  complain- 
ant's interest  In  the  premises,  yet  such  error, 
If  error  it  was,  we  do  not  feel  justified  in  esti- 
mating of  sufficient  magnitude  of  itself,  in  a 
case  of  this  importance,  to  command  a  re- 
versal. The  decree  of  the  circuit  com't  will 
be  allii'med.    Affirmed. 


KEALITT  OF  CONSENT. 


WOOLEY  V.  DREW  ct  al. 
(13  N.  W.  594,  49  Mich.  290.) 
Supreme  Court  of  Michigan.    Oct  18,  1882. 
Appeal  from  Jackson. 

Grove  H.  Walcott  for  complainant  and  ap- 
pellant   Gibson.  Parkinson  &  Ashley,  for  de-  , 
fendants.  | 

MARSTON,  J.  Complainant  comes  into 
court  to  compel  the  defendant  Elizabeth  P. 
Drew  to  convey  a  certain  80  acres  of  land, 
which  complainant  conveyed  to  her  in  1879 
under  an  alleged  promise  to  reconvey  in  two 
years  thereafter. 

The  complainant's  theory  is  that  a  certain 
slander  suit  was  pending  against  her  hus- 
band; that  he  had  previously  conveyed  the 
farm  to  her;  that  defendant  John  F.  Drew 
"excited  complainant  into  the  belief  that  she 
would  lose  her  homestead,  unless  she  made 
a  conveyance  of  it  to  Mr.  Drew;"  and  that 
in  consequence  thereof  the  conveyance  was 
made.  The  defendants  deny  all  this  and 
claim  that  the  sale  made  was  in  good  faith 
for  a  valuable  consideration,  and  made  at  the 
earnest  solicitation  of  complainant  and  her 
husband.  The  case  was  heard  upon  tbe 
pleadings,  and  proofs  taken  in  open  court, 
and  the  bill  dismissed.  The  complainant  ap- 
pealed. 

If  the  complainant's  theory  is  sustained, 
the  case  comes  within  Bams  v.  Brown,  32 
Mich.  146,  and  she  is  entitled  to  relief. 
Where  the  witnesses  have  been  examined  in 
open  court,  and  the  case  is  one  that  must 
be  governed  by  the  credibility  of  the  witness- 
es for  the  respective  parties  and  the  weight 
to  be  given  their  testimony,  the  conclusion 
arrived  at  by  +he  court  below  should  not, 
upon  what  might  seem  to  the  court  a  mere 
preponderance  of  testimony,  be  overturned. 
Tliis  case  does  not  however  come  within  that 
class,  where  the  appearances  of  the  witnesses 
upon  the  stand  can  be  given  any  decisive  ef- 
fect, as  the  transaction,  when  reviewed  upon 
the  defendants'  testimony,  shows  that  it  was 
one  so  fraudulent  and  barefaced  that  it  could 
not  be  permitted  to  stand.  The  complain- 
ant and  her  husband  jvere  uneducated,  and 
they  seemed  to  have  had  a  good  deal  of 
trouble  with  their  neighbors,  while  the  de- 
fendant John  F.  Drew  seems  to  have  had,  or 
claimed  to  have,  considerable  knowledge  per- 
taining to  legal  matters.  The  complainant 
and  her  husband  at  the  time  the  conveyance 
was  made,  evidently  were  afraid,  that  be- 
cause of  the  slander  suit  they  were  in  some 
danger  of  losing  this  farm,  and  that  the  plain- 
tiff in  that  suit  and  other  parties  were  con- 
spiring against  them  to  cheat  them  out  of 
their  property.  Whether  these  ideas  were 
suggested  to  them  for  the  first  lime  by  John 
F.  Drew  as  complainant  claims  or  not  we 
do  not  deem  it  necessary  to  determine.  It 
Is  certain  that  defendants  did  not  make  any 
effort  to  allay  these,  fears,  or  to  assure  com- 


plainants that  their  proi)erty  could  not  be  at- 
tached in  the  slander  suit,  or  they  be  enjoined 
from  transferring  their  farm  because  of  the 
pendency  thereof.  On  the  contrary  these  im- 
pressions were  strengthened  and  the  trade 
consummated  within  a  very  short  time,  a  few 
days  after  being  first  mentioned  or  thought 
of  between  the  parties. 

The  complainant's  farm  contained  80  acres, 
with  suitable  bxiildings  and  improvements 
•thereon  of  the  value  of  $3,200,  upon  which 
there  was  an  incumbrance  of  $100,  and  it 
had  also  been  leased  for  one  year,  from  April, 
1879,  the  rent  to  be  paid  in  a  share  of  the 
crops. 

Vfhen  the  complainant  and  her  husband  at 
the  house  of  defendants  talked  of  selling,  the 
defendant  John  F.  offered  to  give  them  for 
their  farm  a  mortgage  held  by  his  wife  upon 
a  certain  house  and  lot  in  the  city  of  Jackson, 
which  defendants  say  the  complainant  and 
her  husband  were  ready  and  willing  to  ac- 
cept, and  wished  to  have  the  necessary  pa- 
pers executed  at  once,  but  which  defendants 
put  off  for  a  couple  of  days  to  enable  them 
to  make  an  examination  of  complainant's 
title  to  the  farm.  On  making  this  examina- 
tion the  next  day,  they  for  the  first  time 
ascertained  that  there  was  an  outstanding 
mortgage  thereon  for  $100,  and  they  also, 
before  the  trade  was  consummated,  learned 
that  the  farm  had  been  leased  for  one  year 
with  the  privilege  of  an  additional  year. 

The  parties  met  the  following  day,  and 
defendants  say  they  did  not  then  wish  to 
make  the  exchange,  yet  the  defendant  John 
F.  had  procured  the  necessary  blank  form  of 
conveyance,  and  after  some  little  talk  de- 
fendants then  agreed  to  assign  the  mortgage 
referred  to,  and  accept  a  conveyance  of  the 
farm  subject  to  the  mortgage  thereon  and 
give  complainant  a  two  years'  lease  of  the 
same,  although  no  such  favorable  terms  were 
asked  for  by  complainant,  and  the  trade  wns 
so  made,  defendant  John  F.  drawing  all  the 
papers  and  taking  all  the  acknowledgements, 
his  wife  assigning  the  mortgage  and  acknowl- 
edging the  execution  thereof  before  him. 
This  mortgage  bore  date  March  1,  1872,  was 
given  by  Julia  A.  Knowles  to  Sylvester  Mc- 
Michael  to  secure  the  payment  of  $951.49  in 
three  years  from  the  date  thereof,  with  10 
per  cent,  interest  payable  semi-annually,  ac- 
cording to  a  certain  bond  bearing  even  date 
therewith.  Defendant  John  F.  Drew  had  a 
second  mortgage  upon  this  same  property 
:  which  he  foreclosed  and  bid  in  at  the  sale, 
and  afterwards  his  wife,  at  his  request,  took 
an  assignment  of  the  Knowles-McMichael 
mortgage,  the  assignment  bearing  date  De- 
cember 17,  1873. 

At  the  time  of  the  assignment  to  Mrs.  Drew, 
nothing  had  been  paid  upon  tJiis  mortgage, 
and  no  payment  of  either  principal  or  inter- 
est was  made  thereafter  up  to  the  time  of 
the  assignment  to  complainant.  John  F. 
Drew  was  the  owner  under  his  foreclosure 
proceedings  of  the  mortgaged  premises,  re- 


UXDUR  INFLUENCE. 


411 


ceiving  the  rents  and  profits  thereof.  At 
the  time  of  the  assignment  thereof  to  com- 
plainant, defendants  represented  the  amount 
due  thereon  at  about  ?1,'J00.  We  suppose  the 
computation  was  made  under  the  act  of 
1SG9,  which  allows  interest  on  Installments 
after  due.  Whatever  the  fact  may  have 
l)oen  however  as  to  the  amount  claimed  to  be 
due  and  collectiljle  thereon,  the  mortgaged 
premises  were  not  considered  by  the  defend- 
ants as  suflicicnt  to  pay  the  mortgage;  they 
were  not  indeed  wortli  more  tlian  ijil.GOO,  and 
would  not  bring  near  tliat  at  a  public  sale. 
It  was  the  assignment  of  this  mortgage  that 
complainant  received  for  her  farm,  with  a 
two  j^ears'  lease  thereof. 

Tliore  are  some  other  peculiarities  worth 
noting.  Complainant's  farm  was  about 
seven  miles  from  the  residence  of  defendants. 
Some  10  or  12  years  previous  to  this  trade, 
defendant  John  F.  Drew  "went  down  liunt- 
iug  on  the  marsh  across  that  farm,"  and  at 
this  time  he  did  not  know  who  was  living 
on  it.  He  had  not  been  to  the  farm  after 
that,  until  a  few  days  before  the  trade,  when 
he  went  down  to  complainant's  house  to  see 
about  hiring  a  girl,  and  did  not  then  looli 
over  the  farm,  as  he  then  had  no  thought 
of  purchasing  it.  At  the  time  he  examined 
the  title  he  inquired  of  the  register  of  deeds 
what  kind  of  land  this  was,  and  says  "I 
thought  that  his  recommend  and  my  memory 
corresponded."  This  was  the  extent  of  de- 
fendant's knowledge  as  to  the  kind  or  quality 
of  the  soil,  or  the  improvements  thereon  or 
salue  thereof. 

The  mortgage  which  he  assigned  to  com- 
plainant had  been  acquired  by  his  wife  after 
he  became  the  owner  of  the  mortgaged  prem- 
ises, and  another  peculiarity,  altliongh  ac- 
cording to  the  recitals  in  the  mortgage,  a 
l)ond  purported  to  have  accompanied  it,  and 
to  have  been  assigned  to  complainant  ac- 
cording to  the  written  assignment,  yet  nei- 
ther complainant  nor  Mrs.  Drew  seems  to 
liave  ever  seen  or  possessed  this  bond.  True 
it  is,  that  complainant  did  not  receive  or  have 
any  personal  obligation  for  the  amount  repre- 
sented by  the  mortgage  assigned  her  or  any 
part  thereof.  And  it  the  transaction  was  an 
lionest  one,  why  the  defendants  should  not 
have  conveyed  the  premises  to  complainant, 
they  being  of  far  less  value  than  the  mort- 
gage, instead  of  the  latter.  It  is  difficult  to 
conjecture,  thus  putting  her  to  the  trouble 
and  expense  of  foreclosing  the  same  before 
she  could  realize  a  dollar  thereon,  unless  it 
was  to  enable  .Tohn  F.  Drew,  as  owner  of  the 
mortgaged  premises,  to  receive  the  rents  and 
profits  thereof  to  his  own  use.  This  he  did, 
but  was  not  generous  enough  to  pay  any 
part  thereof  to  complainant,  as  she  did  not 


receive  anj'thlng,  either  principal  or  intorost. 
upon  the  mortg-ige.  The  a.ssumption  tliat 
this  course  was  taken  to  prevent  the  collec- 
tion of  any  judgment  that  might  have  been 
received  In  the  slander  suit,  is  not  satisfac- 
tory, as  the  mortgage  could  have  been  reach- 
ed just  as  easily  as  could  the  premises  had 
they  been  conveyed  to  the  complainant. 

It  is  indeed  much  more  probable  that  this 
mortgage    was    transferretl    to    Elizabeth    P. 
•  Drew  at  the  request,  and   for  the   use  and 
benefit,    of   her    liusliand,    the    owner   of    the 
premises,  and  that  it  was  not  at  any  time 
thereafter  considered  as  an  existing  incum- 
brance, or  the  bond  accompanying  tlie  same, 
if  assigned,   an   existing   obligation   against 
the   mortgagor,   as  no  effort  seems  to  have 
at  any  time  been  made  to  collect  principal 
or  interest  thereon  although  long  past  due. 
The   defendants  claimed  and  took   tlie  crop 
j  of  wheat  growing  on  complainant's  land  at 
I  the  time  the  exchange  was  made,  although  It 
I  was  far  from  clear  what  right  they  had  there- 
i  to,   under  the  lease  given  by  them  to  com- 
I  plainant.     Indeed  the  whole  case  shows  that 
I  however  fair  the  transaction  may  have  seem- 
1  ed  to  be  on  the  part  of  defendants,   yet   It 
I   was  fair  upon  the  surface  only,  and  would 
not  bear  investigation;    It  was  much  like  a 
;   subsequent   agreement    made   between   com- 
plainant and  Elizabeth  P.  Drew,  in  reference 
I  to  the  latter  not  taking  any  further  steps  to 
J  obtain   possession,    which   as   given   by   one 
of  defendants'    witnesses   is   worth   quoting. 
When  asked  to  state  a  conversation  he  heard 
between  the  parties  after  this  difficulty  arose, 
the  witness  testified: 

"I  think  about  the  first  that  was  said  after 
Mr.  and  Mrs.  Wooley  came  in,  Mrs.  Drew 
says,  I  promised  you  this  morning  I  would 
do  nothing  further  in  this  matter  In  relation 
to  the  farm  until  I  saw  you  again;  I  have 
seen  you  now,  she  says;  that  cancels  the 
agreement;   or.  something  like  that" 

A  careful  examination  of  the  entire  record 
leaves  no  doubt  in  our  minds  as  to  the  sub- 
stantial correctness  of  the  complainant's  ver- 
sion, and  the  transaction  on  the  part  of  de- 
fendiints  has  been  so  clearly  unconscionable, 
and  their  coui-se  in  endeavoring  to  talce  ad- 
vantage of  the  ccmplainant's  fears  to  obtain 
a  conveyance  of  a  valuable  farm,  for  a  verj- 
questionable  security  of  doubtful  value,  was 
so  clearly  fraudulent  that  a  court  of  equity 
cannot  sanction  the  same  by  permitting  them 
to  enjoy  fniits  thereof. 

The  parties  must  therefore  be  restored' to 
their  original  positions.  The  decree  below 
will  be  reversed  with  'costs  of  both  courts 
and  the  complainant  will  have  a  decree  in 
this  court  in  accordance  herewith. 
The  other  justices  concurred. 


412 


ILLEGALITY  OF  OBJECT. 


> 


ATKINS  V.  JOHNSON 


(43  Vt.  78.) 


■■^^f 


^^ 


Supreme   Court   of   Vermont.    Washington. 
Aug.  Term,  1870. 

As-^nnipsit  us  per  declaration,  which  is 
set  out  in  tlie  opinion  of  tiie  court.  Trial 
on  general  demurrer  to  the  declaration,  at 
the  .March  term,  1S70,  Peck,  J.,  prertidint?. 
Tlie  court,  pro  forma,  adjuili^ed  the  decla- 
ration iiiKiifficient,  and  rendered  judgment 
for  the  defendant  to  recover  liiH  crjstH.  Ex- 
ceptions by  the  i)laintiff. 

C.  J.  Gleason,  for  plaintiff.  Mr.  Carpen- 
ter, for  defendant. 

PIERPOINT,  C.  J.  The  case  comes  into 
this  court  upon  a  general  demurrer  to  the 
plaintiff's  declaraticjn. 

The  declaration  alleges  that  "on  the  22d 
day  of  July,  18G7,  the  defendant,  by  his 
agreement  in  writing  of  that  date,  under- 
tuf)U  and  promised  the  plaintiff  that,  in 
consideration  that  the  plaintiff  would 
print  and  publish  an  article  in  the 
Argus  &  Patiuot,  a  ^weekly  news-  *80 
paper  published  in  Montpclier  by  the 
plaintiff,  entitled  'A  Jack  at  all  Trades 
•E.xposed,'  that  said  article  was  all  true, 
that  there  was  enough  to  back  it  up,  &c., 
and  that  he,  the  said  defendant,  would  de- 
fend and  save  harmless  the  plaintiff  from 
all  damage  and  harm  that  might  accrue 
to  the  plaintiff  in  consequence  of  publishing 
said  article.  That  said  article,  if  untrue, 
was  a  libel  upon  the  charactcrof  one  John 
Gregfjry  ;  that  relying  upon  thosaid  prom- 
ises of  the  defendant  lie  published  the  ar- 
ticle; that  after  said  publication  the  said 
Gregory  called  upon  the  plaintiff  for  the 
name  of  the  writer  of  the  article;  that 
thereupon  the  defendant  requested  the 
plaintiff  not  to  give  the  said  Gregory  the 
name  of  the  writer,  and,  in  consideration 
thereof,  promised  thi;  plaintiff  that  he 
would  save  him  from  all  harm;  that  if  said 
Gregory  sued  the  plaintiff,  that  he,  the 
defendant,  would  defend  the  suit,  prove 
the  charges,  and  save  the  plaintiff  from 
all  trouble  and  expense  in  the  premises. 
The  plaintiff,  relying  thereon,  withheld  the 
name  of  the  defendant  as  the  author  of 
said  article;  that  the  said  Gregory  sued 
the  plaintiff;  that  the  defendant  failed  to 
defend  the  said  suit,  and  the  said  Gregory 
recovered  a  judgment  against  the  plain- 
tiff, which  he  has  been  comiielled  to  pay, 
and  the  defendant  refuses  to  indemnify 
him." 

The  plaintiff  is  here  seeking  to  compel 
the  defendant  to  indemnify  him  for  the 
damage  which  he  has  sustained,  in  conse- 
quence of  publishing  a  libel,  at  the  request 
of  the  defendant,  and  from  the  conse- 
quences of  which  the  defendant  agreed  to 
save  him  harmless. 

The  question  is,  whether  such  an  agree- 
T.ent  as  the  plaintiff  sets  out  in  his  decla- 
ration can  be  legally  enforced. 

The  general  principle,  that  there  can  be 
jio  contribution  or  indemnity,  as  between 
joint  wrong-doers,  is  too  well  settled  to 
require  either  argument  or  authority. 

To  this  rule  there  are  many  exceptions, 
and  prominent  among  them  is  the  class  of 


cases  where  questions  arise  between  dif- 
ferent parties  as  to  the  ownership  of  prtjp- 
crty,  and  a  third  person,  supposing  one 
party  to  be  in  the  right,  uijon  the  request 
and  under  the  authority  of  such  party, 
■Joes  acts  that  are  legal  in  themselves,  but 
which  i)rove  in  the  end  to  be  in  viola- 
tion of  therightsof  the*otlier  party,  "81 
and  he,  in  consequence  thereof,  is 
made  liable  in  damages.  If  in  such  case 
there  was  a  promise  of  indemnity,  the  law 
will  enforce  it,  and  if  there  was  not,  if  the 
circumstances  will  warrant  it,  the  law  will 
implj'  a  promise  of  indemnity,  and  enforce 
that.  Of  tliis  class  are  most  of  the  cases 
cited  and  relied  upon  by  tlie  counsel  for  the 
plaintiff,  such  as,  Betts  v.  Gibbins;  Adam- 
son  V.  Jarvis;  Woolcy  v.  Batte;  Avery  v. 
Ilalsey,  &c.  But  we  apprehend  that  no 
exception  has  ever  been  recognized  broad 
enough  to  embrace  a  case  like  the  present; 
indeed  such  an  exception  would  be  a  virt- 
ual abrogation  of  the  rule. 

In  this  case,  these  parties  in  the  outset 
conspired  to  do  a  wrong  to  one  of  their 
neighbors,  by  publishing  a  libel  upon  liis 
character.  The  publication  of  a  libel  is  an 
illegal  act  upon  its  face.  This,  both  par- 
ties are  presumed  1o  have  known.  The 
publication  not  only  subjects  the  party 
publishing  to  a  prosecution  by  the  person 
injured  for  damages,  but  also  to  a  public 
prcjsecution  by  indictment.  In  either  case, 
all  that  would  be  required  of  the  prosecu- 
tor would  be  to  prove  the  publication  by 
the  party  charged.  The  law  in  such  case 
presumes  malice  and  damage,  and  the 
prosecutor  would  be  entitled  to  a  judg- 
ment, unless  the  party  charged  could  in- 
troduce something  l)y  way  of  defense  that 
would  have  the  effect  to  discharge  him 
from  legal  liability;  failing  in  that,  the 
party  would  be  made  liable  upon  a  simple 
state  of  facts,  all  of  which  he  pej-fectly  un- 
derstood at  the  timehe  commenced  his  un- 
justifiable attack. 

In  this  case,  both  these  parties  knew 
that  they  were  arranging  for  and  consum- 
mating an  illegal  act,  one  that  subjects 
them  to  legal  liability,  h(jping,  to  be  sure, 
that  they  might  defend  it;  but  the  plain 
tiff,  fearing  they  might  not  be  able  to  do 
so, sought  to  protect  himself  from  the  con- 
sequences, by  taking  a  contract  of  indem- 
nity from  the  defendant.  To  say  under 
such  circumstances  that  these  parties  were 
not  joint  wrong-doers,  within  the  full 
spirit  and  meaning  of  the  general  I'ule, 
would  be  an  entire  perversion  of  the  plain- 
est and  simplest  proposition.  This  being 
so,  the  law  will  not  interfere  in  aid  of 
either.  It  will  not  Int^uire  which  of  the 
two  are  most  .in  the  wrongT  witn  arrl^w 
of  adjusting  the  equities  between  them, 
but  n  garding  both  as  having  been 
*82  understandingly  "'engaged  in  a  vio- 
lation of  the  law,  it  will  leave  tliera 
as  it  finds  them,  to  adjust  their  differences 
between  themselves,  as  they  best  may. 

But  it  is  said  in  argument,  that  to  ap- 
ply this  rule  in  a  case  like  the  present  is  an 
encroachment  upon  the  "freedom  of  the 
press. "  We  do  not  so  regard  It.  The  freer, 
doni^f  the  press  does  not  consistjnjaw- 
lessness,  or  in  freedom 'rronr''wTioresojne 
legal  restraint.  The  publisher  of  a  news- 
paper has  no  more  right  to  publish  a  libel 


COMMISSION  OF  CRIME  Oli  CIVIL  WRONG. 


413 


Tiprjn  .111  iiulividual,  tliat  he  or  any  other 
man  has  to  make  a  BlanderouH  prcjclauia- 
tion  by  word  of  month. 

It  Is  also  naid  tliat  tl)o  publisher  of  a 
no\vspa[)('r,  iu  his  desire  to  fnrniHh  the 
pnhlic  with  information  of  wJiat  ik  trans- 
pirinji"  In  the  comnumity,  Ih  liable  to  be 
misled  and  deci'i^ed  in  fe><ard  to  what  he 
publishes.  This  is  undcjubtedly  true,  and 
it  is  etpially  true  that  he  often  is  deceived  ; 
but  in  such  case  he  ordinarily  has  ample 
means  of  reliovinp:  himself,  either  by  cor- 
recting the  error,  or  givinjc  up  the  name 
of  the  author  of  the  object ionablo  commu- 
nication. Had  tli(^  plaii)lin'  in  thin  cuao 
jiiveu  Liui  nuuieal  TTTe  author  of  th«  article 
to  (Jrciiory  when  he  asked  lor  it,  he  would 
undoubtedly  have  cast  the  responsibility 
upon  the  shoulders  of  him  who  ouglit  to 
bear  It.  By  refusing  to  do  this,  he  put 
liimseTfln  the  gaj),  and  voluntarily  as- 
sumed the  whole  responsibility,  relyiiifi,- on 
the  defeudaut's  guarauty  to  indemnify 
him. 

But  It  is  further  insisted,  that  what  Is 
alleged  to  have  transpired  between  the 
plaintiff  and  defendant  after  Gregory  had 
called  on  the  plaintiff  for  the  name  of  the 
autlior.  constituted  a  new  and  independ- 
ent contract,  based  upon  a  new  and  legal 
consideration.  This  proposition  we  think 
is  not  tenable.  What  pass(;d  between  the 
parties  on  that  occasion  is  a  mere  reitera- 
tion of  the  original  agreement,  and  based 
substantially  upon  tlie  same  considera- 
tion. It  was  evidently  so  regarded  by  the 
pleader  when  he  drew  the  declaration.  .It 
is  all  incorporated  in  the  same  count,  be- 
ing a  simple  narration  of  the  events  as 
they  transpired.  The  promise  on  that  oc- 
casion was  to  save  the  plaintiff  from  all 
harm,  trouble  and  expense  in  the  premises, 
in  case  the  said  Gregory  should  sue  him. 

This  question  was  fully  considered  in  the 
case  of  Shackell  v.  Rosier,  29  Eng. Com.L., 
G!)5.  In  that  case  the  [)lainti{f,  Shack- 
ell,  was  *tho  i)ublisher  of  a  newsjja-  *83 
per.  Tlie  defendant  applied  to  him  to 
I)ublish  an  article  that  was  libelous  on  its 
face,  but  which  the  defendant  assured  him 
was  true.  After  the  publication,  the  par- 
ty aggrieved  brought  his  action  against 
the  plaintiff  for  the  libel.  The  defendant 
thereupon  promised  the  plaintiff,  that  If 
he  would  defend  said  suit,  he,  tiie  defend- 
ant, would  save  harmless  and  indemnify 
the    plaintiff  from    all    payments,    costs, 


charges  and  expenses,  &c.  On  trial,  there 
was  a  verdict  for  the  plaintiff.  This  was 
arrested  and  set  aside.  Pa hk,  J.,  says  it 
is  impossible  to  look  at  this  derjaration. 
willuMit  seeing  that  the  publication  <jf 
the  libelous  matt<'r  formed  part  of  the  con- 
siih  ration  for  the  defendant's  i>romise.  "It 
W(nild  be  productive  of  great  evil,  if  the 
courts  wert?  to  encfMirago  such  an  engage- 
ment as  this,  and  thereby  hoh!  out  induce- 
ment to  the  propagation  of  illegal  and  un- 
founded charges; "  and  then  quotes  from 
Lord  Lyndlnirst  as  foUoww:  "I  know  of 
no  case  in  which  a  person,  who  has  com- 
mitte(i  an  act,  declai-ed  by  the  law  t<-i  be 
criminal,  has  been  permitted  to  recover 
comi)ensation  against  a  person  wIkj  has 
acted  jointlj'  with  him  in  the  commission 
of  the  offense.  "  VArGM.\N,J.,Bays:  "Inthis 
case  the  court  itself  would  become  acces- 
sory to  the  publication  of  libels.  If  it  was 
to  enforce  such  a  contract  as  the  present." 
Bosanqi;kt,  J.,  says;  "I  am  of  opinion 
that  the  promise  and  considei-ation  both 
ap[)ear  on  the  record  to  be  illegal.  The 
I)romise  is  to  save  harmless  and  indemnify 
the  plaintiff,  &c.  It  api)ears  that  the  pub- 
lication was  made  at  the  solicitation  of 
the  defendant,  a  publication  marnfestly 
illegal,  and  open  to  indictment;  at  once 
the  subject  of  an  action  at  the  suit  of  the 
party  offended,  and  an  offense  against  the 
public.  The  case  does  not  therefore  fall 
within  the  principle  laid  down  by  Lord 
Kenj'on,  in  Merrj-weather  v.Nixan,  as  the 
act  done  bj'the  plaintiff  here  was  unlaw- 
ful within  his  own  knowledge."  The  prin- 
ciples recognized  and  promulgated  in  this 
decision  cover  substantially  the  whole 
case  now  before  us. 

The  position,  in  which  the  facts  con- 
fessed upon  the  record  place  the  defend- 
ant, is  not  an  enviable  one.  He  seems  to 
have  originated  the  mischief — to  have  in- 
duced the  plaintiff  to  aid  him  in  carrying 
it  into  effect,  by  assurance  of  the  truth  of 
the  statements,  and  a  promise  of  indemni- 
ty', and  after  standing  by  and  seeing 
*S4  the  *plaintiff  amerced  in  damages, 
takes  advantage  of  a  strictly  legal 
defense,  and  throws  the  whole  respcmsibil- 
itj'  opon  the  plaintiff.  Personally,  it 
would  have  given  me  satisfaction  to  have 
decided  the  case  for  the  plaintii'f,  if  it  could 
have  been  done  without  violating  well- 
established  and  salutary  rules  of  law. 

Judgment  of  the  county  court  is  atlirmed. 


414 


ILLEGALITY  OF  OBJECT. 


)^ 


JEWETT  PUB.  CO.  v.  BUTLER.     . 
r34  i\.  E.  10S7,  159  Mass.  517.)  ^  ^ 
Saprenie   Judicial    Court   of   Massachusetts. 
Suffolk.    Oct.  19.  1S93. 


/ 


Report  from  supreme  judicial  court,  Suf- 
folk county;    Oliver  W.  Holmes,  Jr.,  Judge. 

Action  by  C.  F.  Jewett  Publishing  Com- 
pany against  Benjamin  F.  Butler  for  breach 
of  contract.  The  court  reported  the  case  to 
the  supreme  judicial  court.  Judgment  for 
plaintiff. 

The  contract  between  the  parties  recited 
that  the  defendant  "is  minded  and  intending 
to  write  and  have  published  two  volumes  in 
the  nature  of  autobiography  or  reminiscences 
of  his  life,  and  the  acts  and  doings  of  other 
pubUc  men,  so  far  as  they  may  seem  to  him 
to  elucidate  the  history  of  the  country  or  pub- 
lic affairs,"  and  it  was  stipulated  that  the 
plaintiff  should  do  the  publishing.  The  dec- 
laration alleged  that,  after  defendant  had  writ- 
ten the  work,  he  permitted  it  to  be  pub- 
lished by  other  parties,  and  that  plaintiff  had 
suffered  damages  in  having  prepared  for  the 
publication,  and  in  the  loss  of  profits  which  it 
wouid  have  made  from  the  sale. 

E.  C.  Bumpus.  Samuel  J.  Elder,  and  Wil- 
liam Cushing  Wait,  for  plaintiff.  John  Low- 
ell and  E.  M.  Jolmsor    for  defend^nL 

MORTON,  J.     The  first  question  is  v.hath- 
er  the  contract  is,  as  the  defendant  contends, 
Illegal  on  its  face.     The  words  relied  on  to 
ehow  that  it  is  are  as  follows:     "The  party 
of  the  first  part  agrees  to  accep''  full  respon- 
sibility of  all  matter  contained  in  said  work, 
and  to  defend  at  his  own  cost  any  suits  which 
may  be  brought  against  the  party  of  the  sec- 
ond part  for  publishing  any  statements  con- 
tained in  said  work,  and  to  pay  all  costs  and 
damages  arising  from  said  suit."     The  pre- 
siding justice  found  that  "the  contract  was 
made  without  illegal  intent,   unless  and  ex- 
cept so  far  as  the  words  used  import  one  as 
matter    of    law."     Do    the    words    used,    as 
quoted  above,  import  one  as  matter  of  law? 
We  think  not.     The   parties   were  contract- 
ing respecting  a  book  which  was  not  in  ex- 
Lstence,  but  was  to  be  written.     There  was 
nothing  in  the  character  of  the  proposed  work 
which   naturally  or  necessarily   involved   the 
publication  of  scandalous  or  libelous  matter, 
as  was  the  case,  for  instance,  in  Shackell  v. 
Rosier,  2  Bing.  N.  C.  634,  referred  to  by  the 
defendant.     At  the  same  time  it  was  not  im- 
possible that,  in  spite  of  due  care  and  good 
faith  on  the  part  of  the  author  and  publisher, 
the  proposed  book  might  contain  matter  which 
others  perhaps  would  deem  libelous.     In  such 
a  case  it  would  be  no  more  unlawful  for  the 
parties    to    provide    that    the   author    should 
save  the  publisher  harmless   from   all   costs 
and  damages  to  which  he  might  be  subjected 
by  reason  of  the  publication  of  the  book  than 
it  would  be  for  a  patentee  to  agree  with  his 
licensee  that  he  would  protect  him  against 
all  costs  and  damages  to  which  he  might  be 


sul-jected  in  consequence  of  using  the  patent 
to  which  the  license  applied.    The  case  stands 
on   grounds  entirely  different  from  those  on 
which  it  would  stand  if  it  appeared  that  the 
parties  intended   to  publish  or  contemplated 
the  publication  of  libelous  matter.     There  is 
nothing  in  the  agreement  fairly  to  show  that 
such  was  their  purpose.     The  most  that  can 
be  said  is  that,  though  there  was  no  inten- 
tion to  write  or  publish,  nor  any  contempla- 
tion of  writing  or  publishing,  libelous  matter 
on    the   part   of   the   author   or   publisher,    it 
might  turn  out,  after  the  book  was  published, 
that  it  did  contain  libelous  matter.     But  that 
Is  very  far  from  saying  that  the  parties  had 
in  view  an  illegal  purijose  in  publishing  the 
book.     We  see  nothing  unlawful  in  a  contract 
which  provides,  without  anything  more,  that 
the  author  shall  indemnify  the  publisher  for 
costs  and  damages  to  which  he  may  be  sub- 
jected by  reason  of  the  publication  of  a  book 
to  be   written    by   the  author.     Moreover,    it 
was  possible  in  this  case  that  the  book  might 
not    contain    libelous    matter,    although    libel 
suits  against  the  publisher  might  gTow  out  of 
It.     It  would  be  hard  to  say,  in  such  event, 
khat  the  publisher,  who  might  have  published  j 
the  book  without  any  libelous  purpose,  and' 
in   the  full  belief  that  it  contained   nothing; 
libelous,  could  not  recover  of  the  author  un-j 
&er  this  clause  in  the  contract  the  costs  and| 
namages  to  which  he  had  been  put  by  such; 
suits.     In  order,  we  think,  to  render  the  con- 
tract unlawful,   it  should  appear  that  there 
was  an   intention  on  the  part  of  the  authop 
and   publisher  to  write  and  publish  libelous 
matter,  or  that  the  author  proposed,  with  the\ 
knowledge  and  acquiescence  of  the  publisher,  I 
to  write  libelous  matter,  or  that  the  contracti 
on  its  face  provided  for  or  promoted  an  ille/ 
gal  act.     We  do  not  think  the  clause  in  ques- 
tion is  fairly   susceptible  of  either  construc- 
tion.    Fletcher  v.    Harcot,    Hut.   55;    Batter- 
gey's   Case,   Winch,  49;    Betts  v.   Gibbins,  2 
Adol.  «&  B.  57;    Adamson  v.  Jarvis,  4  Bing. 
66;    Waugh    v.    Morris,    L.   R.   8   Q.    B.   202; 
Pearce  v.  Brooks,  L.  R.  1  Exch.  213;    Cannan 
v.    Bryce,    3    Barn.   &    Aid.    179;    Graves    v. 
Johnson,  156  Mass.  211,  30  N.  E.  Rep.  818. 

The  defendant  contends,  in  the  next  place, 
that  he  was  justified  in  his  refusal  to  go  on 
with  the  contract  because  of  his  doubts  as 
to  the  solvency  of  the  plaintiff  corporation, 
and  because  of  the  disgrace  attaching  to  its 
name  in  consequence  of  the  conduct  of  Jew- 
ett. The  first  ground  thus  taken  would  seem 
to  be  disposed  of  by  the  recent  case  of  Hobbs 
V.  Brick  Co.  (Mass.)  31  N.  B.  Rep.  756,  and 
need  not,  therefore,  be  further  considered. 
As  to  the  second  ground,  it  is  to  be  observed 
that  the  contract  was  not  made  with  Jewett 
personally,  but  with  the  corporation  which 
bore  his  name.  Moreover,  Jewett  has  fled, 
and  it  fairly  may  be  presumed  that  his  place 
as  president  and  manager  has  been  filled  by 
the  election  of  another  person,  so  that  tlie 
defendant  cannot  and  will  not  be  obliged  to 
come  into  further  association  with   him.     It 


COMMISSION  OF  CRIME  Oil  CIYIL  WRONG. 


415 


Is  wen  known  that  corporations  are  frequent- 
ly organized  which  bear  as  part  of  tht-ir  cor- 
porate name  the  name  of  sonae  iudividuah 
The  contention  of  the  defendant  would  re- 
quire us  to  liold  that  in  all  such  cases  a  party 
making  a  contract  witli  such  a  corporat)(-n 
would  be  justified  in  refusing  to  go  on  with 
It  if  the  person  whose  name  the  corporation 
bore  committed  an  act  rendering  him  liable 
to  punishment  as  a  criminal,  or  bringing  him 
Into  disgrace  and  rendering  further  associa- 
tion with  him  unprofitable  and  injurious  to 
the  oth^  party  to  the  contract.  But  a  cor- 
poration does  not  in  such  a  case  impliedly 
guaranty  as  an  element  of  the  contract  en- 
tered into  with  it  that  the  person  whose  name 
it  bears  shall  continue  to  be  a  reputable  mem- 
ber of  society.  The  corporation  is  distinct 
from  the  person  whose  name  it  bears.  Its 
interests  and  those  of  its  stockholders  in  con- 
tracts made  by  ft  with  other  parties  are  not 
to  be  affected  by  tJie  disgraceful  or  criminal 
conduct  of  the  person  whose  name  it  bears, 
and  for  which  it  is  in  no  way  responsible.  A 
majority  of  the  court  think  the  entry  should 
be,  judgment  for  plaintiff  for  $2,500  and  in- 
terest from  June  9,  1890,  and  it  is  so  ordered- 

LATHROP,  J.  (dissenting).  I  au  unable 
to  concur  in  the  opinion  of  the  majority  of 
the  court  that  the  contract  sought  to  be  en- 
forced is  a  valid  contract.  The  contract  pro- 
vides for  the  publication  of  a  work  to  contain 
the  author's  autobiogi-aphy  "or  reminiscences 
of  his  life,  and  the  acts  and  doings  of  other 
public  men,  so  far  as  they  may  seem  to  him 
to  elucidate  the  history  of  the  country  or  pub- 
lic affairs."  It  is  in  reference  to  a  work  of 
this  character  that  the  defendant  agrees  to 
do  three  things:  First,  "to  accept  full  re- 
sponsibility of  all  matters  contained  In  said 
work;"  secondly,  "to  defend  at  his  own  cost 
any  suits  which  may  be  brought  against  the 


party  of  the  second  part  for  publishing  any 
statements  contained  in  said  work;"  thirdly, 
"to  pay  all  costs  and  damages  arising  from 
such  suits."  The  obligation  of  the  defend- 
ant is  not  limited  to  paying  legal  expenses, 
but  includes  costs  and  damages  recovered 
against  the  publisher  "for  publishing  any 
statements  contained  in  said  work."  While 
It  is  found  that  the  parties  artr-d  witliout  ille- 
gal intent,  yet  If  the  legal  effect  of  the  lan- 
guage used  is  to  make  the  contract  against 
the  policy  of  the  law,  this  court  ought  not 
to  enforce  it.  It  seems  to  me  to  be  impossi- 
ble to  say  that  the  language  used  applies 
only  to  groundless  suits,  and  that  It  should 
so  be  construed.  What  the  parties  contem- 
plated, and  what  they  intended  to  provide  for, 
was  that  actions  might  be  brought  against 
the  publisher  for  libelous  matter  contained  In 
the  work;  that  these  actions  might  be  suc- 
cessfully maintained  against  the  publisher, 
who  would  then  be  compelled  to  pay  dam- 
ages and  costs.  In  this  event  the  writer 
agreed  to  Indemnify  the  publisher.  Could 
such  an  agreement  have  been  enforced?  In 
my  opinion,  it  could  not,  and  this  view  Is  sus- 
tained by  the  authorities.  Shackell  v.  Rosier, 
2  Bing.  N.  C.  034;  Colburn  v.  Patmore,  1 
Cromp.  M.  &  R.  73;  Gale  v.  Leckie,  2  Starkie, 
107;  Clay  v.  Yates,  1  HurL  &  N.  73;  Arnold 
V.  Clifford,  2  Sum.  238;  i  Odgers,  Sland.  & 
L.  (2d  Ed.)  8.  See,  also,  Bradlaugh  v.  Newde- 
gate,  11  Q.  B.  Div.  1,  12;  Babcock  v.  Terry. 
97  Mass.  482.  It  follows  tliat  the  whole  con- 
tract was  tainted  with  illegality,  and  neither 
party  was  bound  to  go  on  with  it  Robinson 
V.  Green,  3  Mete.  (Ma.ss.)  159,  IGl;  Perkins 
V.  Cummings,  2  Gray,  258;  Woodruff  v.  Went- 
worth,  133  Mass.  309;  Bishop  v.  Palmer,  146 
Mass.  409,  16  N.  E.  Rep.  1^99;  Lound  v.  Grim- 
wade,  39  Ch.  Div.  605,  613. 


1  Fed.  Cas.   No.  555. 


3^ 


416  ILLEGALITY  OF  OBJECT. 

GRIFFITH    T.   WELLS.  ^  ^  / 
(3  Denio,  226.) 


Supreme  Court  of  New  York.    July,   lSi6. 


Error  to  Oneida  C.  P.  Griffith  sued  Wells 
before  a  justice  of  the  peace  in  December. 
1S43,  and  declared  in  assumpsit  for  two  half 
fe'allons  of  whiskey  and  two  glasses  of  beer, 
sold  and  delivered  to  the  defendant,  of  the 
value  of  three  shillings  and  six  pence.  The 
plaintiff,  who  was  a  grocer,  proved  his  declara- 
tion. The  defence  was,  that  the  plaintiff 
sold  the  liquor  without  having  a  license  to  sell 
spirituous  liquors.  The  justice  ga.ve  judgment 
for  the  plaintiff  for  44  cents  damages,  besides 
costs.  On  certiorari,  the  C.  P.  reversed  the 
judgment,  on  the  ground  that  the  plaintiff  did 
not  show  a  license  to  seU  spirituous  liquors. 
The  plaintiff  brings  error. 

J.  Benedict,  for  plaintiff  in  error.  S.  H. 
Stafford,  for  defendant  in  error. 

BRONSON,  C.  J.  Our  excise  law  does  not, 
in  terms,  prohibit  the  sale  of  strong  or  spii-it- 
uous  liqnors  without  a  license,  nor  declare  the 
act  illegal;  but  only  inflicts  a  penalty  upon 
the  offender.  2  Rev.  St.  680,  §§  15,  16.  From 
this  It  is  argued,  that  although  the  seller 
without  a  license  incurs  a  penalty,  the  con- 
tract of  sale  is  valid,  and  may  be  enforced 
by  action.  But  it  was  laid  down  long  ago, 
that  "where  a  statute  inflicts  a  penalty  for 
doing  an  act,  though  the  act  be  not  prohibited, 
yet  the  thing  is  unlawful;  for  it  cannot  be  in- 
tended that  a  statute  would  inflict  a  penalty 
for  a  lawful  act"  Bartlett  v.  Viner,  Skin. 
322.  In  the  report  of  the  same  case  in  Car- 
thew  (page  252),  Holt,  C.  J.,  said:  "A  pen- 
alty implies  a  prohibition,  though  there  are 
no  prohibitory  words  In  the  statute."  Al- 
though this  was  but  a  dictum,  the  doctrine 
has  been  fully  approved.  De  Begnis  v.  Armi- 
stead,  10  Bing.  107;  Foster  v.  Taylor,  3  Nev. 
&  M.  244,  5  Bam.  &  Adol.  887;  Cope  v.  Row- 
lands, 2  Mees.  &  \V.  149:  Mitchell  v.  Smith, 
1  Bin.  110,  4  Dall.  209:  Loidenbender  v. 
Charles,  4  Serg.  &  R.  159,  per  Tilghmna,  a 


J.;    Bank  v.  Merrick,  14  Mass.  322.    --When  i 
license  to  carry  on  a  particular  trade  is  re- 
quired for  the  sole  purpose  of  raising  revenue, 
and  the  statute  only  inflicts  a  penalty  by  way 
of  securing  payment  of  the  license  money,  it 
may  be  that  a  sale  without  a  license  would 
be  valid.     Johnson  v.  Hudson,  11  East,  ISO; 
Brown  v.   Duncan,  10  Bam.  &  C.  93;    Chit. 
Cent  (Ed.  1842)  419,  697.     But  if  the  statute 
looks  beyond  the  question  of  revenue,  and  has 
in  view  the  protection  of  the  public  health  or 
moi-als,  or  the  prevention  of  frauds  by   the 
seller,   then,   though  there  be  nothing  but  a 
penalty,  a  contract  which  infringes  the  stat- 
ute cannot  be  supported.     Law  v.  Hodgson, 
2  Camp.  147;    Brown  v.  Duncan,  10  Bam.  & 
C.  93;    Foster  v.  Taylor,  3  Nev.  &  M.  244,  5 
Bam.  &  Adol.  887;   Little  v.  Poole,  9  Bam.  & 
C.  192;   Tyson  v.  Thomas,  McClel.  &  Y.  119; 
Wheeler  v.  RusseU,  17  Mass.  258;   Bensley  v. 
Bignold,  5  Bam.  &  Aid.  335;   Drury  v.  Defon- 
taine,  1  Taunt  136,  per  Mansfield,  C.  J.;   Cope 
V.  Rowlands,  2  Mees.  &  W.  149;    Houston  v. 
Mills,  1  Moody  &  R.  325.     Now   I  think  it 
quite  clear,  that  in  the  enactment  of  our  ex- 
cise  law   the   legislature   looked   beyond   the 
mere   question   of   revenue,   and   intended   to 
prevent  some  of  the  evils  which  are  so  likely 
to  flow  from  the  traffic  in  spirituous  liquors. 
If  revenue  alone  had  been  the  object,  licenses 
would  have  been  allowed  indiscriminately  to 
all.     But  the  statute  forbids  a  license  to  any 
one,  whether  tavern-keeper  or  grocer,  who  is 
not  of  good  moral   character;    and  he   must 
moreover  give  bond,   with   sureties,  that  his 
house  or  grocery  shall  not  become  disorderly. 
Sections  6,  7,  13.     These  regulations  were  evi- 
dently intended  to  protect  the  public,  in  some 
degree,  against  the  consequences  which  might 
be  expected  to  follow  from  allowing  all  per- 
sons, at  their  pleasure,  to  deal  in  strong  liq- 
uors.    And  although  the  statute  only  inflicts 
a  penalty  for  selling  without  a  license,  the 
contract  is  illegal,  and  no  action  will  lie  to 
enforce  it     The  justice  was  wrong;    and  his 
Judgment  has  been  properly  reversed  by  the 
common  pleas. 
Judgment  fiffixmed. 


VIOLATION  OP  STATUTES-^T     ^JA^  LAWS 


417 


^^ 


LYON 
Suprome    Court    of 


V.  STRONG. 

Vt.  219.) 

Vormont.     Rutland 
1834. 


^^^ 


Hr 


Jan., 


This  was  an  action  oi  a^Kvmpsit  hvonghX  on 
the  warranty  of  a  mare.  Plea,  non-axnuinpsit. 
On  trial  the  plaintiff  olTered  evidence  to  prove 
the  contract  of  sale  and  warranty.  It  appeared 
chat  the  sale  was  made  on  the  — day  of  (Jctoher, 
.8:W,  on  the  Sabbath.  Evidence  was  jriven  by  the 
plaintiff  to  prove  the  sale  and  warrant}',  by  which 
it  appeared  that  the  plain  till  and  defendant  were 
making  their  bargain  and  trading  during  the 
course  of  the  day,  conversing  about  the  terras 
of  the  trade,  and  had  rode  and  tried  the  mare; 
— that  defendant  said  he  would  warrant  her 
sound  every  way,  except  gravel;  and  that  at  or 
towards  evening  they  finished  their  trade,  by 
which  the  plaintiff  gave  an  ox  and  a  cow  and 
three  dollars  in  money  for  the  mare: — that 
plaintiff  then  urged,  as  a  reason  why  he  wanted 
a  warranty,  that  it  was  so  dark  that  he  could 
not  determine  whether  she  had  been  gravelled 
or  not.  After  the  evidence  of  the  plaintiff  in 
relation  to  the  sale  and  warranty  was  linished, 
the  defendant  contended  that  such  a  contract 
made  on  the  Sabbath,  was  void.  The  court  de 
cided  that  a  sale  or  exchange  of  horses,  and  t 
contract  or  warranty  thereon,  made  on  the  Sab- 
oath,  was  void,  and  that  no  action  could  be 
maintained  thereon.  Thereupon  the  plaintiff 
became  nonsuit,  with  liberty  to  move  to  set  it 
aside  if  the  decision  of  the  court  was  wrong. 
The  court  refused  to  set  aside  the  nonsuit.  The 
case  comes  here  upon  exceptions  taken  by  the 
plaintiff'  to  this  decision. 

Mr.  Thrall,  for  plaintiff.  Mr.  Royce,  for  de- 
fendant. 

WILLIA:MS,  C.  J.— From  the  case  it  is  evi- 
dent that  several  questions  might  have  arisen 
in  the  course  of  the  trial.  1.  The 
*220  *one  decided  by  the  county  court,  wheth- 
er a  coutract  for  the  sale  and  exchange 
of  horses,  and  a  warranty  thereon,  made  on 
the  Sabbath,  in  the  usual  way,  and  attended  with 
all  the  circumstances  which  ordinarily  attend 
those  exchanges,  is  so  far  void  that  it  cannot 
be  enforced  in  a  court  of  justice.  2.  Whether 
a  contract  of  this  kind,  made  after  the  setting 
of  the  sun  on  the  Sabbath  is  against  the  stat- 
ute. 3.  Whether  such  a  contract,  commenced 
and  carried  on  as  this  was,  though  not  tinally 
closed  until  after  the  setting  of  the  sun,  can  be 
enforced. 

Our  attention  is  necessarily  confined  to  the 
first  of  these  questions  as  being  the  onlv  one 
decided  by  the  county  court.  After  the  evi- 
dence for  the  plaintiff  was  finished,  the  defend- 
ant contended  and  submitted  to  the  court,  that 
such  a  contract,  made  on  the  Sabbath,  was 
void.  Aft<;r  the  decision  on  this  question  was 
pronounced,  the  plaintiff,  without  introducing 
any  further  testimony,  or  recjuiring  the  defend- 
ant to  introduce  any  testimony  to  determine 
whether  the  case  would  be  subject  to  the  decis- 
ion which  might  be  made  on  the  second  and 
third  questions  above  mentioned,  submitted  to 
a  nonsuit  and  excepted  to  the  opinion  of  the 
court.  Whether  the  evidence  did  or  would 
have  presented  a  case  to  be  determined  by  the 
opinion  which  the  court  might  have  formed  on 
either  of  those  questions,  cannot  now  be  ascer- 
tained, as  the  plaintiff  elected  to  become  non- 
suit on  the  decision  of  the  first;  probablj'  con- 
sidering that  his  chance  with  a  jury  on  the 
whole  evidence,  as  to  bringing  his  catse  out  of 
the  rule  of  law  laid  down  by  the  court,  was  not 

HOPK.  SEL.  CAS.  COXT.  —27 


3uch  af  ^^'^'ind  (uslify  him  in  proceeding  fur- 
ther wo,,  'awcidence.     j         ' 


81  ,^ 

Ihcr  wb/Z'-'awcidence.  As  it  is  presented,  we 
can  on*/.'^'^ainlX'r  the  question  which  the  county 
court  Oyj  '',on  led;  and  if  thcT  decision  is  erro- 
neous>/'y,  ''(of  Pjuil  will  besetuside— ifolherv.  ise, 
it  mui/^  fjh  wriued. 

Th^.-^ie  «  chend  is  purely  a  question  of  law. 
to  b(/^^' v  aed  by  the  constitution  and  statute 
'  "  ilnec.  and  bv  the  application  of  those 
''  GX^^f  law  which  have  been  known,  ac- 
atc'd.and  nevercontroverted.and  I  think 


the',  ^.  up  which  have  been  decided  will  be 
fouL*'()r  be  so  very  similar  and  like  to  the  one 
un(I;,^^ceousideration.  that  the  decisidn  on  them 
mui"^.cOvern  this;  and  further,  that  the  ques- 
tioc^'iiow  presented  has  received  so  many  de- 
terr*'.  nations,  that  we  must  have  departed  not 
onl"'^/from  the  known  and  familiar  principles 
of  i.'.'w,  but  from  determinations  made  under  a 

law  precisely  similar  to  the  statute  of  this 
*221    state,  so  far  as  applicable  to  this  *case.  if 

we  had  come  to  a  different  result  than  the 
one  we  have  made. 

We  are  aware,  however,  that  the  subject 
under  consideration  is  one  which,  is  liable  to  be 
viewed  too  much  on  either  side  through  the 
medium  of  feeling;  and  any  judicial  investiga- 
tion of  it  may  be  regarded  as  treading  upon  for- 
bidden ground.  A  decision  one  way  may  be 
regarded  as  promoting  irreligion,  licentiousness 
and  immorality;  and  a  decision  the  other  way 
be  considered  as  encroaching  upon  religious 
freedom.  We  shall  endeavor,  however,  to  in- 
quire what  the  legislature  have  done,  and  give 
effect  to  their  doings  so  far  as  we  understand 
their  requirements.  The  constitution  of  this 
state,  (and  herein  it  is  a  transcript  from  the  lirst 
constitution  of  government  established  in  this 
state)  while  it  carefully  protects  and  guards  re 
ligious  freedom,  and  asserts  that  the  conscience 
of  no  one  can  be  controlled,  declares,  "that 
every  sect  or  denomination  of  christians  ought 
to  observe  the  Sabbath  or  Lord's  day,  and  keep 
up  some  sort  of  religious  worship,  which  to 
them  shall  seem  most  agreeable  to  the  rev:.  iled 
will  of  God.  "  To  carry  into  effect  the  sjiirit  of 
this  constitution,  to  enable  each  religious  sect 
to  keep  up  religious  worship  on  the  Sabbath, 
and  to  enable  all  to  enjoy  the  benefits  to  be  de- 
rived from  a  day  of  religious  retirement  and 
rest,  the  legislature,  among  their  first  laws, 
made  provision  for  the  prohibition  of  secular 
labor  on  that  day;  and  in  the  statute  which 
they  passed  in  1771>,  and  which  has  in  substance 
been  continued  to  this  time,  embraced  ;.II  the 
provisions  which  are  contained  in  the  English 
statutes  of  the  first  and  second  Charles.  Aware 
of  the  benefits  to  be  derived  from  stated  periods 
of  rest  from  manual  labor,  of  the  importance 
of  having  the  same  day  observed  by  all.  and 
recognizing  that  every  denomination  of  chris- 
tians among  them  regarded  the  Sabbath  as  a 
day  set  apart  for  moral  and  religious  duties, 
they  determined  that  every  one  should  be  pro- 
tected in  the  enjoyment  of  his  religious  privi- 
leges and  in  the  performance  of  liis  reli^MOus 
duties,  and  have  made  provision  that  those  who 
are  thus  disposed  may  on  that  day  perform 
those  great  and  necessary  duties  which  they  be- 
lieve are  required  of  them,  without  disturbance 
from  the  secular  h.hor  of  others;  and  further, 
that  all,  whether  high  or  low,  prisoner  or  free, 
master  or  servant,  shall  be  permitted  to  rest, 
and  that  none  shall  compel  them  to  labor  on 
that  day;  and  lest  through  avarice  or  cupidity, 
any  one  should  be  disposed  so  to  do,  they  have 
enacted  that  the  day  shall  be  observed  as  a  day 
of  rest  from  secidar  labor  and  employ- 
ment, except  such  as  *neccss:ty  and  acrs  *222 
of  charity  shall  rcijuire.     btiitulc,  p.  tJuJ. 


418 


ir.LEGAUTY  OF  OBJECT. 


\ 


It  mav  here  be  remarked,  that  LLSrevera  stat- 
ute inflicts  a.  penalty  for  doing  thing,  the 
penalty  implies  a  prohibition,  th.  ^  there  are 
no  prohibitory  words  in  the  jnj'te.  This 
BUtute  not  only  inflicts  a  penalty  >  ^"lose  who 
violate  it,  by  labor  or  recreation,  I  g^gxpressly 
prohibits  all  secular  labor  or  emp  j-^^Tient,  so 
that  there  is  both  an  implied  and  e.  >ss  pro- 
hibition. The  question  will  then  ar^  '^^  wheth- 
er the  employment  of  these  parties,  -3  detailed 
in  the  bill  of  exceptions,  the  sale,  d,  hange, 
and  contract  of  warranty,  is  a  secular  ce.bor  or 
employment,  within  the  meaning  of  the^^atute, 
subjecting  them  to  a  penalty;  and  seco  ,  ly,  if 
it  is,  wheTher  courts  of  justice  are  to  lei  their 
aid  to  carry  into  effect  a  contract  made  ^^  vio- 
lation of  a  positive  statute,  and  for  the  mricing 
of  which  they  would  inflict  a  penalty  or  fiLiy?  on 
the  parties  thereto? 

On  the  first  question  there  can  be  no  doubt. 
All  will  readily  answer  in  the  affirmative.  It 
was  not  only  a  secular  labor  or  employment, 
but  one  directly  calculated,  from  the  nature  of 
the  business,  to  disturb  the  devotion  of  others, 
and  to  interrupt  the  rest  and  quietness  which 
all  have  a  right  to  enjoy  on  that  day.  On  the 
second  question,  it  is  apprehended  that  the  law, 
as  established  in  analogous  cases,  and  under 
statutes  similar  in  their  provisions,  furnishes 
as  ready  an  answer  in  the  negative.  It  is  an 
acknowledged  principle  of  law,  that  a  court 
will  not  lend  its  aid  to  carry  into  effect  a  con- 
tract made  in  contravention  of  a  positive  stat- 
ute, particularly  if  the  statute  was  made  for 
the  purpose  of  protecting  the  public,  for  pro- 
moting peace,  good  order,  or  good  morals. 
The  reason  for  this  is  sufliciently  obvious  with- 
out recurrence  to  authorities.  There  would  be 
a  great  inconsistency  in  a  court  of  justice,  to 
inflict  a  punishment  on  persons  for  makings 
contract,  which  disturbed  the  public  peace  and 
contravened  a  statute,  and  in  the  next  cause 
settle  the  terms  of  that  contract  between  the 
same  parties,  inquiring  whether  it  had  been 
fultilled,  and  giving  damages  to  the  one  or  the 
other  for  not  fulflUing  it.  It  would  be  alto- 
gether more  consonant  to  propriety  to  tell  the 
parties  to  such  an  illegal  transaction,  that  they 
are  not  to  come  into  a  court  of  justice  on  any 
question  in  relation  to  such  a  transaction,  ex- 
cept to  receive  judgment  for  the  penalty  they; 
'have  incurred  by  disregarding  <he  law. 

The  authorities  to  this  effect,  are  numerous, 
both  in  England  and  in  this  country.  A  few  of 
them  only  will  be  noticed.  In  the  case  of  Bart- 
lett  vs.Yinor,  Garth.  252,  and  also  Skinner 
•223  *:j22,  it  was  said  that  in  case  of  simony, 
although  the  law  only  inflicted  a  penalt}', 
and  does  not  mention  any  avoiding  of  the  sim- 
onical  contract,  yet  it  has  always  been  held 
that  such  contracts,  being  against  law,  were 
▼oid.  By  a  statute  in  England,  it  is  illegal  for 
any  candidate  at  an  election  to  furnish  provis- 
ions to  voters,  and  it  was  held  that  an  action 
could  not  be  maintained  by  an  innkeeper  against 
a  candidate  for  i)rovisions  furnished  for  that 
purpose  at  his  request  Ribbans  vs.  Crickett 
and  al.  1  Bos.  &  Pull.  2(54.  By  a  statute  in  that 
country  all  bricks  made  for  sale  shall  be  of  cer- 
ta  n  dimensions,  and  a  sale  is  prohibited  under 
a  penalty.  It  was  held  that  if  bricks  be  sold 
under  that  size,  the  seller  could  not  recover  the 
the  value.  Law  vs.  Hodgson,  2  Camp.  147,  and 
also  11  East,  300.  Brewers  are  prohibited  by 
a  statute  from  using  any  thing  but  malt  and 
hops  in  the  brewing  of  beer.  A  druggist  was 
not  permitted  to  recover  the  price  of  certain 
drugs,  sold  to  a  brewer,  knowing  they  were  to 
be  used  in  a  brewery.  1  Maule  &  Selwyn,  593, 
Langton  and  others  vs.  Hughes  and  others.    A 


printer  was  not  permitted  to  recover,  either  for 
his  labors  in  printing  a  pamphlet  or  for  mate- 
rials found,  when  he  omitted  to  affix  his  name 
and  the  place  of  his  abode,  in  pursuance  of  the 
directions  of  the  statute.  39  G.  3  c.  79  and  27. 
One  of  the  judges  (Bayley)  observed  that  the 
omission  was  a  direct  violation  of  the  law,  that 
the  public  have  an  interest  that  the  thing  shall 
not  be  done,  that  the  objection  ag.-iinst  the 
plaintiff's  recovery  must  prevail,  not  for  the 
sake  of  the  defendant,  but  for  that  of  the  pub- 
lic. Bensley  and  another  vs.  Bignold,  5  Barn. 
&  Aid.  335.  In  Pennsylvania  a  penalty  is  in- 
flicted on  any  one  who  sells  lands  under  the  Con- 
necticut title,  but  the  statute  contained  no  pro- 
hibitory clause;  yet  it  was  held  that  a  contract 
for  the  sale  of  lands  in  that  state  under  that 
title  was  unlawful  and  void.  1  Binn,  110,  Mitch- 
ell vs.  Smith.  In  New  York  a  statute  prohibited, 
under  a  penalty,  the  sale  or  purchase  of  tickets 
in  any  lotter.v  not  authorized  by  the  legislature 
and  it  was  there  held  that  no  action  could  be 
maintained  on  a  contract  for  the  sale  of  tickets 
in  a  lottery  not  there  authorized.  Hunt  and 
others  vs.  Knickerbacker,  5  Johnson,  327.  In 
Massachusetts  a  statute  prohibits  the  sale  of 
shingles  under  certain  dimensions,  or  if  not 
surveyed,  and  makes  both  the  buyer  and  seller 
liable  to  a  pecuniary  penalty  for  a  violation  of 
the  statute.  Under  this  statute  it  was  held  that 
no  action  could  be  maintained  on  a  note  the 

consideration  whereof  was  a  quantity  of 
*224    shingles  sold  not  *of  the  size  prescribed 

by  the  statute.  Wheeler  vs.  Russell,  17 
Mass.  Rep.  258.  In  the  case  of  May  &  Co.  vs. 
Brownell,  3  YL  Rep.  463,  the  same  principle  was 
recognized.  These  cases,  which  are  selected 
from  a  multitude  of  others,  are  suflicient  to  es- 
tablish the  general  principle,  and  it  may  not  be 
out  of  place  to  notice  the  strong  and  emphatic 
language  made  use  of  by  the  different  judges 
on  this  subject,  to  show  how  clearly  the  princi- 
ple is  recognized  and  established.  Lord  Mans- 
field says,  "No  court  will  lend  its  aid  to  a  man 
who  founds  his  cause  of  action  upon  an  illegal 
or  immoral  act.  If  the  cause  of  action  appears 
to  arise  from  the  transgression  of  a  positive 
law  of  this  country,  the  plaintiff  has  no  right 
to  be  assisted.  It  is  upon  this  ground  the 
court  goes,  not  for  the  sake  of  the  defendant, 
but  because  they  will  not  lend  their  aid  to  such 
a  plaintiff."  Cowper,  343.  "The  court  will  not 
interfere  to  assist  either  party,  according  to  the 
well  known  rule  that,  in  pari  delicto,  &c. — not 
that  defendant's  right  is  better  than  plaintiff's, 
but  they  must  draw  their  remedy  from  pure 
fountains."  Douglass,  468.  Eyre,  chief  justice, 
in  the  case  before  cited  from  1  Bos.  &  Pull, 
says,  "How  shall  an  action  be  maintained  on 
that  which  is  a  direct  violation  of  the  public 
law?  The  contract  is  bottomed  in  malum  pro- 
hibitum of  a  very  serious  nature,  as  appears  by 
the  preamble  of  7  and  8  W.  3,  c.  4.  How  then 
can  we  enforce  a  contract  to  do  that  very  thing 
which  is  so  much  reprobated  by  the  act?  Per- 
sons who  engage  in  this  kind  of  transaction 
must  not  bring  their  case  before  a  court  of 
law."  1  Bos.  &  Pull,  266,  Lord  Alvanley  says, 
"No  man  can  come  into  a  British  court  of  jus- 
tice to  ask  the  assistance  of  the  law,  who  founds 
his  claim  upon  a  contravention  of  the  British 
laws."    3  Bos.  and  Pull,  38. 

In  Law  vs.  Hodgson,  2  Camp.  148,  Lord  Ellen- 
borough  says,  "The  plaintiff,  in  making  the 
brick  in  question,  was  guilty  of  an  absolute 
breach  of  the  law,  and  he  shall  not  be  permitted 
to  maintain  an  action  for  their  value. "  And 
again:  "The  best  way  to  enforce  an  observance 
of  the  statute  ■was  to  prevent  the  violation  of 
it  from  being  profitable."    Ashhurst,  J.:  "No 


VIOLATION  OF  STATUTES— SUNDAY  LAWS, 


419 


right  of  action  can  spring  out  of  an  illegal  con- 
tract. "  8  Term  Hep.  fc*0.  Lord  Ellenborough: 
"It  maybe  taken  as  a  received  rule  of  law — 
tliat  which  is  done  in  contravention  of  the  pro- 
visions of  an  act  of  parliament  cannot  be  made 
the  subject  of  an  action.  "  Best,  J. — "'l"hi;re  is 
no  illegal  contract  on  which  an  action  can  be 
founded,  inasmuch  as  the  thing  was  done 
in*(iirect  violation  of  the  law;"  and  in  the  *225 
same  case  he  saj's,  "It  is  eipiaily  unfit  that 
a  man  should  be  allowed  to  take  advantage  of 
what  the  law  says  he  ought  not  to  do,  whether 
the  thing  be  prohibited  because  it  is  against 
good  morals,  or  whether  it  be  prohibited  be- 
cause it  is  against  the  interests  of  the  state." 

From  the  principle  of  law  thus  clearlj-  de- 
fined, and  too  often  mentioned  without  any  ex- 
pression of  doubt  to  induce  us  to  believe  it  has 
ever  been  questioned,  it  would  follow  that  if 
the  contract  under  consideration  was  made  in 
violation  of  the  statute,  and  subjected  the  par- 
ties to  a  penaltv,  it  could  not  be  the  subject  of 
an  action  at  law;  that  although  both  parties 
may  be  equally  culpable,  yet  the  ma.xim,  m  pa- 
ri delicto,  should  prevail,  and  the  court  should 
refuse  to  aid  the  plaintiff,  not  for  the  sake  of 
the  defendant,  but  because  his  claim  grows  out 
of  a  transaction  prohibited  by  law.  On  the 
question  itself  in  relation  to  contracts  of  this 
kind,  made  on  the  Sabbath  and  under  a  similar 
statute,  the  authorities  are  clear  and  decisive. 
The  statutes  which  have  been  passed  in  this 
state  are  ver}'  similar  to  the  English  statutes. 
Yet  the  terms  made  use  of  are  more  extensive 
and  embrace  a  greater  number  of  cases.  The 
statute  of  Car.  let,  like  our  statute,  prohibits 
all  sports,  pastimes,  games  or  plays,  although 
it  does  not  prohibit  labor.  The  statute  of  Car. 
2nd  contains  all  the  provisions  of  the  former 
statute,  and  further  provides  that  no  trades- 
man, artificer,  &c.  shall  do  any  worldly  labor, 
or  works  of  their  ordinary  calling,  upon  the 
Lord's  day.  Our  statute  is,  that  no  person 
shall  exercise  any  secular  labor,  business  or 
eniiUoyment.  Statute,  p.  <)08.  By  the  statute 
of  Charles,  it  is  to  be  observed,  it  is  the  labor 
or  work  of  the  ordinarj'  calling  of  the  person 
which  is  prohibited.  Hence  the  attention  of 
the  courts  in  that  country  has  often  been  called 
to  the  question,  whether  a  contract  or  sale  was 
made  in  the  ordinary  calling  of  the  vendor,  and 
doubts  have  been  expressed  at  times  whether 
the  statute  extended  to  private  sales  as  well 
as  public.  These  doubts,  however,  all  vanished 
when  the  subject  was  fully  investigated.  The 
first  case  which  I  shall  notice  was  that  of  Drur\' 
vs.  Defontaine,  1  Taun.  131.  The  plaintiff  had 
sent  his  horse  to  an  auctioneer,  who  sold  him 
on  Sunday  to  the  defendant  b}'  private  contract. 
In  an  action  for  the  price  of  this  horse  the 
court  held  that  the  auctioneer  was  not  in  the 
exercise  of  his  ordinary  callinir  when  hs  sold 
the  horse  by  private  contract;  and  there- 
*226  fore,  as  neither  the  plaintiff"  *nor  his 
agent  were  in  the  exercise  of  their  ordi- 
nary calling,  the  sale  was  not  void  by  common 
law  or  by  the  statute,  the  court  say  it  is  to  be 
lamented  that  the  sale  must  be  held  good,  and 
say  expressly,  that  if  an\-  man  in  the  exercise 
of  his  ordinary  calling  should  make  a  contract 
on  Sunday,  that  contract  would  be  void;  that 
is,  as  was  afterwards  explained,  void  so  far  as 
to  prevent  a  party  privy  to  it  from  sueing  it  in 
a  court  of  law. 

The  next  case  in  which  the  subject  was  con- 
sidered, was  Bloxsome  vs.  Williams,  3  Barnwell 
&  Cres,  232.  This  case  went  off",  on  the  ground 
that  the  contract  was  not  made  on  Sunday. 
Justice  Ba3'le}',  however,  intimates  an  opinion 
that  the  statute  only  applied  to  work  visibly 


laborious,  and  did  not  extend  to  private  sales. 
He  says,  however,  that  if  it  was  within  the  s:at- 
ute,  the  plaintiff  might  be  deprived  of  any  right 
to  sue  u|)on  a  contract  so  illegally  made.  In 
the  case  of  Fennell  vs.  liidler,  "i  Barn,  ic  Cres. 
400,  wliich  was  an  action  on  the  warranty  of  a 
horse,  the  court  decided  that  the  purchase  of  a 
horse,  bv  a  horse  dealer,  was  in  the  exercise  of 
the  business  of  his  ordinary  callinir;  that  the 
statute  extends  to  private  as  well  as  public  sales, 
and  that  the  plaintiff  could  not  maintain  any 
action  upon  a  contract  for  the  sale  and  warranty 
of  a  horse,  made  by  him  upon  Sunday;  and  Mr. 
Justice  Bayley  observed,  that  though  he  ex- 
pressed doubts  in  the  case  of  Bloxsome  vs. 
Williams,  whether  the  statute  extended  to  pri- 
vate sales,  he  was  satisfied  upon  further  consid- 
eration that  it  would  be  a  narrow  construction 
of  the  act,  and  a  construction  contrary  to  its 
spirit,  to  give  it  such  a  restriction.  During  the 
same  summer,  a  case  came  before  Chief  Justice 
Best,  at  nL'ii  jirius,  in  an  action  on  a  breach  of 
a  contract  for  the  purchase  of  nutmegs.  The 
same  questions  were  made  in  that  case,  which 
had  been  urged  before  in  other  cases— to  wit, 
that  the  sale  was  not  complete,  and  that  it  was 
not  in  the  exercise  of  his  calling.  The  Chief 
Justice,  after  intimating  his  opinion  that  these 
questions  had  been  decided  too  narrowly,  de- 
cided that  the  contract  was  void,  having  been 
made  on  the  Sabbath. — 2  Car.  &  Payne,  544. 
The  cause  was  carried  up  to  the  court  of  com- 
mon pleas  in  Hilary  term,  1827,  and  the  decis- 
ion was  confirmed  bj'  all  the  members  of  Iho 
court.  Park.  J.,  said  that  he  did  not  think  the 
decision  of  the  court  in  Drury  vs.  Defontaine, 
1  Taun.  131,  was  right;  that  the  construction 
put  upon  the  statute  was  too  narrow;  and  Ch. 
J.  Best,  with  that  promptness,  firmness  and  en- 
ergy, which  is  always  to  be  admired  in  his 
opinions,  says,  *"I  do  not  say  that  the  *227 
mere  inception  of  a  contract  on  Sunday 
will  avoid  it,  if  completed  the  next  day;  but  if 
most  of  the  terms  are  settled  on  Sunday,  and 
the  mere  signatures  deferred  to  the  next  day, 
such  a  contract  could  scarcely  be  supported." 
This  point,  however,  was  not  decided;  for  he 
says.  "Here  the  whole  was  in  effect  complete 
on  the  Sunday,  and  unless  it  be  permitted  to  a 
party  to  profit  by  a  contract  in  defiance  of  the 
law  "of  the  country,  the  plaintiff  cannot  recov- 
er. "—Smith  vs.  Sparrow,  4  Bing.  84. 

In  Connecticut  it  is  said  by  Judge  Gould,  that 
the  execution  of  written  instruments  on  Sun- 
day, between  sunrise  and  sunset,  have  always 
been  holden  as  falling  within  the  description 
of  secular  business  and  been  adjudged  void  un- 
der the  statutes  of  that  state.— 2  Conn.  Kep. 
500.  There  is  a  case  reported  in  Croke  Eliz. 
485,  Comyns  vs.  Boyer.  where  it  is  said  that  a 
fair  hoUien  upon  Sunday  is  well  enough,  al- 
though by  the  27  Hen.  0.  c.  5,  there  is  a  penalty 
inflicted  upon  the  party  that  sells  upon  that 
day,  but  it  makes  it  not  void.  Upon  that  case, 
however,  if  it  had  not  been  overruled,  it  might 
be  remarked,  it  was  not  a  decision  under  the 
statute  of  Charles  the  second.  The  statute  of 
Henry  the  sixtn  only  prohibited  fairs  or  mar- 
kets on  certain  Sundays,  ithe  four  Sundays  in 
harvest  excepted.)  "on  pain  to  forfeit  the  wares 
BO  showed,  to  the  lord  of  the  franchise.  "  Be- 
fore the  establishment  of  the  Protestant  relig- 
ion in  England,  fairs,  markets,  sports  and  pub- 
lic sales,  were  usual  on  the  Sabbath,  and  fairs 
being  held  by  prescription,  could  only  be  held 
on  the  usual'days.  according  to  the  calendar, 
whether  Sunday  or  not.  For  that  reason  the 
statute  of  Henry  the  sixth  has  been  called  a 
very  singular  statute,  as  altering  the  course  of 
prescription,     iloreoer,  it   has  been  decided 


420 


ILLEGALITY  OF  OBJECT. 


that  the  case  from  Croke.  Eliz.  isnot  now  law. 
that  the  law  has  been  since  changed,  that  now  if 
anv  act  is  forbidden  under  a  penalty,  a  contract 
to  "do  it  is  now  held  void.— 1  Taun.  136.  In  the 
case  of  Geer  vs.  Putnam,  10  Mass.  Rep.  313,  it 
was  decided  that  a  note  dated  on  Sunday  might 
be  recovered.  It  is  very  evident,  however,  that 
the  question  was  not  much  considered,  so  as  to 
entitle  it  to  great  weight  as  an  authority,  if  it 
should  be  found  to  contlict  with  other  cases  de- 
cided. The  counsel  for  the  party  who  made 
the  defence  gave  it  up  in  argument,  and  the  de- 
cision was  made  on  the  authority  of  a  case 
which  had  been  decided  in  another  county  but 
not  reported.  Possibly,  however,  the  decision 
may  stand  without  co'ntticting  with  the 
cases  which  *have  been  mentioned.  A  *228 
note  dated  on  the  Lord's  day  might  bs 
for  a  consideration  recognized  as  valid,  as  for 
acts  of  necessity  or  charity,  and  the  party  who 
would  avoid  it  might  be  required  to  furnish 
gome  other  evidence  of  its  being  a  contract 
contrarv  to  the  statute  than  what  might  be  in- 
ferred from  the  date  of  the  note  alone. 

The  whole  current  of  authorities  being  in  fa- 
vor of  the  decision  made  by  the  county  court 
in  this  case— and  I  confess  I  have  always  been 
satisfied  with  the  reasons  given  in  the  cases  re- 
ported, and  think  that  the  consequence  follows 
irresistibly  from  the  statute,  that  no  action  can 
be  maintained  on  a  contract  made  in  violation 
of  the  statute— it  becomes  our  duty  to  declare 
the  law  us  we  find  it,  without  regard  to  conse- 
quences. "We  have  not,  however,  kept  ont  of 
view  the  arguments  which  might  be  urged 
against  this  view  of  the  statute.  It  is  said  that 
it  will  enable  a  party  to  take  advantage  of  his 
own  wrong.  It  is  so  in  all  cases  of  the  viola- 
tion of  a  statute,  when  the  maxim,  in  pari  de- 
licto, is  applicable.  It  is  also  said  that  it  is  dif- 
ficult to  decide  what  cases  come  within  the  stat- 
ute, that  there  will  always  be  doubts  upon  the 
construction  oi  the  statute,  as  to  what  are  work? 
of  necessity  or  charity.  To  this  it  may  be  an- 
swered, that  if  the  statute  is  not  sufficiently  ex- 
plicit, it  is  competent  for  the  legislature  to  make 
it  more  so;  but  surely  it  is  no  reason  why  wo 
should  not  apply  it  to  a  case  plainly  within  its 
letter  and  spirit,  because  a  case  may  arise  of 
which  there  may  be  some  difficulty  in  delermlu- 
ing  upon  its  extent.  I  cannot,  however,  appre- 
hend the  least  danger  on  this  head.  It  is  a  law 
as  easily  observed  as  any  in  the  statute  book, 
and  those  who  do  not  violate  its  precepts  will 
suffer  no  inconvenience  from  its  provisions; 
while  those  who  do,  have  only  to  blame  them- 


I  selves.     They  cannot  call  on  a  court  to  disre- 
I   gard  a  positive  statute  for  the  accommodation 
of  those  who  are  disposed  to  violate  it.     It  is 
not  for  us  to  endeavor  to  anticipate  all  the  con- 
sequences to  result  from  an  adherence  to  the 
statute.     In  a  case  of  Williams  vs.  Paul,  6  Bing. 
653,  decided  after  the  causes  before  mentioned, 
it  was  determined  that  where   a  drover  sold 
some  cows  on  Sunda}-,  at  a  stipulated  price,  and 
the  purchaser  afterwards  promised  to  settle,  he 
might  recover  on  a  quantum  meruit  for  the  val- 
ue of  the  cows,  though  not  for  the  stipulated 
sum,  on  the  ground  of  the  after  promise.     Pos- 
sibly in  a  similar  case  the  parties  abiding  by  a 
sale" or  exchange  might  be  considered  as  so  far 
ratifying  it  as  to  furnish  ground  of  recov- 
*229    ery  on   an   *indfbitaius   assumpsit,  if  the 
court  would  not  have  to  enforce  the  con- 
tract made  on  the  Sabbath.     This,  however,  is 
not  now  before  us.     People  must  observe  and 
obey  the  laws  and  statutes  of  the  state,  and  in 
cases  which  may  arise  hereafter,  the  courts  of 
justice  will  undoubtedly  decide  according  to 
the  circumstances  of  each  case,  so  as  to  carry 
into  effect  the  statute  and  see  that  it  is  not 
made  an  instrument  of  fraud  or  injustice.     It 
is  to  be  remarked,  that  we  do  not  decide  that  a 
contract    or    proceeding    of    this   kind,  made 
wholly  after  the  setting  of  the  sun  on  Sunday, 
would  be  void.     A  contract  at  that. time  is  not 
prohibited  by  the  statute.     Nor  do  we  decide 
that  a  horse  trade  or  any  other  of  a  similar 
character,  commenced  on  Sunday  and  contin- 
ued until  after  the  setting  of  the  sun  before 
completed,  would  be  valid.     My  present  opin- 
ion is,  that  if  a  trade  of  this  kind  was  com- 
menced during  the  day,  attended  with  the  usu- 
al circumstances,  riding  about,  jockeying,  chaf- 
fering about  terms,  and  thus  continued  until  it 
ended  in  a  trade,  and  was  one  continuous  deal- 
ing, that  it  would  not  be  out  of  the  statute,  be- 
cause it  was   completed  a  few  minutes  after 
sundown.     This,  however,  it  is  not  necessary 
to  decide  in  this   case.     We   only  determine, 
that  when  there  is  a  sale  or  exchange  of  horses 
made  on  Sunday,  and  a  contract  of  warranty 
thereon,  no  action  can  be  maintained  on  such 
warranty,  it  being  a  violation  of  the  statute  of 
this  state. 

I  have  examined  this  subject  more  at  length 
than  I  otherwise  should,  as  the  court  are  not 
all  agreed  in  the  result.  Judge  Mattocks  dis- 
sents The  judgment  of  the  county  court  is  af- 
firmed, and  as  the  plaintiff  became  nonsuit,  he 
can  commence  auother  suit,  if  he  can  by  hia. 
testimonv  take  the  case  out  of  the  statute. 


VIOLATION  OF  STATUTES— USUEY. 


421 


LLOYD  T.  SCOTT. 

<4  Pet.  205.) 

Snpreme  Conrt  of  the  Uaited  States.    1830. 

Error  to  the  circuit  court  of  the  United 
States  for  the  District  of  Columbia. 

E.  J.  Loe  and  Mr.  Swann,  for  plaintiff. 
Taylor  &  Jones,   contra. 

M'LEAN,  J.  This  is  an  action  of  replevin, 
brought  to  ri'plevy  certain  goods  and  chattels 
which  the  defendant,  as  bailiff  of  William  S. 
Moore,  had  taken  upon  a  distress  for  rent 
claimed  to  be  due  upon  certaiu  houses  and 
lots  In  Alexandria,  owned  and  possessed  by 
the  plaintiff.  The  sum  for  which  the  dis- 
tress was  made  is  $500. 

The  declaration  is  in  the  usual  form,  and 
the  damages  are  laid  at  $1,000.  The  defend- 
ant filed  his  cognizance,  in  which  he  aclmowl- 
edges  the  taking  of  the  goods  specified  in  the 
declaration,  and  states  that  a  certain  Jona- 
than Scholfield,  being  seised  in  fee  of  four 
brick  tenements  and  a  lot  of  ground  in  the 
town  of  Alexandria,  by  his  indenture,  dated 
the  11th  of  June,  1S14,  in  consideration,  of 
$5,000,  granted,  bargained,  and  sold  to  Wil- 
liam S.  Moore  one  certain  annuity  or  yearly 
rent  of  $500,  to  be  issuing  out  of  and  charged 
upon  the  said  houses  and  ground,  and  paid 
to  the  said  Moore,  his  heirs  and  assigns,  by 
equal  yearly  payments  of  $250,  on  the  10th 
of  December  and  on  the  10th  of  June  in  each 
year  forever  thereafter,  to  have  and  to  hold 
the  said  annuity  or  rent  charged  and  payable 
as  aforesaid,  to  the  said  William  S.  Moore, 
his  heirs  and  assigns  forever.  It  also  states 
that  the  said  Scholfield,  for  himself  and  his 
lieirs  and  assigns,  did,  by  the  said  indenture, 
among  other  things,  covenant  well  and  truly 
to  pay  to  the  said  Moore,  his  heirs  and  as- 
signs, the  said  annual  rent  of  $500,  by  equal 
half  yearly  payments,  forever.  And  if  the 
rent  should  not  be  paid  as  it  became  due,  it 
should  be  lawful  for  the  said  Moore,  his  heirs 
and  assigns,  to  make  distress  for  it;  that 
Moore  was  seised  of  the  rent  on  the  11th  of 
December,  1814,  and  has  since  remained  seis- 
ed thereof. 

The  cognizance  further  states  that,  on  the 
20th  of  October,  181 G,  the  said  Jonathan 
Scholfield,  by  his  deed  of  bargain  and  sale, 
conveyed  to  Lloyd,  the  plaintiff,  forever,  cer- 
tain tenements  and  lots  of  ground  in  the 
town  of  Alexandria,  whereof  the  said  four 
brick  tenements  and  lot  of  ground  were  par- 
cel, and  subject  to  the  rent-charge  stated; 
that  Lloyd  has  been  seised  ever  since  and 
possessed  of  the  same;  and  that  on  the  10th 
of  June,  1824.  $250.  a  part  of  the  rent,  was 
due,  and  on  the  10th  of  December  following, 
$250,  the  balance  of  the  annual  rent,  was 
due  and  unpaid,  for  which  sums  the  defend- 
ant,  as  bailiff,  levied  a  distress. 

The  cognizance  is  concludod  by  praying  a 
judgment  for  $1,000,  being  double  the  amount 
of  the  rent  in  arrear. 


Moore  covenants  in  the  deed  that  If  Schol- 
field, his  heirs  or  assigns,  "shall,  at  any  time 
after  the  expiration  of  five  years  from  the 
date  of  the  deed,  pay  to  the  said  Moore,  his 
heirs  or  a.sslgus,  the  sum  of  $5.<XX>,  together 
with  all  arrears  of  rent,  and  a  ratable  divi- 
dend of  the  rent  for  the  time  which  shall 
have  elapse<l  between  the  half  year  day  then 
next  preceding  and  the  day  on  which  such 
payment  shall  be  made,  he,  the  said  Moure, 
his  heirs  and  assigns,  will  execute  and  de- 
liver any  deeds  or  Instruments  which  may 
be  necessary  for  releasing  and  extinguishing 
the  rent  or  annuity  hereby  created,  which, 
on  such  payment  being  made,  shall  forever 
after  cease  to  be  payable." 

Scholfield  covenanted  for  himself,  his  heirs 
and  assigns,  that  he  would  keep  the  build- 
ings in  repair,  have  them  fully  insured 
against  fire,  and  would  assign  the  policies  of 
insurance  to  such  trustee  as  Moore,  his  heirs 
or  assigns,  might  appoint,  that  the  money 
may  be  applied  to  the  rebuilding  of  the 
houses  destroyed  by  fire,  or  repairing  any 
damage  which  they  might  suffer. 

To  this  cognizance,  the  plaintiff  filed  a 
special  demurrer,  which  in  the  argument  he 
abandoned,  and  relies  upon  the  special  pleas 
of  usury.  To  each  of  the  four  pleas  the  de- 
fendant demurs  specially,  and  assigns  for 
causes  of  demurrer— 

1.  That  the  said  pleas  do  not  set  forth  with 
any  reasonable  certainty  the  pretended  con- 
tract which  is  alleged  to  have  been  usurious, 
and  do  not  show  an  usurious  contract. 

2.  That  they  do  not  state  the  time  the  said 
pretended  loan  was  made. 

3.  That  they  do  not  state  the  amount  of 
interest  reserved  or  intended  to  be  reserved 
on  the  said  pretended  contract 

4.  That  they  do  not  set  forth  any  loan  or 
forbearance  of  any  debt. 

5.  That  they  neither  admit  nor  deny  the 
sale  and  conveyance  of  the  premises  charged 
with  the  annuity  or  rent  to  have  been  made 
by  Scholfield  to  the  plaintiff  below. 

Upon  these  demurrers,  the  circuit  court  ren- 
dered judgment  for  $1.(X>0.  the  double  rent 
claimed  in  the  cognizance. 

The  plaintiff  here  prays  a  reversnl  of  this 
judgment. 

1.  Because  the  deed  which  forms  a  part  of 
the  cognizance,  on  its  face,  shows  an  usuri- 
ous contract. 

2.  Because  the  pleas  set  forth,  with  suf- 
ficient cei-titinty,  an  usurious  contract 

The  statute  of  Virginia  against  usury  was 
passed  In  1703,  and  provides  that  no  person 
shall  take,  directly  or  indirectly,  more  than 
six  dollars  for  the  forbearance  of  one  hun- 
dred dollars  per  annum;  and  it  declares  that 
all  bonds  and  other  instruments  for  a  greater 
amount  of  interest  shall  be  utterly  void. 

In  support  of  the  demurrer,  it  is  argued 
that  the  pleas  are  defective,  as  they  do  not 
contain  any  allegation  of  facts  which  amount 
to  usury,  and  that  the  decision  must  turn 
on  the  construction  of  the  contract  between 


422 


ILLEGALITY  OF  OBJECT. 


Scholfield  and  Moore.  And  it  is  contended 
that,  although  usury  appears  upon  the  face 
of  a  deed,  yet  advantage  can  only  be  taken 
of  it  by  plea;  that  the  obligee  may  explain 
the  contract  by  showing  a  mistake  in  the 
scrivener,  or  a  miscalculation  of  the  parties. 

In  Comyn  on  Usury  (page  201)  it  is  laid 
down  that,  in  an  action  on  a  specialty,  though 
it  appear  on  the  face  of  the  declaration  that 
the  bond,  &c.,  is  usurious,  still,  no  advantage 
can  be  taken  of  this,  unless  the  statute  be 
specially  pleaded.  3  Salk.  291;  5  Coke,  119; 
Chit.  Cont.  240;  1  Sid.  2S5;  1  Saund.  295a. 
The  decision  of  this  point  is  not  necessarily 
Involved  in  the  case. 

The  requisites  to  form  an  usurious  trans- 
action are  three: — 

1.  A  loan,  either  express  or  implied. 

2.  An  understanding  that  the  money  lent 
shall  or  may  be  returned. 

3.  That  a  greater  rate  of  interest  than  is 
allowed  by  the  statute  shall  be  paid. 

The  intent  with  which  the  act  is  done  is 
an  important  ingredient  to  constitute  this  of- 
fence. An  ignorance  of  the  law  will  not  pro- 
tect a  party  from  the  penalties  of  usury, 
where  it  is  committed;  but  where  there  was 
no  intention  to  evade  the  law,  and  the  facts 
which  amount  to  usury,  whether  they  appear 
upon  the  face  of  the  contract  or  by  other 
proof,  can  be  shown  to  have  been  the  result 
of  mistake  or  accident,  no  penalty  attaches. 
At  an  early  period  in  the  histoiy  of  Eng- 
lish jurisprudence,  usury,  or,  as  it  was  then 
called,  the  loaning  of  money  at  interest,  was 
deemed  a  very  high  offence.  But  since  the 
days  of  Henry  VIII.  the  taking  of  interest 
has  been  sanctioned  by  statute? 

In  this  country,  some  of  the  states  have 
no  laws  against  tal-cing  any  amount  of  inter- 
est which  may  be  fixed  by  the  contract. 

The  act  of  usury  has  long  since  lost  that 
deep  moral  stain  which  was  formerly  at- 
tached to  it,  and  is  now  generally  considered 
only  as  an  illegal  or  immoral  act  because  it 
Is  prohibited  by  law.  Assuming  the  posi- 
tion that  the  pleas  contain  no  averments 
which  extend  beyond  the  terms  of  the  con- 
tract, the  counsel  in  support  of  the  demur- 
rers have  contended  that  no  fair  construc- 
tion of  the  deed  will  authorize  the  inference 
that  it  was  given  on  an  usurious  considera- 
tion. 

It  was  the  purchase  of  an  annuity,  it  is 
contended;  and  though  the  annuity  may  pro- 
duce a  higher  rate  of  interest  than  six  pei 
cent  upon  the  consideration  paid  for  it,  yet 
this  does  not  taint  the  transaction  with 
usury. 

If  the  court  were  limited  by  the  pleas  to 
the  words  of  the  contract,  and  it  purported  to 
be  a  purchase  of  an  annuity,  and  no  evidence 
were  adduced  giving  a  different  character 
to  the  transaction,  this  argument  would  be 
unanswerable.  An  annuity  may  be  purchas- 
ed like  a  tract  of  land  or  other  property,  and 
the  Inequality  of  price  will  not,  of  itself, 
make  the  contract   usurious.    If   the   inade- 


quacy of  consideration  be  great,  in  any  pur- 
chase, it  may  lead  to  suspicion;  and,  con- 
nected with  other  circumstances,  may  induce 
a  court  of  chancery  to  relieve  against  the 
contract. 

In  the  case  under  consideration,  ?5,000 
were  paid  for  a  ground-rent  of  !?500  per  an- 
num. This  circumstance,  although  ten  per 
cent,  be  received  on  the  money  paid,  does 
not  make  the  contract  unlawful.  If  it  were 
a  bona  fide  purchase  of  an  annuity,  there 
is  an  end  to  the  question;  and  the  condition 
which  gives  the  option  to  the  vendor  to  re- 
purchase the  rent,  by  paying  the  $5,000  after 
the  lapse  of  five  years,  would  not  invalidate 
the  contract  1  Brown,  Ch.  7,  93.  The  right 
to  repurchase,  as  also  the  inadequacy  of 
price,  would  be  circumstances  for  the  con- 
sideration of  a  jury. 

The  case  reported  In  2  Coke,  252,  Is  strong- 
ly relied  on  by  the  counsel  for  the  defendant. 
In  that  case,  an  action  of  debt  was  brought 
upon  an  obligation  of  £300,  conditioned  for  the 
payment  of  £20  per  annum,  during  the  lives 
of  the  plaintiff's  wife  and  son.  The  defendant 
pleaded  the  statute  of  usury,  and  that  he  ap- 
plied to  the  defendant  to  borrow  of  him 
£120,  at  the  lawful  rate  of  interest;  but  that 
he  corruptly  offered  to  deliver  £120  to  him, 
if  he  would  be  obliged  to  pay  £20  per  annum. 
The  court  considered  this  as  an  absolute  con- 
tract for  the  payment  of  £20  per  annum  dur- 
ing two  lives;  and  no  agreement  being  made 
for  the  return  of  the  principal,  it  was  not 
considered  usury.  But,  they  stated,  if  there 
had  been  any  provision  for  the  repayment  of 
the  principal,  although  not  expressed  in  the 
bond,  the  contract  would  have  been  usurious. 
This  is  a  leading  case,  and  the  principle  on 
which  it  rests  has  not  been  controverted  by 
modem  decisions. 

Scholfield,  it  appears,  was  under  no  obliga- 
tion to  repurchase  the  aimuity,  but  he  had  the 
option  of  doing  so  after  the  lapse  of  five  years, 
which  is  a  strong  circumstance  to  show  the 
nature  of  the  transaction. 

The  purchase  of  an  annuity,  or  any  other 
device  used  to  cover  an  usurious  transaction, 
will  be  unavailing.  If  the  contract  be  hifect- 
ed  with  usury,  it  cannot  be  enforced. 

Where  an  annuity  is  raised  with  the  design 
of  covering  a  loan,  the  lender  will  not  be 
exempted  by  It  from  the  penalties  of  usury. 
3  Bos.  &  P.  150.  On  this  point  there  is  no  con- 
tradiction in  the  authorities. 

If  a  party  agree  to  pay  a  specific  sum  ex- 
ceeding the  lawful  interest,  provided  he  do  not 
pay  the  principal  by  a  day  certain,  it  is  not 
usury.  By  a  punctual  payment  of  the  prin- 
cipal he  may  avoid  the  payment  of  the  sum 
stated,  which  is  considered  as  a  penalty. 

Where  a  loan  is  made  to  be  returned  at  a 
fixed  day  with  more  than  the  legal  rate  of 
interest,  depending  upon  a  casualty  which 
hazards  both  principal  and  interest,  the  con- 
tract is  not  usurious;  but  where  the  interest 
only  is  hazarded,  it  is  usury. 
Does  the  decision  in  this  case,  as  has  been 


VIOLATION  OF  STATUTES— USURY. 


42a 


contondod,  depend  upon  a  construction  of  the 
contract?  Are  there  no  averments  in  the  pleas 
which  place  before  the  court  material  facts  to 
constitute  u.suiy,  that  do  not  appear  on  the 
face  of  the  deed? 

Lf  the  court  were  limited  to  a  mere  con- 
struction of  the  contract,  they  would  have  no 
difficulty  in  deciding  that  the  ease  was  not 
strictly  embraced  by  the  statute. 

In  the  second  plea,  the  plaintiff  below  prays 
oyer  of  the  deed  of  Indenture,  and  among  oth- 
er statements  alleges,  "that  it  was  corruptly 
agreed  between  the  said  Scholfiold  and  the 
said  Moore,  that  the  said  Moore  should  lend 
to  him  the  sum  of  $5,000,  and  in  consideration 
thereof,  that  he  should  execute  the  said  deed, 
&c."  And  in  another  part  of  the  same  plea, 
it  Is  stated  "that  the  said  Moore  did  cor- 
niptly  agree,  tliat  he  would  in  the  said  In- 
denture covenant,  &c.,  that  if  the  said  Schol- 
field,  his  heirs  and  assigns,  should,  at  any 
time  after  the  expiration  of  five  years  from 
the  date  of  said  indenture,  pay  to  the  said 
Moore,  his  heirs  and  assigns,  the  sum  of 
$0,000,  together  with  all  arrears  of  rent  he, 
the  said  Moore,  would  release  to  him  the 
said   annuity." 

And  it  is  further  alleged,  "that  the  said 
Moore,  in  pursuance  and  in  prosecution  of 
the  said  corrupt  agreement,  did  advance  to  the 
said  Scholfleld  the  said  sum  of  $5,000."  And 
again,  "that  the  said  deed  of  indenture  was 
made,  in  consideration  of  money  lent  upon 
and  for  usury;  and  that,  by  the  said  indent- 
ure, there  has  been  reserved  and  taken  above 
the  rate  of  $6  per  annum  In  the  hundred,  for 
the  forbearance  of  the  said  sum  of  $5,000  so 
lent  as  aforesaid." 

The  fourth  plea  contains,  substantially,  the 
allegations  as  to  the  lending,  &c.,  that  are 
found  in  the  second  plea 

The  facts  stated  in  the  pleas  are  admitted 
by  the  demurrers,  and  the  question  of  usury 
arises  on  these  facts,  connected  as  they  are 
with  the  contract 

Although  the  second  and  fourth  pleas  may 
not  contain  every  proper  averment  with  tech- 
nical accuracy,  yet  they  are  substantially  good. 
All  the  material  facts  to  constitute  usury  are 
found  In  the  second  plea. 

It  states  a  corrupt  agreement  to  loan  the 
money,  at  a  higher  rate  of  interest  than  the 
law  allows.  That  the  money  was  advanced 
and  the  contract  executed,  In  pursuance  of 
such  agreement.  That  on  the  return  of  the 
principal,  with  a  full  payment  of  the  rent 
after  the  lapse  of  five  years,  the  annuity  was 
to  be  released.  The  amount  agreed  to  be  paid 
above  the  legal  Interest,  for  the  forbearance, 
is  not  expressly  averred,  but  the  facts  are  so 
stited  in  the  plea  as  to  show  the  amount  with 
certainty.  $500,  under  cover  of  the  annuity, 
were  to  bo  paid,  annually,  for  the  forbearance 
of  the  $5,000,  making  an  annual  interest  of 
ten  per  cent  Do  not  these  facts,  imcontradict- 
ed  as  they  are,  amount  to  usury?  Is  it  not  evi- 
dent from  this  statement  of  the  case,  that  the 


annuity  was  created  as  a  means  for  paying 
the  interest  until  the  principal  should  be  re- 
turned, and  as  a  disguise  to  the  transaction? 
Such  is  the  legitimate  inference  which  arises 
from  the  facts  stated  in  the  plea. 

At  this  point  in  the  case  an  important  ques- 
tion is  raised,  whether  Lloyd,  the  plaintiff  in 
the  replevin,  being  the  a.->signee  of  .Sf-holfield, 
can  set  up  this  plea  of  usury  in  his  defence- 
It  is  strongly  contended  that  he  cannot  He 
purchased  tliis  property,  it  is  alleged,  sub- 
ject to  the  annuity,  and  paid  for  it  a  pro- 
portionably  less  consideration.  That  know- 
ing of  the  charge  before  he  made  the  pur.ha;>e, 
it  would  be  unjust  for  him  now  to  evade  the 
payment  And  the  inquiry  is  made,  whether 
Lloyd  could  plead  u.«urj'  In  this  contract,  if 
the  annuity  had  been  purchased  by  Schol- 
field.  lie  would  be  estopped  from  doing  so, 
it  is  urged,  by  the  obligations  of  his  own  con- 
tract, as  he  Is  now  estopped  from  resisting 
the  claim  of  iloore. 

As  to  the  injustice  of  the  defence,  It  may 
be  remarked  that  the  objection  would  apply 
with  still  greater  force  against  Scholfleld,  if 
he  were  to  attempt,  by  a  similar  defence,  to 
evade  the  payment  of  the  annuity.  He  re- 
ceived the  money  after  assenting  to  the  con- 
tract; but  he  is  at  liberty  to  evade  the  pay- 
ment of  the  annuity  by  the  plea  of  usury.  Is 
the  position  correctly  taken,  that  no  person 
can  avail  himself  of  this  plea,  but  a  party  to 
the  original  contract? 

The  principle  seems  to  bt  settled,  that  usuri- 
ous securities  are  not  only  void,  as  between 
the  original  parties,  but  the  illegality  of  their 
inception  affects  them  even  in  the  hands  of 
third  persons  who  are  entire  strangers  to  the 
transaction.  Comyn,  Usury,  160.  A  stninger 
must  "take  heed  to  his  assurance,  at  his  per- 
il;" and  cannot  insist  on  his  ignorance  of  the 
contract  in  support  of  his  claim  to  recover 
upon  a  security  which  originated  In  U5ury. 

In  the  case  of  Lowe  v.  Waller,  Doug.  ~:\~i. 
the  plaintiff  was  the  indorser  of  a  bill  origi- 
nally made  upon  an  usurious  contract:  though 
he  had  received  it  for  a  valuable  consider- 
ation, and  was  entirely  ignorant  of  its  vice, 
the  court  of  king's  bench,  after  great  consid- 
eration, determined  that  the  words  of  tlie 
statute  were  too  strong;  and  that  after  what 
had  been  held  in  a  case  on  the  statute  against 
gaming,  the  plaintiff  could  not  recover. 

K  a  bill  of  exchange  be  drawn  In  conse- 
quence of  an  usurious  agreement  for  discount- 
ing It  although  the  drawer  to  whose  order  it 
was  payable  was  not  privy  to  this  agreement 
stUl,  it  is  void  in  the  hands  of  a  bona  fide  in- 
dorser. 2  Camp.  500.  In  Holt.  N.  P.  256, 
Ix>rd  EUenborough  lays  down  the  law  that  a 
bona  fide  holder  cannot  recover  upon  a  bin 
founded  In  usury;  so  neither  can  he  recover 
upon  a  note  where  the  payee's  indorsement 
through  which  he  must  daim,  has  been  made 
by  an  usurious  agreement  But  if  the  first 
indorsement  be  valid,  a  subsequent  usurious 
indorsement  will  not  affect  him;  because  such 


424 


ILLEGALITY  OF  OBJECT. 


intermediate  indorsement  Is  not  necessary  to 
his  title  to  sue  the  original  parties  to  the 
note. 

If  a  note  be  usurious  in  its  inception,  and  it 
pass  into  the  hanas  of  a  bona  fide  holder  who 
has  no  notice  of  the  usury,  and  the  drawer 
give  to  the  holder  a  bond  for  the  amount  of 
the  note,  the  bond  would  not  be  affected  by 
the  usury.    8  Term  R.  390. 

In  the  case  of  Jackson  v.  Henry,  reported  in 
10  Johns.  1S5,  a  plea  of  usury  was  set  up  to 
invalidate  the  title  of  a  purchaser  at  a  sale 
of  mortgaged  premises.  This  sale,  under  the 
statute  of  New  York,  is  equivalent  to  a  fore- 
closure by  a  decree  in  chancery;  and  the 
court  decided  that  the  title  of  the  purchaser 
was  not  affected  by  usury  in  the  debt  for 
which  the  mortgage  was  given.  The  stitute 
of  New  York  declares  all  bonds,  bills,  con- 
tracts, and  assurances,  infected  with  usury, 
'"utterly  void."  And  so  say  the  court  on  the 
adjudged  cases,  when  the  suit  at  law  is  be- 
tween the  original  parties,  or  upon  the  very 
instrument  infected. 

The  case  of  D'WoLf  v.  Johnson,  reported  In 
10  "Wall.  367,  is  relied  on  by  the  counsel  for 
the  defendant,  as  a  decision  in  point. 

In  that  case,  it  will  be  observed  that  the 
drst  mortgage  being  executed  in  Rhode  Island 
in  1S15,  was  not  usurious  by  the  laws  of  that 
state;  and  the  second  one,  executed  in  Ken- 
tucky, in  1S17,  being  a  new  contract,  was  not 
tainted  with  usury.  The  question,  therefore, 
whether  the  purchaser  of  an  equity  of  redemp- 
tion can  show  usury  in  the  mortgage  to  defeat 
a  foreclosure,  was  not  involved  ia  that  case. 

The  Virginia  statute  makes  void  every  usu- 
rious contract;  and  the  second  plea  contains 
allegations  which,  uncontradicted,  show  that 
the  contract  between  Moore  and  Scholfleld 
was  usurious  in  Its  origin. 

Thia  contract,  thus  declsjed  to  be  void,  is 


sought  to  be  enforced  against  Lloyd,  the  pur- 
chaser of  the  property  charged  with  the  an- 
nuity. Between  Scholfield  and  Lloyd  there  Is 
a  privity;  and  if  the  contract  for  the  annuity 
be  infected  with  usury,  is  it  not  void  as 
against  Lloyd? 

In  this  contract,  a  summary  remedy  is  given 
to  enter  on  the  premises,  and  levy  by  distress 
and  sale  of  the  goods  and  chattels  there 
found,  for  the  rent  in  arrear;  and  if  the  dis- 
tress should  be  insufficient  to  satisfy  the  rent, 
and  it  should  remain  unpaid  for  thirty  days, 
Moore  is  authorized  to  enter  upon  the  prem- 
ises, and  to  expel  Scholfield,  his  heirs  and  as- 
signs, and  hold  the  estate.  Lloyd,  as  the  as- 
signee of  Scholfield,  comes  within  the  terms 
of  the  contract,  and  is  liable,  being  in  pos- 
session of  the  premises,  to  have  his  property 
distrained  for  the  rent,  and,  if  it  be  not  paid, 
himself  expelled  from  the  possession.  Under 
such  circumstances,  may  he  not  avail  himself 
of  the  plea  of  usury,  and  show  that  the  con- 
tract which  so  materially  affects  his  rights  is 
Invalid?  Moore  seeks  his  remedy  under  this 
contract,  and  if  it  be  usurious  and  consequent- 
ly void,  can  it  be  enforced? 

If  usury  may  be  shown  in  the  inception  of  a 
bUl  to  defeat  a  recovery  by  an  indorsee,  who 
paid  for  it  a  valuable  consideration  without 
notice  of  the  usury,  may  not  the  same  offence 
be  set  up  where,  in  a  case  like  the  present,  the 
party  to  the  usurious  contract  claims  by  virtue 
of  its  provisions,  a  summary  mode  of  redress? 

The  court  entertain  no  doubt  on  this  subject 
They  think  a  case  of  usury  is  made  out  by 
the  facts  stated  in  the  second  plea,  and  that 
Lloyd  may  avail  himself  of  such  a  defence. 

The  judgment  of  the  circuit  court  must  be 
reversed,  and  the  cause  remanded,  with  in- 
Rtructions  to  overrule  the  demurrers  to  the 
second  and  fourth  pleas.  an(?  permit  the  de- 
fendant to  plead. 


PUBLIC  POLICY— INJUllY  TO  PUBLIC  SERVICE. 


425 


P 


2^      BLISS  V.  LAWRENCE.  c- 

SAME  V.  GARDNEE.  2.^ 

(58  N.  Y.  442.) 


Court  of  Appeals  of  New  York.      1874. 

Appeals  from  judgments  dismissing  the  com- 
plaint. Defendant  was  a  cleric  in  the  United 
States  treasury  department,  In  New  York 
City,  and  sold  and  assijrned  to  plaintiff  a 
month's  salary  In  advance  at  a  discount  of  ten 
per  cent,  and  when  the  salary  became  due,  he 
collected  and  converted  it  to  his  own  use. 

James  Emott  and  Samuel  Hand,  for  appel- 
lant L  L  Lansing  and  Moses  Ely,  for  re- 
spondent 

JOHNSON,  J.  The  controlling  question  In 
these  cases  is  that  of  the  lawfulness  of  an 
assignment,  by  way  of  anticipation,  of  the 
salary  to  become  due  to  a  public  officer.  The 
particular  cases  presented  are  of  assignments 
of  a  month's  salary  in  advance.  But  if  these 
can  be  sustained  in  law,  then  such  assign- 
ments may  cover  the  whole  period  of  possible 
service.  In  the  particular  cases  before  us  the 
claims  to  a  month's  salary  seem  to  have  been 
-"gold'^at  a  discount  of  about  ten  per  cent. 
While  tliis  pi-csonls  no  question  of  usiil-y 
(since  it  was  a  sale  and  not  a  loan  for  which 
the  parties  were  dealing),  it  does  present  a 
quite  glaring  instance  and  example  of  the  con- 
sequences likely  to  follow  the  establishment 
of  the  validity  of  such  transfers,  and  thus 
iUustnites  one  at  least  of  the  grounds  on  which 
the  alleged  rule  of  public  policy  rests,  by 
which  such  transfers  are  forbidden.  The  pub- 
lic^_secEi£e_Js^rotocted  by  protecting  those 
engaged  in  pcrfonning  public  duliis;  and 
this  not  upon  The  groimd  ol"  ibeir  private  in- 
terest, but  upon  that  of  the  necessity  of  se- 
curing the  efficiency  of  the  public  service 
/  by  seeing  to  it  that  the  funds  provided  for, 
1  its  maintenance  should  be  received  by  those' 
\  who  are  to  perform  the  work  at  such  periods 
1  as  the  law  has  appointed  for  their  payment. 
It  is  argned  that  a  public  officer  may  bet- 
ter submit  to  a  loss  in  order  to  get  his  pay 
into  his  hands  in  advance,  than  deal  on 
credit  for  his  necessary  expenses.  This  may  I 
be  true  in  fact,  in  individual  instances,  and  | 
yet  may  in  genenil  not  be  in  accordance  with 
the  fact.  Salaries  are  by  law  payable  after 
work  is  performed  and  not  before,  and  while 
this  remains  the  law,  it  must  be  presumed 
to  be  a  wise  regulation,  and  necessary  in  the 
view  of  the  law-makers  to  the  efficiency  of 
the  public  service.  The  contrary  rule  would 
permit  the  public  service  to  be  undermined 
bythe_assigiiment"to  strangers  of  all  tlie 
funds  ap;irotiri:itoi'l  tci  sahii'ifs.  It  is  true 
that  in  respect  to  officers  removable  at  will, 
this  evil  could  in  some  measure  be  limited 
by  their  removal  when  they  were  found  as- 
signing their  salaries;  but  this  Is  only  a 
partial  remedy,  for  there  would  stiU  be  no 
means  of  preventing  the  continued  recur- 
rence of  the  same  difficulty.     If  such  assign- 


ments are  allowed,  then  the  assignees  by  no 
tice  to  the  government,  would  on  ordinary 
principles  be  entitled  to  receive  pay  directly 
and  to  take  the  place  of  their  assignors  in 
respect  to  the  emoluments,  leaving  the  du- 
ties as  a  barren  charge  to  be  borne  by  the 
assignors.  It  does  not  need  much  reflection 
or  observation  to  understand  that  such  a  con- 
dition of  things  could  not  fail  to  produce  re- 
sults disastrous  to  the  efficiency  of  the  pub- 
lic service. 

Some  mi-sapprehension  as  to  the  doctrine 
involved  seems  to  have  arLsen  from  the  fact 
that  the  modern  adjudged  cases  have  often 
related  to  the  pay  of  half-pay  army  officers, 
which  In  part  is  given  as  a  compensation 
for  past  services  and  in  part  with  a  view  to 
future  services.  Upon  a  review  of  the  Eng- 
lish cases,  it  will  appear  that  the  general 
proposition  is  upon  authority  unquestionable, 
that  salary  for  continuing  services  could  not 
be  assigned;  while  a  pension  or  compensa- 
tion for  past  services  might  be  assigned. 
The  doubt,  and  the  only  doubt  in  the  case  of 
half-pay  officers  was  to  which  class  they 
were  to  be  taken  to  belong.  It  was  decided 
that  inasmuch  as  their  pay  was  in  part  in 
view  of  future  service,  it  was  unassignable. 
Similar  questions  have  arisen  in  respect  to 
persons  not  strictly  public  officers,  but  the 
principle  before  stated  has  In  the  courts  of 
England  been  adhered  to  firmly.  Flarty  v. 
Odium,  3  Term  R.  681;  Stone  v.  Lidderdale, 
2  Anst.  533;  Davis  v.  Marlboro,  1  SwansL 
79;  Lidderdale  v.  Duke  of  Montrose,  4  Tenn 
R.  248;  Barwick  v.  Read,  1  H.  Bl.  627;  Ar- 
buckle  V.  Co  whan,  3  Bos.  &  P.  328;  Wells 
V.  Foster,  8  Mees.  &  W.  149;  Story,  Eq.  Jur. 
§  1040d;  1  Pars.  Cont.  194.  These  cases  and 
writers  sustain  the  proposition  above  set 
forth  and  show  the  settled  state  of  the  Eng- 
lish law  upon  the  subject.  Some  other  cases 
are  so  pertinent  to  the  general  discussion  as 
to  deserve  to  be  stated  more  at  length,  espe- 
cially as  they  are  not  so  accessible  as  those 
before  referred  to.  Among  them  the  judg- 
ment of  Lord  Brougham,  in  the  house  of 
lords,  in  Hunter  v.  Gardner,  6  Wils.  &  S. 
618,  decided  in  1831,  gives  an  admirable  sum- 
mary of  thfe  state  of  the  English  law  upon 
the  subject.  The  case  was  a  Scotch  appeal, 
in  which  the  Scotch  court  had  approved,  un- 
der the  law  of  that  country,  a  partial  trans- 
fer of  the  salary  of  a  public  officer.  The  par- 
ticular judgment  was  aflirmed  without  decid- 
ing what  thQ  law  of  Scotland  was  upon  the 
subject.  In  his  judgment  Lord  Brougham 
said:  "The  court  seem  not  to  have  scruti- 
nized very  nicely  whether  from  the  nature 
of  the  subject-matter,  namely,  the  half-pay 
or  the  full  pay  of  an  officer  or  a  minister's 
stipend,  or  in  the  present  case,  the  salary  of 
an  ofiicer  employed  under  government  and  in 
the  execution  of  an  imjiortant  public  trust, 
an  assignment  can  validly  operate  upon  and 
affect  those  particular  rights;  but  they  have 
nevertheless  assumed  to  deal  with  them  and 
have   directed   that  a  certain   proportion   of 


426 


ILLEGALITY  OF  OBJECT. 


them  shall  be  assigned  on  the  condition  of 
panting  the  benefit  of  the  cessio  bouorum. 
Those  cases  undoubtedly  could  not  have  oc- 
curred in  this  country.  I  may  refer  to  the 
well-known  case  of  Flarty  v.  Odium,  3  Term 
R.  GSl.  which  from  its  importsjice  was  the 
subject  of  mucL  discussion,  it  being  the  first 
case  in  which  it  was  held  that  the  half-pay 
of  an  officer  was  not  the  subject  of  assign- 
ment; and  it  was  followed  in  Lidderdale  v. 
Duke  of  Montrose,  in  4  Term  R.,  where  the 
doctrine  laid  down  was  made  the  subject  of 
further  discussion,  and  the  court  adhered  to 
their  former  view,  that  the  half-pay  was  free 
from  attachment;  so  that  neither  is  a  man 
bound  to  put  it  into  the  schedule  of  his  as- 
sets, nor  does  the  general  assignment  to  the 
provisional  assignee  transfer  it,  nor  would  a 
bargain  and  sale  to  the  assignees  vmder  a 
commission  of  bankruptcy  pass  it  out  of  the 
bankrupt;  it  is  unassignable  and  incapable 
of  being  affected  by  any  of  those  modes  of 
proceeding.  The  same  doctrine  was  laid 
down  with  respect  to  the  profits  of  a  living 
in  the  case  of  Arbuckle  v.  Cowhan,  the  judg- 
ment in  which  has  been  very  much  consid- 
ered in  Westminster  Hall,  and  like  most  of 
the  judgments  of  that  most  able  and  learned 
lawyer.  Lord  Alvanley,  has  given  great  sat- 
isfaction to  the  courts  and  the  profession. 
In  the  report  of  that  case,  your  lordships  will 
find  laid  down  the  general  principle,  though, 
perhaps,  not  worked  out  in  these  words,  that 
all  such  profits  as  a  man  receives  in  respect 
to  the  performance  of  a  public  duty  are, 
from  their  very  nature,  exempt  from  attach- 
ment and  incapable  of  assignment,  inasmucn 
as  it  would  be  inconsistent  with  the  nature 
of  those  profits  that  he  who  had  not  been 
trusted,  or  he  who  had  not  been  employed  to 
do  the  duty,  should  nevertheless  receive  the 
emolument  and  reward.  Lord  Alvanley 
quotes  Flarty  v.  Odium  and  Lidderdale  v. 
Duke  of  Montrose,  and  in  illustrating  the 
principle  on  which  a  parson's  emoluments 
are  not*  assignable,  he  does  not  confine  his 
observations  to  the  particular  case  of  half- 
pay  officers  or  the  case  of  a  parson's  emolu- 
ments, but  he  makes  the  observation  in  all 
its  generality,  as  applicable  to  every  case  of 
a  public  office  and  the  emoluments  of  that 
office.  The  first  case  (1  H.  Bl.  627),  decided 
by  the  court  of  common  pleas  (the  case  of 
Barwick  v.  Read),  clearly  recognizes  the 
principle.  •  •  •  In  this  case  as  well  as 
the  other  case  of  Arbuckle  v.  Cqwhan,  it  was 
perfectly  clearly  held  by  the  court  that  in 
all  such  cases,  one  man  could  not  claim  to 
receive,  by  assignment  or  attachment,  emol- 
uments which  belonged  to  another  deemed  to 
be  capable  of  performing  the  duties  append- 
ed to  those  emoluments,  but  which  duties 
could  not  be  performed  by  the  assignee;  and 
there  was  an  old  case  referred  to  in  Banvick 
V.  Read,  and  a  curious  case  in  Dyer,  in 
which  so  long  ago  as  the  reign  of  Elizabeth, 
the  question  appears  to  have  been  disposed 
of  by  a  decision  now   undisputed,  and  now 


referred  to  in  Westminster  Hall.  »  ♦  • 
All  these  cases  laid  down  this  principle, 
which  is  perfectly  undeniable,  that  neither 
attachment  nor  assignment  is  applicable  to 
such  a  case." 

Other  cases  to  the  same  effect,  of  later 
date,  are  likewise  noteworthy. 

In  Hill  V.  Paul,  8  Clark  &  F.  307,  decided 
in  1842,  Lord  Chancellor  Lyndhurst,  speaking 
of  the  legality  of  assigning  the  future  emol- 
uments of  an  office  in  Scotland,  says:  "That 
such  an  assignment  would  be  illegal  in  Eng- 
land there  can  be  no  doubt.  Palmer  v.  Bate, 
2  Brod.  &  B.  673,  is  directly  applicable  to  this 
case.  And  in  Davis  v.  Marlboro,  1  Swanst. 
79,  there  is  the  observation  of  Lord  Eldon 
already  cited,  which  seems  to  me  quite  in 
point  and  which  lays  down  the  true  rule  and 
the  distinction  to  be  observed  in  these  cases, 
and  to  which  for  that  reason  I  refer  as  show- 
ing what  is  the  law  of  England  on  this  sub- 
ject." What  Lord  Eldon  said  in  the  case 
referred  to  was:  "A  pension  for  past  serv- 
ices may  be  aliened;  but  a  pension  for  sup- 
porting the  grantee  in  the  performance  of  fu- 
ture duties  is  inalienable."  And  in  Flarty  v. 
Odium,  4  Term  R.  248,  the  court  say:  "It 
might  as  well  be  contended  that  the  salaries 
of  the  judges  which  are  granted  to  support 
the  dignity  of  the  state  and  the  administra- 
tion of  justice  may  be  assigned." 

In  Arbuthnot  v.  Norton  (1846)  5  Moore,  P. 
C.  230,  the  question  was  whether  an  Indian 
judge  could  assign  a  contingent  sum  to  which 
on  his  death  within  six  months  after  his  ar- 
rival in  India  his  representative  would  be 
entitled  by  law,  and  it  was  held  that  such 
an  assignment  was  not  against  public  policy 
and  would  in  equity  transfer  the  right  to 
the  fund.  In  the  course  of  the  judgment 
given  by  Dr.  Lushington,  he  says:  "We  do 
not  in  the  slightest  degree  controvert  any  of 
the  doctrines  whereupon  the  decisions  have 
been  founded  against  the  assignment  of  sal- 
aries by  persons  filling  public  offices:  on  the 
contrary,  we  acknowledge  the  soundness  of 
the  pi*inciples  which  govern  those  cases  but 
we  think  that  this  case  does  not  fall  within 
any  of  these  principles;  and  we  think  so  be- 
cause this  is  not  a  sum  of  money  which  at 
any  time  during  the  life  of  Sir  John  Norton 
could  possibly  have  been  appropriated  to  his 
use  or  for  his  benefit,  for  the  purpose  of  sus- 
taining with  decorum  and  propriety  the  high 
rank  in  life  in  which  he  was  placed  in  India. 
We  do  not  see  how  any  of  the  evils  which 
are  generally  supposed  would  result  from  the 
assignment  of  salary,  could  in  the  slightest 
degree  have  resulted  from  the  assignment  of 
this  sum,  inasmuch  as  during  his  life-time  his 
personal  means  would  in  no  respect  whatever 
have  been  diminished,  but  remain  exactly  in 
the  same  state  as  they  were." 

In  Liverpool  v.  Wright,  28  L.  J.  (N.  S.)  Ch. 
871,  A.  D.  1859,  in  which  the  question  re- 
lated to  the  alienability  of  the  fees  of  the 
office  of  a  clerk  of  the  peace.  Wood,  V.  C, 
after   disposing   of   another   question,    says: 


PUBLIC  POLICY— INJURY  TO  PUBLIC  SERVICE. 


427 


"Then  there  Is  a  second  ground  of  public 
policy,  for  which  the  case  of  Palmer  v. 
Vaughn,  3  Swaust.  173,  is  the  leading  author- 
ity, which  is  this:  That  Independently  of 
any  corrupt  bargain  with  the  appointor,  no- 
body can  deal  with  the  fees  of  a  person  who 
holds  an  office  of  this  description,  because 
the  law  presumes,  with  reference  to  an  of- 
fice of  trust,  thut  he  requires  the  payment 
which  the  law  has  assigned  to  him  for  the 
purpose  of  upholding  the  dignity  and  per- 
forming properly  the  duties  of  that  otlice,  and 
therefore  it  will  not  allow  him  to  part  with 
any  portion  of  those  fees  either  to  the  ap- 
pointor or  to  anybody  else.  He  Is  not  al- 
lowed to  charge  or  incumber  them.  That 
was  the  case  of  Parsons  v.  Thompson,  1  H. 
Bl.  322.  Any  attempt  to  assign  any  portion 
of  the  fees  of  hi«  office  is  illegal  on  the 
ground  of  public  policy,  and  held  therefore  to 
be  void." 

In  respect  to  American  authority  we  have 
been  referred  to  Brackett  v.  Blake,  7  Mete. 
(Mass.)  335,  Mulhall  v.  Quinn,  1  Gray,  105, 
and  Macomber  v.  Doane,  2  Allen,  541,  as  con- 
flicting with  the  views  we  have  expressed. 
An  examination  of  these  cases  shows  that 
the  point  of  public  policy  was  not  considered 
by  the  court  in  either  of  them,  but  that  the 
question  was  regarded  as  entirely  relating  to 
the  sufficiency  of  the  interest  of  the  assignor 
in  the  future  salary  to  distinguish  the  cases 
from  those  of  attempted  assignments  of  mere 
expectation,  such  as  those  of  an  expectant 
heir.  The  court  held  that  in  the  cases  cited, 
the  expectation  of  future  salary  being  found- 
ed on  existing  engagements,  was  capable  of 


assignment  and  that  the  existing  Interest 
sutliced  to  support  the  transfer  of  the  future 
expectation.  The  only  other  case  to  which 
we  have  been  referred  Is  a  decision  of  the 
supreme  court  of  Wisconsin. 

In  State  Bank  v.  Hastings,  15  Wis.  78,  the 
question  being  as  to  the  assignability  of  a 
judge's  salary,  the  court  say:  "We  were  re- 
ferred to  some  English  cases  which  hold  that 
the  assignment  of  the  pay  of  officers  in  tlie 
public  service,  judges'  salaries,  pen.sion.s, 
etc.,  was  void  as  being  against  public  policy, 
but  it  was  not  contended  that  the  doctrine 
of  those  cases  was  applicable  to  the  condi- 
tion of  society  or  to  the  principles  of  law  or 
of  public  policy  in  this  country.  For  cer- 
tainly we  can  see  no  possible  objection  to 
permitting  a  judge  to  assign  his  salary  be- 
fore it  becomes  due,  if  he  can  find  any  per- 
son willing  to  take  the  risk  of  his  living  and 
being  entitled  to  It  when  it  becomes  pay- 
able." 

We  do  not  understajid  that  the  English  de- 
cisions really  rest  on  any  grounds  peculiar  to 
that  country,  although  sometimes  expressed 
In  terms  which  we  might  not  select  to  ex- 
press our  views  of  the  true  foundation  of  the 
doctrine  In  question.  The  substance  of  it  all 
is  the  necessity  of  maintaining  the  efficiency 
of  the  public  service  by  seeing  to  it  that  pub- 
lic salaries  really  go  to  those  who  perform 
the  public  service.  To  this  extent  we  think 
the  public  policy  of  every  country  must  go  to 
secure  the  end  in  view. 

The  judgments  must  be  affirmed. 

All   concur. 

Judgments  afHrmed. 


428 


ILLEGALITY  OF  OBJECT. 


2^       PROVIDEXCE   TOOL    CO.   v. 
(2  Wall.  45.) 


NORRIS. 
Dec^ 


tSupreme   Court   of    the    United    States. 
1S64. 


In  July,  1S61,  the  Providence  Tool  Company, 
a  corporation  created  under  the  laws  of  Rhode 
Island,  entered  into  a  contract  with  the  gov- 
ernment, through  the  secretaiy  of  war,  to  de- 
liver to  officers  of  the  United  States,  within 
certain  stated  periods,  trwenty-five  thousand 
muskets,  of  a  specified  pattern,  at  the  rate  of 
twenty  dollars  a  musket  This  contract  was 
procured  through  the  exertions  of  Norris,  the 
plaintiff  in  the  court  below,  and  the  defendant 
in  error  in  this  court,  upon  a  previous  agree- 
ment with  the  corporation,  through  its  man- 
aging agent,  that  in  case  he  obtained  a  con- 
tract of  this  kind  he  should  receive  comi)en- 
sation  for  his  services  proportionate  to  its  ex- 
tent 

Norris  himself.  It  appeared,  —  though  not 
having  any  imputation  on  his  moral  character, 
—was  a  person  who  had  led  a  somewhat  mis- 
cellaneous sort  of  a  life,  in  Europe  and  Amer- 
ica. Soon  after  the  rebellion  broke  out,  he 
found  himself  in  Washington.  He  was  there 
without  any  special  purpose,  but,  as  he  stated, 
with  a  view  of  "making  business— anything 
generally;'*  "soliciting  acquaintances;"  "get- 
ting letters;"  "getting  an  office,"  &c.  Finding 
that  the  government  was  in  need  of  arms  to 
suppress  the  rebellion,  which  had  now  become 
organized,  he  applied  to  the  Providence  Tool 
Company,  already  mentioned,  to  see  if  they 
wanted  a  job.  and  made  the  contingent  sort  of 
contract  with  them  just  referred  to.  He  then 
set  himself  to  work  at  what  he  called,  "con- 
centrating influence  at  the  war  department;" 
that  is  to  say,  to  getting  letters  from  people 
who  might  be  supposed  to  have  influence  with 
Mr.  Cameron,  at  that  time  secretary  of  war, 
recommending  him  and  his  objects.  Among 
other  means,  he  applied  to  the  Rhode  Island 
senators,  Messrs.  Anthony  and  Simmons, 
with  whom  he  had  got  acquainted,  to  go  with 
him  to  the  war  office.  Mr.  Anthony  declined 
to  go;  stating  that  since  he  had  been  senator 
he  had  been  applied  to  some  hundred  times, 
in  like  manner,  and  had  invariably  declined; 
thinking  it  discreditable  to  any  senator  to  in- 
termeddle with  the  business  of  the  depart- 
ments. "You  will  certainly  not  decline  to  go 
with  me,  and  introduce  me  to  the  secretary, 
and  to  state  that  the  Providence  Tool  Com- 
pany is  a  responsible  corporation."  "I  will 
give  you  a  note,"  said  Mr.  Anthony.  "I  do 
not  want  a  note,"  was  the  reply;  "I  want  the 
weight  of  your  presence  with  me.  I  want 
the  influence  of  a  senator."  "Well,"  said  Mr. 
Anthony,  "go  to  Simmons."  By  one  means 
and  another,  Norris  got  influential  introduc- 
tion to  Mr.  Secretary  Cameron,  and  got  the 
<X)ntract,  a  very  profitable  one;  the  secretary, 
whom  on  leaving  he  warmly  thanked,  "hoping 
that  he  would  make  a  great  deal  of  money 
out  of  it" 

But  a  dispute  now  arose  between  Norris  and 


the  tool  company,  as  to  the  amount  of  com- 
pensation to  be  paid.  Norris  insisted  that  by 
the  agreement  with  him  he  was  to  receive 
$7.5,000;  the  difference  between  the  contract 
price  and  seventeen  dollars  a  musket;  whilst 
the  corporation,  on  the  other  hand,  contended, 
that  it  had  only  promised  "a  liberal  compen- 
sation" in  case  of  success.  Some  negotiation 
on  the  subject  was  had  between  them;  but  it 
failed  to  produce  a  settlement  and  Norris  in- 
stituted the  present  action  to  recover  the  full 
amount  claimed  by  him. 

The  declaration  contained  several  coimts; 
the  firet  and  second  ones,  special;  the  third, 
fourth,  and  fifth,  general.  The  special  ones 
set  forth  specifically  a  contract,  that  if  he, 
Norris,  procured  the  government  to  give  the 
order  to  the  company,  the  company  would  pay 
to  him,  Norris,  "for  his  services,  in  obtaining, 
or  causing  and  procuring  to  be  obtained,  such 
order,  all  that  the  government  might  by  the 
terms  of  their  arrangement  with  the  company, 
agree  to  pay  above  $17  fcT  each  musket." 
The  general  counts  were  in  the  usual  form  of 
quantum  meruit  &c,;  but  hi  these  counts,  as 
in  the  special  ones,  a  contract  was  set  forth 
on  the  basis  of  a  compensation,  contingent  up- 
on Norris's  procuring  an  order  from  the  gov- 
ernment for  muskets  for  the  tool  company; 
reliance  on  this  contingent  sort  of  contract 
nmning  through  all  the  counts  of  the  declara- 
tion. There  was  no  pretence  that  the  plain- 
tiff had  rendered  any  other  service  than  that 
which  resulted  in  the  contract  for  the  mus- 
kets. 

On  the  trial  in  the  circuit  court  for  the 
Rhode  Island  district,  the  counsel  of  the  tool 
company  requested  the  court  to  instruct  the 
jui-y,  that  a  contract  like  that  declared  on  in 
the  first  and  second  counts  was  against  public 
policy,  and  void;  which  instruction  the  court 
refused  to  give.  The  same  counsel  requested 
the  court  to  charge,  "that  upon  the  quantum 
meruit  count  the  plaintiff  was  not  entitled  in 
law  to  recover  any  other  sum  of  money,  for 
services  rendered  to  the  tool  company  in  pro- 
curing a  contract  for  making  arms,  than  a 
fair  and  reasonable  compensation  for  the  time, 
speech,  labor  performed,  and  expenses  incur- 
red in  performing  such  services,  to  be  com- 
puted at  a  price  for  which  similar  services 
could  have  been  obtained  from  oTTTersT^T^o 
coarfgave  this  instruction,  with  the  excep- 
tion of  the  last  nine  words  in  italics.  The 
jury  found  for  the  defendant  on  the  first  and 
second— that  Is  to  say.  upon  the  special- 
counts,  and  for  the  plaintiff  on  the  others, 
and  judgment  was  entered  on  $13,500  for  the 
plaintiff.  The  case  came,  by  writ  of  error, 
here. 

Payne  &  Thurston,  for  plaintiff  in  error. 
Mr.  Blake,  contra. 

Mr.  Justice  FIELD  delivered  the  opinion  of 
the  court 

Several  grounds  were  taken,  in  the  court  be- 
low, in  defence  of  this  action;  and,  among 
others,  the.  corporation  relied  upon  the  propo- 


PUBLIC  POLICY— IX JURY  TO  PUBLIC  SERVICE. 


129 


ciUon  of  law,  that  an  agreement  of  the  char- 
acter stated,— that  is,  an  agreement  for  com- 
pensation to  procure  a  contract  from  the  gov- 
ernment to  furnish  Its  supplies, — Is  against 
public  policy,  and  void.  This  proposition  Is 
tlie  question  for  the  consideration  of  the  court. 
It  arises  upon  the  refusal  of  the  court  below 
to  give  one  of  the  instructions  asked. 

A  suggestion  was  made  on  the  argument, 
though  not  much  pressed,  that  the  lusti-uction 
invoh-ing  the  proposition  cannot  properly  be 
regarded,  inasmuch  as  it  was  directed  In  tenus 
to  the  agreement  set  forth  in  the  special 
counts  of  the  declaration,  upon  which  the 
jury  found  for  the  defendants.  There  would 
be  much  force  in  this  suggestion,  if  the  gen- 
eral counts,  upon  which  the  verdict  passed  for 
the  plaintiff,  did  not  also  aver  that  his  serv- 
ices were  rendered  in  procuring  the  same  con- 
tract from  the  government.  Ihe  instruction 
was  directed  especially  to  the  legality  of  a 
contract  of  that  kind,  which  having  been  once 
refused  with  reference  to  some  of  the  counts, 
it  was  not  necessary  for  counsel  to  renew 
with  reference  to  the  other  counts  to  which  it 
was  equally  applicable.  The  subsequent  in- 
structions were,  therefore,  directed  to  other 
matters. 

It  was  not  claimed,  on  the  trial,  that  the 
I)laintiff  had  rendered  any  other  services  than 
those  which  resulted  in  the  procurement  of  the 
contract  for  the  muskets.  We  are  of  opin- 
ion, therefore,  that  the  proposition  of  law  is 
fairly  presented  hy  the  record,  and  is  before 
us  for  consideration. 

The  quesUuii,  thi'u,  is  this:  Can  an  agree- 
ment for  compeusation  to  procure  a  contract 
from  the  government  to  furnish  its  supplies 
be  enforced  by  the  courts?  We  have  no  hesi- 
tation Ln  answering  tlie  question  in  the  nega- 
tive. All  contracts  for  supplies_should  be 
made  wTth  those,  and  with  those  only,  who 
wiU  execute  them  mo^t  faithf^illy,  nnd  at  the 
least  P'gT>gnse  to  the  froyemment.  Considera- 
tions as  to  the  most  efficient  and  economical 
mode  of  meeting  the  public  wants  should 
alone  control,  in  this  respect,  tlie  action  of 
every  department  of  the  government.  No  oth- 
er considomtion  can  lawfully  enter  into  the 
transaction,  so  far  as  the  government  is  con- 
cerned. Such  is  the  rule  of  public  policy; 
and  whatever  tends  to  Introduce  any  other 
elements  into  the  transaction,  is  against  pub- 
lic policy.  That  agreements,  like  the  one  un- 
der considerat^n,  have  this  tendency,  is  mani- 
fest. They  /ot\6  to  introduce  personal  solici- 
tation, and  personal  influence,  as  elements  in 
tile  procurement  of  contracts;  and  thus  di- 
rectly lead  to  inefficiency  in  the  public  ser- 
vice, and  to  unneces.sary  expenditures  of  the 
public  funds. 

The  prinfiple  which  determines  the  invalid- 
ity of  tlie  agreement  in  question  has  been  as- 
serted in  a  great  variety  of  cases.  It  has 
been  asserted  in  cases  relating  to  agreements 
for  compensation  to  procure  legislation. 
These  have  been  uniformly  declared  invalid. 


and  the  decisions  have  not  turned  upon  the 
question,  whether  improper  influences  were 
contemplated  or  used,  but  upon  the  corrupting 
tendency  of  the  ag.-eements.  Legislation 
should  be  prompted  solely  from  consideraiions 
of  the  public  good,  and  the  best  means  of 
advancing  it.  Whatever  tends  to  divert  the 
attention  of  legislators  from  their  high  duties, 
to  mislead  their  judgments,  or  to  substitute 
other  motives  for  their  conduct  than  the  ad- 
vancement of  the  public  iniere.sLs,  must  neces- 
sarily and  direcUy  tend  to  impair  the  integ- 
rity of  our  political  institutions.  Agreements 
for  compensation  contmgent  upon  success, 
suggest  the  use  of  sinister  and  corrupt  mejins 
for  the  accomplishment  of  the  end  desired- 
The  law  meets  the  suggestion  of  evil,  and 
strikes  down  the  contract  from  its  inception. 

There  Is  no  real  difference  in  principle  be- 
tween agreements  to  procure  favors  from  leg- 
islative bodies,  and  agreements  to  procure  fa- 
vors in  the  shape  of  contracts  from  the  heads 
of  departments.  The  introduction  of  improp- 
er elements  to  control  the  action  of  both,  is 
the  direct  and  inevitable  result  of  all  such 
arrangements.  Marshal  v.  Railroad  Co..  16 
How.  314;  Harris  \  Roof's  Ex'rs,  10  Barb. 
4S9;   Fuller  v.  Dame,  18  Pick.  472. 

The  same  principle  has  also  been  applied, 
in  numerous  instances,  to  agreements  for  com- 
pensation to  procure  appointments  to  public 
offices.  Tlaose  offices  are  trusts,  held  solely 
for  the  public  good,  and  should  be  conferred 
from  considerations  of  the  ability,  integrity, 
fidelity,  and  fitness  for  the  position  of  the 
appointee.  No  other  considerations  can  prop- 
erly be  regarded  by  the  appointing  power. 
Whatever  introduces  other  elements  to  con- 
trol this  power,  must  necessarily  lower  the 
character  of  the  appointments,  to  the  great 
detriment  of  the  public.  Agreements  for  com- 
pensation to  procure  these  appointments  tend 
directly  and  necessarily  to  introduce  such  ele- 
ments. The  law,  therefore,  from  this  tend- 
ency alone,  adjudges  these  agreements  iuo<m- 
sisteut  with  sound  morals  and  public  policy. 
Gray  v.  Hook,  4  N.  Y.  449. 

Other  agreements  of  an  analogous  character 
might  be  mentioned,  which  the  courts,  for  the 
same  or  similar  reasons,  refuse  to  uphold.  It 
is  unnecessary  to  state  them  particularly;  it 
is  sufficient  to  observe,  generally,  that  all 
agreements  for  pecuniarj-  considerations  to 
control  the  business  operations  of  the  govern- 
ment, or  the  regular  administration  of  jus- 
tice, or  the  appointments  to  public  offices,  or 
the  ordinai-y  course  of  legislation,  are  void  as 
against  public  policy,  without  reference  to  the 
question,  whctlier  improper  means  are  c<">n- 
templated  or  used  in  their  execution.  The 
law  looks  to  the  general  tendency  of  such 
agreements;  and  \i  closes  the  door  to  temp- 
tation, by  refusing  them  recognition  in  any  of 
the  courts  of  tlie  country. 

It  follows  that  the  .nidgment  of  the  court  be- 
low must  be  reversed,  and  the  cause  remand- 
ed for  a  new  trial;   and  it  is  so  ordered. 


} 


430 
2- 


ILLEGAiXTY  OF  OBJECT. 

TRIST  V.  CHILD,    j^^^ 
(21  Wall.  441.)  3^^ 


iSupreme  Court  of  the  United  States.    1874. 

Appeal  from  the  supreme  court  of  the  Dis- 
trict of  Columbia;    the  case  being  thus: 

N.  P.  Trist  having  a  claim  against  the 
United  States  for  his  services,  rendered  in 
1S4S,  touching  the  treaty  of  Guadalupe  Hi- 
dalgo—a claim  which  the  government  had  not 
recognized— resolved,  in  1SG&-7  to  submit  it 
to  congress  and  to  ask  payment  of  it  And 
he  made  an  agreement  with  Linus  Child,  of 
Boston,  that  Child  should  take  charge  of 
the  claim  and  prosecute  It  before  congress 
as  bis  agent  and  attorney.  As  a  compensa- 
tion for  his  services  it  was  agreed  that  ChUd 
should  receive  25  per  cent,  of  whatever  sum 
congress  might  allow  in  payment  of  the 
claim.  If  nothing  was  allowed,  Child  was 
to  receive  nothing.  His  compensation  de- 
pended wholly  upon  the  contingency  of  suc- 
cess. Child  prepared  a  petition  and  pre- 
sented the  claim  to  congress.  Before  final 
action  was  taken  upon  it  by  that  body  Child 
died.  His  son  and  personal  representative, 
L.  M.  Child,  who  was  his  partner  when  the 
agreement  between  him  and  Trist  was  en- 
tered into,  and  down  to  the  time  of  his  death, 
continued  the  prosecution  of  the  claim.  By 
an  act  of  the  20th  of  April,  1871,  congress  ap- 
propriated the  sum  of  514,559  to  pay  it.  The 
son  thereupon  applied  to  Trist  for  payment 
of  the  25  per  cent  stipulated  for  In  the  agree- 
ment between  Trist  and  his  father.  Trist 
declined  to  pay.  Hereupon  Child  applied  to 
the  treasury  department  to  snspend  the  pay- 
ment of  the  money  to  Trist  Payment  was 
suspended  accordingly,  and  the  money  was 
still  in  the  treasury. 

Child,  the  son,  now  filed  his  bill  against 
Trist,  praying  that  Trist  might  be  enjoined 
from  withdrawing  the  ?14,559  from  the  treas- 
ury until  he  had  complied  with  his  agree- 
ment about  the  compensation,  and  that  a  de- 
cree might  pass  commanding  him  to  pay  to 
the  complainant  .?.5000,  and  for  general  relief. 

The  defendant  answered  the  bill,  assert- 
ing, with  other  defences  going  to  the  merits, 
that  all  the  services  as  set  forth  in  their  bill 
were  "of  such  a  natm-e  as  to  give  no  cause  of 
action  In  any  court  either  of  common  law  or 
equity." 

The  case  was  heard  upon  the  pleadings  and 
much  evidence.  A  part  of  the  evidence  con- 
sisted of  correspondence  between  the  par- 
ties. It  tended  to  prove  that  the  (3hilds, 
father  and  son,  had  been  to  see  various  mem- 
bers of  congress,  soliciting  their  influence  in 
behalf  of  a  bill  introduced  for  the  benefit  of 
Mr.  Trist,  and  In  several  instances  obtaining 
a  promise  of  It  There  was  no  attempt  to 
prove  that  any  kind  of  bribe  had  been  of- 
fered or  ever  contemplated;  but  the  follow- 
ing letter,  one  in  the  correspondence  put  in 
evidence,  was  referred  to  as  showing  the  ef- 
fects of  contracts  such  as  the  one  in  this  case: 
"From   Child,   Jr.,  to  Trist     House  of  Rep- 


resentatives, Washington,  D.  C,  Feb.  20th, 
1871.  Mr.  Trist:  Everything  looks  very  fa- 
vorable.    I  found  that  my  father  has  spoken 

to  C and  B ,  and  other  members  of  the 

House.     Mr.  B says  he  will  try  hard  to 

get  it  before  the  House.  He  has  two  more 
chances,  or  rather    'morning   hours,'    before 

Congress  adjourns.     A will  go  in  for  It. 

D promises  to  go  for  it.     1  have  sent  your 

letter  and  report  to  Mr.  W ,  of  Pennsyl- 
vania. It  may  not  be  reached  till  next  week. 
Please  write  to  your  friends  to  write  imme- 
diately to  any  memljer  of  Congress.  Every 
vote  tells;  and  a  simple  request  to  a  member 
may  secure  his  vote,  he  not  caring  anything 
about  It.  Set  every  man  you  know  at  work, 
even  if  he  knows  a  page,  for  a  page  often 
gets  a  vote.  The  most  I  fear  is  indiflierence. 
Yours,  &c.,  L.  M.  Child." 

The  court  below  decreed: 

1st.  That  Trist  should  pay  to  the  complain- 
ant .$3G39,  with  Interest  from  April  20th,  1871. 

2d.  That  until  he  did  so,  he  should  be  en- 
joined from  receiving  at  the  treasury  "any  of 
the  moneys  appropriated  to  him"  by  the 
above  act  of  congress,  of  April  20th,  1871. 

From  this  decree  the  case  was  brought  here. 

The  good  character  of  the  Messrs.  Child, 
father  and  son,  was  not  denied. 

Durant  &  Homer,  for  appellants,  upon  the 
main  point  of  the  case  (the  validity  of  the 
contract  between  Child  and  Trist),  relied  upon 
Marshall  v.  Railroad,  IG  How.  314,  in  this 
court  and  upon  the  principles  there  enunci- 
ated in  behalf  of  the  court  by  Grier,  J.  They 
relied  also  on  Tool  Co.  v.  Norris,  2  Wall.  54. 

B.  F.  Butler  and  R.  D.  Mussey,  contra. 

The  case  relied  on  by  opposing  counsel  Is 
widely  different  from  this  one. 

There,  Marshall  entered— as  the  report  of 
the  case  shows— into  a  contract  with  the  Bal- 
timore and  Ohio  Railroad  Company,  to  ob- 
tain certain  favorable  legislation  in  Virginia 
for  the  contingent  compensation  of  fifty  thou- 
sand dollars  by  the  use  of  personal,  secret, 
and  sinister  influences  upon  the  legislators. 
He  expressly  stated  that  his  plan  required 
"absolute  secrecy,"  and  "that  he  could  al- 
lege 'an  ostensible  reason'  for  his  presence  in 
Richmond  and  his  active  interference  with- 
out disclosing  his  real  character  and  object." 
He  spoke  of  using  "outdoor  influence"  to  af- 
fect the  legislators  through  their  "kind  and 
social  dispositions,"  and  pictured  them  as 
"careless  and  good-natured,"  "engaged  in  idle 
pleasures,"  c-apable  of  being  "moulded  lik'e 
wax"  by  the  most  "pressing  influences."  The 
company  authorized  him  to  use  these  means. 
The  question  in  that  case,  therefore,  was, 
whether  a  contract  for  contingent  compensa- 
tion for  obtaining  legislation  by  the  use  of 
secret,  sinister  and  personal  influences  upon 
legislators  was  or  was  not  contrary  to  the 
policy  of  the  law.  And  the  decision  of  that 
question  was  the  decision  of  the  case. 

In  Marshall's  Case,  the  plaintiff  and  defend- 
ant combined  together  to  perpetrate  a  fraud 


PUBLIC  POLICY— INJURY  TO  PUBLIC  SERVICE. 


431 


upon  the  servants  of  tlie  public  engaged  In 
legislating  for  the  public  good,  and  it  was 
this  fact  which  made  the  contract  infanaous 
and  disgraceful  and  incapable  of  enforcement 
In  the  courts;  not  that  the  action  sought  was 
that  of  a  legislature. 

The  case  at  bar  differs  from  that  of  Mar- 
shall, toto  ca-lo.  Here  both  father  and  son 
were  opi'nly  and  avowedly  attorneys  for  their 
client,  Trist.  They  never  presented  them- 
selves to  anybody  in  any  different  or  other 
respect.  Every  act  of  theirs  was  open,  fair, 
and  honorable. 

Will  it  be  denied  tliat  any  man  having  a 
claim  on  the  government,  may  appear  in  per- 
son before  a  committee  of  congress,  If  they 
allow  him,  or  speak  to  members  of  congress, 
If  they  incline  to  hear  him;  point  out  to  them 
the  justice  of  his  claim,  and  put  before  them 
any  and  all  honorable  considerations  which 
may  make  them  see  that  the  case  ought  to  be 
decided  in  his  favor?  This,  we  assume,  will 
not  be  denied.  But  suppose  tliat  he  Is  an 
old  man.  ^r  a  man  infirm  and  sick;  one, 
withal,  living  away  from  the  seat  of  govern- 
ment; a  case,  it  may  be  stated,  in  passing, 
the  exact  case  of  Mr.  Trist;  for  he  was  old, 
infirm,  sick,  and  lived  at  Alexandria.  Now, 
If  Mr.  Trist  being  well  had  the  right  to  call 
upon  committees  or  members  of  congress,  and 
(if  they  invited  him  or  were  willing  to  listen 
to  him)  to  show  to  them  that  he  negotiated, 
as  he  asserted  that  he  did,  the  treaty  of 
Guadalupe  Hidalgo,  and  should  be  paid  for 
doing  so,  what  principle  of  either  morals  or 
policy,  public  or  private,  was  there  to  prevent 
him  (being  thus  old,  infirm,  sick,  and  away 
from  Washington)  from  employing  an  honor- 
able member  of  the  Mas;sachusetts  bar  to  do 
the  same  thing  for  him?  What  principle  to 
prevent  him  from  doing  by  attorney  that 
which  he  had  himself  the  right,  but  from  the 
visitation  of  God,  had  not  himself,  and  at 
that  time,  the  physical  ability  to  do? 

We  are  not  here  asking  the  court  to  open 
the  door  to  corrupt  influenoGs  upon  congress, 
or  to  give  aid  to  that  which  is  popularly 
known  as  "lobbying,"  and  is  properly  de- 
nounced as  dishonoi-ahlG.  But  we  are  ask- 
Insr  that  by  giving  the  sanction  of  the  law  to 
an  ouen  and  honorable  advocacy  by  counse' 
r>f  nrivate  rights  before  legislative  bodies,  the 
court  shall  aid  in  doing  away  with  tlie  em- 
ployment of  agencies  which  work  secretly  and 
dishonorably. 

The  records  of  congress  show  that  with 
honorable  motives  and  dishonorable  stimu- 
lants both  combined  and  acting  upon  the  two 
classes  of  persons— upright  and  avowed,  the 
Childs;  or  dishonest  and  secret,  the  Mar- 
shalls — who  urge  claims  upon  congress,  out 
of  fifteen  tJiousand  private  claims  put  before 
It  since  the  government  was  organized,  not 
more  than  one-half  have  been  acted  upon  in 
any  way.  Are  all  private  claims — claims  In 
which  the  public  has  no  Interest— to  be  left 
absolutely  to  the  action  of  congress  itself, 
moving  only  sua  sponto?  If  so,  they  will 
never  be  acted  upon.     They  can  come  before 


the  body  only  through  the  action  of  private 
p;;!ties. 

There  will,  therefore,  always  be  solicitation 
before  legislatures  so  long  as  legislatures 
have  the  power  and  exercise  it  of  passing 
private  laws.  For  the  gift,  or  the  art,  of 
statement  and  persuasion  is  not  the  common 
proi>erty  of  mankind. 

And  if  solicitation  of  some  sort  there  mu.st 
be,  shall  It  come  from  the  mouths  of  such 
men  as  Linus  Child  and  his  son— lawyers 
both,  of  unquestioned  integrity — and  be  an 
open  and  upright  solicitation  of  the  intellect 
and  the  reason  of  the  legislator;  or  shall  It 
be  made,  by  outlawry,  a  secret,  sinister  and 
personal  solicitation  of  his  passions,  his  preju 
dices,  and  his  vices? 

If  you  shall  decide  that  the  pledged  word 
of  his  client  as  to  compensation  avails  the 
congressional  practitioner  nothing;  that  a 
man  who  in  his  poverty  makes  a  contract  may 
repudiate  It  when  the  fruit  of  the  contract 
is  attained;  then  will  you  remit  all  work  be- 
fore such  bodies  to  men  devoid  of  honor,  ir- 
responsible both  In  character  and  property; 
preying  alike  upon  the  misfortunes  of  claim- 
ants and  the  weaknesses  of  legislators. 

[A  good  deal  was  said  in  the  argument  on 
both  sides  about  contingent  fees,  but  in  view 
of  the  grounds  on  which  the  court  based  its 
judgment,  a  report  of  that  part  of  the  argu- 
ment would  be  of  no  pertinence.] 

Mr.  Justice  SWAYNE,  delivered  the  opin- 
ion of  the  court. 

The  court  below  decreed  to  the  appellee 
the  amount  of  his  claim,  and  enjoined  Trist 
from  receiving  from  the  treasury  "any  of  the 
money  appropriated  to  him"  by  congress,  un- 
til he  should  have  paid  the  demand  of  the 
appellee. 

This  decree,  as  regards  that  portion  of  the 
fund  not  claimed  by  the  appellee,  is  an  anom- 
aly. Why  the  claim  should  affect  that  part 
of  the  fund  to  which  it  had  no  relation, 
is  not  easy  to  be  imagined.  This  feature  of 
the  decree  was  doubtless  the  result  of  over- 
sight and  inadvertence.  The  bill  proceeds 
upon  the  grounds  of  the  validity  of  the  origi- 
nal contract,  and  a  consequent  lien  in  favor 
of  the  complainant  upon  the  fund  appropri- 
ated. We  shall  examine  the  latter  ground 
first.  Was  tliere,  in  any  view  of  the  case,  a 
lien? 

It  is  well  settled  that  an  order  to  pay  a 
debt  out  of  a  particular  fund  belonging  to 
the  debtor  gives  to  the  creditor  a  specific 
equitable  lien  upon  the  fund,  and  binds  it 
in  the  hands  of  the  drawee.  Yeates  v. 
Groves,  1  Ves.  Jr.  2S0;  Lett  v.  Morris,  4 
Sim.  607;  Bradley  v.  Root,  5  Paige,  632;  2 
Story.  Eq.  Jur.  §  1047.  A  part  of  the  par- 
ticular fund  may  be  assigned  by  an  order, 
and  the  payee  may  enforce  payment  of  the 
amount  against  the  drawee.  Field  v.  Mayor, 
6  N.  Y.  179.  But  a  mere  agreement  to  pay 
out  of  such  fund  is  not  sufficient.  Something 
more   Is   necessary.     There   must   be   an   ap- 


432 


ILLEGALITY  OF  OBJECT. 


propriation  of  the  fund  pro  tanto,  either  by 
giving  an  order  or  by  transferring  it  other- 
wise in  snch  a  manner  that  the  holder  is 
authorized  to  pay  the  amount  directly  to  the 
creditor  without  the  further  intervention  of 
the  debtor.  Wright  v.  Ellison,  1  Wall.  16; 
Hoyt  V.  Story,  3  Barb.  2G4;  Malcolm  v.  Scott, 
3  Hare,  39;    Rogers  v.  Hosack,  IS  Wend.  319. 

Viewing  the  subject  in  the  light  of  these 
authorities,  we  are  brought  to  the  conclusion 
that  the  appellee  had  no  lien  upon  the  fund 
here  in  question.  The  understanding  be- 
tween the  elder  Child  and  Trist  was  a  per- 
sonal agreement.  It  could  in  nowise  produce 
the  e£f!ect  insisted  upon.  For  a  breach  of 
the  agreement,  the  remedy  was  at  law,  not 
in  equity,  and  the  defendant  had  a  constitu- 
tional right  to  a  trial  by  jury.  Wright  v.  El- 
lison, 1  Wall.  16.  If  there  was  no  lien,  there 
was  no  jurisdiction  in  equity. 

There  is  another  consideration  fatally  ad- 
verse to  the  claim  of  a  lien.  The  first  sec- 
tion of  the  act  of  congress  of  February  2Gth, 
ISoo,  declares  that  all  transfers  of  any  part 
of  any  claim  against  the  United  States,  "or 
of  any  interest  therein,  whether  absolute  or 
conditional,  shall  be  absolutely  null  and  void, 
unless  executed  in  the  presence  of  at  least 
two  attesting  witnesses  after  the  allowance 
of  such  claim,  the  ascertainment  of  the 
amount  due,  and  the  issuing  of  a  warrant 
therefor."  That  the  claim  set  up  in  the  bill 
to  a  specific  part  of  the  money  appropriated 
is  within  this  statute  is  too  clear  to  admit  of 
doubt.  It  would  be  a  waste  of  time  to  dis- 
cuss the  subject. 

But  there  is  an  objection  of  stiU  greater 
gravity  to  the  appellee's  case. 

Was  the  contract  a  valid  one?  It  was,  on 
the  part  of  Child,  to  procure  by  lobby  serv- 
ice, if  possible,  the  passage  of  a  bill  providing 
for  the  payment  of  the  claim.  The  aid  asked 
by  the  younger  Child  of  Trist,  which  indi- 
cated what  he  considered  needful,  and  doubt- 
less proposed  to  do  and  did  do  himself,  is 
thus  vividly  pictured  in  his  letter  to  Trist  of 
the  20th  February,  1871.  After  giving  the 
names  of  several  members  of  congress,  from 
whom  he  had  received  favorable  assurances, 
he  proceeds:  "Please  write  to  your  friends 
to  write  to  any  member  of  congress.  Every 
vote  tells,  and  a  simple  request  may  secure 
a  vote,  he  not  caring  anything  about  it.  Set 
every  man  you  know  at  work.  Even  if  he 
knows  a  page,  for  a  page  often  gets  a  vote." 

In  the  Roman  law  it  was  declared  that  "a 
promise  made  to  effect  a  base  purpose,  as  to 
commit  homicide  or  sacrilege,  is  not  binding." 
Just.  Inst.  lib.  3,  tit.  19,  par.  24.  In  our  ju- 
risprudence a  contract  may  be  illegal  and  void 
because  it  is  contrary  to  a  constitution  or 
statute,  or  inconsistent  with  sound  policy  and 
good  morals.  Lord  Mansfield  said  (Jones  v. 
Randall,  1  Covpp.  39):  "Many  contracts 
which  are  not  against  morality,  are  still  void 
as  being  against  the  maxims  of  sound  policy." 

It  is  a  rule  of  the  common  law  of  univer- 
sal application,  that  where  a  contract  express 


or  implied  is  tainted  with  either  of  the  vice& 
last  named,  as  to  the  consideration  or  the 
thing  to  be  done,  no  alleged  right  founded 
upon  it  can  be  enforced  in  a  court  of  justice. 

Before  considering  the  contract  here  in 
question,  it  may  be  weU,  by  way  of  illustra- 
tion, to  advert  to  some  of  the  cases  present- 
ing the  subject  in  other  phases,  in  which  the 
principle  has  been  adversely  applied. 

Within  the  condemned  category  are:  An 
agreement  to  pay  for  supporting  for  election 
a  candidate  for  sheriff,  Swayze  v.  HuU,  8  N. 
J.  Law,  54;  to  pay  for  resigning  a  public  po- 
sition to  make  room  for  another,  Eddy  v. 
Capron,  4  R.  I.  395;  Parsons  v.  Thompson, 
1  H.  Bl.  322;  to  pay  for  not  bidding  at  a 
sheriff's  sale  of  real  property,  Jones  v.  Cas- 
well, 3  Johns.  Cas.  29;  to  pay  for  not  bidding 
for  articles  to  be  sold  by  the  goveniment  at 
auction,  Doolin  v.  Ward,  6  Johns,  194;  to 
pay  for  not  bidding  for  a  contract  to  carry  the 
mail  on  a  specified  route,  Gulick  v.  Bailey,  lO 
N.  J.  Law,  87;  to  pay  a  person  for  his  aid 
and  influence  in  procuring  an  office,  and  for 
not  being  a  candidate  himself,  Gray  v.  Hook, 
4  N.  Y.  449;  to  pay  for  procuring  a  contract 
from  the  government,  Tool  Co.  v.  Norris,  2 
W^aU.  45;  to  pay  for  procuring  signatures  to 
a  petition  to  the  governor  for  a  pardon,  Hatz- 
field  V.  Gulden,  7  Watts,  152;  to  sell  land  ta 
a  particular  person  when  the  surrogate's  or- 
der to  sell  should  have  been  obtained.  Over- 
seers of  Bridgewater  v.  Overseers  of  Brook- 
field,  3  Cow.  299;  to  pay  for  suppressing  evi- 
dence and  compounding  a  felony,  CoUins  v. 
Blantern,  2  Wils.  347;  to  convey  and  assign 
a  part  of  what  should  come  from  an  ancestor 
by  descent,  devise,  or  distribution,  Boynton 
v.  Hubbard,  7  Mass.  112;  to  pay  for  promot- 
ing a  marriage,  Scribblehill  v.  Brett,  4  Brown 
Pari.  Cas.  144;  Anindel  v.  Trevillian,  1  Ch. 
Rep.  47;  to  influence  the  disposition  of  prop- 
erty by  will  in  a  particular  way,  Debenham 
V.  Ox,  1  Ves.  276.  See,  also,  Add.  Cont.  91; 
1  Story,  Eq.  c  7;  Collins  v.  Blantern,  1  Smith 
Lead.  Cas.  676.  Am.  note. 

The  question  now  before  us  has  been  de- 
cided in  four  American  cases.  They  were  all 
ably  considered,  and  in  all  of  them  the  con- 
tract was  held  to  be  against  public  policy,  and 
void.  Clippiuger  v.  Hepbaugh,  5  Watts  &  S. 
315;  Harris  v.  Roofs  Ex'r,  10  Barb.  489;  Rose 
&  Hawley  v.  Truax,  21  Barb.  361;  Marshall  v. 
Railroad  Co.,  16  Hoav.  314.  We  entertain  no 
doubt  that  in  such  cases,  as  under  all  other 
circumstances,  an  agreement  express  or  im- 
plied for  purely  professional  services  is  valid. 
Within  this  category  are  included,  drafting  the 
petition  to  set  forth  the  claim,  attending  to  the 
taking  of  testimony,  collecting  facts,  preparing 
arguments,  and  submitting  them  orally  or  in 
writing,  to  a  committee  or  other  proper  au- 
thority, and  other  services  of  like  character. 
All  these  things  are  intended  to  reach  oulj'  the 
reason  of  those  sought  to  be  influenced.  They 
rest  on  the  same  piinciple  of  ethics  as  pro- 
fessional services  rendered  in  a  court  of  jus- 
tice,  and   are    no   more    exceptionable.     But 


PUBLIC  POLICY— INJURY  TO  PUBLIC  SEllYICE. 


433 


such  sorricos  are  sciiarated  by  a  broad  line 
of  demarcation  from  personal  solicitation,  and 
the  other  means  and  apphances  which  the 
correspondence  shows  were  resorted  to  in 
this  case.  There  Is  no  reason  to  believe  that 
they  involved  anything  corrupt  or  dilferont 
from  what  is  usually  practiced  by  all  paid 
lobbyists  in  the  prosecution  of  their  business. 
The  foundation  of  a  republic  Is  the  virtue 
of  its  citizens.  They  are  at  once  sovereij,'us 
and  subjects.  As  the  foundation  is  under- 
mined, the  structure  is  weakened.  When  it 
Is  destroyed,  the  fabric  must  fall.  Such  is 
the  voice  of  universal  history.  1  Montes(l. 
Spirit  of  Laws,  17.  The  theory  of  our  gov- 
ernment is,  that  all  public  stations  are  trusts, 
and  that  those  clothed  with  them  are  to  be 
animated  in  the  discharge  of  their  duties 
solely  by  considerations  of  right,  justice,  and 
the  public  good.  They  are  never  to  descend  to 
a  lower  plane.  But  there  is  a  correlative  duty 
resting  upon  the  citizen.  In  his  intercourse 
with  those  in  authority,  whether  executive  or 
legislative,  touching  the  performance  of  their 
functions,  he  is  bound  to  exhibit  truth,  frank- 
ness, and  integrity.  Any  departure  from  the 
line,  of  rectitude  In  such  cases,  is  not  only 
bad  In  morals,  but  Involves  a  public  wrong. 
No  people  can  have  any  higher  public  inter- 
est, except  the  preservation  of  their  liberties, 
than  integrity  in  the  administration  of  their 
government  in  all  its  departments. 
/  The  agreement  in  the  present  case  was  for 
the  sale  of  the  influence  and  exertions  of  the 
/lobby  agent  to  bring  about  the  passage  of  a 
/law  for  the  payment  of  a  private  claim,  with- 
out reference  to  its  merits,  by  means  which, 
If  not  corrupt,  were  illegitimate,  and  consid- 
ered in  connection  with  the  pecuniary  inter- 
lest  of  the  agent  at  stake,  contrary  to  the 
mlainest  principles  of  public  policy.  No  one 
lias  a  right,  in  such  circumstances,  to  put 
himself  in  a  position  of  temptation  to  do  what 
is  regarded  as  so  pernicious  In  its  character. 
The  law  forbids  the  inchoate  step,  and  puts 
the  seal  of  its  reprobation  upon  the  undertak- 
ing. 

If  any  of  the  great  corporations  of  the 
country  were  to  hire  adventurers  who  make 
market  of  themselves  in  this  way,  to  procure 
the  passage  of  a  general  law  with  a  view  to 
the  promotion  of  their  private  interests,  tlie 
moral  sense  of  every  right-minded  man  would 
instinctively  denounce  the  employer  and  em- 
ployed as  steeped  in  corruption,  and  the  em- 
ployment as  infamous. 

If  the  instances  were  numerous,  open,  and 
tolerated,  they  would  be  regarded  as  meas- 
uring tlie  decay  of  the  public  morals  and  the 
degeneracy  of  the  times.  No  prophetic  spirit 
would  be  needed  to  foretell  the  consequences 
.near  at  hand.  The  same  thing  in  lesser  leg- 
islation, if  not  so  prolific  of  alarming  evils,  is 
not  less  vicious  in  itself,  nor  less  to  be  con- 
demned. The  vital  principle  of  both  is  the 
same.  The  evils  of  the  latter  are  of  sutli- 
cient  magnitude  to  invite  the  most  serious 
consideration.     The    prohibition    of    the    law 

UOPK.SEr...CAS.CONT. — 28 


rests  upon  a  solid  foundation.  A  private  bill 
is  apt  to  attract  little  attention.  It  involves 
no  great  public  Interest,  and  usually  failij  to 
excite  much  dis<us-ion.  Not  unfrequently 
the  facts  are  whimpered  to  those  whose  duty 
it  Is  to  investigate,  vouched  for  by  them,  and 
the  passage  of  the  measure  Is  thus  secured. 
If  the  agent  is  truthful,  and  conceals  nothing, 
all  is  well.  If  he  uses  nefarious  means  with 
success,  the  spring-head  and  the  stream  of 
legisLition  are  polluted.  To  legalize  the  traf- 
fic of  such  service,  would  open  a  door  at 
which  fraud  and  falsehood  would  not  fail  to 
enter  and  make  themselves  felt  at  every  ac- 
cessible point  It  would  invite  their  pres- 
ence and  offer  them  a  premium.  If  the 
tempted  agent  be  corrupt  himself,  and  dis- 
posed to  corrupt  others,  the  transition  requires 
but  a  single  step.  He  has  the  means  in  his 
hands,  with  every  facility  and  a  strong  in- 
centive to  use  them.  The  widespread  suspi- 
cion which  prevails,  and  charges  openly  made 
and  hardly  denied,  lead  to  the  conclusion  that 
such  events  are  not  of  rare  occurrence. 
^Yhere  the  avarice  of  the  agent^  i^sinflamed 
by^tHFIiope  of  a'Teward  co'ntingent  upon  suc- 
cess, and  to  be  graduated  by  a  percentage 
upon  the  amount  appropriated,  the  danger  of 
tampering  in  its  worst  form  is  greatly_  lii- 
creased. 

It  is  by  reason  of  these  things  that  the  law 
is  as  it  is  upon  the  subject.  It  will  not  al- 
low either  party  to  be  led  into  temptation 
where  the  thing  to  be  guarded  against  is  so 
deleterious  to  pi-ivate  morals  and  so  injurious 
to  the  public  welfare.  In  expressing  these 
views,  we  follow  the  lead  of  reason  and  au- 
thority. 

We  are  aware  of  no  case  in  English  or 
American  jurisprudence  like  the  one  here  un- 
der consideration,  where  the  agreement  has 
not  been  adjudged  to  be  illegal  and  void. 

We  have  said  that  for  professional  services 
in  this  connection  a  just  compensjition  may  be 
recovered.  But  where  they  are  blended  and 
confused  with  those  which  are  forbidden,  the 
whole  is  a  unit  and  indivisible.  That  which 
is  bad  destroys  that  which  is  good,  and  they 
perish  together.  Services  of  the  latter  char- 
acter, gratuitously  rendered,  are  not  unlaw- 
ful. The  abstMice  of  motive  to  wrong  is  the 
foundation  of  the  sanction.  The  tendency  to 
mischief,  if  not  wanting,  is  greatly  lessened. 
The  taint  lies  in  the  stipulation  for  pay. 
Where  that  exists,  it  affects  fatilly,  in  all  its 
parts,  the  entire  body  of  the  contract.  In  all 
such  cases,  protior  conditio  defendentis. 
Where  there  is  turpitude,  the  law  will  help 
neither  party. 

The  elder  agent  in  this  case  is  represented 
to  have  been  a  lawyer  of  ability  and  high 
character.  The  appellee  is  said  to  be  equally 
worthy.  This  can  make  no  difference  as  to 
the  legal  principles  we  have  considered,  nor 
in  their  application  to  the  case  in  hand.  The 
law  is  no  respecter  of  persons. 

Decree  reversed,  and  the  case  remanded, 
with  directions  to  dismiss  the  biU. 


ILLEGALITY  OF  OBJECT. 


GOODRICH  V.   TENNET  et  aL 

(32  N.  E.  44  144  lU.  422.) 

Supreme   Court  of  Illinois.    Jan.   19,   1S93. 

Appeal  from  appellate  court,  first  district 
Bill  by  Alphon5o  Goodrich  against  Daniel 
K.  Tenney,  Robert  M.  Bashford,  Horace  K. 
Tenney.  and  George  A.  Hawley.  The  bill 
was  dismissed  on  demurrer,  and  this  decree 
was  affirmed  by  the  appellate  court.  Com- 
plainant appeals.    Affirmed. 

The  other  facts  fully  appear  in  the  follow- 
ing statement  by  SHOFE,  J.: 

"This  was  a  p'-oceeding  on  the  equity  side 
of   the   court.    Only   such  parts   of   the   bill 
need  be  given  as  will  raise  the  single  point 
decided.     It   is   alleged    that    one    Smith,    a 
merchant  at   Omaha,   Neb.,  had  become  in- 
debted to  diver"^  persons,   banks,   and   firms 
in  sums  aggregating  $275,000,  and  transfer- 
red  his   business,     tock  of  goods,   "and  all 
that  apparently  pertained  to  the  same,"  to 
one  Lowey,   and  immediately  absconded  to 
Canada,  leaving  his  debts  unpaid.    Suits  had 
been  brought  by  certain  Nebraska  creditors; 
and  in  one,  at  least,  affecting  the  validity  of 
such  transfer,  a  verdict  or  finding  had  been 
rendered  adversely  to  the  creditors,  and  was 
at  the  time  of  making  the  contract  referred 
to  pending  on  motion  for  new  trial.    That  it 
was   desired   by   the  creditors   concerned   in 
such  litigation,  "and  in  which  was  involved 
the  question  of  the  fraudulent  character  of 
the  transfer  of  said  property,    *    *    *    that 
said  Smith  should  give  his  testimony  in  said 
cause,  and  should  furnish  affidavits  showing 
the    alleged     fraudulent    character   of   said 
transfer  by  said  Smith  to  said  Lowey."    Ap- 
pellees, a  firm  of  Chicago  lawyers,  were  em- 
ployed by  and  represented  certain  Chicago, 
and  other,  creditors;    and  they,  representing 
such  creditors,  also  desired  "that  the  testi- 
mony and  co-operation  of  said  Smith  should 
be  secured  in  their  behalf,  for  the  purpose  of 
sustaining  the  litigation  as  to  the  fraudulent 
transfer  of  said  property  by  said  Smith  to 
said  Lowey."     The  bill  then  alleges  the  busi- 
ness and  friendly  relations  existing  between 
appellant  and  said  Smith,  and  the  fact  that 
correspondence  had  been  maintained  between 
them  since  his  absconding,  which  led  appel- 
lees to  confer  with  appellant,  to  interest  him 
to    induce    Smith    to   return  to  the   United 
States,  and  give  such  affidavits  and  testimony 
in  the  Omaha  litigation,  and  in  such  other 
suits  as  might  be  instituted  by  or  on  oehalf 
of  the  creditors  of  Smith  to  reach  said  prop- 
erty, or  the  avails  thereof,  in  the  hands  of 
Lowey,    or    others.     As  a   result  appellant 
twice  visited  Smith,  in  Canada,  on  the  last 
visit   being  accompanied  by  appellee  D.  K. 
Tenney.     The    proposals     were   laid    before 
Smith,  and  such  negotiations  had  that  on  the 
last  visit  the  affidavit  of  Smith  was  obtained, 
brought  to  Chicago,  and  delivered  by  appel- 
lant to  said  Tenney.    Tliereupon  the  contract, 
the    terms    of    which    had    been    previously 


agreed   upon,  was  drawn  up  and  signed,  a 
copy  of  which  purports  to  bo  attached  to  the 
bill  as  an  exhibit.    It  is  alleged  to  bear  date, 
and  to  have  been  executed.  May  5,  1S8(>,  and 
provides  that  appellees  or  said  Tenney  should 
endeavor  to  get  control  of  all  of  the  claims 
against  said  Smith,  with  power  to  compro- 
mise the  same  as  follows:    "The  claim  of  .1.  V. 
FarwcU  &  Co.  and  A.  S.  Gage  &  Co.  at  par; 
the  claims  of  the  Omaha  banks  at  50  cents  on 
the  dollar;    claims  of  other  attaching  credit- 
ors, up  to  the  amount  of  $78,000,  at  thirty 
cents  on  the  dollar,    and  all  other  claims  at 
twenty  cents  on  the  dollar."     And  appellant 
undertook  and  agreed  on  his  part,  as  alleged, 
"to  furnish  the  affidavits  of  L.  L.  Smith,  Fred 
W.  Fuller,  alias  Pullen,  and  Frank  C.  Moies, 
of  the  facts  of  the  sale  by  Smith  to  Lowey, 
showing  clearly   that   no  consideration   was 
paid  by  Lowey,  and  that  he  knew  of  Smith's 
insolvency,    to   be   used   on   motion   for  new 
trial  in  the  case  of  Cole  v.  Miller;    and  that 
the   testimony   of   said   witnesses,    either   In 
person  or  by  depositions,  should  be  given,  of 
like  tenor,  to  be  used  upon  the  next  trial,  or 
any  other  legal  proceedings  instituted  by  said 
Tenney  against  said  Lowey."     And  "that  for 
such  consideration  it  was  agreed  that  your 
orator  [said  Goodrich]  should  have  one  quar- 
ter  of  all   money    realized   upon   their   said 
claims  out  of  the  property  transferred  by  said 
Smith  to  said  Lowey,  or  in  any  litigation  with 
said  Lowey  or  Cole,  in  respect  to  the  same, 
and  the  same  should  be  paid  to  said  Good- 
rich [appellant]  as  fast  as  the  money  should 
be  collected;  two  thousand  dollars  thereof  to 
be  retained  by  said  Tenney  on   account  of 
costs  and  expenses;   Smith  to  be  released  by 
the  consenting  creditors  from  any  right  they 
might  have  to  arrest  him,  and   from   their 
claims  entirely,  when  such  evidence  should 
be   procured   and   given,"   etc.    The   bill   al- 
leges that  appellant  obtained  the  affidavits  of 
said  Fuller  and  Moies,  and  the  further  affi- 
davit of  Smith,  and  delivered  them  to  said 
Tenney,  "and  which  were  accepted  and  ap- 
proved by  said  Tenney,  as  in  all  respects  ac- 
cording to  the  wishes  and  purposes  of  said 
defendants,    [appellees,]    and   a    satisfactory 
compliance  with  the  terms  and  conditions  of 
said    agreement."     And    that    appellees,    by 
means   of    a    circular    letter    addressed   to 
Smith's  creditors,  etc.,  had  by  the  17th  day 
of  May,  ISSB,  obtained  control  of  claims  to 
the  amount  of  $125,000;    that  Smith,  under 
an  arrangement  procured  by  appellant  with 
certain  of  his  creditors,  that  they  would  pro- 
cure persons  to  go  bail  for  him  if  he  should 
be  arrested  by  other  creditors,  had  returned 
to  Chicago,  and  on  said  day  executed  and  de« 
livered  to  said  D.  K.  Tenney,  as  trustee  for 
creditors,  his  judgment  note  for  the  sum  of 
$125,500,  the  sum  of  $.500  being  added  as  an 
attorney's  fee;    that  judgment  was  entered 
up  thereon,  and,  an  execution  being  returned 
nulla  bona,  a  creditor's  bill  was  filed  against 
said    Smith,    Lowey,   and   others   to   subject 
said  property  transferred  by  Smith  to  Lowey, 


rUBLIC  POLICY— OBSTRUCTION  OF  JUSTICE. 


435 


and  the  avails  thereof,  to  the  payment  of  said 
judgment,  upon  the  ground  that  said  trans- 
fer was  without  consideration,  and  fraudu- 
lent as  against  creditors.  It  is  further  al- 
leged that  appellant  "gave  diligent  attention 
to  the  securing  of  the  testimony  of  the  said 
Smith  and  said  Fuller,  alias  Pullen,  and  the 
said  Moies,  to  be  used  on  the  hearing  of  said 
cause,  and  in  the  progi'ess  thereof,  and  all 
such  affidavits  as  were  called  for  or  required 
by  said  defendants  [appellees]  during  the 
progress  "of  said  cause,  and  did  and  perform- 
ed, to  the  satisfaction  of  said  defendants,  all 
that  was  required  by  them  •  ♦  •  under 
and  pursuant  to  the  terms  of  •  •  •  said 
agreement."  It  Is  alleged  that  Smith,  Ful- 
ler, and  Moies  each  attended,  and  gave  testi- 
mony and  affidavits  In  said  cause,  when  re- 
quired to  do  so,  etc.  Tlio  result  is  alleged 
to  have  been  a  decree  on  the  28th  of  May, 
1SS8,  two  years  after  filing  the  bill.  In  favor 
of  Tenney,  etc.,  and  against  Lowey,  for  the 
sum  of  $117,416.06,  and  which  was,  on  the 
0th  day  of  December,  1S88,  received  by  said 
Tenney,  amounting  at  that  date,  principal 
and  interest,  to  $120,500,  "or  thereabout." 
Thirty  thousand  dollars,  or  one  fourth  of  the 
sum  collected,  less  $500.  presumably  the  at- 
torney fee  Included  In  the  note.  Is  alleged  to 
have  become  immediately  due  and  payable 
to  appellant  under  said  contract;  and  It  Is 
to  enforce  an  accounting  and  payment  of 
this  sum,  under  said  contract  alone,  that 
this  bill  Is  filed.  There  Is  no  pretense  In  the 
bill  of  any  other  or  different  agreement  by 
which  said  money,  or  any  part  of  It,  would 
become  payable  to  appellant,  or  any  consid- 
eration, other  than  performing  said  agree- 
ment on  his  part,  moving  to  appellant  for 
its  payment.  Other  parts  of  the  bill  are  suffi- 
ciently noticed  In  the  opinion  of  the  court. 
A  demurrer  was  interposed  and  sustained, 
and  decree  entered  dismissing  the  bill.  On 
appeal  to  the  appellate  court  this  decree  was 
affirmed,  and  the  complainant  prosecutes  this 
further  appeal. 

H.  T.  &  L.  Helm,  for  appellant.  Tenny, 
Church  &  Coffeen,  (William  E.  Church,  of 
counsel,)  for  appellees. 

SHOPE,  J.,  (after  stating  the  facts.)  It  Is 
probable  that  the  demurrer  was  properly 
sustained  upon  the  ground  that,  if  the  com- 
plainant had  a  right  of  recovery,  his  remedy 
was  compU'te  at  law,  and  possibly,  also,  upon 
the  ground  of  laches;  but  we  will  consider 
the  single  question  ot  the  validity  of  the  con- 
tract sought  to  be  enforced.  No  good  pur- 
pose can  be  served  by  a  considenition  of 
the  allegations  of  this  bill  setting  up  the 
confederacy  and  fraud  by  which  appellant 
was  induced  to  •=<urrender  the  written  con- 
tract to  Tenney.  it  Is  alleged  that  It  was 
expressly  agreed  that  the  surrender  of  the 
writing  should  not  abrogate  tlie  contract,  or 
make  any  difference  as  to  the  rights  of  ap- 
pellant    thereunder,     but     that    his    Interest 


should  remain  the  same.  If  the  allegations 
of  tlie  bill  are  true,  the  surrender  was  made 
to  destroy  the  written  evidence  of  appellant's 
interest,  because  of  the  pretended  fear  tluit 
his  Interest  under  such  a  contract.  If  known, 
would  prejudice  Tenneys  case  against 
Lfjwey,  and  to  enable  the  attorney  to  more 
safely,  but  fal-sely,  testify.  If  callid  therein, 
that  no  such  contract  existed.  So  with  those 
allegations  which  are  explanatory  of  why 
appellant  himself  falsely  denied  that  there 
was  any  such  contract,, or  that  he  had  any 
interest  in  the  litigation  against  Lowey,  as  it 
Is  alleged  he  did,  when  called  and  examined 
In  said  creditors*  bill  proceeding.  And  the 
same  is  true  of  the  allegations  setting  up  the 
fraudulent  and  ^ppressive  acts  and  conduct 
by  which,  after  the  rendition  of  the  decree 
against  Lowey,  appellant  was  Induced  to 
execute  and  deliver  to  Tenney  an  absolute 
release  and  acquittance  of  all  claim  or  right 
soever  to  the  money  derived  under  said  de-. 
cree.  If  the  Interest  that  can  be  claimed  in 
respect  of  such  allegations  be  conceded,  they 
amount  to  no  more  than  that,  because  of  the 
fraud  practiced,  the  surrender  was  ineffec- 
tual to  abrogate  or  destroy  the  contract;  that 
appellant  should  not  be  estopped  from  now 
asserting  his  rights  under  said  contract  by 
his  false  denial  of  Its  existence;  and  that 
said  release  Is,  as  between  appellant  and  ap- 
pellees, fraudulent,  and  should  be  set  aside, 
and  the  contract,  as  originally  made,  be  held 
to  be  in  full  force  and  effect  The  specific 
prayer  of  tMs  bill  is  "that  the  said  contract 
so  delivered  to  said  defendants  may  be  re- 
stored to  your  orator,  and  the  rights  in  and 
under  the  same  may  be  established  and  con- 
firmed, and  the  said  release,  so  fraudulently 
extorted  from  your  orator,  be  canceled  and 
annulled,  and  for  naught  held,  and  the  said 
defendants  may  be  required  to  pay  to  your 
orator  the  amount  tliat  shall  be  found  due 
and  owing  •  •  •  under  and  in  pursuant 
to  the  terms  of  said  agreement,"  etc.  Th# 
right  of  recovery,  if  It  exists,  is  therefore 
predicated  solely  upon,  and  Involves  the  en- 
forcement of,  ihe  contract  set  up  In  the  bilL 
It  is  under  and  by  virtue  of  that  contract, 
alone,  that  it  is  sought  to  establish  appel- 
lant's right  to  the  money;  and  there  is  noth- 
ing, except  said  agreement,  that  would  give 
him  any  riglit,  either  at  law  or  In  equity,  to 
demand  the  payment  of  the  25  per  cent  of 
the  amount  collected  of  Lowey. 

The  English  reports,  as  well  as  American, 
abound  with  cases  holding  that  coD'ntct.<» 
are  illegal  when  founded  upon  a  considera- 
tion, contra  bonos  mores,  or  against  the 
principles  of  sound  public  policy,  or  founded 
In  fraud,  or  In  contravention  of  the  provi- 
sions of  some  statute,  (2  Kent,  Comm.  p. 
4GG;)  and  we  need  not  review  the  cases  il- 
lustrating the  application  of  the  rule.  Thus, 
contracts  to  pay  money  to  Influence  legisla- 
tion. (Marshall  v.  Riiilroad  Co.,  16  How.  314; 
MUls  V.  Mills,  40  N.  Y.  543;  McBratney  v. 
Chandler,  22  Kan.  6'J2;    Bryan  v.  Reynolds, 


436 


ILLEGALITY  OF  OBJECT. 


5  Wis.  200;  Powers  v.  Skinner,  3i  Vt.  27G;) 
agreements  founded  upon  violations  of  pub- 
lic trust  or  confidence,  (Cooth  v.  Jackson,  6 
Ves.  12-35;)  contracts  to  pay  public  officers 
for  the  performance  of  official  duty,  (Odineal 
V.  Barry,  24  :*Iiss.  9;)  contracts  for  the  buy- 
ing, selling,  or  procuring  of  public  office, 
(Earl  of  Chesterfield  v.  Janssen,  1  Atk.  352; 
Boynton  v.  Hubbard,  7  Mass.  119;  Waldo  v. 
Martin,  4  Barn.  &  C.  319;)  agi'eements  for  the 
purpose  of  stifling  criminal  prosecutions, 
(Gorham  v.  Keyes,  137  Mass.  583;  Hender- 
son V.  Palmer,  71  lU.  579;  Ricketts  v.  Har- 
vey, lOG  Ind.  5(34,  6  N.  E.  325;  McMahon  v. 
Smith,  47  Conn.  221;  Roll  v.  Raguet,  4  Ohio, 
400;)  agreements  relating  to  civil  proceed- 
ings involving  anything  inconsistent  with  the 
full  and  impartia'  course  of  justice  therein, 
(Dawkins  v.  Gill,  10  Ala.  206,)  or  that  tend 
to  pervert  the  course  of  justice,  or  its  pure 
administration  by  the  courts,  (Gillett  v.  Lo- 
gan Co.,  G7  111.  256;  Patterson  v.  Donner,  48 
Cal.  369,)— and  many  others,  are  justly  deem- 
ed contracts  of  turpitude,  contrary  to  sound 
public  policy,  and  void.  1  Story,  Eq.  Jur. 
§§  293-3CN0;  3  Am.  &  Eng.  Enc.  Law,  875-881, 
and  notes.  In  GLLlett  v.  Logan  Co.,  supra, 
the  contracts  were  to  pay  for  procuring  testi- 
mony showing  that  a  certain  number  of  votes 
cast  at  an  election  were  illegal,  and  we  said 
that,  "on  account  of  their  corrupting  ten- 
dency, we  must  hold  them  to  be  void,  as  in- 
consistent with  public  policy."  It  was  also 
there  said,  in  effect,  that  such  contracts  cre- 
ated a  powerful  inducement  to  make  use  of 
improper  means  to  procure  the  testimony 
contracted  for,  to  secure  the  desired  result; 
ttiat  they  led  to  the  subornation  of  witnesses, 
to  taint  with  corruption  the  atmosphere  of 
courts,  and  to  pervert  the  course  of  justice. 
In  Patterson  v.  Donner,  supra,  it  was  agreed, 
among  other  things,  that  a  certain  sum  of 
money  should  be  paid,  etc.,  provided  the 
party  procured  "two  witnesses  to  testify  that 
they  had  seen  wnat  purported  to  be  a  genu- 
ine grant"  of  the  land  mentioned,  etc.;  and 
It  was  held  that  the  stipulation  was  immoral, 
against  public  policy,  and  void.  Courts  of 
justice  will  not  enforce  the  execution  of  il- 
legal contracts,  nor  aid  in  the  division  of  the 
profits  of  an  illegal  transaction  between  as- 
.sociates.  Neustadt  v.  Hall,  58  LI.  172.  It  is 
there  said:  "In  the  language  of  Lord  Ellen- 
borough  in  Edgar  v.  Fowler,  3  East,  222,  we 
will  not  assist  in  illegal  transaction,  in  any 
respect.  We  leave  the  matter  as  we  find  it, 
and  then  the  maxim  applies,  'melior  est  con- 
ditio possidentis.'  "  It  may  be  insisted  that 
it  is  unjust,  as  between  the  parties,  for  Ten- 
ney  to  raise  the  question,  and  very  dishon- 
est, towards  appellant,  for  him  to  take  ad- 
vantage of  it;  but,  the  contract  being  illegal, 
no  rights  can  be  enforced  under  it.  As  said 
by  Lord  Mansfield  in  Holman  v.  Johnson, 
Cowp.  341,  "no  court  will  lend  its  aid  to  a 
man  who  founds  his  cause  of  action  upon  an 
illegal  or  immoral  act."  The  maxim,  "ex 
turpi  contractu  non  oritur  actio,"  applies  in 


all  such  cases;  and  neither  party,  If  in  pari 
delicto,  can  have  assistance  from  courts  of 
justice  in  enforcing  the  contract.  And  the 
objection  may  be  made  by  a  party  In  pari 
delicto,  for  the  defense  is  not  allowed  be- 
cause the  party  raising  the  objection  is  en- 
titled to  the  relief,  but  upon  principles  of 
public  policy,  and  to  conserve  the  public  wel- 
fare. 

No  better  illiistratlon  can  perhaps  be  found 
of  the  soundness  and  wisdom  of  the  rule, 
and  the  danger  to  be  apprehended  from  its 
relaxation,  than  is  shown  in  this  case.  It 
is  apparent  that  Lowey  was  in  equal  peril  of 
recovery  against  him,  whether  he  had  paid 
full  and  honest  value  upon  purchase  of  the 
goods  from  Smith,  or  had  taken  them  iu 
fraud  of  the  rights  of  the  creditors.  Smith, 
a  dishonest  debtor,  after  cheating  his  credit- 
ors, absconded.  The  appellant,  as  alleged,  in 
consideration  of  the  agreement  of  Tenney  to 
pay  him  25  per  cent.,  practically,  of  what- 
ever should  be  collected  from  Lowey,  under- 
took and  agreed  to  procure  the  affidavits  of 
said  Smith,  of  one  Fuller,  with  an  alias,  and 
one  Moies,  "of  the  facts  of  the  sale  by  Smith 
to  Lowey,  showing  clearly  that  no  considera- 
tion was  paid  by  Lowey,  and  that  he  knew 
of  Smith's  insolvency."  "and  that  the  testi- 
mony of  said  witnesses,  either  in  person  or 
by  deposition,  should  be  given,  of  like  tenor," 
etc.  Copies  of  the  affidavits  alleged  to  have 
been  furnished,  and  which  it  is  alleged  were 
received  as  a  satisfactory  fulfillment  of  ap- 
pellant's contract  in  that  regard,  are  attached 
to  the  bUl  as  exhibits,  and  show  that  the 
witnesses  testified  up  to  the  high  mark  set 
by  the  contract.  Smith  was  brought  back 
from  Canada,  secured  immunity  from  arrest 
for  his  fraud,  his  debts  canceled,  if  he  would 
testify  as  required;  and  it  is  apparent  from 
the  bill  that  he  at  least  claimed  a  portion 
of  the  money,  and  was  actually  paid  $14,- 
000.  And  this  under  the  direction  and  con- 
trol, if  the  bill  be  true,  of  an  attorney,  who 
deliberately  laid  the  foundation  for  the  com- 
mission of  perjury  with  safety  by  himself,  if 
called  to  testify,  and  advised  the  commission 
of  perjury  by  appellant,  and  framed  the  lan- 
guage iu  which  he  should  commit  it;  and 
the  testimony  was  procured  by  appellant, 
who,  after  planning  with  the  attorney  as 
to  the  wording  of  his  false  testimony,  de- 
liberately gave  it,  for  no  other  reasons  than 
that  he  was  led  to  believe  that  his  telling 
the  truth  would  endanger  the  chances  of 
success  in  the  litigation  against  Lowey.  If 
transactions  of  this  kind  should  receive  sanc- 
tion, and  contracts  based  upon  them  be  en- 
forced, the  suborner  of  perjury  would  be- 
come a  potent,  if  not  a  necessary,  factor  in 
litigation.  The  fact  that  the  purchase  was 
made  in  good  faith  would  be  no  protection  to 
the  buyer.  Premium  would  be  offered  to  the 
dishonest  and  unscrupulous,  and  result  in  the 
perversion  of  justice,  and  bringing  its  ad- 
ministration into  deserved  disrepute.  It  is 
not   enough   that   the   parties   may   have  in- 


PUBLIC  POLICY— OBSTRUCTION  OF  JUSTICE. 


437 


tended  no  wrong,  or  that  tho  testimony  pro- 
duced In  the  case  may  have  been  true.  It  is 
the  tendency  of  such  contracts  to  the  per- 
version of  Justice  tliat  renders  them  Illegal. 
It  is  perhaps  a  singular  fact,  however,  though 
unimportant,  tliat  this  bill  nowhere  alleges 
tlial  either  the  attorney  or  appellant  believed, 
or  had  any  reason  to  believe,  the  testimony 
of  Smith  was  lu  fact  true.  That,  so  far  as 
this  bill  goes,  seems  to  have  been  a  matter 
not  considered.  That  this  contract  falls  di- 
rectly within  the  maxim  before  quoted  is 
unquestionable,  and  by  all  the  authorities  the 
court  can  do  nothing  to  enforce  it  by  either 
party. 

But  it  is  said  that  Tenney,  having  received 
the  money,  must  account  for  it  to  appellant; 
and  we  are  referred  by  counsel  to  a  line  of 
cases  holding  that,  although  tlie  money  may 
have  been  realized  in  an  illegal  transaction, 
yet  where  the  liability  of  the  defendant  to 
pay  it  to  the  plaintiff  arises  upon  some  new 
or  independent  consideration,  unaffected  with 
illegality,  and  the  enforcement  of  the  illegal 
contract  is  not  involved,  there  may  be  a  re- 
covery.    None  of  the  cases  referred  to  have 
any  application  to  the  case  at  bar.    As  said 
in  Dent  v.  Ferguson,  132  U.  S.  50,  10  Sup. 
Ct  13,  in  commenting  upon  this  line  of  cases: 
"In   all   those  cases   the   court   was   careful 
to  distinguish   and   sever  the   new   contract 
from  the  original  illegal  contract.    Whether 
in  the  application  of  this  principle  some  of 
tliem   do  not  trench   upon    the    line    which 
separates  the  cases  of  contracts  void  in  con- 
sequence of  their   illegality   from  new   and 
subsequent  contracts,  arising  out  of  the  ac- 
complislmicut  of  the  illegal  object,  is  not  the 
subject  of  inquiry  here."     It  is  to  be  remem- 
bered the  contract  was,  as  alleged,  with  the 
defendant  D.  K.  Tenney,  and  signed  by  him, 
and,  as  alleged,  tlie  money  collected  by  him 
as  trustee  for  the  creditors  of  Smith.    If  the 
money  had  been  paid  to  a  third  person  for 
the  use  of  appellant,  or  there  were  collateral 
circumstances,  disconnected  with  the  illegal 
contract,   out   of   which   an   implied   promise 
to  pay  the  money  to  appellant  would  arise, 
the  cases  referred  to  would  apply.    But  the 
fact  that  Tenney   received   tho   money  upon 
the  decree  against  Lowey  would,  independ- 
(nitly  of  the  contract,   raise  no  implied   as- 
sumpsit   in    appellant's    favor.    The    contro- 
versy here  aiises  between  tho  parties  to  the 
illegal  agreement,  and  appellant  must,  if  at 
all,  assert   his   claim  to  the  money   in  Ten- 
ney's  hands  through  and  under  that  contract. 
Treat  that  as  void,  as  if  never  made,   and 
there  is  nothing  upon  which  appellant  can 
base  a  claim  to  the  money.    The  case  prin- 
cipally relied  upon  by  appellant  as  sustain- 
ing his  contention  is  McBlair  v.  Gibbes.   17 
How.  2o2.    In  that  case  one  Goodwin  had  an 
interest  in  a   claim   held   by  the   Baltimore 
Company    for   supplies    furnished    in    fitting 
out  a  milttary  expedition  against  dominions 
of  the  Spanish  government,  under  a  contract 
in   violation   of   the  neutrality   laws   of   the 


United  States,  and  therefore  illegal.    Gill  v. 
Olivers  Ex'rs,  11  How.  520.     In  1829  Good- 
win, for  an  Independent,  valuable  considera- 
tion, assigned   his  right  and  interest  in  the 
claim   to  one  Oliver.     Under  the  convention 
of   1S3U,   "for  the  adjustment  of   claims   of 
citizens    of    the    United    States    against    the 
Mexican  republic'    the  illegality  of  the  con- 
tract was  waived,  and  the  claim  paid.    The 
question   at   Issue   was   whether  the   assign- 
ment to  Oliver  was  valid,    llio  court  found 
that  in  doterm'ning  the  question  the  illegal- 
ity  of  the   contract   with   the   Mexican   gen- 
eral,   Mina,    upon    which    the    claim    against 
Mexico    was    based,    was   not    involved.    Its 
illegality  had   been   waived   by  the  Mexican 
government,  and  payment  of  the  claim  made. 
The  court,  hnding  that  the  assignment  was 
made  for  a   valuable  consideration   paid  by 
Oliver,  and  was  in  itself  untainted  with   Il- 
legality, after  review  of  the  authorities,  held 
that  it  passed  whatever  rights  Goodwin  had, 
which   might  be  nothing,  if  the  illegality  of 
the  contract  was  Interposed,  or  all  that  was 
claimed,  if  the  promisor  saw  fit  to  waive  it, 
passed  by  the  assignment  to  Oliver.    It  seems 
clear  that  this  case,   in  principle,  can  have 
no  application    to   the   case   at   bar,   and   is 
clearly  distinguishable  from  a  case  where  it 
is  sought  to  enforce  the  illegal  contract,  or  fo 
enforce  one  made  in  aid  or  furtherance  of 
a  contract  so  infected.    Appellant  also  relies 
upon  Willson  v.  Owen,  30  Mich.  474.    There 
the  defendant  received  money  as  treasurer  of 
a    horse-fair    association,   for   entrance    fees, 
stock     subscriptions,     and     commissions    on 
pools  sold,  which  he  refused  to  pay  over.    It 
was  conceded  that  the  business  in  which  the 
money  was  earned  was  unlawful.    The  plain- 
tiffs,   who    had    o.-ganized     the    association, 
brought  an   action  for   money   had   and   re- 
ceived.   It  was  held  that  the  defendant  hav- 
ing in  fact  received  the  money  for  the  plain- 
tiffs'   use,    he    could    not   appropriate    it    to 
himself,  but  must  account  for  it.    The  plain- 
tiffs' case  was  made  out  when  they  sh  iwed 
that  the  defendant   had  received  the  money 
for  their  use.     And  the  court  distinguished 
the    case    from    that    of    Breeders'    Assu    v. 
Kamsdell,  24  Mich.  441,   where  the  attempt 
was  to  collect  money  earned  by  illegal  means, 
and  where  the  recovery  must  be  had.  if  at 
all,  in  furtherance  of  the  illegal  trans;action. 
In  Tenant  v.  Elliott,  1  Bos.  &;  P.  3,  a  broiler 
procured   illegal    insurance.    Upon   loss,   the 
insurance   company  paid   the   money   to   the 
broker,  who  refused  to   pay  it   over  to   the 
insured,  setting  up  the  illegality  of  the  in- 
stirance.    The  plaintiff'  was  held  entitled  to 
recover,   upon   the   ground   that  the   implied 
promise  of  the  defendant,  arising  from  the 
receipt   by   him   of   the  money,   was  a   new 
undertaking,     unaffected     by     the    illegality 
of  the  insurance.     So  in  Sharp  v.  Taylor,  2 
Phil.  Ch.  801,  a  bill  was  filed  to  recover  a 
moiety  of  freight  money  earned  by  a  vessel 
engaged    in    trade    in   violation    of    rhe    navi- 
gation   laws,    and    illegal,    which    money    had 


438 


ILLEGALITY  OF  OBJECT. 


come  into  tlie  hands  of  one  of  tlie  joint  own- 
ers. The  illegality  of  the  trade  was  set 
up  as  a  defense,  but  it  was  answered  by  the 
lord  ehaucellor  that  the  plaintiff  was  not 
seeking  the  enforcement  of  an  illegal  agree- 
ment, or  compensation  for  the  performance 
of  an  illegal  voyage,  but  was  seelcing  his 
share  of  the  profits  realized,  arid  in  the  h.-mds 
of  the  defendant  jomt  owner.  It  there  re- 
quired no  enforcement  of  an  illegal  contract 
or  agreement  to  hold  tlie  defendant  liable  to 
account  to  the  other  joint  owner.  The  lia- 
bility arose  from  the  receipt  of  the  money  as 
the  agent  of  the  plaintiff,  in  respect  of  his 
moiety.  The  cases  of  Tenant  v.  Elliott, 
supra,  and  Farmer  v.  Kussoll,  1  Bos.  &  P. 
29G,  are  referred  to  as  sustaining  the  distinc- 
tiou  in  this  case.  A  further  reference  to  tills 
line  of  cases  will  not  be  necessary.  The  dis- 
tinction between  the  enforcement  of  the  il- 
legal contract,  and  asserting  title  to  money 
arising  from  it,  where  there  is  an  express 
contract  to  pay,  upon  sullicient  considera- 
tion, or  where  the  collateral  circumstances 
are  such  as  to  raise  an  implied  promise  to 
pay  to  the  plaintiff,  is  recognized,  and  care- 
fully made,  in  practically  all  of  the  cases. 
In  the  case  of  Thompson  v.  Thompson,  7 
Ves.  470,  Sir  William  Grant,  master  of  the 
rolls,  drew  the  distinction  with  great  clear- 
ness. A  sale  of  the  command  of  an  East 
India  Company  ship  was  made  to  the  defend- 
ant, who  agreed  to  pay  therefor  an  annuity 
of  f20U.  Under  regulations  adopted  by  the 
company  to  prevent  such  sales,  the  defendant 
subsequently  relinquished  the  command,  and 
was  allowed  £3,500.  £2,(>i0  of  which  was  de- 
livered to  an  agent  of  the  defendant  A  bill 
was  filed  by  the  annuitant  for  the  purpose  of 
procuring  a  decree  declaring  the  value  of  the 


annuity,  and  enforcing  its  payment  out  of 
the  allowance  to  the  defendant.  The  master 
of  the  roils  found  the  agreement  for  the  pay- 
ment of  the  annuity  to  be  illegal,  and,  ad- 
mitting tiiere  existed  an  equity  against  the 
fund,  if  it  could  be  reached  through  a  legal 
agreement,  said:  "You  have  no  claim  to  this 
money,  except  through  the  medium  of  an 
illegal  agreement,  which,  according  to  tlift 
determinations,  you  cannot  support.  I  should 
have  no  difficulty  in  following  the  fund,  pro- 
vided you  could  recover  against  the  party 
himself."  And  after  citing  Tenant  v.  Elliott, 
supra,  as  authority  for  the  position  that,  if 
the  company  had  paid  the  money  into  tlie 
hands  of  a  third  person  for  the  use  of  the 
plaintiff,  he  might  have  recovered,  further 
observed:  "But  in  this  instance  it  is  paid  to 
the  party,  for  there  can  be  no  difference  as 
to  the  payment  to  his  agent.  Then  how  are 
you  to  get  at  it,  except  through  this  agi*ee- 
ment?  There  is  nothing  collateral,  in  respect 
of  which,  the  agreement  being  out  of  the 
question,  a  collateral  demand  arises.  Here 
you  cannot  stir  a  step  but  through  the  illegal 
agreement,  and  it  is  impossible  for  the  court 
to  enforce  it."  So  here  the  right  of  appel- 
lant to  recover  of  appellees  depends  solely 
upon  the  contract,  the  provisions  of  which 
cannot  be  enforced  in  a  court  of  justice. 

The  unfortimate  delay  of  appellant  in  dis- 
closing the  facts  alleged,  for  more  than  three 
years  after  the  facts  occurred,  will  probably 
prevent  their  investigation  where  they  could 
receive  that  attention  their  merit  demands; 
and  the  bill,  not  being  verified,  forms  no 
basis  for  further  investigation  in  this  court. 
The  bill  was  properly  dismissed,  and  the 
judgment  of  the  appellate  court  will  be  af- 
firmed- 


PUBLIC  POLICY— OBSTRUCT  [ON  OF  JUSTICE 


^3^ 


JONES  V.  RICE. 
(18  Pick.  440.)' 


/t^ 


439 


Supreme  Jndicial    Court   of    Massachusett*. 
Middlesex.    Jan.  21,   1837. 

Assumpsit  on  a  pruuiis-soi-j'  uole,  dated  Jan- 
uary 1st,  1835,  made  by  tlie  defendant  to  the 
plainUCf,  for  $147. 

At  the  ti'ial,  before  Shaw,  G.  J.,  It  appear- 
ed tliat  on  the  ni^ht  of  December  31st,  18;i4, 
a  ball  was  given  at  the  house  of  Joel  Jones, 
In  Sudbury;  that  an  attempt  was  made  by 
the  defendant  and  Ufliers,  to  interrupt  the 
balLby  vioTence;  that  a  riot  ensued,  in  which 
some  injury  was  done  to  J.  Jones  and  oth- 
ers, assembled  at  the  ball;  that  a  complaint 
was  filed  before  a  justice  of  the  peace  and  a 
warrant  issued  by  him  against  some  of  the 
rioters;  that  the  persona  assembled  at  the 
ball  ctiose  a  ccuiiinitt"  e  to  irporton  the  terms 
which  should  N-  proposed  to  the  accused,  for 
a  settlciiioiit  of  tlio  difficulty;  that  the  com- 
mittee reported  that  the  accused  should  pay 
the  sum  of  $184;  that  of  this  amount  the 
sum  of  $40  was  for  damages  sustained  by 
three  individuals,  $10  for  the  services  of  the 
officer,  and  $2  for  the  services  of  the  magis- 
trate, and  that  the  balance  was  for  the  pur- 
pose of  stopping  that  an<l  other  prosecutions; 
that  it  was  thereupon  voted  by  those  assem- 
bled at  the  ball,  that  if  the  accused  would 
pay  the  sum  proposed  or  give  security  for 
it,  the  other  party  would  do  nothing  more 
about  the  matter;  tlyit  the  accused  agreed 
to  the  terms  and  paid  about  $40,  and  the  de- 
fendant, at  their  request,  gave  the  note  in 
suit  for  the  balance;  that  J.  Jones  and  oth- 
ers, including  the  plaintiff,  then  signed  a  re- 
ceipt "in  fuU  for  all  damages  sustained  by 
the  ball  party  assembled,  &c.  and  all  other 
demands  of  any  name  or  nature  of  said  ball 
party";  and  that  in  consequence  of  this  ar- 
rangement the  officer  made  no  return  of  tbe 
.warrant,  and  no  further  proceedings  were 
had  upon  the  complaint. 

The  Chief  Justice  was  of  opinion,  that  the 
plaintiff  was  not  entitled  to  recover,  because 
the  evidence  proved  a  want  of  consideration 
or  a  bad  consideration  for  the  note;  and  the 
plaintiff  consented  to  a  nonsuit,  subject  to 
the  opinion  of  the  whole  court. 

Mr.  Hoar,  for  plaintiff.  S.  H.  Mann,  for 
defendant. 

PUTNAM,  J.  delivered  the  opinion  of  the 
court.  The  facts  reported  disclose,  that  di- 
vers persons  committed  an  aggravated  riot 
and  assault  upon  the  plaintiff  and  others, 
and  that  the  note  was  given  partly'  for  the 
damages  and  expenses  which  the  plaintiff 
and  others  had  sustained,  and  partly  for  their 


agreement  no  further  to  prosecute  for  the 
offence  against  the  public.  The^s'um  of  $52 
was  given  for  the  damages  and  expenses,  and 
$l.'i2  for  the  compounding  of  the  misdemean- 
or; part  was  paid  in  njonci',  and  the  balance 
was  secured  by  the  note  now  sued. 

Cases  have  been  cited  from  the  English 
authorities  which  sustain  the  distinction  be- 
tween considerations  arising  from  the  com- 
pounding of  felonies,  which  Is  admitted  to 
be  Illegal,  and  the  compounding  of  misde- 
meanors, which  Is  alleged  to  be  lawful;  but 
it  appears  that  there  is  a  conflict  in  the  de- 
cisions upon  this  matter.  In  Drage  v.  Ibber- 
son,  2  Esp.  043,  Lord  Kenyon  held,  that  the 
consideration  for  settling  a  misdenieauor  was 
good  in  law.  And  the  case  of  Fallowes  v. 
Taylor,  7  Term  R.  745,  proceeds  upon  the 
same  principle.  It  was  there  held  by  Lord 
Kenyon  and  ilie  rest  of  the  court,  that  a 
bond  given  to  the  plaintiff  (who  was  clerk  of 
the  quarter  sessions  and  who  was  directed  to 
prosecute  the  defendant  for  a  public  nui- 
sance,) conditioned  to  remove  the  nuisiince, 
was  valid,  notwithstanding  it  was  taken  by 
the  plaintiff  for  his  own  use,  he  agreeing  not 
to  prosecute  for  the  nuisance. 

We  do  not  think,  that  such  a  power  is  vest- 
ed in  individuals.  It  would  enable  them  to 
use  the  claim  of  the  government  for  their" 
own  emolument,  and  greatly  to  the  oppres- 
sion of  the  people.  It  has  a  direct  tendency 
to  obstruct  the  course  of  the  administration 
of  justice;  and  the  mischief  extends,  we 
think,  as  well  to  misdemeanors  as  to  felonies. 
1  Russ.  Crimes,  210;  Edgcombe  v.  Rodd,  5 
East,  301. 

The  power  to  stop  prosecutions  is  vested  in 
the  law  officers  of  the  commonwealth,  who 
use  it  with  prudence  and  discretion.  If  it 
were  given  to  the  party  injured,  who  might 
be  the  only  witness  who  could  prove  the  of- 
fence, he  might  extort  for  his  own  use,  mon- 
ey which  properly  should  be  levied  as  a  fine 
upon  the  criminal  party  for  the  use  of  the 
commonwealth.  The  case  at  bar  furnishes  a 
strong  illustration  of  the  illegality  of  such 
a  proceeding.  The  plaintiff  claimed  and  got 
the  note  to  secure  to  his  own  use  four  times 
as  much  as  in  his  own  estimation  his  Indi- 
vidual damage  amounted  to.  Now  the  sum 
thus  secured  might  be  more  or  less  than  the 
rioters  would  have  been  fined;  but  whether 
more  or  less  is  altogether  immaterial;  for 
no  part  of  it  belonged  to  the  party.  He  might 
settle  for  his  own  damage  from  the  riot;  but 
it  would  enable  the  party  to  barter  away  the 
public  right  for  his  own  emolument,  if  we 
were  to  hold  that  the  consideration  of  this 
note  was  lawful. 

We  are  all  of  opinion,  that  the  nonsuit 
must  stand. 


440 


ILLEGALITY  OF  OBJECT. 


THOMPSON  et  al.  v.  REYNOLDS^^;^ 

(73  111.  11.)  S^2'^^ 

Supreme  Court  of   Illinois.     Sept.   Term,   1874. 
Appeal    from    circuit   court,    Cook    couuty; 
John  G.  Rogers,  Judge. 

Merriam  &  Alexander,  for  appellants.  John 
C.  Richberg,  for  appellee. 

WALKER,  J.  Some  time  in  the  latter  part 
of  the  year  ISGS,  appellee  and  his  partner 
were  consulted  by  appellants  as  to  whether 
they  should  execute  a  release,  without  consid- 
eration, of  certain  property  mentioned  in  the 
deed.  The  partner  advised  that  they  had  no 
interest,  and  could  do  so  without  prejudice  to 
their  rights;  but,  subsequently,  another  quit- 
claim deed  was,  in  like  manner,  presented  for 
a  large  amount  of  property.  Appellee  was 
then  appUed  to  for  further  advice,  when 
he,  with  appellant  Charles  Thompson,  con- 
sulted with  one  James  Dunne,  also  an  attor- 
ney, who  occupied  the  same  office  with  appel- 
lee. They  investigated  the  matter,  and  ar- 
rived at  the  conclusion  that  appellants  had 
an  interest  in  the  property. 

An  agreement  was  soon  after  entered  into 
between  appellants  and  appellee,  by  which 
appellee  was  to  institute  all  necessary  pro- 
ceedings to  ascertain  and  fix  the  rights  of  ap- 
pellants; that^  he  should  pay  all  necessary 
expenses,  and  receive  one-half  of  whatever 
ghould  be  realized.  Appellants  agreed  that 
they  would  do  no  act  to  interfere  with  the 
proceedings.  It  is  claimed  that,  with  the  con- 
sent of  the  parties,  appellee  agreed  with 
Dunne  he  should  assist  in  prosecuting  the 
claims,  for  which  he  was  to  receive  one-half 
of  appellee's  moiety,  being  one-fourth  of  what 
should  be  recovered- 
Soon  after,  proceedings  were  commenced  In 
the  circuit,  the  superior  and  the  county  courts 
by  these  attorneys.  During  the  continuance 
of  these  proceedings,  it  is  claimed  that  about 
$10,000  was  realized  by  appellants  executing 
the  releases,  by  way  of  compromise,  with  sev- 
eral defendants  to  the  various  suits,  and  it  is 
claimed  that  these  proceeds  Avere  divided  ac- 
cording to  the  terms,  of  the  agreement. 

About  the  month  of  May,  1S71,  appellants, 
it  is  claimed,  without  the  consent  of  appeUee 
of  Of  Dunne,  terminated  the  several  ppoceed- 
ings  and  conveyed  the  lands  m_iitigation,  in 
consideration  of  $7,500  actuJifly^  paid  to  tlkm, 
,and  to  TecDverOTie^alf  of  JMl_sunrthij5  ac- 
tion was  brought  A  trial  by  the  court  and  a 
jury  wasfi'ad,  resulting  in  a  verdict  of  .'?1,500 
in  favor  of  plaintiff,  on  which  a  judgment 
was  rendered,  and  this  appeal  prosecuted. 

A  number  of  errors  are  assigned  on  the  rec- 
ord, but  in  the  view  we  take  of  the  case,  we 
shall  only  consider  whether  the  judgment  is 
against  the  law.  The  court  was  asked  to  in- 
struct the  jury  that  the  agreement  entered 
into  was  champertous  and  void,  but  the  court 
below  refused  to  give  the  instruction.  Black- 
«tone  defines  champerty  (volume  4,  p.  135)  as 
■"species  of  maintenanc-e,  and  punished  in  the 


same  manner,  being  a  bargain  with  a  plain- 
tiff or  defendant  compum  partire,  to  divide 
the  land  or  other  matter  sued  for  between 
them,  if  they  prevail  at  law,  whereupon  the 
chaniperter  is  to  cari-j'  on  the  party's  suit  at 
his  own  expense."  The  same  author  informs 
us  that  the  punishment,  if  a  common  person, 
for  champerty,  was  by  fine  and  imprisonment; 
and  this  was  a  misdemeanor,  punishable  at 
the  common  law.  See  1  Hawk.  P.  C.  p.  463. 
It  was  also  prohibited  by  various  ancient  stat- 
utes, commencing  as  early  as  the  Statute  of 
Westm.  L  c  25,  all  of  which  enact  heavy  pen- 
alties for  their  violation. 

It  thus  appears,  that  champerty  was  an  of- 
fense at  tlie  common  law,  and  our  general 
assembly  having  adopted  the  common  law  of 
England  as  the  rule  of  decision,  so  far  as  ap- 
plicable to  our  condition,  until  modified  or  re- 
pealed this  must  be  regardetl  as  in  force  in 
this  state,  as  affecting  all  such  contracts,  and 
as  being  opposed  to  sound  public  policy.     It 
is  certainly  applicable  to  our  condition  so  far 
as  it  relates  to  attorney  and  cUent,  and  con- 
tracts with  intermeddlers  and  speculators  in 
apparently  defective  titles  to  property.    If  al- 
lowed to  be  practiced  by  attorneys,  it  would 
give   them    an    immense   advantage    over    a 
jClient     The  superior  knowledge  of  the  attor- 
ney of  the  rights  of  the  client  would  give  him 
the  means  of  oppression  and  acquiring  great 
and  dishonest  advantages  over  the  ignorant 
"and    unsuspecting    owner    of    property.     By 
giving  false  advice,   the  attorney,   owing  to 
the  confidence  his  client  reposes  in  him,  and 
to  his  superior  knowledge,   would  have  the 
cUent  completely  at   his   mercy,   and   would 
thus  be  enabled  to  acquire  the  client's  prop- 
erty in  the  most  dishonorable  manner.     To 
aUow  champerty  would  be  Jo  permit  tempta- 
.tion  to  the  avaricious  and  unscrupulous  m  the 
profession,  that  would,  from  the  very  nature 
of  things,  lead  to  great  abuse  and  oppression. 
■  Whilst  the  great  body  of  the  profession  are 
honest,  and  understand  and  act  on  the  duties' 
devolving  upon  them,  there  necessarily  must 
be,  in  this  as  in  all  ages  of  the  past,  some 
who  gain  admission  that  have  neither  the  in- 
tegrity nor  sense  of  duty  necessary  to  restrain 
them    from   dishonorable   means   in  practice. 
Usually  a  person  will  not  employ  an  attorney 
unless  he  feels  assured  of  his  honesty  as  a 
man  as  well  as  his  ability  as  an  attorney. 
Having  this   confidence,   all   must   see   at   a 
glance  that  it  Avould  give  the  attorney   im- 
mense power  over  the  client,  and  with  this 
power  all   must   see  that  to   permit   him   to 
make    champertous    contracts    would    be    to 
place  the  client  in  the  power  of  the  attorney. 
Professional  duty  requires  that  advice  giVen 
should  be  honest,  fair  and  unreserved;    but 
where  the  weak  in  morals  or  the  vicious  are 
consulted,  and  they  see  and  determine  to  em- 
brace the  opportunity  to  make  a  champertous 
contract,   how  can  we  expect  them   to  give 
fair,    honest   and   unreserved    advice   at   the 
commencement,  or  in  conducting  the  litiga- 
tion?    The  just  the  good  and  upright  require 


\ 


PUBLIC  POLICY— CUAMPEUTY  AND  MAL\  TENANXE. 


441 


no  restraints,  but  the  vicious  or  Immoral 
should  be  freed  from  temptation. 

At  all  times,  in  the  past,  champerty  has 
been  found  a  source  of  oppression  and  wrong 
to  the  property  owner,  and  a  great  annoy- 
ance to  the  community.  To  allow  It  to  at- 
torneys, with  a  portion,  but  it  is  believed  llie 
number  would  be  small,  there  would  be  strong 
temptation  to  anuoj'  others  by  the  commence- 
ment of  suits  without  just  claim  or  right, 
merely  to  extort  money  from  the  defendant 
in  buying  his  peac*e.  Such  practices  have 
been  denominated  as  a  crime  malum  In  se. 
And  such  extortion  from  others,  or  by  the  op- 
pression of  a  client.  Is  unquestionably  a  great 
moral  delinquency,  that  no  government  re- 
gardful of  the  rights  of  its  citizens  should 
ever  tolerate.  We  see  that  it  is  as  liable 
now  to  abuse  as  It  ever  was,  and  would  be  as 
injurious  to  our  community  as  to  other  com- 
miinitJes  In  the  past.  And  this  court  lias  re- 
peatedly held  that  common  law  misdemeanors 
may  be  punished  in  this  suite,  unless  abro- 
gated by  statutory  enactment. 

Then,  has  this  common  law  offense  been  re- 
pealed? We  think  not  The  general  assem- 
bly has  defined  the  offenses  of  barratry  and 
maintenance,  but  the  offense  of  champerty  is 
not  named;  and  as,  at  common  law,  all  three 
of  these  offenses  were  regarded  as  separate 
and  distinct,  and  as  the  British  parliament 
enacted  separate  laws  in  reference  to  each, 
and  as  they  were  enforced  by  distinct  pro- 
ceedings, we  may  regard  them  as  different 
offenses,  although  champerty  is  said  to  be  a 
species  of  maintenance.  Then,  if  the  108th 
section  of  the  Criminal  Code  would  not  em- 
brace this  offense,  it  is  In  force  as  a  common 
law  misdemeanor,  and  we  do  not  see  that  it 
does. 

But,  it  is  said  that  the  case  of  Newkirk  v. 
Cone,  18  111.  449,  has  determined  that  there 
is  no  law  in  this  state  against  champerty,  but 
this  is  manifestly  a  mistake.  In  that  case 
'  there  seems,  at  first,  to  have  been  a  champer- 
tous  agreement,  but  it  was  abandoned  by  the 
parties  by  mutual  consent.  Cone  thou  went 
on  and  rendered  services,  and  sued  for  pro- 
fessional services  in  prosecuting  and  defend- 
ing causes,  also  for  examining  records  in  pub- 
lic offices,  abstracting  title  to  lauds,  drawing, 
copying  and  engrossing  conveyances,  deeds 
and  writings,  for  journeys  and  purchasing 
lands,  and  for  work  and  labor.  Thus,  it  will 
be  seen,   that,   although    It   may    have   been 


argued,  the  question  of  maintenance  or  cham- 
perty was  not  before  the  court,  but  simply 
whether  an  attorney  may  recover  a  fair  com- 
pensation for  professional  services  and  labor 
performed  as  an  agent,  and  it  was  hold  that 
a  contract  of  hiring,  for  the  purpose  of  In- 
vestigating title,  and  making  purchases,  and 
rendering  legal  services  in  settling  titles  to 
land  thus  purchased,  was  legal,  and  the  per- 
son emj)luyed  could  recover  for  such  services. 
It  is  true  that  the  court  refer  to  the  ancit-nt 
common  law  and  British  statutes  to  show 
that  the  contract  of  the  parties  then  before 
the  court  was  not  affected  by  them.  It  was 
also  shown  that  our  statute  against  mainte- 
nance did  not  embrace  that  contract.  There, 
a  pei-son  desiring  to  purcliase  lands  employed 
an  attorney  to  examine  title,  to  give  him  an 
opinion  as  to  its  validity,  and  when  purcha.s- 
ed  to  litigate  against  conflicting  titles,  which 
was  held  not  to  be  maintenance.  That  case 
Is  essentially  different  from  this,  both  in  Ita 
facts  and  on  principle,  and  for  these  reasons 
it  cannot  be  regarded  as  an  authority  In  favor 
of  appellee  in  this  case. 

This  court  has  held  In  Gilbert  v.  Holmes, 
64  111.  548,  and  Walsh  v.  Shumway,  05  IlL 
471,  that  similar  contracts  were  tainted  with 
champerty,  and  could  not  be  enforced. 

According  to  the  doctrine  of  the  case  of 
Scoley  V.  Ross,  13  Ind.  117,  there  can  be  no 
question  that  this  contract  Is  champertous, 
according  to  the  doctrine  of  the  courts  of  this 
country.  That  case  refers  to  and  reviews  a 
large  nimiber  of  American  decisions  on  this 
question,  and  carries  the  doctrine  to  the  full 
extent  of  the  English  rule. 

It  was  the  policy  of  the  common  law  to 
protect  persons  from  harassing  and  vexatious 
litigation.  Hence,  it  would  not  permit  a  per- 
son having  no  interest  in  the  subject  matter 
of  the  litigation  to  intermeddle  or  to  become 
interested  in  the  suit  of  another,  unlos^;  it 
was  an  attorney,  who  could  only  have  and 
demand  a  fee  for  his  services,  and  that  not 
in  a  portion  of  the  thing  in  dispute.  In  the 
absence  of  such  a  rule,  great  wrong  would 
necessarily  be  inflicted  on  community. 

On  a  consideration  of  all  the  authorities,  we 
are  clearly  of  ppinion  that  this  contract,  how- 
ever honestly  entered  into  and  carried  out, 
was  void,  and  that  tlie  judgment  of  the  court 
below  should  be  reversed,  and  the  cause  re- 
manded. 

Judgment  reversed. 


ILLEGALITY  OF  OBJECT. 


F(>WLER  V.  CALLAN. 
'ly  (T  N.  E.  169.  102  N.  Y.  395.) 

Court  of  Appeals  of  New  York.    June  1,  1SS6. 

Appeal  from  general  term,  New  York  com- 
mon pleas. 

Scott  Lord,  for  appellant  J.  A.  Kamping, 
for  respondent. 

FINCn,  J.  It  does  not  affect  the  validity 
of  the  contract  between  the  attorney  and  his 
client  that,  measured  by  the  old  rules  relat- 
ing to  champerty  and  maintenance,  it  would 
have  fallen  under  their  condemnation;  for 
neither  doctrine  now  prevails  except  so  far  as 
preserved  by  our  statutes.  Sedgwick  v.  Stan- 
ton, 14  N.  Y.  2S9.  The  attorney  may  agree 
upon  his  compensation;  and  it  may  be  con- 
tingent upon  his  success,  and  payable  out  of 
the  proceeds  of  the  litigation.  Such  contracts 
are  of  common  occurrence,  and,  while  their 
propriety  has  been  vehemently  debated,  they 
are  not  illegal,  and,  when  fairly  made,  are 
steadily  enforced.  In  substance,  that  was  the 
contract  here  made,  and  there  would  be  no 
question  about  It  had  it  not  contained  a  pro- 
vision by  the  terms  of  which  the  attorney  not 
only  agreed  to  rely  upon  success  for  his  com- 
pensation, but  also  to  assume  all  costs  and 
expenses  of  the  litigation,  and  indemnify  his 
client  against  them.  It  is  this  feature  of  the 
contract  which  raises  the  question  necessary 
to  be  determined. 

The  facts  of  the  case  are  not  very  fully 
developed,  but  appear  to  be  that  the  defend- 
ant as  devisee  under  a  will,  was  entitled  to 
certain  real  estate;  his  right  dependent  upon 
the  validity  of  the  will,  and  in  some  manner 
threatened  by  proceedings  before  the  surro- 
gate, which  put  his  interest  in -peril,  and  made 
a  defense  essential  to  its  protection.  In  this 
emergency  he  sought  the  aid  and  professional 
Bervice  of  the  plaintiff,  and  retained  him  as 
attorney.  The  latter  neither  sought  the  re- 
tainer, nor  did  anything  to  Induce  it  So  far 
as  appears,  it  was  not  occasioned  by  any  offer 
or  solicitation  of  his,  but  originated  in  the  free 
and  unbribed  choice  of  the  client.  The  evi- 
dence does  not  show  whether  the  latter  had 
gained  possession  of  the  land  devised,  or  was 
out  of  possession,  but  he  gave  to  the  attorney 
a  deed  of  the  one  undivided  half  part  of  the 
property,  taking  back  his  covenant  to  conduct 
the  defense  to  its  close,  paying  all  costs  and 
expenses  of  the  litigation,  and  indemnifying 
the  devisee  against  all  such  liability. 

The  agreement  appears  to  have  been  purely 
one  for  compensation.  If  the  client  had  given 
to  the  attorney  money  Instead  of  land,  the 
contract  would  have  differed  In  no  respect  ex- 
cept the  contingent  character  of  the  compen- 
sation. The  arrangement  contemplated  suc- 
cess in  the  litigation,  in  which  event  the  land 
would  pay  the  cosrs  and  expenses  and  the  at- 
torney's reward,  and  both  would  be  discharged 
out  of  the  property  of  the  client  placed  in  the 
hands  of  the  attorney  for  tliat  precise  pur- 


pose. The  contract  in  no  respect  induced  the 
litigation.  That  was  already  begun,  and  ex- 
isted independently  of  the  agi'eement,  and 
originated  in  other  causes.  It  did  not  tend  to- 
prolong  the  litigation.  It  made  it  to  the  in- 
terest of  the  attorney  to  close  it  as  briefly  and 
promptly  as  possible,  and  at  as  little  cost  and 
expense  as  prudence  would  permit.  The 
plaintiff,  therefore,  stirred  up  no  strife,  in- 
duced no  litigation,  but  merely  agreed  to  take 
for  his  compensation  so  much  of  the  value  of 
the  land  conveyed  to  him  as  might  remain  aft- 
er, out  of  that  value,  the  costs  and  expenses 
had  been  paid. 

We  do  not  think  the  statute  condemns  such 
an  agreement  3  Rev.  St  (6th  Ed.i  p.  449, 
§§  .59,  60;  Code,  §§  73.  74.  The  Code  revi- 
sion changed  somewhat  the  language  of  the 
prohibition,  but  nevertheless  must  be  deemed 
a  substantial  re-enactment  of  the  earlier  sec- 
tions. Browning  v.  Marvin,  100  N.  Y.  148, 
2  N.  E.  03.5.  They  forbid— First  the  pm-- 
chase  of  obligations  named  by  an  attorney 
for  the  purpose  and  with  the  intent  of  bring- 
ing a  suit  thereon;  and,  second,  any  loan  or 
advance,  or  agreement  to  loan  or  advance,  "as 
an  inducement  to  the  placing,  or  in  considera- 
tion of  having  placed,  in  the  hands  of  such  at- 
torney" any  demand  for  collection.  The  stat- 
ute presupposes  the  existence  of  some  right  of 
action,  valueless  unless  prosecuted  to  judg- 
ment, which  the  owner  might  or  might  not 
prosecute  on  his  own  behalf,  but  which  he  is 
induced  to  place  in  the  hands  of  a  particular 
attorney  by  reason  of  his  agreement  to  loan 
or  advance  money  to  the  client.  It  contem- 
plates a  case  in  which  tlie  action  might  never 
have  been  brought  but  for  the  inducement  of 
a  loan  or  advance  offered  by  the  attorney; 
and  in  which  the  latter,  by  officious  interfer- 
ence, procures  the  suit  to  be  brought,  and  ob- 
tains a  retainer  in  it  The  statute  speaks  of 
a  "demand"  which,  by  enforcement,  will  end 
In  a  "collection;"  phrases  which  have  no  apt- 
ness to  the  situation  of  one  simply  defending 
a  good  title  to  land  against  the  efforts  of  oth- 
ers seeking  to  destroy  the  devise  under  which 
he  claims.  The  plaintiff  made  no  "loan  or  ad- 
vance," in  any  proper  sense  of  those  words. 
They  imply  a  liability  on  the  part  of  the 
client  to  repay  what  was  thus  lent  or  ad- 
vanced. The  attorney  loaned  nothing,  and  he 
advanced  nothing  to  the  client  which  the  lat- 
ter was  bound  to  reimburse.  Simply,  he  was 
paid  in  advance  an  agreed  price,  taken  in 
land  instead  of  money,  and  out  of  which  he 
was  first  to  pay  costs  and  expenses. 

The  facts  before  us  are  not  within  the  terms 
of  the  statutes,  as  it  respects  a  "demand" 
which  is  the  subject  of  "collection;"  but  our 
conclusion  rests  more  strongly  upon  the  con- 
viction that  the  agreement  made  was  one  for 
compensation  merely,  and  had  in  it  no  vicious 
element  of  inducing  litigation  or  holding  out 
bribes  for  a  retainer. 

The  judgment  should  be  reversed,  and  a 
new  trial  granted;    costs  to  abide  the  event 

AH  concur. 


PUBLIC  POLICY— CHAMPERTY  AND  MAINTENANCE. 


443 


"^  (13  Fed.  317.)  ^ 

Circuit   Court,    W.   D.   Missouri,    W.   D.     Nov., 
1881. 

Tlie  case  was  tried  before  tlie  court  by 
agreement  of  parties,  a  jurj'  being  waived. 

Botsford  &  Williams  and  G.  W.  De  Camp, 
for  plaintiff.  Willard  P.  Hall,  Silas  Wood- 
son, Benj.  F.  Stringfellow,  and  L.  H.  Waters, 
for  defendant. 

McCRARY,  C.  J.  The  answer  alleges  that 
this  suit  is  being  prosecuted  by  one  of  the 
attorneys  for  plaintiff  upon  a  champertous 
contract  by  which  he  is  to  pay  the  expenses 
xi£_thc  litigation  anrT  receive  as  his  compen- 
satlon  40  per  cent,  of  tlio  sum  realized,  and 
tfae^efendant  moves  to  dismiss  the"  suit  for 
that  reason.  The  proof  sustains  the  allega^ 
tion  or  cnamperty,  the  testimony  of  the  de- 
fendant himself  being  quite  conclusive  upon 
that  point.  This  makes  it  necessary  for  the 
court  to  decide  the  Important  question  wheth- 
er the  plaintiff  can  be  defeated  in  his  action 
upon  the  note  by  the  proof  that  he  has  made 
a  champertous  contract  with  his  attorney. 
In  other  words,  can  the  defendant,  the  mak- 
er of  a  promissory  note,  avoid  payment  there- 
of or  prevent  a  recovery  thereon  upon  the 
ground  that  the  holder  of  the  note  has  made 
a  void  and  unlawful  agreement  with  an  at- 
torney for  the  prosecution  of  a  suit  upon  it. 
The  authorities  upon  this  question  are  In 
conflict.  Some  courts  have  ruled  that  if  the 
fact  that  a  suit  is  being  prosecuted  upon  a 
champertous  contract  comes  totbe  knowledge 
of  the  court  in  any  proper  manner  It  should 
refuse  longer  to  entertain  the  proceedings. 
Barker  v.  Barker,  14  Wis.  142;  Webb  v.  Arm- 
strong, 5  Humph.  379;  Morrison  v.  Deader- 
ick,  10  Humph.  342;  Greenman  v.  Cohee,  61 
Ind.  201. 

I  Other  courts  have  held  that  the  fact  that] 
jthere  is  an  Illegal  and  champertous  contract  I 
/for  the  prosecution  of  a  cause  of  action  is 
I  no  ground  of  defense  thereto,  and  can  only 
be  set  up  by  the  client  against  the  attorney 
'  when  the  champertous  agreement  itself  is 
sought  to  be  enforced.  Hilton  v.  Woods,  L. 
-ftr  4  Eq.  Cas.  432;  Elborough  v.  Ayres,  L.  R. 
10  Eq.  Cas.  367;  Whitney  v.  KirUand.  27  N. 
J.  Eq.  333;  Robinson  v.  Beall,  26  Ga.  17; 
Allison  V.  Railroad  Co.  42  Iqwa,  274;  Small 
V.  Railroad  Co.  8  N.  W.  437. 

This  latter  view  is  In  my  judgment  support- 
ed by  the  better  reason.  It  Is  not  aecessary 
for  the  full  protection  of  the  client  to  go  so 
far  as  to   dismiss  the  suit   for  he  Is  In  no 


»  Irrelevant  parts  omitted. 


manner  bound  by  the  champertous  agree- 
ment; nor  are  there  any  reasons  founded  on 
public^  policy  that  should  require  such  dls^ 
missal.  If  all  champertous  agreements  shalF 
be  hcTd'void,  and  the  courts  firmly  refuse  to 
enforce  them,  they  will  thereby  be  discour- 
aged and  discountenanced  to  the  same  extent 
and  in  the  same  manner  as  are  all  other  un- 
lawful, fraudulent,  or  void  contracts.  If,  on 
the  other  hand,  the  defendant  in  an  action 
upon  a  valid  and  binding  contract  may  avoid 
liability  or  prevent  a  recovery  by  proving  a 
champertous  agreement  for  the  prosecution 
of  the  suit  between  the  plaintiff  and  his  at- 
torney, an  effect  would  thus  be  given  to  the 
champertous  agreement  reaching  very  far 
beyond  that  which  attaches  to  any  other  il- 
legal contract  The  defendant  in  such  case? 
is  no  party  to  the  champerty;  he  is  not  in- 
terested In  it  nor  in  anywise  Injured  by  it 
If  the  contract  upon  which  he  is  sued  is  a 
"bona  fide  contract  upon  which  a  sum  ol 
money  is  due  from  him  to  the  plaintiff,  and 
he  has  no  defense  upon  that  contract  I  can 
see  no  good  reason  for  holding  that  he  may 
be  released  by  showing  that  the  plaintiff  has 
made  a  void  and  unlawful  agreement  with 
his  attorney  concerning  the  fee  and  expenses 
of  the  suit 

The  tendency  In  the  courts  of  this  coun- 
try is  stronger  in  the  direction  of  relaxing 
the  common-law  doctrine  concerning  cham- 
perty and  maintenance,  so  as  to  permit  great- 
er libertj'^  of  contracting  between  attorney 
and  client  than  was  formerly  allowed,  and 
this  for  the  reason  that  the  peculiar  condi- 
tion of  society  which  gave  rise  to  the  doc- 
trine has  in  a  great  measure  passed  away. 
In  some  of  the  states  the  common-law  rule 
is  altogether  repudiated,  and  it  is  held  tbat 
no  such  contract  is  now  Invalid  unless  it  con- 
travenes some  existing  statute  of  the  state. 
Sedgwick  v.  Stanton.  14  N.  Y.  2S9;  Voorhees 
V.  Darr,  51  Barb.  5S0;  Richardson  v.  Row- 
land, 40  Conn.  572;  Mathewson  v.  Fitch,  22 
Cal.  86;  Hoffman  v.  Vallejo,  45  Cal.  564; 
Lytle  V.  State,  17  Ark.  609. 

The  common-law  doctrine,  however,  pre- 
vails in  Missouri,  according  to  the  decision 
of  the  supreme  court  of  the  state  in  Duke  v. 
Harper,  66  Mo.  55.  While  following  that  rul- 
ing. I  am  disposed.  In  view  of  the  general 
tendency  of  American  courts,  to  relax  some- 
what the  rigor  of  the  English  rule,  to  apply 
It  only  to  the  champertous  contract  Itself, 
and  not  to  allow  debtors  to  make  use  of  it 
to  avoid  the  payment  of  their  honest  obliga- 
tions. 

It  follows  that  the  defense  of  champerty 
In  this  case  cannot  be  maintained,  and  that 
the  motion  to  dismiss  must  be  overruled- 


444 


ILLEGALITY  OF  OBJECT. 


.^ 


SAXON  V.  WOOD.  At 

(30  .N.  K.  797,  4  Ind.  App.  242.) 
Appellate  Court  of  Indiana.    March   16,   1892, 

Appeal  from  circuit  court,  Fayette  county; 
N.  S.  Gavin,  Special  Judge. 

Action  by  Addie  Wood  against  Walter  Sax- 
on for  the  breach  of  a  promise  of  marriage. 
Judgment  for  plaintiff.  Defendant  appeals. 
Reversed. 

J.  I.  Little  and  D.  W.  McKee,  for  appellant. 
Reuben  Conner  and  H.  L.  Frost,  for  appellee. 

BLACK,  J.  The  appellee,  a  minor,  by  her 
next  friend,  sued  the  appellant.  Upon  the 
appellant's  motion,  the  next  friend  was  re- 
moved. The  appellee  was  permitted  to  prose- 
cute her  suit  as  a  poor  person.  She  recovered 
judgment  for  $250.  A  demurrer  to  the  com- 
plaint for  want  of  sufficient  facts  was  ovemil- 
ed.  This  ruling  alone  is  assigned  as  error. 
The  complaint,  filed  in  September,  1&89,  omit- 
ting the  title  of  the  cause,  was  as  follows: 
"Addie  Wood,  plaintiff,  by  Emma  L.  Disbor- 
ough,  her  next  friend,  complains  of  Walter 
Saxon,  defendant,  and  says  that  plaintiff  was 
a  minor  of  the  age  of  twenty  years  on  the 

day  of  May,  1889;    that,  for  a  period 

of  one  year  prior  to  the  time  of  the  prom- 
i.se  hereinafter  alleged,  the  defendant  kept 
company    with,    and   paid   his    attentions    to, 

plaintiff  as  her  suitor;  that  on  the  day 

of  September,  1SS8,  while  so  keeping  company 
and  paying  his  attentions,  defendant  solicited 
plaintiff  to  have  sexual  intercourse  with  him, 
which  she  refused  to  do;  that  thereu;pQiLjie- 
fendant_agreed  with  and  promised  her  that  if 
she  _WQUld  have  sexual  intercourse  with  him, 
and  she  should  become  pregnant  from  such 
intercourse,  he  would  at  once  marry  her;  that 
in  consideration  of  such  promise  and  agree- 
ment so  to  marry  in  case  of  pregnancy,  to 
which  promise  and  agreement  she  assented, 
plaintiff  yielded  to  defendant's  solicitations, 
and  did,  on  four  or  five  occasions,  then  and  on 
days  following,  have  sexual  intercourse  with 
defendant,  from  which  pregnancy  resulted, 
and  from  which  a  child  was  bom  to  plaintiff; 
that  plaintiff  was  at  the  time  of  such  promise 
and  intercourse,  and  still  is,  unmarried;  that, 
immediately  upon  the  discovery  of  such  preg- 
nancy, plaintiff,  who  was  then  wiUing  to  mar- 
ry defendant,  requested  defendant  to  fulfill  his 
said  promise  of  marriage,  which  defendant  re- 
fused, and  still  refuses,  to  do,  to  plaintiff's 
damage  in  the  sum  of  five  thousand  dollars. 
Wherefore,"  eta 

In  an  action  for  a  breach  of  a  promise  to 
marry,  a  consideration  for  the  promise  must 
be  shown.  There  must  have  been  mutual 
promises  to  marry.  Unless  there  has  been  a 
promise  on  the  part  of  the  plaintiff,  the  prom- 
ise of  the  defendant  is  void  for  want  of  con- 
sideration. Adams  v.  Byerly,  123  Ind.  368,  24 
N.  E.  130.  In  the  case  before  us  the  agree- 
ment of  the  parties  did  not  consist  merely  of 
mutual  promises  to  marry.    The  promise  and 


agn^ement  to   which   it  was  alleged   the   ap- 
pellee assented  was  to  marry  in  case  of  preg- 
nancy resulting  from  her  future   intercourse 
with  the  appellant.     It  is  alleged  that  he  so- 
licited her,   not   to   marry   him,   but   to   have 
sexual  intercourse  with  him,  and  oft'ered  mar- 
riage as  a  consideration  for  such  intercourse 
and  consequent  pregnancy.    Iler  acceptance  of 
his  offer  implied  her  agreement  to  marry  if 
their  intercourse  should  result  in  her  pregnan- 
cy.   The  consideration  of  his  promise  to  mar- 
ry was'^alTe'ged  to  be  that  she  should  have  sex- 
ual intercourse  with  him,  and  should  thereby 
become  pregnant.     The  marriage  which  they 
agreed  about  was  not  to  take  place  until  she 
should  have  so  paid  for  it.    A  woman  cannot 
maintain   an   action   for  her  own   seduction, 
when  the  yielding  of  her  person  has  been  in- 
duced by  the  promise  of  a  pecuniary  reward, 
(Wilson  V.  Ensworth,  85  Ind.  399;)    but  she 
may  maintain  such  an  action  where  she  has 
been  prevailed  upon  to  surrender  her  chastity 
under  the  promise  of  the  seducer  to  marry 
her,  (Lee  v.  Hefley,  21  Ind.  98;    Shewalter  v. 
Bergman,    123   Ind.    155,    23   N.   E.    GS6,   and 
cases  cited.)     Her  action  for  seduction  is  an 
action   of  tort  provided  by  statute,   whereby 
she    obtains    damages    for    the    defendant's 
wrong,    notwithstanding   her  consent   to    the 
act  which  injures  her.    An  action  for  a  breach 
of  promise  to  marry  is  a  common-law  action 
founded  upon  a  contract.     An  action  will  noj; 
lie  for  the  breach  of  a  contract  based  upon  .^n 
illegal  or  immoral  consideration.     In  2  Kent, 
Comm.    466,    it   Is    said:      "The  consideration 
must  not  only  be   valuable,   but  it  must  be 
a  lawful  consideration,  and  not  repugnant  to 
law  or  sound  policy  or  good  morals,  ex  turpi 
contractu  actio  non  oritur,  and  no  person,  even 
so  far  back  as  the  feudal  ages,  was  permit- 
ted by  law  to  stipulate  for  iniquity.    *    •    • 
If  the  contract  grows  immediately  out  of,  or 
is  connected  with,  an  illegal  or  immoral  act, 
a  court  of  justice  will  not  enforce  it."     See.^ 
also,  2  Chit.  Cent.  (11th  Am.  Ed.)  979;   1  Pars.' 
Cent.  4.56:    Bish.  Cont.  §  494;    1  Whart  Cont. 
§§  370-373.     The  validity  of  a   man's  prom- 
ise to  marry  a  woman  is  dependent  upon  the 
consideration  existing  for  such  promise.     Fel- 
ger  V.  Etzell,  75  Ind.  417-419.     In  Hanks  v. 
Naglee,  54  Cal.  51,  which  was  an  action  for  a 
breach  of  promise  to  marry,  the  plaintiff  tes- 
tified,  in   substt^>nce,   that  the  agreement  be- 
tween the  parties  was  that  the  plaintiff  should 
then  presently  surrender  her  person  to  the  de- 
fendant, and  that  in  consideration  of  such  sm-- 
render  the  defendant  would  afterwards  mar- 
ry her.     It  was  held  that,  upon  well-settled 
principles,  the  plaintiff  could  not  recover  upon 
such  a  contract;  that,  being  a  contract  for  illic- 
it cohabitation,  it  was  tainted  with  immorali- 
ty.    See,   also,   Boigneros   v.   Boulon,   54  Cal. 
146;   Baldy  v.  Stratton.  11  Pa.  St.  316;  Goodal 
V.  Thurman,  1  Head,  208;  Steinfield  v.  Levy, 
16  Abb.  Prac.  (N.  S.)  26.    If  it  be  said  that  the 
complaint  showed  by  implication  a  promise  of 
the  appellee  to  marry  the  appellant,  yet  she 
is  not  shown  to  have  made  any  promise  which 


PUBLIC  POLICY— IMMORAL  AGREEMENTS. 


445 


rould  serve  as  a  consideration  for  bis  prom- 
ise. Her  implied, promise  was  so  united  wiih 
thcjmmoraj  part  of  the  corisiderat[uii.  aniLso 
dependent  upon  the  consetiuonces  of  tbe_ijjj- 

mnf;\]___pnjjdnf;f-  _Qrf)pns7vT7~thn  t     it    cannot    be 

separated  and  made  to  scr\;e_'as  a  valid  con- 
^BideratioD^  Steinfield  v.  Levy,  supra;  James 
v."Jellison,  94  Ind.  292;  Lodge  v.  Crary,  93 
Ind.  238;  Riclvctts  v.  Harvey.  100  lud.  oi'A,  G 
N,  E.  325.  The  appellee  relics  in  argument 
upon  Kurtz  v.  Frank,  7G  Ind.  ij94;  Wilson  v. 
Ensworth,  85  Ind.  399;  and  Kenyon  v.  Peo- 
ple, 2G  N.  Y.  203.  Kurtz  v.  Franlc,  supra, 
was  an  action  for  breach  of  man-iage  con- 
tract. The  questions  presented  on  appeal 
arose  upon  a  motion  for  a  new  trial.  It  is 
said  in  the  opinion  of  the  court:  "The  plain- 
tiff testified  that  the  defendant  promised  to 
marry  her  in  September  or  October,  (1878;) 
that  he  said  he  would  marry  her  in  the  fall, 
if  they  could  agree  and  get  along  and  be  true 
to  each  other;  but,  If  she  became  pregnant 
from  their  intercourse,  he  would  marry  her 
immediately.  She  did  become  pregmmt  about 
the  middle  of  July,  1878,  and  informed  the 
defendant  of  the  fact  as  soon  as  aware  of 
it  Upon  this  evidence  it  Is  insisted  that  the 
agreement  to  marry  immediately,  in  case  of 
the  plaintiff's  pregnancy,  is  void,  because  im- 
moral, and  that,  aside  from  this  part  of  the 
agreement,  the  defendant  had  until  the  1st 
of  December  within  which  to  fulfill  his  en- 
gagement, and  consequently  that  the  suit,  be- 
gun as  it  was  before  that  date,  was  prema- 
turely brought.  It  does  not  appear  that  the 
illicit  intercourse  entered  into  the  considera- 
tion of  the  marriage  contract,  but  the  appel- 
lant, having  agreed  to  marry  the  appellee  at  a 
time  then  in  the  future,  obtained  the  inter- 
course upon  an  assurance  that,  if  pregnancy 
resulted,  the  contract  already  made  should 
be  performed  at  once.  This  did  not  supersede 
the  original  agreement,  but  fixed  the  time  of 
its  performance.  Clark  v.  Pendleton,  20  Conn. 
495.  We  are  not  prepared  to  lend  judicial 
sanction  and  protection  to  the  seducer  by  de- 
claring that  he  may  escape  the  obligation  of 
his  contract,  so  made,  on  the  plea  that  it  is 
immoral.  But  if  this  were  otherwise,  and  if, 
by  its  terms,  the  contract  was  not  to  be  per- 
formed until  at  a  time  subsequent  to  the 
commencement  of  the  suit,  yet  if,  before  the 
suit  was  brought,  the  appellant  had  renounced 
the  contract,  and  declared  his  purpo.se  not  to 
keep  it,  that  coastituted  a  breach  for  which 
the  appellee  had  an  immediate  right  of  ac- 
tion." 

The  appellee  relies  upon  the  sentence,  "We 
are  not  prepared,"  etc.  This  sentence,  and 
the  portion  of  the  opinion  following  it,  as 
above  quoted,  had  reference  to  the  question 
whether  the  action  was  prematurely  brought. 
The  case  lends  no  aid  to  the  contention  of  the 
appellee.  The  court,  in  effect,  held  that  if  the 
time  of  performance  fixed  by  the  contract,  in- 
to wltich  no  immorality  entered,  could  not 
be  changed  and  fixed  by  the  assurance  on  the 
part    of    the    defendant    that,    if    pregnancy 


should  result,  the  contract  already  made 
should  he  performed  at  once,  then  his  renun- 
ciation  of  the  i-yntroi-t  to  marry  constituted 
^  breacli  of  that  coliTTacipand'gave^tlie^plajii- 
tiff  an  iramediaterjiiht  of  actiu-t  oa  tlui  cy£- 
tractj_and  t h£re£ace_U  was  not  necessary  that 
tlie  commencement  of  the  action  should  hcita 
been  delayed  until  the  time  fixed  for  the 
marriage  in  the  original  contract.  Wilson  v. 
Ensworth,  supra,  was  an  action  for  the  plain- 
tiff's own  .seduction.  It  was  said  in  the  opin- 
ion of  the  court:  "In  this  ease  the  promi.se 
was  pecuniarj'  aid.  Reliance  upon  such  a 
promise  did  not  make  the  act  seduction.  A 
promise  to  marrj'  would  be  different,  and  con- 
stitute a  sullicient  Inducement.  The  yielding 
of  the  woman  to  the  solicitations  of  the  man, 
under  such  a  promise,  would  imply  a  prom- 
ise on  the  part  of  the  woman  to  marry  the 
man.  The  contract  would  be  legal,  and  for  its 
breach  the  law  would  give  the  injured  party 
a  remedy.  Kenyon  v.  People,  2G  N.  Y.  203; 
Kurtz  V.  Frank,  7G  Ind.  594."  The  injured 
party  in  such  case  might  have  a  remedy  by  ac- 
tion for  seduction,  but  illicit  intercourse  could 
not  form  a  valid  consideration  for  the  con- 
tract to  marry.  The  statements  that  the  con- 
tract would  be  legal,  and  tliat  an  action  would 
Lie  for  its  breach,  were  not  necessary  to  the 
decision  of  the  case.  Kenyon  v.  People,  su- 
pra, was  a  criminal  prosecution  for  seduc- 
tion. The  judge  of  the  trial  court  charged 
the  jury  that,  "if  they  were  fully  satisfied 
from  the  evidence  that  the  defendant  promised 
to  marry  the  prosecutrix  if  she  would  have 
carnal  connection  with  him,  and  she,  believ- 
ing and  confiding  in  such  promise,  and  In- 
tending on  her  part  to  accept  such  offer  of 
marriage,  did  have  such  carnal  connection,  it 
is  a  suilicient  promise  of  marriage  under  the 
statute."  The  statute  thus  referred  to  was: 
"Any  man  who  shall,  under  promise  of  mar- 
riage, seduce  and  have  illicit  intercourse  with 
any  unmarried  female  of  previous  chaste  char- 
acter, shall  be  guilty  of  a  misdemeanor,"  etc. 
In  the  opinion  of  Wright.  J.,  it  was  said  of 
this  instruction:  "This  seems  to  me  unob- 
jectionable. It  is  not  necessary  that  the  pri>m- 
ise  should  be  a  valid  and  binding  one  between 
the  parties.  The  offense  consists  in  seducing 
and  having  illicit  connection  witli  an  unmar- 
ried female  under  promise  of  marriage.  It  Is 
enough  that  a  promi.se  is  made  which  is  a 
consideration  for  or  inducement  to  the  in- 
tercourse." Having  thus  given  a  sutficient 
reason  for  upholding  the  instruction,  the  judge 
proceeded:  "But  if  the  statute  required  the 
promise  to  be  a  valid  one,  the  charge  was 
correct.  A  mutual  promise  on  the  part  of  the 
female  seduced  is  implied  if  she  yields  to  th« 
solicitations  of  the  seducer,  madp  under  his 
promise  to  marry."  This  suggestion  that  .such 
implied  promise,  together  with  the  st^ducer's 
express  promise,  made  in  consideration  of  or 
dependent  upon  solicited  carnal  intercourse, 
could  constitute  a  valid  contract  to  marry.  Is 
contrary  to  principle  and  authority.  It  ap- 
pears from  the  report  of  the  case  that  Bal- 


446 


ILLEGALITY  OF  OBJECT. 


com,  J.,  "concurred  with  Judge  Wright  in  the  ; 
conclusion   that   it   was   unnecessary  for  the 
district  attorney  to  prove  there  was  a  valid 
contract  of  marriage  between  the  prosecutrix  | 
and   prisoner  prior   to   the    illicit   connection,  j 
and  said,  among  other  things,  that,  before  the 
statute  could  be  construed  as  contended  for  by  1 


the  prisoner's  counsel,  it  should  read  that  any 
man  who  shall,  under  'contract'  of  marriage, 
seduce,  etc.,  and  not  any  man  who  shaU,  un- 
der 'promise'  of  marriage,  seduce,  etc.,  as  it 
now  is."  The  judgment  is  reversed,  and  the 
cause  is  remanded,  with  instruction  to  sus- 
tain the  demurrer  to  the  complaint 


PUBLIC  POLICY— GAMING  AND  WAGERS. 


447 


^^/^ 


^    3   ^       COLI.AMER  V.  DAT. 

(2  Vt.  144.) 

finprcme    Court   of    Vermont.    Windsor.     Feb., 
1829. 

This  was  an  action  of  trover.  brouc:ht  up 
from  the  County  Court  for  the  re%isi<)n  of  their 
decision  presented  in  the  following  case, 
agreed  to  by  the  parties,  to  wit: 

"In  this  action,  plaintiff  offered  to  prove,  at 
the  trial,  that,  on  the  day  mentioned  in  the  dec- 
laration, the  plaintiff  and  defendant  were  to- 
gether in  the  ollice  of  Jacob  Collamer,  at 
*145  Itoyalton— that  *while  there,  a  gentle- 
man passed  in  a  chaise:  when> defendant 
asked,  whose  chaise  is  that?  Plaintiff  answered. 
Dr.  Denison's.  Defendant  said  no,  it  is  not 
Denison's  chaise:  I  will  bet  my  watch  against 
yours  that  it  is  not  Denison's  chaise — That  to 
this  proposal  plaintiff  agreed — That  each  of  the 
parties  then  took  out  his  watch,  and  laid  it 
upon  the  table:  and  it  was  then  mutually  agreed 
by  the  parties,  that  they  would  go  together, 
and  ascertain  whether  the  said  chaise  was  the 
said  Denison's  chaise;  and  that,  if  it  was,  plain- 
tiff should  take  both  w^atches;  and,  if  not,  de- 
fendant should  take  both,  as  and  for  his  own — 
That  they  did  proceed  and  examine,  and  found 
it  to  be  said  Denison's  chaise — That  the  parties 
then  returned  to  the  said  office,  and  the  defend- 
ant immediately  took  up  his  watch,  and  carried 
it  away — That,  on  the  same  day,  plaintiff"  de- 
manded said  watch  of  defendant,  who  refused 
to  deliver  it,  but  converted  it  to  his  own  use. 
This  evidence  was  objected  to  by  the  defend- 
ant's counsel,  and  excluded  by  the  Court.  To 
which  decision  the  plaintiff  excepted,  and  the 
exception  was  allowed,  and  the  cause  ordered 
to  pass  to  the  Supreme  Court. 

Mr.  Marsh,  for  plaintiff,  contended.  That  by 
the  common  law,  a  wager  in  general,  is  legal,  if 
it  be  not  an  excitement  to  a  breach  of  the  peace, 
or  to  immorality;  or  if  it  do  not  affect  the  feel- 
ings or  interests  of  a  third  person,  or  expose 
him  to  ndicule,  or  libel  him;  or  if  it  be  not 
against  sound  policy; — and  that  the  wager  in 
question  could  not  lead"  to  any  of  those  conse- 
quences. He  cited,  among  other  authorities, 
2  T.  Rep.  693.— Cowp.  37.  The  counsel,  also, 
contended,  that  actual  delivery  of  the  property, 
in  this  case,  was  not  necessary  in  order  to  vest 
the  property  in  the  plaintiff,  and  to  enable  him 
to  maintain  trover;  and  cited  Loft,  219.— Cro. 
ElJz.  866.— 1  T.  Rep.  56—7  id.  9.— 1  Salk.  113. 
—1  Strange,  165.  Atkin  vs.  Barwick. 

The  Court  declined  hearing  Mr.  Everett,  for 
the  defendant 


The  opinion  of  the  Court  was  delivered  by 

nUTCIIINSON,  J.— Nothing  appears  in  this 
case,  but  that  the  action  would  be  maintainable 
by  the  common  law  of  England,  "^rhe  common 
law  is  adopted  by  our  statute,  so  far,  and  so 
far  only,  as  the  same  is  applicable  to  our  local 
situation  and  circumsiances,  and  is  not  repug- 
nant to  the  constitution,  or  to  any  act  of  the 
legislature,  of  this  state.  Whether  applicable, 
or  not,  must  necessarily  be  a  question  of  judi- 
cial decision:  and  this  is.  probably,  the  lirst 
action,  that  has  ever  called  upon  a  court  in  this 
state  to  sanction  such  a  contract  of  bet- 
ting. The  .Judges  of  the  L'tjurls  in  *Kng-  ♦146 
land  have  expressed  their  regret,  of  late 
years,  that  such  transactions  ever  received  the 
sanction  of  a  court  of  justice:  but,  they  yield 
to  the  force  of  the  law,  which  they  consider 
settled  by  a  train  of  decisions,  extending  down 
from  remote  antiquity.  We  feel  no  such  em- 
barrassment, nor  are  we  willing  to  transmit  any 
such  embarrassment  to  our  successors:  nor  dif- 
fuse into  society  the  influence  of  a  rule  so  de- 
moralizing, as  would  be  the  sanction  of  such  a 
contract.  It  is  honorable  to  this  state,  that  the 
industrious  and  moral  habits  of  our  citizens 
have  furnished  no  occasion  to  litigate  questions 
of  this  nature.  It  is  honorable  to  the  legislature, 
that  they  have  interposed  checks  to  such  games 
and  sports  as  they  supposed  were  creeping  into 
use.  By  the  Statute  ot  1821,  page  268,  penalties 
are  affixed  to  the  winning  or  losing,  or  betting, 
in  money,  goods  or  chattels,  on  any  game,  or 
on  any  horse-race,  or  other  sport,  within  this 
state.  And  said  statute  makes  void  anj'  con- 
tracts and  securities  made  and  given  for  money 
won  on  such  games.  The  species  of  betting 
now  in  question  may  not  come  within  that 
statute,  giving  it  the  strict  construction  of  a 
penal  statute:  ^tthe  good  morals  of  society 
require,  that  no  encouragement  should  be  af- 
forded to  the  acquisition  of  property,  otherwise 
than  by  honest  industry.  Time  might  be  occu- 
pied in  seeking  occasions  to  take  advantage  of 
the  unwary,  and  acquiring  a  skill  to  take  such 
advantage,  which  ought  to  be  devoted  to  better 
purposes. 

In  this  case,  according  to  the  terms  of  the 
Det,  the  plaintiff  had  acquired  a  right  to  the 
possession  of  the  watch,  which  the  "defendant 
had  laid  down  in  the  bet,  but  the  plaintiff  had 
not  acquired  the  actual  possession,  when  the 
defendant  resumed  his  possession.  The  plain- 
tiff, therefore,  had  no  complete  right  to  the 
watch,  without  the  sanction  of  such  a  contract 
of  betting.     That  sanction  is  now  withheld,  and 

The  judgment  of  the  County  Court  is  allirmed. 


448 


ILLEGALITY  OF  OBJECT. 


BEADLES  et  al.  v.  McELRATH  et  aL^ 

SAME  V.  LEET  et  al.       '^^i) 

(3  S.  W.  152,  85  Ky.  230.)  J^ 

Court  of  Appeals  of  Kentucky.    February  19, 
1887- 

W.  W.  Tice  and  Wm.  Lindsay,  for  appel- 
lant. Robertson  &  Robbins,  Hargis  «&  East- 
In,  and  C.  L.  Baudle,  for  appellees. 

PRYOR,  C.  J.  These  two  cases  were  ar- 
gued and  will  be  considered  as  one  case. 
The  appellants,  Beadles,  Wood  «&  Co.,  were 
cotton  brokers,  engaged  in  buying  and  sell- 
ing cotton  on  commission,  as  they  allege,  in 
the  city  of  New  Orleans.  They  instituted 
these  actions  in  the  court  below  against  the 
appellees  for  large  sums  of  money  said  to 
have  been  advanced  by  them  for  the  appel- 
lees in  the  purchase  and  sale  of  cotton  on  the 
cotton  exchange  in  the  city  of  New  Orleans. 
The  appellees,  by  way  of  defense,  allege,  in 
substance,  that  the  claim  set  up  by  the  ap- 
pellants originated  by  reason  of  certain  trans- 
actions between  them  and  appellants  in  the 
purchase  and  sale  of  cotton  on  speculation, 
and  under  contracts  that  were  not  to  be  per- 
formed for  the  delivery  of  the  cotton,  and 
the  payment  therefor,  at  the  maturity  of  the 
contracts;  that  they  were  dedling  in  futures, 
by  which  they  were  to  pay  in  money  the  dif- 
ference by  reason  of  wagering  bargains  by 
which  no  cotton  was  sold  or  delivered,  and 
none  intended  to  be  delivered,  when  the  con- 
tracts were  executed.  They  also  allege  that 
Beadles,  Wood  &  Co.  were  dealing  largely 
in  cotton  on  their  own  account  or  for  others, 
and  that,  having  made  contracts  in  which 
the  appellees  had  no  interest,  similar  to  those 
made  with  the  appellees,  they  were  unable 
to  meet  their  obligations  with  members  of 
the  cotton  exchange,  with  whom  they  con- 
tracted, and,  under  the  rules  of  the  exchange, 
those  contracts  were  all  declared_foj*feited, 
including  the  contracts  said  to  have  been 
made  for  the  appellees;  that  the  forfeiture 
took  place  before  their  contracts  matured, 
and  in  that  manner  they  were  deprived  of 
any  right  to  recover,  without  fault  on  the 
part  of  either  the  appellants,  or  of  those  with 
whom  they  contracted  for  their  benefit.  A 
jury,  by  special  fijidings,  determined  the  is- 
sue in  the  case  of  McElrath  &  Co.,  and  the 
judge,  on  a  submission  of  the  law  and  facts 
to  him,  determined  the  case  of  Leet  &  Mead- 
ows. 

The  one  case,  that  against  McElrath  &  Co., 
was  decided  for  the  defendants  because  of 
its  vicious  consideration,  it  being  a  gambling 
transaction;  and  the  other,  that  of  Leet  & 
Meadows,  on  the  ground  that  the  forfeiture 
of  the  contracts  was  caused  by  the  insolvency 
of  the  appellants,  who  were  unable  to  com- 
ply with  their  contracts,  and  caused  the  loss 
to  the  defendants,— the  judge  further  hold- 
ing that  the  contract  was  not  a  wagering  con- 
tract,  or   against   public   policy.    The   cases 


were  determined  in  different  jurisdictions^ 
but  were  heard  together  in  this  court.  The 
judgment  in  each  case  was  rendered  for  the 
appellees.  The  appellants,  having  denied 
that  the  contracts  were  invalid,  relied  on  cer- 
ta  in  rides  of  the  cotton  exchange,  from  which 
it  appears  that  such  contracts  can  be  enforced 
for  the  delivery  of  the  cotton,  and  further 
established  by  the  testimony  that  the  con- 
tracts were  made  subject  to  the  rules  of  the 
cotton  exchange,  and  should  not,  therefore, 
be  regarded  as  wagering  contracts.  The  con- 
tracts being  in  writing,  it  is  further  main- 
tained that  parol  proof  is  inadmissible  to 
vary  their  terms.  By  the  rules  of  the  cotton 
exchange,  the  delivery  of  the  cotton  may  be 
exacted,  and  the  testimony  conduces  to  show 
that  the  appellees  entered  into  the  contracts 
with  the  knowledge  that  by  its  terms  those 
rules  were  to  determine  its  legal  effect.  In 
fact,  the  jury  'trying  this  case,  in  response  to 
special  interrogatories,  have  so  said  by  their 
verdict. 

In  this  case  it,  then,  plainly  appears  that 
contracts  legitimate  on  their  face,  containing 
stipulations  plain  and  easily  onderstood,  by 
which  the  cotton  purchased  Is  required  to  be 
delivered,  have  been  declared  vicious,  in  the 
one  case  at  least,  upon  parol  testimony  show- 
ing that  such  was  not  the  real  purpose  and 
intention  of  either  party  to  the  contract;  the 
real  purpose  being,  in  fact,  to  speculate  only 
on  the  rise  and  fall  of  prices,  as  has  been 
determined  by  the  special  findings  of  the  jury 
in  the  particular  case.  If  the  written  con- 
tract and  the  rules  of  the  cotton  exchange 
are  to  conti'ol  the  decision  of  this  case,  then 
the  facts  and  circumstances  by  which  the 
real  nature  of  the  various  transactions  were 
brought  to  light  should  have  been  excluded 
from  the  jury,  and  a  judgment  rendered  for 
the  appellants,  the  plaintiffs  below.  The 
question  simply  is  whether  a  contract,  legal 
and  proper  in  form,  can  be  avoided  by  a 
proper  pleading,  and  shown  to  be  in  fact  a 
contract  vicious  in  its  character,  and  con- 
traiy  to  public  policy;  a  contract  legal  on 
its  face,  but  when  explained  by  the  facts 
and  circumstances  connected  with  its  per- 
formance, only  a  gambling  transaction.  The 
rule  is  well  established  that  parol  evidence 
is  not  admissible  to  restrict,  enlarge,  or  con- 
tradict the  terms  of  a  written  contract  where 
there  is  no  ambiguity  in  its  meaning;  but 
when  facts  are  alleged  showing  the  existence 
of  fraud,  or  that  the  contract  was  entered 
into  as  a  device  to  avoid  what  would  other- 
wise be  a  vicious  consideration,  as  is  in  sub- 
stance alleged  in  this  case,  this  rule  has  no 
application. 

The  rule,  says  Mr.  Gre^nleaf,  *is  not  in- 
fringed by  the  admission  of  parol  evidence 
showing  that  the  instrument  is  altogether 
void,  or  that  it  never  had  any  legal  existence, 
either  by  reason  of  fraud,  or  for  want  of 
due  execution  and  delivery,  or  for  the  illegal- 
ity of  the  subject-matter."  Again:  "I'arol 
evidence   may   be  offered  to  show   that   the 


PUBLIC  POLICY— FUTURES. 


449 


contract  was  ma  do  for  the  furtherance  of 
objects  forbiddou  by  law,  whether  it  be  by 
statute,  or  by  an  express  rule  of  the  common 
law,  or  by  tlie  gouenil  polici'  of  the  law,"  etc. 
1  Greenl.  Ev.  U-tth  Ed.)  3G(>,  liCA.  So.  in  this 
case,  although  by  the  rules  of  the  cotton  ex- 
change the  cotton  was  to  be  delivered,  and 
the  contract  made  with  the  appellees  express- 
ly stipulated  the  delivery  at  a  particular  day 
in  the  future,  still,  if_this  was  a  merejde; 
vice  to  avoid  th^  effect  of  a  contract  that  thg 
pa rTIcs  really  madr,  and  if  expressed  in  terms 
would  have  been  \:  mis,  and  without  con- 
sideration, we  perceive  no  reason  why  such 
facts  may  not  be  pleaded  and  proven,  and 
the  recovery  on  that  account  denied.  That  a 
contract  of  sale  may  be  made  for  the  future 
dylrfery  of  produce,  or  any  article  of  per- 
sonal property,  will  not  be  contru  'rted;  and 
that  such  a  contract,  by  the  agreement  of 
parties,  or  by  the  regulations  connected  with 
the  boards  of  trade  in  the  country,  may  be 
transferable  from  one  to  the  other,  will  be 
conceded;  but  when  entered  into  for  the 
sole  purpose  of  speculating  in  futures,  and 
with  no  intention  to  deliver  the  cotton  pur- 
chased, but  to  pay  the  difference  between 
the  contract  price  of  the  cotton  and  its  mar- 
ket price  on  the  day.  If  a  contract  in  good 
faith,  the  cotton  was  to  be  delivered,  then 
the  contract  becomes  a  mere  wager,  and  nei- 
ther party  to  it  can  recover.  If  a  contract  in 
good  faith,  it  is  binding;  but  when  assailed 
as  havTugTSeon  ontorod  Into  to  cover  up  the 
real  intention  of  tlic  [lartics,  by  making  that 
appear  legitimate  which  is  really  a  gaming 
transaction,  the  defendant  will  be  permitted 
to  introduce  parol  proof  to  establish  his  de- 
fense. 

Such  a  contract  will  be  presumed  to  be 
valid  when  unexplained,  because  it  shows  by 
its  tenns  an  actual  purchase  and  sale,  and 
the  burden  is  on  the  defense  to  show  the  il- 
legal intention  of  the  parties.  As  said  by 
Agnew,  J.,  in  the  case  of  Kirkpatrick  v.  Bon- 
sall,  "the  law  does  not  condemn  such  trans- 
actions, providing  the  intention  really  is  that 
the  commodity  shall  be  actually  delivered 
and  received  when  the  time  for  delivery  ar- 
rives." 72  Pa.  St.  155.  In  Barnard  v.  Back- 
haus,  52  Wis.  593,  6  N.  W.  252,  and  9  N.  W. 
595,  that  court  went  further,  and  held  "that, 
for  the  sale  and  delivery  at  a  future  day  of 
grain  for  a  fixed  price,  it  must  affirmatively 
and  satisfactorily  appear  that  it  was  made 
with  an  actual  view  to  the  delivery  of  the 
grain,  and  not  as  a  cover  for  a  gambling 
transaction." 

It  seems  to  us  that  the  terms  of  the  writ- 
ten contract  imply  good  faith,  and  the  bur- 
den should  rest  on  the  defense  to  show  the 
illegal  purpose.  It  becomes  necessary,  there- 
fore, to  examine  the  nature  of  the  transac- 
tions between  these  parties,  in  the  light  of 
the  .testimony  before  lis,  with  a  view  of  de- 
termining the  validity  of  those  contracts. 
By  the  rules  of  the  cotton  exchange,  no  one 
but  a  member  can  make  contracts  for  the 

HOPK-SEL.  CAS.  CONT. — 29 


purchase  and  future  delivery  of  cottoir. 
Therefore  the  broker,  being  a  member  whei> 
purchasing,  must  necessarily  purchase  of  a 
member  of  the  exchange;  and  in  this  man- 
ner they  make  large  contracts  bj'  either  pur- 
hasing  or  selling  cotton  for  future  deliv«  :  y, 
and  assign  so  much  of  the  contract  to  eacU 
customer  as  the  broker  may  have  received 
orders  to  purchase  or  sell.  He  receives  or- 
ders to  purchase  from  A.,  B.,  C,  and  D.,  liv- 
ing in  Kentucky,  to  purchase  2,(Xt(i  bii.es  for 
each,  and  a  like  number  of  onh  i>  from  A., 
B.,  C,  and  D.,  living  in  Tennessee.  The 
broker  enters  the  exchange,  and  purchases 
of  one  or  more  members  lG,fK)0  bales  of  cot- 
ton in  his  (the  broker's)  <  wn  name,  and  then 
on  his  books  assigns,  or  by  contract  passes, 
to  each  one  of  his  eight  customers,  2,(X>0 
bales  of  cotton,  at  the  price  for  which  he 
purchased;  the  purchasers  depositing  such 
a  margin  as  is  required  by  the  rules  of  the 
exchange.  If  the  broker  should  receive  a 
telegram  from  one  of  the  parties  in  Ken- 
tucky to  sell  his  2,000  bales  before  tin-  time 
of  delivery,  and  one  of  his  custom'  s  from 
Tennessee  should  want  to  purchase  an  ad- 
ditional 2,000  bales,  he  then  transfers  on  his 
books  the  cotton  of  the  Kentucky  customer 
as  sold  to  the  Tennessee  customer,  at  th:  i 
day's  prices.  All  dealers  are  to  keep  up  their 
margins  as  the  fluctuations  in  prices  de- 
mand, as  this  is  determined  by  the  rules  of 
the  exchange.  The  speculator  in  futures 
from  this  mode  of  dealing,  whether  for  ac- 
tual delivery  or  not,  has  in  fact  made  a  pur- 
chase of  cotton,  but  can  never  ascertain  with 
whom  the  contract  was  made.  The  broker 
maj'  inform  the  exchange  for  whom  he  is 
purchasing,  but  this  gives  no  right  of  action 
against  any  one  but  the  broker.  The  broker 
is  insisting  that  he  is  the  mere  agent  of  the 
purchaser,  and  entitled  to  his  commission, 
and,  when  told  by  the  purchaser  that  the 
2.000  bales  of  cotton  must  be  delivered  at 
the  maturity  of  his  contract.  It  Is  then  as- 
certained that  the  broker  has  purchased  IG,- 
000  bales  of  cotton  of  one  or  more  members 
of  the  exchange  in  his  own  name,  and,  the 
margin  not  being  kept  up,  the  entire  con- 
tract is  forfeited,  and  the  moneys  already 
advanced  on  the  margin  gone  to  the  vendor 
of  the  cotton. 

In  February,  18S2,  the  appellants,  being^ 
purchasers  of  near  GO.OOO  bales  of  cotton,  no- 
tified the  exchange  that  they  were  unalile  to 
comply  with  their  contracts.  The  forfeiture 
took  place,  and  this  was  before  the  maturity 
of  the  contracts  with  the  appellees;  but  it  is 
now  insisted  that,  if  the  margins  had  been 
kept  up,  the  contracts  would  have  remained 
in  force.  Suppose  the  margins  had  been  for- 
warded to  the  appellants:  from  the  testi- 
mony in  this  case,  the  appellants  have  pur- 
chased cotton  exceeding  in  value  more  thai* 
?200.000.  and  the  margin  being  called  for^ 
and  not  deposited,  the  whole  contract  went 
with  the  insolvency  of  the  firm  that  took 
place  in   February,   1S62.     These  appellants 


450 


ILLEGALITY  OF  OBJECT.  ' 


were  in  fact  selling  to  the  appellees,  and 
were  not  their  agents.  They  purchased  large 
quantities  of  cotton  in  the  exchange  on  their 
Individual  account,  and  afterward  distributed 
those  purchases  between  their  customers, 
leaving  them  without  any  remedy  except 
against  the  broker  for  the  delivery  of  the  cot- 
ton, if  such  had  in  good  faith  been  the  con- 
tract between  them.  With  the  prices  of  cot- 
ton favoring  the  appellees,  their  claim  as  pur- 
chasers might  have  been  enforced  through 
their  broker,  in  his  name;  but  with  an  in- 
solvent commission  merchant,  whose  credit 
alone  enabled  him  in  the  first  place  to  enter 
the  exchange,  and  make  these  large  pur- 
chases, the  remedy  was  necessarily  worth- 
less, because  the  party  In  fact  liable  had  be- 
come insolvent. 

It  is  shown  that  within  less  than  a  year 
prior  to  these  contracts  with  the  appellees, 
that  appellants  contracted  for  300,000  bales 
of  cotton,  and  on  the  eighth  of  Febniary, 
1S82,  the  day  they  failed,  the  contracts  they 
had  on  hand  compelled  them  to  receive  and 
pay  for  near  60,000  bales  of  cotton,  a  portion 
of  which,  they  say,  was  the  cotton  of  these 
appellees.  The  appellants  were  not  worth 
exceeding  $75,000,  if  that  much,  and  yet  it 
is  argued  that  such  contracts  were  valid 
business  transactions,  and  the  parties  ex- 
pected to  comply  with  the  terms  of  each  con- 
tract; or,  if  not,  that  the  prime  object  was 
not  to  speculate  merely  on  the  rise  and  fall 
of  cotton,  but  to  receive  or  deliver  the  cotton 
purchased  or  sold.  It  is  evident  that  if  the 
margin  had  been  forwarded  by  the  appellees, 
that  all  would  have  gone  in  the  financial 
wreck  that  followed  the  reckless  ventm'es  of 
men  who  were  doubtless  enterprising  mer- 
chants, but  who  had  speculated  to  such  an 
extent,  either  for  themselves  or  others,  as  to 
Involve  all  in  financial  ruin.  This  would  con- 
etftute  a  complete  defense  to  each  action,  re- 
gardless of  the  other  questions  raised,  and 
the  judgment  in  the  case  of  Leet  &  Meadows 
was  therefore  proper.  It  is  claimed  that  Mc- 
Elrath,  one  of  the  firm,  was  in  New  Orleans, 
and  on  the  exchange,  when  some  of  this  cot- 
ton was  purchased.  He  was  not  a  member 
of  the  exchange,  and  therefore  made  no  pur- 
chases, but  the  cotton  was  purchased  in  the 
manner  and  as  all  other  cotton  was  pur- 
chased for  their  customers  by  these  appel- 
lants. They  were  simply  paying  the  appel- 
lants a  bonus  for  the  privilege  of  trading 
with  them,  and  were,  in  fact,  the  vendors, 
and  the  appellees  the  vendees,  of  the  cotton. 
These  appellees  were  men  of  limited  means, 
living  in  this  state,  and  contracting  by  tele- 
grams and  letters  for  futures  in  cotton,  with 
no  intention  or  expectation  of  receiving  a 
single  bale,  either  from  the  appellants  or  any 
one  else,  and  this  was  the  intention  and  pur- 
pose of  the  contracts,— a  fact  known  to  the 
appellants  as  well  as  the  appellees.  The  tes- 
timony of  the  appellants  leaves  no  doubt  on 
this  subject,  and  neither  the  rules  of  the  cot- 
ton exchange,  nor  the  letter  of  the  contract. 


will  be  allowed  to  give  validity  to  such  agree- 
ments. 

The  opinion  in  the  case  of  Sawyer  v.  Tag- 
gart,  repoitwl  in  14  Bush,  727,  was  based  on 
the  idea  that  no  evidence  was  offered  by  the 
defense  showing  that  the  contracts  were  to 
be  settled  by  the  payment  of  differences; 
but,  on  the  contrary,  the  plaintiffs  had  as- 
sumed the  burden,  or  rather  established,  that 
the  contracts  were  to  be  executed  in  good 
faith,  with  no  evidence  conflicting  with  such 
a  conclusion.  Here  the  character  of  the  busi- 
ness transactions  conducted  by  the  appel- 
lants, from  their  own  statements,  both  with 
the  appellees  and  others,  conduce  to  show 
that  there  was  a  tacit,  if  not  an  express, 
agreement  that  no  cotton  was  to  be  deliver- 
ed, and,  with  the  testimony  for  the  defense, 
there  can  be  no  doubt  on  the  subject. 

But  it  is  argued  that  a  mere  tacit  agree- 
ment, or  one  necessarily  inferred  from  the  cir- 
cumstances surrounding  the  various  transac- 
tions connected  with  the  positive  statements 
of  the  defendants,  cannot  supplant  that 
which  the  parties  have  reduced  to  writing, 
and  the  contracts  must  be  enforced  because 
they  purport  to  be  valid  contracts,  and  the 
rules  of  the  cotton  exchange  have  so  de- 
termined. In  discussing  a  similar  question, 
the  supreme  court,  through  Mr.  Justice  Mat- 
thews, said:  "We  do  not  doubt  that  the 
question  whether  the  transaction  came  with- 
in the  definition  of  wagers  is  one  that  may 
be  determined  upon  the  circumstances,  the 
jury  drawing  all  proper  inferences  as  to  the 
real  intent  and  meaning  of  the  parties;  for, 
as  was  properly  said  in  the  charge,  'it  maker; 
no  difference  that  a  bet  or  wager  is  made  to 
assume  the  form  of  a  contract.'  Gambling 
is  none  the  less  such  because  it  is  carried  on 
in  the  form  or  guise  of  legitimate  trade.  It 
might  therefore  be  the  case  that  a  series  of 
transactions  might  present  a  succession  of 
contracts  perfectly  valid  in  form,  but  which 
on  the  face  of  the  whole,  taken  together,  in 
connection  with  all  the  attendant  circum- 
stances, might  disclose  indubitable  evident' 
that  they  were  mere  wagers."  Irwin  v.  Wil- 
liar,  110  U.  S.  511,  4  Sup.  Ct.  160. 

The  bulk  of  the  transactions  in  the  ex- 
change by  the  appellants  were  in  the  depart- 
ment known  as  the  "margin,"  as  distinguish- 
ed from  the  other  departments.  The  amount 
of  cotton  delivered  in  all  the  sales  and  pur- 
chases did  not  exceed  4,000  bales,  and  the 
proof  conduces  to  show  that  the  cotton  was 
on  consignment;  but,  whether  so  or  not,  it  is 
unreasonable  to  suppose  that  the  appellees, 
with  their  limited  means,  had  undertaken  to 
receive  and  pay  for  cotton  exceeding  in  value 
greatly  more  than  they  were  worth,  and  that 
appellants  induced  them  to  speculate  through 
him  as  their  agent  with  such  an  understand- 
ing or  agreement.  There  are  so  many  facts 
and  circumstances  leading  to  the  opposite 
.conclusion  as  to  the  intention  of  both  par- 
ties when  these  trades  were  made  as  leave 
no  doubt  as  to  the  correctness  of  the  judg- 


PUBLIC  POLICY— FUTURES. 


451 


mcnt  below.  We  are  aware  that  the  business 
of  the  cotton  exchange  Involves  the  greater 
part  of  the  trade  in  the  country's  greatest 
staple,  and  that  leading  merchants  and  busi- 
ness men  engage  in  such  transactions;  but 
this  in  no  manner  relieves  the  case  from  the 
vicious  features  of  this  class  of  contracts. 
Men,  no  doubt,  of  both  personal  and  com- 
mercial integrity  enter  into  such  contracts. 
They  are  nevorthele.ss  piratt'S  upon  the  legiti- 
mate trade,  and  consumers  of  the  country. 
Fictitious    values,   created   by   a   speculation 


that  causes  the  fluctuation  in  prices  from  day 
to  day  of  all  the  leading  products  of  the  coun- 
try, based  upon  a  species  of  gambling  more 
ruinous  to  the  people  than  any  other,  re- 
sult from  such  contracts  as  w  made  in  this 
case.  They  will  not  be  euiorced  by  the 
courts  of  this  state. 

There  are  many  question-s  raiscil  a»  to  the 
pleadings  and  evidence  not  necessaiy  to  be 
cousidiTod.  SLS  from  the  testimony  of  the 
plaintiffs  alone  these  judgments  were  proper. 
Judgment  atJirmed. 


452 


ILLEGALITY 


SriXKS  V.  DAVIS. 

(.32  Miss.  152.) 

Court    of    Errors    aud    Appeals    of    Mississippi. 

Oct.  Term,  1856. 

Error  from  cii-cuit  court,  Tallaliatcliie  coun- 
ty; W.  L.  HaiTis,  Judge. 
'This  was  a  suit  brouglat  by  W.  P.  Spiiiks 
against  A.  W.  Davis,  upon  an  agreement  en- 
tered into  between  Spinlis  and  Davis,  where- 
by Davis,  for  a  consideration,  undertakes,  as 
attorney,  to  assume  the  administration  of  a 
certain  estate,  and  collect  a  debt  due  to 
Spiuks.  The  defendant  demurs  and  sets  forth 
several  causes,  the  principal  of  which  is  that 
the  agreement  is  illegal,  contrary  to  public 
policy,  and  therefore  void,  in  support  of  which 
pr>sition  a  number  of  cases  are  cited,  none  of 
which  I  think  are  in  point.  The  case  cited 
from  4  Wash.  C.  C.  R.  279,  differs  very  widely 
f:om  the  one  at  bar.  In  that  case  absolute 
fraud  aud  corniption  was  charged;  the  others 
are  of  similar  character.  I  cannot  see  how 
the  agreement  is  contrary  to  public  policy.  It 
is  clear  that  a  person,  when  he  is  immediately 
interested,  or  a  creditor,  can  take  out  letters 
of  administration,  but  it  is  equally  clear,  that 
what  he  is  authorized  to  do  himself,  he  may 
authorize  another  to  do  for  him.  "Qui  facit 
per  alium,  facit  per  se." 

The  position  of  the  attorney  is  not  more  in- 
consistent than  would  be  the  position  of  tlie 
principal;  they  are  Identically  the  same.  See 
Hutch.  Code,  G65,  §  54. 

W.  B.  Helm,  for  plaintiff  in  error.  Daniel 
Mayes,  for  defendant  in  error. 

HANDY,  J.  The  declaration  in  this  case 
states,  in  substance,  that  the  plaintiff  con- 
tracted with  and  retained  the  defendant  as 
an  attomey-at-law,  to  collect  certain  claims  to 
a  large  amount,  due  him  from  the  estate  of 
one  John  Carson,  deceased,  who  resided  in 
Alabama,  and  died  insolvent,  but  was  en- 
titled to  a  distributive  share  of  the  estate  of 
his  father  WiUiam  Carson,  who  had  previous- 
ly died  in  Tallahatchie  county,  in  this  state; 
that  the  said  estate  having  been  fully  admin- 
istered and  distribution  made,  and  no  dis- 
tributive share  set  apart  or  allowed  to  John 
Carson,  and  the  plaintiff  being  advised,  that 
in  oixler  to  reach  John's  interest  in  his  father's 
estate,  it  would  be  necessary  to  take  out  let- 
ters of  administration  of  John's  estate,  and 
proceed  against  the  administrators  of  the 
father's  estate,  contracted  with  and  retained 
the  defendant  as  an  attorney,  to  take  out  let- 
ters of  administration  upon  John's  estate,  and 
to  collect  his  debt,  for  certain  reasonable  fees 
and  reward  to  be  paid  to  him;  that  the  de- 
fendant accordingly  took  out  letters  of  ad- 
ministration in  the  Tallahatchie  probate  court, 
at  June  term,  185G,  and,  in  conjunction  with 
other  counsel  retained  with  the  defendant,  the 
defendant,  as  such  administrator,  filed  a  bill 
in  chancery  against  the  distributees  of  Wil- 
liam Carson's  estiite,  and  obtained  a  decree 
in    his    favor    at    October    term,    1850,    from 


or  OBJECT. 

which  an  appeal  was  taken  by  the  adverse 
parties,  to  this  court;  that  pending  that  ap- 
peal, the  defendant,  without  notice  to  the 
plaintiff  or  his  associate  attorney,  fraudulent- 
ly stated  to  this  court,  that  the  suit  was  com- 
menced and  prosecuted  without  his  knowl- 
edge or  consent,  whereupon  this  com't,  con- 
sidciii.g  that  admission  as  a  confession  of  er- 
rors, and  without  examining  tbe  merits  of  the 
case,  reversed  the  decree;  and  the  same  state- 
ment being  afterwards  niade  to  the  chancery 
court,  the  bill  was  finally  dismissed  by  that 
court,  at  April  term,  1853.  The  declaration 
avers,  that  the  plaintiff's  debt  could  have 
been  collected,  but  that  it  was  prevented  by 
the  fraudulent  conduct  of  the  defendant; 
wherefore,  he  prays  judgment  against  the  de- 
fendant In  his  individual  capacity  for  his 
debt,  &c. 

The  defendant  demurred  to  this  declaration 
upon  many  grounds,  and  judgment  was  ren- 
dered thereupon  for  the  defendant;  and  for 
this  alleged  error,  the  case  is  brought  here. 

We  will  proceed  to  consider  the  correctness 
of  the  judgment  upon  the  most  essential  point 
of  the  demurrer. 

The  first  objection  to  the  declaration  is,  that 
the  contract  set  up  is  contrary  to  public  policy, 
and,  therefore,  illegal  and  void. 

This  agreement  as  stated  is,  in  substance, 
that  the  defendant  who  was  thus  retained  as 
the  attorney  of  the  plaintiff,  to  collect  his 
debt,  for  compensation,  should  also  become 
administrator  of  the  debtor's  estate,  and  there- 
by accomplish  the  object  of  his  original  en- 
gagement and  collect  the  debt.  The  question 
is,  do  not  these  respective  duties  involve  in- 
compatible obligations,  or,  does  not  the  faith- 
ful performance  of  one  of  them  tend  neces- 
sarily to  the  violation  of  the  other? 

It  was  the  duty  of  the  attorney  diligently 
to  prosecute  the  claim  according  to  law,  and 
to  collect  it  if  it  could  be  done  by  legal  means. 
It  was  the  duty  of  the  administrator  to  scru- 
tinize the  claim  rigidly,  and  to  refuse  pay- 
ment if  there  was  any  doubt  about  its  just- 
ness in  fact,  or  its  validity  according  to  strict 
legal  rules;  to  defend,  upon  the  ground  of  the 
statute  of  limitations,  the  illegality  or  want 
of  consideration  of  the  claim,  or  any  other  bar 
which  was  a  sufficient  defence  to  it  in  law. 
And  all  such  defences  It  was  the  plain  duty 
of  the  attorney  to  resist.  In  short,  the  at- 
torney was  bouud  to  protect  the  interest  of 
his  client,  and  the  administrator  was  prima- 
rily bound  to  protect  the  legal  interests  of  the 
estate.  Under  such  circumstances,  the  attor- 
ney c-ould  not  have  performed  his  duty  tO' 
prosecute  the  claim,  if  its  validity  had  been 
doubtful,  consistently  with  his  duty  to  defend 
the  estate  against  its  collection.  Hence,  a 
strong  temptation  would  necessarily  arise  to 
violate  his  duty  in  the  latter  capacity,  and  to 
pay  the  claim;  because  the  attorney  would 
thereby  make  a  profit  by  his  retainer  in  addi- 
tion to  the  commission  which  he  would  at  all 
events  receive  as  administrator;  and  instead 
of  acting  as  a  faithful  and  impartial  adminis- 


PUBLIC  POLICY— FKAUD  AND  BUEACU  OF  TRUST. 


453 


trator,  he  stands  iiiidci  a  str<  ii;;  tfiiiiitaLion 
to  abuse  his  trust  to  his  owu  priv/itu  ^'aiu. 
It  cJie  claim  should  be  of  such  doubtful  valid- 
ity as  to  malie  it  the  duty  of  the  administra- 
tor to  resist  its  payment  and  to  render  a  suit 
necessary,  what  is  his  attitude?  IIo  must 
either  become  the  plaintiff's  attorney  in  the  suit 
against  himself  as  administrator,  or  he  must 
procure  some  one  else  to  bring  the  suit  against 
him.  In  this,  there  would  be  an  almost  irre- 
sistible iudufcnient  to  malpractice  and  collu- 
sion; for,  cun^idcring  the  infirmities  of  hu- 
man nature,  it  is  scarcely  to  be  supposed, 
that  he  would  make  a  very  vigorous  defence 
to  a  suit  in  which  he  was  directly  interested 
that  tlie  plaintiff  should  recover. 

But  in  this  case,  the  main  object  of  the  ar- 
rangement was  the  colle^--tion  of  the  plaintiffs 
claim,  and  to  tliat  the  defendant  was  primari- 
ly boimd  by  his  agreement.  The  admiBis- 
tration  was  to  be  undertaken  merely  as  a 
means  to  that  end  How,  then,  could  the  at- 
torney properly  perform  liis  contract  to  coUect 
the  plaintiff's  claini,  when  it  might  become 
his  duty  as  administrator  to  resist  it?  Either 
by  the  force  of  his  contract,  and  in  further- 
ance of  the  object  of  the  undertaking,  or  by 
the  temptation  to  do  wrong  which  his  situa- 
tion would  render  almost  irresistible,  he  must 
act  as  administrator,  so  as  to  facilitate  the 
end  for  which  the  whole  arrangement  was 
entered  into,  and  thereby  violate  his  duty  in 
that  capacity. 

The  obligations  are,  therefore,  manifestly 
inconsistent,  and  are  calculated  to  induce  a 
violation  of  one  of  two  high  public  duties; 
and  the  agreement  must  therefore  be  con- 
demned as  illegal  and  against  public  policy, 
so  far  as  it  charged  the  attorney,  upon  his 
individual  undertaking,  to  collect  the  claim 
by  means  of  the  administration. 

It  is  no  answer  to  this  view  of  the  case  to 
say,  that  the  defendant  might  properly  have 
performed  his  duty  generally,  as  adminis- 
trator, as  well  to  others  interested  as  to  the 
plaintiff,  and  yet  have  properly  paid  the 
claim  of  the  plaintiff;  and  that  it  is  to  be 
presumed  that  the  arrangement  was  intended 
to  be  carried  out  by  legal  meajis,  and  not  by 
those  which  were  illegal.  It  is  a  sufficient 
objection  to  a  contract,  on  the  ground  of 
public  policy,  that  it  has  a  direct  tendency 
to  induce  fraud  and  malpractice  upon  the 
rights  of  others,  or  the  violation  or  neglect  of 
high  public  duties.  Upon  this  principle,  cou- 
tracts  to  procure  the  making  of  a  will  in  favor 
of  a  particular  party,  or  to  bring  about  a  mar- 
riage between  certain  parties.and  the  like,  are 
held  to  be  illegal  as  being  against  public  policy. 
For  although  the  act  contracted  to  be  done  may 
be  just  and  beneficial  as  between  the  parties 
immediately  concerned  in  it,  and  though  it  be 
accomplished  in  good  faith  and  without  undue 
means,  yet  the  contract  to  procure  it  to  be 
done  is  held  to  be  against  public  policy,  be- 
cause its  natural  effect  is  to  cause  the  party 
to  abuse  the  confidence  placed  in  him  by 
those  upon  whom  the  infiuence  Is  to  be  exert- 


ed, and  thereby  prejudicially  to  affect  the 
rights  of  others.  Fuller  v.  Dame,  IS  Pick. 
47li;  Collins  v.  Blantern,  2  Wils.  347;  1  Slur.  . 
Eq.  Jut.  §§  2G5,  2GG;  Chit  Cont  525,  52G;  1 
Lead.  Cas.  Eq.  loO-lGO,  and  cases  tliere  cited. 

It  is  urged,  In  support  of  this  action,  that 
by  our  laws  a  creditor  has  the  right  to  take 
out  letters  of  administration  upon  his  debtor's 
esta.te,  if  parties  having  the  prior  right  fail 
to  do  so;  and  that  there  can  be  no  impropri- 
ety In  the  attorney's  doing  that  which  his 
client,  wIkj  had  the  same  temptation  to  do 
wrong  as  the  attorney,  is  allowed  to  do. 

But  the  question  is,  not  whether  the  attor- 
ney had  the  right  to  administer,  but  whether 
a  contract  by  which  he  was  either  bound,  or 
under  a  strong  and  direct  temptation,  to  use 
his  trust  for  the  purpose  of  paying  the  claim 
of  the  plaintiff,  is  proper  and  legal.  The 
creditor-administrator  is  under  no  contmct  to 
induc-e  him  to  abuse  his  trust;  ami  being 
known  as  a  creditor,  his  acts  will,  in  all  jirob- 
ability,  be  closely  examined  by  those  inter- 
ested in  the  estate.  But  the  attorney  appears 
as  a  disinterested  person,  In  whom  the  par- 
ties may  confide  for  the  faithful  perf.irmance 
of  all  his  duties,  and  especially  for  the  protec- 
tion of  the  rights  and  interests  of  the  estaie. 
He  Is  supposed  not  to  be  acting  in  his  own 
right,  but  for  the  benefit  of  others,  and  im- 
partially; and  from  the  confidence  that  may 
weU  be  presumed  to  be  reposed  in  him,  he 
will  have  much  greater  power  to  make  under- 
hand arrangements  than  would  the  creditor 
himself,  who  was  known  to  be  acting  mainly 
for  his  personal  interest.  The  policy  of  the 
statute  allowing  a  creditor  to  administer 
upon  his  debtor's  estate,  proceeds  on  the 
ground  of  enabling  the  creditor  to  collect  his 
debt,  and  that  from  necessity,  because  no  one 
else  will  administer.  But  it  Is  not  to  be  ex- 
tended to  justify  agreements  made  by  third 
persons  who  may  become  administrators,  the 
performance  of  which  will  have  a  direct  tend- 
ency to  cause  malpractice  and  fraud  in  the 
administration. 

Nor  is  this  agreement  of  the  same  charac- 
ter as  a  contract  to  indemnify  a  party  for  be- 
coming administrator  of  an  estate.  In  such 
a  case,  the  administrator  is  bound  to  do  noth- 
ing which  at  all  conflicts  with  his  duly  as 
such.  He  undertaiies  the  trust  for  no  ulte- 
rior collateral  puii^ose,  and  the  object  is  mere- 
ly to  have  the  estate  administered  in  due 
course  of  law.  The  indemnity  or  compensa- 
tion is  only  to  induce  him  to  take  upon  him- 
self the  trust  to  be  performed  according  to 
law,  and  there  is  no  continuing  inducement 
to  malpractice  after  the  trust  is  imdertaken. 

If  these  views  of  the  case  be  correct,  it  fol- 
lows that  however  the  conduct  of  the  defend- 
ant, as  stated  in  the  declaration,  may  be  con- 
demned in  point  of  morals,  or  whether  he  be 
liable  or  not  for  his  fraudulent  conduct  as  ad- 
ministrator, no  action  against  him  individual- 
ly can  be  maint:Uned  upon  the  agreement 
made  by  him;  and  the  judgment  sustaining 
the  demurrer  must  be  affirmed. 


454 


ILLEGALITY  OF  OBJECT. 


^•^ 


r 


LOWE  V.  PEERS. 

(4  Burrows,  2225.) 

King's  Bench.    1768. 


363 


This  was  an  acLiou  of  covenaut,  upon  a  mar- 
riage contiact;  being  a  promise  under  the  de- 
fendant's hand  and  seal,  and  in  his  own  hand- 
writing, to  the  effect  following— "I  do  hereby 
promise  Mrs.  Catherine  Lowe,  that  I  will  not 
marry  with  any  person  besides  herself:  If  I 
do,  I  agree  to  pay  to  the  said  Catherine  Lowe 
£1,000  within  three  months  next  after  I  shall 
marry  any  body  else.  Witness  my  hand 
Newsham  Peers  and  seal  «Stc."  This  deed  was 
executed  in  1757.  And  in  1767,  Peers  mar- 
ried another  woman.  Whereupon  this  action 
was  brought 

The  plaintiff  avers  in  her  declaration,  "that 
she  had  remained  single,  and  was  always 
willing  and  ready  to  marry  him,  whilst  he 
continued  single:  but  he  married  Elizabeth 
Gardiner."  The  breach  was  assigned  in  non- 
payment of  the  fl.OOO,  though  demanded. 
The  defendant  pleaded  "non  est  factum." 

The  question  turned  upon  the  second  count 
only:  for,  it  was  admitted,  that  no  sufficient 
evidence  was  given  to  support  the  first  count. 

The  cause  was  tried  before  Lord  MANS- 
FIELD. It  appeared  in  evidence,  by  letters 
that  were  read,  that  there  had  been  a  long 
courtship;  and  that  this  obligation  was  fairly 
and  voluntarily  given  by  the  defendant  to  the 
plaintiff:  the  defendant  pulled  the  stampt 
paper  out  of  his  own  pocket;  and  wrote, 
signed,  sealed,  and  executed  it  In  the  presence 
of  one  witness.  And  a  witness  who  saw  it 
executed,  attested  it,  after  the  defendant  was 
gone.  There  was  no  intercourse  between  the 
plaintiff  and  defendant  afterwards.  The  wit- 
ness to  prove  this  deed  swore  that  the  de- 
fendant sealed  it  before  he  wrote  his  name 
"Xewsham  Peers."  Evidence  was  called,  on 
the  other  side,  to  prove  the  contrary. 

His  lordship  directed  the  jury  to  find  for  the 
plaintiff,  with  damages  £1,000  if  they  thought 
the  deed  to  be  a  good  deed.  If  this  direction 
was  wrong,  he  gave  the  defendant  leave  to 
move  for  a  new  trial,  without  costs. 

Accordingly,  on  Thursday,  21st  April  last, 
Mr.  Dunning,  solicitor  general,  moved  for  a 
new  trial,  with  liberty  also  to  move  after- 
wards in  arrest  of  judgment 

Rule  to  shew  cause. 

Upon  shewing  cause  on  Monday  last  (the 
9th  instant.)  a  question  was  proposed  to  be 
debated,  "Whether  the  jury  could  give  any 
more  or  less  damages  than  the  £1,000,  the 
specific  sum  mentioned  in  the  deed;"  as  well 
as  "whether  this  instrument  is  good  enough  in 
law,  to  support  any  action  whatsoever?" 

It  was  then  agreed  that  both  motions,  (viz. 
for  a  new  trial,  and  in  arrest  of  judgment,) 
should  come  on  to  be  argued  together. 

Pursuant  to  which  agreement,  the  case  was, 
yesterday  and  to-day,  argued  by  Sir  Fletcher 
Norton,  Mr.  Cust  and  Mr.  Wallace  for  the 
plaintiff;   and  by  Mr.  Dunning,  solicitor  gen- 


eral, and  Mr.  Mansfield  for  the  defendant: 
but  the  court,  in  giving  their  opinions  upon 
the  two  motions,  entered  so  fully  into  the 
groimds  and  reasons  upon  which  they  founded 
their  determination,  and  discussed  the  objec- 
tions and  cases  cited  so  particularly,  as  may 
render  the  arguments  of  the  counsel  unneces- 
sary to  be  given  here  at  all;  or  at  least  more 
than  a  slight  sketch  of  them.  The  general 
tendency  of  them  was  shortly  this: 

The  motion  for  a  new  trial  was  founded  up- 
on an  objection  to  the  direction  given  to  the 
jury,  "to  find  the  whole  sum  of  £1,000  in 
damages,  in  case  they  should  find  for  the 
plaintiff:"  the  counsel  for  the  defendant  in- 
sisting that  the  jury  ought  to  have  been  left 
at  liberty  to  give  a  less  sum,  if  they  had 
thought  proper;  the  jury  being  judges  of  the 
damages,  as  well  in  covenant  as  in  assumpsit. 
They  cited  James  v.  Morgan,  1  Lev.  Ill, 
where  the  juiT  were  directed  to  give  only  the 
value  of  the  horse  in  damages,  upon  an  as- 
sumpsit "to  pay  a  barley-corn  a  nail,  doubling 
it  every  naU."  They  also  cited  and  much  re- 
lied upon  Sir  Baptist  Hixt's  Case,  in  1  Rolle, 
Abr.  p.  703,  tit.  "Trial,"  pi.  9,  where  a  find- 
ing of  less  was  holden  to  be  good;  and  the 
jury  are  said  to  be  chancellors,  and  may  give 
such  damages  as  the  ease  requires  in  equity. 

It  was  answered,  that  where  a  particular 
sum  is  liquidated  and  fixed  by  the  agreement 
of  the  parties,  and  the  breach  of  covenant  as- 
signed in  non-payment  of  that  money,  that 
fixed  sum  alone  is  the  measure  of  the  dam- 
ages. 

The  motion  in  arrest  of  judgment  was 
founded  upon  the  following  reasons— That  all 
engagements  in  restraint  of  marriage  are  void. 
—That  this  engagement  is  of  that  sort- That 
there  is  no  consideration  for  this  contract  It 
is  not  reciprocal:  here  is  no  mutuality;  which 
is  essential  to  the  validity  of  a  contract 

It  was  answered,  that  this  whole  transac- 
tion amounts  to  a  mutual  promise  "to  marry 
each  other."  The  plaintiff's  acceptance  of  this 
deed  is  sufficient  evidence  of  her  making  such 
a  promise.  So  that  there  were  mutual  prom- 
ises; and  both  were  bound  to  perform  them. 
Therefore  there  was  u  consideration  for  the 
defendant's  promise.  However,  this  promise 
is  by  a  deed:  ',nd  a  deed  carries  its  own 
consideration. 

And  this  is  not  an  engagement  in  restraint 
of  marriage  generally:  it  is  only  a  restraint 
from  marrying  any  body  else  but  each  other. 
Therefore  it  is  not  like  the  case  of  Baker  v. 
White,  2  Vem.  215,  or  that  of  Woodhouse  and 
Shepley.  in  2  Atk.  535. 

Lord  Mansfield  stated  the  deed  particularly, 
and  the  declaration  upon  it.  The  words  are — 
"I  do  hereby  promise  Mrs.  Catherine  Lowe 
that  I  will  not  marry  with  any  person  besides 
herself:  if  I  do.  I  agree  to  pay  the  said  Cath- 
erine I/)we  £1,000  within  three  months  &c." 
The  defendant  was  single,  at  the  time;  and  so 
was  the  plaintiff. 

The  second  count  avers  that  the  plaintiff 


PUBLIC  POLICY— DEIIOGATION  OF  MAllUIAGE  RELATION. 


455 


was  ready  to  marry  liiin;  and  that  after  the 
makin;;  the  deed,  he  did  marry  another  wo- 
inau,  namely,  one  Elizabeth  Gardiner:  yet  he, 
the  defendant,  did  not,  when  requested  by  the 
plaintiff,  pay  the  £1,000  which  he  had  agreed 
to  pay;  and  so  (thout^h  often  reiiuosted)  hath 
not  kept  the  covenant  made  between  them  as 
aforesaid.  So  that  the  breach  Is  assigned  in 
the  not  paying  the  £1,000. 

To  this  declaration  "non  est  factum"  was 
pleaded,  by  the  defendant:  but  the  jury  found 
"that  it  was  his  deed;"  and  have  given  £1,000 
damages.  And  by  law  and  in  jusUce,  he 
ought  to  pay  the  £1,000.  Money  is  the  meas- 
ure of  value.  Therefore  what  else  could  the 
jury  find  but  this  £1,000  (unless  they  had  also 
given  interest  after  the  three  months?) 

This  is  not  an  action  brought  against  him 
for  not  marrying  her,  or  for  hi«5  marrying  any 
one  else:  the  non-payment  of  the  £l,fXK)  is  the 
ground  of  this  action- -"That  he  did  not,  when 
requested,  pay  the  £1,000." 

The  money  was  payable  upon  a  contingency: 
and  the  contingency  has  happened.  Therefore 
it  ought  to  be  paid. 

There  is  a  difference  between  covenants  in 
general,  and  covenants  secured  by  a  penalty 
or  forfeiture.  In  the  latter  case,  the  obligee 
has  his  election.  Pie  may  either  bring  an  ac- 
tion of  debt  for  the  penalty,  and  recover  the 
penalty;  (after  which  recovery  of  the  penalty, 
he  can  not  resort  to  the  covenant;  because 
the  penalty  is  to  be  a  satisfaction  for  the 
whole:)  or,  if  he  does  not  choose  to  go  for  the 
penalty,  he  may  proceed  upon  the  covenant, 
and  recover  more  or  less  than  the  penalty, 
toties  quoties. 

And  upon  this  distinction  they  proceed  in 
courts  of  equity.  They  wUl  relieve  against  a 
penalty,  upon  a  compensation:  but  where  the 
covenant  is  "to  pay  a  particular  liquidated 
sum,"  a  court  of  equity  can  not  make  a  new 
covenant  for  a  man;  nor  is  tliere  any  room 
for  compensation  or  relief.  As  in  leases  con- 
taining a  covenant  against  plowing  up  a  mead- 
ow; if  the  covenant  be  "not  to  plow;"  and 
there  be  a  penalty;  a  court  of  equity  will  re- 
lieve against  the  penalty,  or  will  even  go  fur- 
ther than  that  (to  preserve  the  substance  of 
the  agreement:)  but  If  it  is  worded— "to  pay 
£5  an  acre  for  evei-y  acre  plowed  up;"  there 
is  no  alternative,  no  room  for  any  relief 
against  it;  no  oompensation;  it  is  the  sub- 
stance of  the  agi'eement.  Here,  the  specified 
sum  of  £1,000  is  found  in  damages:  it  is 
the  particular  liquidated  sum  fixed  and  agreed 
upon  between  the  parties,  and  is  therefore  the 
proper  quantum  of  the  damages. 

The  same  reason  answers  to  the  motion  for 
a  new  trial  in  the  present  case. 

As  to  the  case  mentioned  by  Mr.  Mansfield, 
from  2  Rolle,  Abr.  703.— It  is  impossible  to 
support  it:  for  it  can  not  be,  that  a  man 
should  be  obliged  to  take  less  than  the  liqui- 
dated sum.  And  the  writ  of  error  in  that 
ease  was  plainly  brought  by  the  (Cro.  Jac. 
390)  defendant.     Besides,  the  damages  could 


never  be  taken  advantage  of  up-n  a  writ  of 
error.  How  could  the  quantum  of  damages 
found  by  the  jury  be  the  subject  of  a  writ 
of  error? 

'Tis  therefore  clear,  that  where  the  precise 
sum  is  not  the  es.sence  of  the  agreement,  the 
quantum  of  the  damages  may  be  assessed  by 
the  jury:  but,  where  the  precise  sum  is  fixed 
and  agreed  upon  betv.een  the  parties,  that 
very  sum  is  the  ascertained  damage,  and  the 
jury  are  confined  to  it. 

This  brings  the  matter  to  the  validity  of  the 
deed. 

Whatever  grounds  existed  at  that  time,  that 
could  avail  the  defendant  to  avoid  the  deed, 
should  have  come  on  his  part,  by  a  proper 
plea,  if  it  would  in  reality  have  been  a  good 
defence  for  him.  And  therefore  if  any  such 
ground  had  existed  in  this  case,  as  did  exist 
in  Shepley's  Case  (2  Atk.  535);  or  any  other 
ground  not  appearing  upon  the  face  of  the 
deed;  it  ought  to  have  been  avoided  by  a 
proper  plea.  Here,  wj  are  upon  the  face  of 
the  deed;   the  plea  is  "non  est  factum.'' 

It  is  objected,  that  tliis  is  an  engagement  in 
restraint  of  marriage. 

It  is  answered,  that  this  construction  is  di- 
rectly contrary  to  the  words  and  intention  of 
the  deed;  which  amounts  to  a  mutual  agree- 
ment between  these  two  persons  "to  marry 
each  other;"  and  that  the  plaintifTs  acceptance 
of  the  deed  proves  that;  and  that  what  the 
jury  have  found,  is  a  sufficient  reason  to  have 
it  supposed  that  there  was  such  a  mutual 
agreement  "to  marry  each  other:"  that,  how- 
ever, this  is,  at  the  utmost,  only  a  contract 
"that  he  would  not  marry  any  other  woman; 
and  that  if  he  should  marry  any  other  woman, 
he  would  pay  the  plaintiff  £1,000  within  three 
months  after  he  should  so  marry  any  other 
woman;"  but  it  is  very  far  from  restraining 
his  marrying  at  all. 

This  is  a  point  of  very  considerable  impor- 
tance. 

All  these  contracts  ought  to  be  looked  upon 
(as  Lord  Hardwicke  said  in  the  case  of  Wood- 
house  V.  Shepley)  with  a  jealous  eye;  even 
supposing  them  clear  of  any  direct  fraud.  In 
that  case.  Lord  Hardwicke  did  not  proceed  on 
any  circumstiinces  of  particular  actual  fraud; 
but  on  public  and  general  considerations:  and 
therefore  he  gave  no  costs. 

These  engagements  are  liable  to  many  mis- 
chiefs;   to  many  dangerous  consequences. 

When  persons  of  different  sexes,  attached  to 
each  other,  and  thus  contracting  to  marry  each 
other,  do  not  marry  immediately,  there  is  al- 
ways some  reason  or  other  against  it;  as  dis- 
approbation of  friends  and  relations,  inequal- 
ity of  circumstances,  or  the  like.  Both  sides 
ought  to  continue  free;  otherwise,  such  con- 
tracts may  be  greatly  abused;  as,  by  putting 
women's  virtue  in  danger,  by  too  much  con- 
fidence in  men;  or,  by  young  men  living  with 
women  without  being  married.  Therefore 
these  contracts  are  not  to  be  extended  by  im- 
plication. 


456 


ILLEGALITY  OF  OBJECT. 


But  here  is  not  the  least  ground  to  saj-  that 
this  man  has  "engaged  to  marry  this  woman." 
Much  less  does  any  thing  appear,  of  her  en- 
gagixig  to  marry  him. 

There  is  a  great  difference  between  promis- 
ing to  maiTy  a  particular  person;  and  prom- 
ising not  to  marry  any  one  else.  There  is  no 
colour  for  either  of  these  constructions  that 
have  been  offered  by  the  plaintiff's  counsel. 

This  is  only  a  restraint  upon  him  against 
marrying  any  one  else,  besides  the  plaintiff: 
not  a  reciprocal  engagement  "to  marry  each 
•  other;"  or  any  thing  like  it. 

This  penalty  is  set  up  against  the  defend- 
ant, after  ten  years  have  passed  without  any 
Intercourse  between  the  plaintiff  and  him. 

Another  reason  why  we  should  not  strain  in 
favour  of  this  contract,  is  because  if  there 
was  really  any  mutual  contract  under  fair  and 
equal  circumstances,  the  plaintiff  will  still  be 
at  liberty  to  bring  her  action:  for,  a  void  bond 
can  never  stand  in  her  way. 

Therefore  I  think,  that  what  passed  at  the 
trial  was  perfectly  right;  that  the  measure 
of  damages  was  the  £1,000  and  that  this  was 
such  a  contract  as  ought  not  to  be  carried  in- 
to execution. 

The  case  of  Baker  v.  White,  2  Vern.  215. 
"was  not  near  so  strong  as  the  present  case. 
That  was  in  restraint  of  Elizabeth  Baker's 
marrying  again.  There  is  a  difference  be- 
tween a  restraint  of  a  first  marriage,  and  a 
restraint  of  a  second  marriage:  the  plaintiff 
there  was  a  widow,  when  she  gave  the  bond. 
And  the  transaction  was.  In  effect,  a  mere 
wager,  and  nothing  at  all  unfair  in  it:  and 
yet,  in  that  case,  the  bond  was  decreed  to  be 
delivered  up  to  be  cancelled. 

Mr.  Justice  Yates  was  of  the  same  opinion, 
on  both  points. 

In  actions  of  debt,  it  is  fatal  to  the  plaintiff, 
if  he  mistakes  his  demand;  because  the  de- 
mand is  not  divisible.  In  covenant,  it  is  di- 
visible. 

This  deed  was  the  only  evidence  upon  which 
damages  could  be  given.  It  is  a  covenant  "to 
pay  a  stipulated  sum  upon  a  particular  event" 
The  event  has  happened:  the  action  is  brought 
upon  it.  On  a  writ  of  inquiry,  the  inquisi- 
tion would  have  been  set  aside,  if  less  than 
the  sum  specified  had  been  found. 

As  to  Sir  Baptist  Hixt's  Case,  2  Rolle,  Abr. 
'703. — What  Lord  Mansfield  has  said,  is  an 
answer  to  it.  The  jury  ought  to  have  allowed 
the  stipulated  sum  for  every  acre  that  was 
wanting.  For,  according  to  that  rate  the  pur- 
-chase-money  was  paid,  or  agreed  to  be  paid; 
and  according  to  that  rate  it  ought  to  have 
been  allowed  or  refunded:  part  of  the  money 
might  have  been  actually  paid.  And  on  a 
writ  of  error,  (as  Lord  Mansfield  has  observ- 
•ed,)  the  finding  of  damages  by  the  jury  could 
not  come  in  question. 

So  far,  I  am  of  opinion  for  the  plaintiff:  for, 
I  think  the  £1,000  is  the  proper  quantum  of 
damages  which  the  jury  were  bound  to  find. 

But  on  the  motion  in  arrest  of  judgment. 


upon  the  invalidity  of  the  deed— I  am  of  opin- 
ion for  the  defendant. 

For,  this  agreement  is  in  restraint  of  mar- 
riage. It  is  not  a  covenant  to  "marry  the 
plaintiff;"  but  "not  to  marry  any  one  else:" 
and  yet  she  was  under  no  obligation  to  marry 
him.  So  that  it  rvistrained  him  from  man-y- 
ing  at  all,  in  case  she  had  chosen  not  to  per- 
'iuit  him  to  marry  her. 

An  action  of  covenant  must  be  founded  on 
the  covenant,  and  the  breach  assigned  within 
the  words  of  it. 

Now  if  she  had  requested  him  to  marry  her, 
and  been  refused  by  him;  how  must  she 
have  assigned  the  breach  ?— Why— "That  he 
being  requested  by  her  to  marry  her,  he  had 
refused  to  do  so." 

But  what  obligation  was  he  under,  "to  mar- 
ry her?"  Or  where  was  the  breach  of  his 
covenant?  This  covenant  says  no  such  thing, 
as  "that  he  would  marry  her."  Tender  and 
refusal  must  apply  to  the  thing  stipulated: 
but  he  has  not  stipulated  "that  he  would  mar- 
ry her." 

.  As  to  mutuality  of  contract— The  deed  does 
not  import  that  she  shall  marry  him:  neither 
doth  her  acceptance  of  it  import  any  such 
thing.  It  does  not  follow  from  her  accepti 
ance  of  the  deed,  that  she  either  understood 
he  meant  to  bind  himself  to  marry  her;  ot 
that  she  engaged  to  marry  him. 

Possibly,  he  might  not  at  all  mean  to  mar- 
ry her,  though  he  bound  himself  not  to  marry 
any  one  else.  They  are  two  quite  different 
things:   one  does  not  follow  from  the  other. 

This  covenant  is  illegal,  and  will  support  no 
action:  and  therefore  the  plaintiff  ought  to 
recover  nothing  upon  it. 

Mr.  Justice  ASTON  concurred,  upon  both 
points. 

As  to  the  quantum  of  damages — That  is  ex- 
pressly stipulated  and  agreed.  He  took  no- 
tice of  what  is  said  in  the  case  of  Edgcomb  v. 
Dee,  Vaughan,  101,  and  applied  it  to  the  pres- 
ent case. 

As  to  the  great  point— he  said,  he  had  had 
doubt:    but  now  he  clearly  concurred. 

If  this  had  been  a  covenant  "to  marry  her," 
all  the  consequences  which  have  been  men- 
tioned would  have  followed. 

But  it  is  not  a  covenant  "to  marry  her." 
The  words  import  no  such  thing:  and  the 
court  can  not  suppose  fraud.  It  is  only  a 
covenant  to  pay  a  sum  of  money,  in  case  he 
shall  marry  any  one  else,  "any  person  besides 
herself." 

This  is  in  restraint  of  marriage,  and  is  ille- 
gal and  void. 

The  ease  of  Baker  v.  White.  2  Vern.  215. 
was  a  bond  given  by  a  widow,  conditioned  to 
pay  the  defendant  White  £100  if  she  should 
afterwards  marry  again:  and  White,  at  the 
same  time,  gave  her  a  like  bond,  conditioned 
to  pay  the  like  sum  to  her  executors,  if  she 
should  not  marry  asain  before  she  died.  She 
married  again,  to  Baker:  and  he  and  she 
brought  their  bill,  to  have  her  bond  deliveired 


PUBLIC  POLICY— DEIiOGATION  OF  MARRIAGE  RELATION. 


457 


up.  And  the  bond  was  decreed  to  be  de- 
livered up,  to  be  cancelled.  He  observed,  that 
there  is  a  difference  between  a  first  and  a  sec- 
ond marriage.  The  restraint  of  a  first  mar- 
riage is  contrary  to  the  general  policy  of  the 
law,  the  public  good,  and  the  interests  of 
society:  but  the  frequent  customs  of  copy- 
holds intimate  that  the  restraint  of  a  second  is 
not  so.  Yet  there  the  bond  was  decreed  to 
be  delivered  up. 

We  can  not  make  a  covenant  for  the  man: 
and  he  himself  has  only  covenanted  "not  to 
marry  any  other  person,  besides  tlie  plaintiff." 

Mr.  Justice  WILLES  also  concurred. 

1st  No  new  trial  ought  to  be  had.  The  di- 
rection of  my  Lord  Chief  Justice  was  right 
For  here  the  deed  Itself  liquidated  the  certain 
sum:  it  was  a.scertained  and  fixed,  between 
the  parties  themselves;  and  was  therefore  the 
true  and  proper  quantum  of  the  damages. 

2d.  As  to  the  motion  In  arrest  of  Judgment 
—I  should  not  think  it  a  proper  motion,  if  this 
was  a  covenant  "to  marry  her."  But  this  Is 
only,  "not  to  marry  another." 

The  words  are  plain  and  manifest:   and  the 


intention  seems  to  have  been  agreeable  to 
then..  The  deed  was  executed  in  1757:  and 
the  defendant  did  not  marry  till  17G7.  The 
plaintiff  lay  by,  and  never  made  a  requi.sition 
to  hiui  "to  luarry  her;"  but  when  he  married 
another,  she  brought  her  action  of  covenant. 

It  seems  to  me,  to  have  been  understood  be- 
tween the  parties  themselves,  and  even  by 
the  plaintiff  herself,  in  the  same  sense  as  we 
understand  it  now. 

If  so,  'tis  a  restraint  ujyin  matrimony,  and 
is  illegal,  and  stronger  tlian  the  case  of  Wood- 
house  V.  Shepley. 

Lord  MANSFIELD— I^t  the  rule  for  a  new 
trial  be  discharged:  but  the  Judgment  must  be 
arrested. 

This  rule  was  drawn  up,  for  the  plaintiff  to 
shew  cause  why  the  verdict  should  not  be  set 
aside,  and  a  new  trial  had  between  the  par- 
ties: and  in  case  the  court,  upon  hearing  coun- 
sel on  both  sides,  should  be  of  opinion  to  dis- 
charge the  rule,  that  then  the  defendant  should 
be  at  liberty  to  move  In  arrest  of  Judgment 

Memorandnm— This  judgment  was  alErmed  la 
the  ejcheqaer-chamber,  on  26th  May,  1770. 


458 


ILLEGALITY  OF  OBJECT. 


,?^ 


HERRESHOFF   v.    BOUTINEAU. 

Supreme  Court  of  Rhode  Island.    April  14, 
1S90. 


(19  Atl.  712,  17  R.  I.  3.)       ^^  ^f 


On  demurrer  to  bill. 

Bill  for  injunction  by  Julian  L.  Herreshoff 
against  A.  I3outineau.  Defendant  demurs 
to  the  bill. 

Amaaa  JI.  Eaton,  for  complainant.  Al- 
bert A.  Baker,  for  respondent. 

STINESS,  J.  The  complainant,  director  of 
a  school  of  languages  in  Providence,  era- 
ployed  the  respondent  to  teach  French  from 
January  7,  1889,  to  July  1,  1889.  The  con- 
tract, in  writing,  provided  that  the  respon- 
dent would  nut,  during  the  year  after  the  end 
of  his  service,  "teach  the"FrencTi  or  German 
language,  or  any  part  thereof,  nor  aid  to 
teacii  them,  nor  advertise  to  teach  them,  nor 
be  in  any  way  connected  with  any  person  or 
persons  or  institutions  that  teach  them,  in 
the  said  state  of  Rhode  Island."  The  re- 
spondent's service  ended  July  1,  1889.  after 
which  time  he  gave  lessons  in  French,  in 
Providence.  This  suitjs  brought  to  restrain 
him  from  so  doing  wilhin  the  time  covered 
by  this  contract.  The  respondent  demurs  to 
Trie"  bill,  contending— i^trs^,  that  the  con- 
tract is  void  on  the  ground  of  public  policy, 
because  it  imposed  a  ge^ieraL, restraint 
throughout  the  state;  and,  secondly,  because 
it  is  unreasonable.  Is  the  contract  void? 
For  a  long  time,  beginning  with  the  Year 
Book-^,  contracts  limiting  the  exercise  of  one's 
ordinary  trade  or  calling  met  with  much  dis- 
favor in  the  courts.  Any  limitation  what- 
ever was  considered,  in  the  first  repoi'ted 
case.  (Y.  B.  fol.  5,  2  Hen.  V.  p.  26,)  so  far 
contrary  to  law  that  a  plaintilf  suing  thereon 
was  sworn  at  by  the  judge,  and  threatened 
with  a  fine.  But  it  was  soon  found  that,  to 
some  extent  at  least,  such  contracts  help, 
rather  than  harm,  both  public  interests  and 
private  welfaie;  that  they  are  necessary  to 
trade  itself,  in  order  to  secure  the  sale,  at 
fair  value,  of  an  established  business,  by  pro- 
tecting it  against  the  immediate  competition 
of  the  seller;  also  to  enable  one  to  learn  a 
trade  or  to  get  employment  from  another, 
free  from  the  risk  of  having  the  knowledge 
and  infiuence  thus  gained  used  to  the  em- 
ployer's damage;  to^ encourage  investment  in 
business  enterprises,  under  reasonable  safe- 
guards; and  for  other  equally  evident  rea- 
sons. Accordingly,  exceptions  to  the  early 
doctrine  were  recognized  from  time  to  time, 
until  the  leading  case  of  Mitchel  v.  lleynolds, 
1  P.  Wras.  181,  when  the  court  established 
the  rule  that  a  contract  in  restraint  of  trade, 
upon  consideration  which  shows  it  was  rea- 
sonable for  the  parties  to  enter  into  it,  is 
good,  "that  wherever  a  sufficient  considera- 
tion appears  to  mike  it  a  proper  and  an  use- 
ful contract,  and  such  as  cannot  be  set  aside 
without  injury  to  a  fair  contractor,  it  ought 
to  be  maintained;  but  with  this  constant  di- 


ver-^ity,  viz.,  where  the  restraint  is  general 
not  to  exercise  a  trade  throughout  the  king- 
dom, and  where  it  is  limited  to  a  particular 
place;  for  the  former  of  these  must  be  void, 
being  of  no  benefit  to  either  party,  and  only 
oppressive."  It  is  to  be  observed  tliat  tlie 
contract  in  this  case  was  limited  in  time  to 
five  years,  the  term  of  the  lease  of  a  bake- 
house, which  the  plaintiff  had  bought  of  the 
defendant,  and  also  limited  in  space  to  the 
parish  of  St.  Andrew's,  Holborn.  The  case, 
therefore,  did  not  call  for  decision  upon  a 
contract  running  throughout  the  kingdom. 
Nevertheless  it  has  since  been  commonly  as- 
sumed, as  the  settled  rule  of  law,  that  such 
a  restraint  is  contrary  to  public  policy,  and 
void.  The  principle  upon  which  this  rule  is 
put  is  that  the  public,  have  the  right  to  de- 
mand that  every  person  should  carry  on  his 
trade  freelj,  both  for  the  prevention  of  mon- 
opoTy'and  of  unprofitable  idleness.  Theargu- 
ni^nt  is.Tf  the  restraint  is  general  through- 
out the  realm,  the  public  interest  is  interfered 
with,  since  the  party  restrained  can  only  re- 
sort to  his  trade  for  a  livelihood  by  expatria- 
tion. I^it,  if  the  restraint  be  local  and  par- 
tial, the  party  and  the  public  may  still  have 
theLenelit  ot  his  services  in  his  own  land,  in 
some  other  place.  While  this  distinction  has" 
frequently  been  recognized,  the  cases  in 
which  it  has  had  the  sanction  of  a  decision 
have  been  few.  In  Rousillon  v.  Rousillon, 
14  Ch.  Div.  351,  Fry,  J.,  mentions  only  two, 
and  these,  he  says,  seem  to  have  been  de- 
cided upon  the  ground  of  unreasonableness, 
rather  than  upon  the  ground  of  universality. 
In  other  words,  the  universality  was  held  to 
be  unreasonable.  This  case,  following  Whit- 
aker  v.  Howe,  3  Beav.  383;  Jones  v.  Lees,  1 
Hurl.  &  N.  189;  and  Leather  Cloth  Co.  v. 
Lorsont,  L.  R.  9  Eq.  345, — expressly  holds 
that  there  is  no  absolute  rule  that  a  covenant 
in  restraint  of  trade  is  void,  if  it  is  unlimited 
in  regard  to  space. 

The  respondent  urges  that  Rousillon  v. 
Rousillon  has  been  overruled  by  the  recent 
case  of  Davies  v.  Davies,  36  Ch.  Div.  359; 
but  we  do  not  think  this  is  so.  While  Cot- 
ton, L.  J.,  showing  great  willingness,  if  not 
anxiety,  to  overrule  it,  based  his  opinion  upon 
the  ground  that  the  restriction  was  void,  be- 
cause unlimited  in  space,  Bowen,  L.  J.,  did 
not  put  his  decision  on  that  ground,  and 
Fry,  L.  J.,  adhered  to  his  opinion  in  Rousil- 
lon V.  Rousillon.  That  Davies  v.  Davies  was 
not  rieceived  in  England  as  overruling  the 
last-named  case,  see  note  to  this  case  in  Law 
Quarterly  Review,  vol.  4,  p.  240.  In  view 
of  these  cases,  we  do  not  think  it  is  now  the 
rule  in  England  that  restraint  throughout 
the  kingdom  is  absolutely  void. 

In  this  country  the  cases  have  been  quite 
similar  to  those  in  England.  In  the  recent 
case  of  Match  Co.  v.  Itocber,  106  N.  Y.  473, 
13  N.  E.  Rep.  419,  Andrews,  J.,  says:  "It 
is  worthy  of  notice  that  most,  if  not  all,  the 
English  cases  which  assert  the  doctrine  that 
all  contracts  in  general  restraint  of  trade  are 
void,  were  cases  where  the  contract  before 


PUBLIC  POLICY— RESTRAINT  OF  TRADE 


459 


thft  foiirt  wiiH  liiniteJ  ur  PfiiLial.  Tlie  same 
is  generally  true  of  the  American  cases."  In 
tliat  case  tlie  defeiidanL  covenanted,  for  the 
period  of  99  ^ears,  not  to  engapfc  in  the  man- 
ufacture or  sale  of  friction  matchee,  wiihin 
any  of  the  slates  or  territories  of  the  United 
States,  except  Nevada  and  Montana.  Tlie 
com[)Ia;iiant  soui^ht  to  restrain  a  breach  of 
Wiat  covenant  in  New  York,  the  respondent 
clainiing  that  tlie  covenant,  being  general  as 
to  New  Yoik,  was  void.  But  the  court  de- 
clared it  to  be  valid,  in  a  strong  and  thorough 
opinion,  showing  tlie  history  of  litigation, 
and  the  tendency  of  recent  judicial  decisions 
upon  this  subject.  Taking  this  case  in  connec- 
tion witli  Navigation  Co.  v.Winsor,  20  Wall. 
64,  we  think  it  cannot  be  said  here,  any  more 
than  in  England,  tiiat  a  restraint  is  absolutely 
void,  upon  grounds  of  public  policy,  because 
it  extends  througliout  a  state.  Public  policy 
is  a  variable  test.  In  the  days  of  the  early 
Englisii  cases,  one  who  could  not  work  at  his 
trade  could  hardly  work  at  all.  The  avenues 
to  occupation  were  not  as  open  nor  as  nu- 
merous as  now,  and  one  rarely  got  out  of  the 
path  he  started  in.  Contracting  not  to  follow 
one's  trade  was  about  the  same  as  contract- 
ing to  be  idle,  or  to  go  abroad  for  employ- 
ment. But  this  is  not  so  now.  It  is  an 
every-day  occurrence  to  see  men  busy  and 
prosperous  in  other  pursuits  than  those  to 
which  they  were  trained  in  youth,  as  well  as 
to  see  them  change  places  and  occupations 
without  depriving  themselves  of  the  means 
of  livelihood,  or  the  state  of  the  benelit  of 
tlieir  industry.  It  would  therefore  be  absurd, 
in  the  light  of  this  common  experience  now, 
to  say  that  a  man  shuts  himself  up  to  idle- 
ness or  to  expatriation,  and  thus  injures  the 
public,  when  he  agrees,  for  a  sufficient  con- 
sideration, not  to  follow  some  one  calling 
within  the  limits  of  a  particular  state.  There 
is  no  expatriation  in  moving  from  one  state 
to  another,  and  from  such  removals  a  state 
would  be  likely  to  gain  as  many  as  it  would 
lose.  We_jlQ__not  think  public  poUcy-de- 
mands  aJTagreement"  of  the  kind  in  question 
to  be  declared  voicT,'  aTT^'we  do  not  think  such 
a  rule  is  eslabllslicd  upon  authority.  Wo 
therefore  hold  that  the  agreement  set  out  in 
the  bill  is  not  void  simply  because  it  runs 
throughout  the  state. 

Is  the  contract  unreasonable?  Courts 
should  be  slow  to  set  aside  as  unreasonable  a 
restriction  which  has  formed  a  part  of  the 
consideration  of  a  contract;  yet,  when  it  is  a 
restriction  upon  individual  and  common 
rights,  \\:iu&ti^auiy_ ojipresses  one  party  >vjtli- 
out  lii-noilting  the  other,  all  courts  agree  that 
it  sliould  nut  be  enforced.  In  determining 
the  rcasoiKibleuess  of  a  contract,  regard  must 
be  hail  to  the  uature_aud_citcumstance3  of 
the  transaction.  For  example,  if  one  has 
soKTllie  good-will  of  a  mercantile  enterprise, 
receiving  pay  for  it,  upon  an  agreement  not 
to  engage  in  the  same  business  in  the  same 
state,  for  a  certain  time,  such  a  stipulation 
would  stand  upon  quite  a  different  footing 
from  the  similar  stipulation  of  a  mere  servant 


in  ;jn  ordinary  local  business..  In  many  un- 
dertakings, with  modern  methods  of  adver- 
tising and  facilities  for  ordering  by  t  legraph 
or  mail,  and  sending  goods  i^y  railroad  or  ex- 
press, it  would  matter  little  whether  one  was 
located  at  Providence  or  Boston  or  some  other 
place.  In  such  cases  a  restriction  embracing 
the  state,  or  even  a  larger  territory,  coiiM 
not  be  said  on  that  a-count  to  be  unreason- 
aide;  for  without  it  the  seller  might  imme- 
diately destroy  the  value  of  wliat  he  sold  and 
was  paid  for.  But  it  is  unreasonable  to  ask 
courts  to  enforcelTgreater  restriction  than  Is 
needed!  So  Tt  lias  been  uniformly  held  that 
restrictions  which  go  too  far  are  void.  As 
was  said  in  tlie  note  of  the  Law  Quarterly 
Review,  above  cited:  "Covenantees  desiring 
the  maximum  of  jirotection  have,  no  doubt, 
a  diflicult  task.  When  they  fail,  it  is  com- 
monly because,  like  the  dog  in  the  fable,  they 
grasp  at  too  much,  and  so  lose  all." 

Besides  the  matter  of  protection,  the  hard- 
ship of  the  restriction _upon_tlie_paxl#_iiiiiLLliR 
public  should  also  be  considered.  In  the 
present  case,  we  think  the  restriction  is  un- 
reasonable. Not  as  a  rule  of  law  because  it 
extends  throughout  the  state,  but  because  it 
extends  beyond  any  apparently  necessary 
jjrotection  which  the  complainant  migljt  r^-. 
sonably  require,  and  thus,  without  benefiting^ 
liiin,  it  oppresses  the  respondent,  and  de- 
prives people  in  other  places  oFtlie  chance 
which  miglit  be  offered  them  to  learn  the 
French  and  German  languages  of  the  respond- 
ent. The  complainant  urges  that  he  has 
established  a  school  in  Providence,  at  great 
expense,  to  teach  languages  by  a  new  method, 
where  scholars  come  from  all  parts  of  the 
state,  and  that  by  reason  of  the  small  extent 
of  the  state,  and  the  ease  of  passing  to  and 
fro  within  it,  such  a  restriction  is  reasonable 
and  necessary  to  keep  teachers  from  setting 
up  similar  schools,  and  enticing  away  his 
scholars.  All  this  may  be  true  with  refer- 
ence to  Providence  and  its  vicinity.  But 
while,  as  is  averred,  many  pupils  from  all 
parts  of  the  state  may  come  to  Providence,  as 
a  center,  for  the  same  reason  few  would  goto 
other  places.  For  exam[)le,  a  school  in  West- 
erly or  Newport  would  not  be  likely  to  draw 
scholars  from  Providence,  or  places  from 
which  Providence  is  more  easily  reached.  In- 
deed, the  complainant  says  he  otTered.  after  the 
contract  was  made,  and  now  olTers,  to  allow 
the  respondent  to  teach  in  Newport;  thereby 
admitting  that  the  restriction  is  greater  than 
the  necessity.  The  people  of  Newport,  Wes- 
terly, and  other  places  have  the  right  to  pro- 
vide for  education  in  languages  without 
coming  to  Prt)viilence.  It  is  hard  to  believe, 
and  the  bill  does  not  aver,  that  losing  the  tew, 
if  any,  from  some  such  place  who  might  leave 
the  complainant,  if  the  respondent  were  to 
teach  there,  would  seriously  atTect  the  com- 
plainant's school.  Teaching  in  Providence, 
or  in  any  place  from  which  the  complainant 
receives  a  considerable  number  of  pupils, 
might  affect  it.  and  a  re-striction  limited  ac- 
cordingly might  be  reasonable;  but  we  think 


461 


ILLEGALITY  OF  OBJECT. 


it  is  unreasonable  to  go  further.  The  com- 
plainant bought  nothing  of  the  respondent 
whose  value  he  now  seeks  to  destroy.  He 
liired  the  latter  as  a  teacher  at  no  more  than 
fair  wages.     He  needs  and  has  the  right  only 


to  be  secured  against  injury  to  his  school, 
from  teachers  who  may  entice  away  Ids 
scholars,  after  leaving  his  employ.  The  con- 
tract clearly  goes  beyond  this.  The  demur- 
rer must  be  sustained. 


PUBLIC  rOLICY— RESTRAINT  OF  TRADE. 


461 


DIAMOND  MATCH  CO.  ▼.  ROEBEH.1 

4j?  ^<  (13  N.  E.  419,  106  N.  Y.  473.)    ^^^ 

^  >,  ^jDourt  of  Appeals  of  New  York.      October  4, 
^/-Tj  1887. 

^     L< 

/'^''Kobt.  Sowoll,  for  appellant     Noah  Davis, 

for  respondent. 

ANDREWS,  J.  Two  questions  are  pre- 
sented—First, whether  the  covenaut  of  the 
defendant  contained  in  the  bill  of  sale  exe- 
cuted by  him  to  the  Swift  &  Courtney  & 
Beecher  Company  on  the  twenty-seventh  day 
of  August,  1880,  that  lie  shall  and  will  not  at 
any  time  or  times  within  D'J  years,  directly 
or  indirectly  engage  in  the  manufacture  or 
sale  of  friction  matches  (excepting  in  the  ca- 
pacity of  agent  or  employe  of  the  said  Swift 
&  Courtney  «&  Beecher  (Company)  within  any 
of  the  several  states  of  the  United  States  of 
America,  or  In  the  territories  thereof,  or 
within  the  District  of  Columbia,  excepting 
and  reserving,  however,  the  right  to  manu- 
facture  and  sell  friction  matches  in  the  state 
of  Nevada,  and  in  the  territoi-y  of  ^I  on  tana, 
is-  void  as  being  a  covenant  in  i:e&tralnt~bf 
trade;  and,  second,  as  to  the  right  of  the 
|)laintig.  under  the  special  circumstances,  to 
tlie  efjnital;)le  remedy  bv  injunction  to^  en- 
force  the  pejfo''"^""'^'^  pf  tho  covenant. 

There  is  no  real  controversy  as  to  the  es- 
sential facts,  llie  consideration  of  the  cove- 
nant was  the  purchase  by  the  Swift  «&  Court- 
ney &  Beecher  Company,  a  Connecticut  cor- 
poration, of  the  manufactory  No.  528  West 
Fiftieth  street,  in  the  city  of  New  Yorli,  be- 
longing to  the  defendant,  in  which  he  had, 
for  several  years  prior  to  entering  into  the 
covenant,  carried  on  the  business  of  manu- 
facturing friction  matches,  and  of  the  stock 
and  materials  on  hand,  together  with  the 
trade,  trade-marks,  and  good-will  of  the  busi- 
.  uess,  for  the  aggregate  stun  (excluding  a 
mortgage  of  $5,000  on  the  property  assumed 
by  the  company)  of  $46,724.05,  of  which  $13,- 
000  was  the  price  of  the  real  estate.  By  the 
preliminary  agreement  of  July  27,  1880,  $28,- 
000  of  the  purchase  price  was  to  be  paid  in 
the  stock  of  the  Swnft  &  Courtney  &  Beecher 
Company.  This  was  modified  when  the  prop- 
erty was  transferred,  August  27,  1880,  by  giv- 
ing to  the  defendant  the  option  to  receive  the 
$28,000  in  the  notes  of  the  company  or  in  its 
stock,  the  option  to  be  exercised  on  or  before 
January  1,  18S1.  The  remainder  of  the  pur- 
chase price,  $18,724.05,  was  paid  down  In 
cash,  and  subsequently,  March  1,  ISSl,  the 
defendant  accepted  from  the  plaintiff,  the 
Diamond  Match  Company,  in  full  payment  of 
the  $28,000,  the  sum  of  $8,000  In  cash  and 
notes,  and  $20,000  in  the  stock  of  the  plain- 
tiff; the  plaintiff  company  having  prior  to 
said  payment  purchased  the  property  of  the 
Swift  &  Courtney  &  Beecher  Company,  and 
become  the  assignee  of  the  defendant's  cove- 

»  Irrelevant  parts  omitted. 


nant.  It  is  admitted  by  the  pleadings  that  In 
August,  1880,  (when  the  covenant  In  question 
was  made,)  the  Swift  &  Courtney  &  Beecher 
Company'  carried  on  the  business  of  manu 
facturiug  friction  matches  in  the  states  of 
(Donnecticut  Delaware,  and  Illinois,  and  of 
selling  the  matches  which  it  manufactured 
"in  the  several  stales  and  territories  of  the 
United  States,  and  in  the  District  of  Colum- 
bia;" and  the  complaint  alleges  and  the  de- 
fendant in  his  answer  admits  that  he  was  at 
the  same  time  also  engaged  In  the  manufac- 
ture of  friction  matches  in  the  city  of  New 
York,  and  in  selling  tliem  in  the  same  terri- 
tory. Tlie  proof  tends  to  support  the  admis- 
sion In  the  pleadings.  It  was  shown  that 
the  defendant  employed  traveling  salesmen, 
and  that  his  matches  were  found  in  the 
hands  of  dealers  In  10  states.  The  Swift  & 
Courtney  &  Beecher  Company  also  sent  their 
matches  throu£hout_jLke_  country  wherever 
they  could  find  a  market.  When  the  bargain 
was  consummated,  on  tlie  twenty-seventh  of 
August,  1880,  the  defendant  entered  into  the 
employment  of  the  Swift  &  Courtney  & 
Beecher  Company,  and  remained  in  its  em- 
ployment until  January,  1881,  at  a  salary  of 
$1,500  a  year.  He  then  entered  into  the  em- 
ployment of  the  plaintiff,  and  remained  with 
it  during  the  year  1881,  at  a  salary  of  $2..jOO 
a  year,  and  from  January  1,  1882,  at  a  sal- 
ary of  $3,(}00  a  year,  when,  a  disagreement 
arising  as  to  the  salary  he  should  thereafter 
receive,  the  plaintiff  declining  to  pay  a  sal- 
ary of  more  than  $2,500  a  year,  the  defend- 
ant voluntarily  left  its  service.  Subsequent- 
ly he  became  superintendent  of  a  rival 
match  manufacturing  company  In  New  Jer- 
sey, at  a  salary  of  $5,(X)0,  and  he  also  opened 
a  store  in  New  York  for  the  sale  of  matches 
other  than  those  manufactured  by  the  plain- 
tiff. --^ 

The  contention  by  the  defendant  that  the 
plaintiff  has  no  equitable  remedy  to  enforce 
the  covenant,  rests  mainly  on  the  fact  that 
contemporaneously  with  the  executios  of  the 
covenant  of  August  27,  18S0,  the  defendant 
also  executed  to  the  Swift  &  Courtney  & 
Beecher  Company  a  bond  In  the  penalty  of 
$15,000,  conditioned  to  pay  that  sum  to  the 
company  as  liquidated  damages  in  ca.se  of  a 
breach  of  his  covenant. 

The  defendant  for  his  main  defense  relies 
upon  the  ancient  doctrine  of  the  common  law, 
first  definitely  declared,  so  far  as  I  can  dis- 
cover, by  Chief  Justice  Parker  (Lord  Mac- 
clesfield) in  the  leading  case  of  Mitchel  v. 
Reynolds,  1  P.  Wms.  ISl,  and  which  has  been 
repeated  many  times  by  judges  In  England 
and  America,  that  a  bond  in  general  restraint 
of  trade  is  void.  There  are  several  decisions 
In  the  English  courts  of  an  earlier  date,  in 
which  the  question  of  the  validity  of  con- 
tracts restraining  the  obligor  from  pursuing 
his  occupation  within  a  particular  locality  was 
considered.  The  cases  are  chronologically  ar- 
ranged and  stated  by  Mr.  Parsons  in  his  work 
on  Contracts  (volume  2,  p.  748,  note.)    The  ear- 


462 


ILLEGALITY  OF  OBJECT. 


liest  reported  case,  decided  in  tlie  time  of 
Henry  Y.,  was  a  suit  on  a  bond  given  by  the 
defendant,  a  dyer,  not  to  use  bis  craft  within 
a  certain  city  for  the  space  of  half  a  year.  The 
judge  before  whom  the  case  came  indignantly 
denounced  the  plaintiff  for  procuring  such  a 
contract,  and  tm-ned  him  out  of  court.  This 
was  followed  by  cases  arising  on  contracts 
of  a  similar  character,  restraining  the  obli- 
gors from  pursuing  their  trade  within  a  cer- 
tain place  for  a  certain  time,  which  appar- 
ently presented  the  same  question  which  had 
been  decided  in  the  dyer's  case,  but  the 
courts  sustained  the  contracts,  and  gave 
judgment  for  the  plaintiffs;  and  before  the 
case  of  Mitchel  v.  ReyBolds  it  had  become 
settled  that  an  obligation  of  this  character, 
limited  as  to  time  and  space,  if  reasonable 
under  the  circumstance,  and  supported  by  a 
good  consideration,  was  valid.  The  case  in 
the  Year  Books  went  against  aU  contracts  in 
restraint  of  trade,  whether  limited  or  gen- 
eral. The  other  cases  prior  to  Mitchel  v. 
Reynolds  sustained  contracts  for  a  particular 
restraint,  ujpon  special  grounds,  and  by  in- 
ference decided  against  the  validity  of  gen- 
eral restraints.  The  case  of  Mitchel  v. 
Reynolds  was  a  case  of  partial  restraint,  and 
the  contract  was  sustained.  It  is  worthy  cf 
notice  that  most,  if  not  all,  the  English  cases 
which  assert  the  doctrine  that  all  contracts 
in  general  restraint  of  trade  are  void,  were 
cases  where  the  contract  before  the  court 
was  limi'Eed'  or  paftlaT  The  same  is  general- 
ly^tni^or'nierSmeflcan  cases.  The  principal 
cases  in  this  state  are  of  that  character,  and 
in  all  of  them  the  particular  contract  before 
the  court  was  sustained.  Nobles  v.  Bates,  7 
Cow.  307;  Chappel  v.  Brockway,  21  Wend. 
157;  Dunlop  v.  Gregory,  10  N.  Y.  241.  In 
Alger  V.  Thacher,  19  Pick.  51,  the  case  was 
one  of  general  restraint,  and  the  court,  con- 
struing the  rule  as  inflexible  that  all  con- 
tracts in  general  restraint  of  trade  are  void, 
gave  judgment  for  the  defendant.  In  Mit- 
chel V.  Reynolds  the  court,  in  assigning  the 
reason  for  the  distinction  between  a  contract 
for  the  general  restraint  of  trade  and  one 
limited  to  a  particular  place,  says:  "for  the 
former  of  these  must  be  void,  being  of  no 
benefit  to  either  partj%  and  only  oppressive;" 
and  later  on,  "because  in  a  great  many  in- 
stances they  can  be  of  no  use  to  the  obligee, 
which  holds  in  all  cases  of  general  restraint 
throughout  England;  for  what  does  it  signify 
to  a  tradesman  in  London  what  another  does 
in  Newcastle,  and  surely  it  would  be  unrea- 
sonable to  fix  a  certain  loss  on  one  side 
without  any  benefit  to  the  other."  He  refers 
to  other  reasons,  viz.,  the  mischief  which 
may  arise  (1)  to  the  party  by  the  loss  by  the 
obligor  of  his  livelihood  and  the  substance 
of  his  family,  and  (2)  to  the  public  by  de- 
priving it  of  a  useful  member,  and  by  en- 
abling corporations  to  gain  control  of  the 
trade  of  the  kingdom.  It  is  quite  obvious 
that  some  of  these  reasons  are  much  less 
forcible  now  than  when  Mitchel  v.  Reynolds 


was  decided.  Steam  and  electricity  have  for 
the  purposes  of  trade  and  commerce  almost 
aniiihilated  distance,  and  the  whole  world  is 
now  a  mart  for  the  distribution  of  the  prod- 
ucts of  industry.  The  great  diffusion  of 
wealth,  and  the  restless  activity  of  mankind 
striving  to  better  their  condition,  have  great- 
ly enlarged  the  field  of  human  enterprise,  and 
created  a  vast  number  of  new  industries, 
which  gives  scope  to  ingenuity  and  employ- 
ment for  capital  and  labor.  The  laws  no 
longer  favor  the  granting  of  exclusive  priv- 
ileges, and  to  a  great  extent  business  corpo- 
rations are  practically  partnerships,  and  may 
be  organized  by  any  persons  who  desire  to 
unite  their  capital  or  skill  in  business,  leav- 
ing a  free  field  to  all  others  who  desire  for 
the  same  or  similar  purposes  to  clothe  them- 
selves with  a  corporate  character.  The  ten- 
dency of  recent  adjudications  is  marked  in 
the  direction  of  relaxing  the  rigor  of  the  doc- 
trine that  all  contracts  in  general  restraint 
of  trade  are  void,  irrespective  of  special  cir- 
cumstances. Indeed,  it  has  of  late  been  de- 
nied that  a  hard  and  fast  rule  of  that  kind 
has  ever  been  the  law  of  England.  Rousil- 
lon  V.  Rousillon,  14  Ch.  Div.  351.  The  law 
has  for  centuries  permitted  contracts  in  par- 
tial restraint  of  trade,  when  reasonable;  and 
in  Horner  v.  Graves,  7  Bing.  735,  Chief  Jus- 
tice Tindal  considered  a  true  test  to  be 
"whether  the  restraint  is  such  only  as  to 
afford  a  fair  protection  to  the  interests  of  the 
party  in  favor  of  whom  it  is  given,  and  not 
so  large  as  to  interfere  with  the  interests  of 
the  public."  When  the  restraint  is  general, 
but  at  the  same  time  is  co-extensive  only  j 
I  with  the  interest  to  be  protected,  and  with 
1  the  benefit  meant  to  be  conferred,  there 
\ seems  to  be  no  good  reason  why,  as  betweei* 
|the  parties,  the  contract  is  not  as  reasonable  1 
jas  when  the  mterest  is  partial,  and  there  is  ^ 
la  corresponding  partial  restraint.  And  is 
there  any  real  public  interest  which  neces- 
sarily condemns  the  one,  and  not  the  other? 
It  is  an  encouragement  to  industry  and  to 
enterprise  in  building  up  a  trade,  that  a  man 
shall  be  allowed  to  sell  the  good-will  of  the 
business  and  the  fruits  of  his  industry  up- 
on the  best  terms  he  can  obtain.  If  his  busi- 
ness extends  over  a  continent,  does  public 
policy  forbid  his  accompanying  the  sale  with 
a  stipulation  for  restraint  co-extensive  with 
the  business  which  he  sells?  If  such  a  con- 
tract  is  permitted,  is  the  seller  any  more 
likely  to  become  a  burden  on  the  public  than 
a  man  who,  having  built  up  a  local  trade 
only  sells  it,  binding  himself  not  to  can-y  it 
on  in  the  locality?  Are  the  opportunities  for 
employment  and  for  the  exercise  of  useful 
talents  so  shut  up  and  hemmed  in  that  the 
public  is  likely  to  lose  a  useful  member  of 
society  in  the  one  case,  and  not  in  the  other? 
Indeed,  what  public  policy  requires  is  often 
a  vague  and  ditticult  inquiry.  It  is  clear  that 
public  policy  and  the  interests  of  society 
favor  the  utmost  freedom  of  contract,  with- 
in the  law,  and  require  that  business  trans- 


PUBLIC  POLICY— RESTRAINT  OF  TRADE. 


463 


actions  should  not  be  trammeled  by  unnec- 
essaiy  restrictions.  "If,"  said  Sir  George 
Jessell  in  Prinliug  Co.  v.  Sampson,  L.  K.  19 
Eq.  402,  "thero  Is  one  thin;?  more  than  any 
other  which  public  policy  requires,  it  is  that 
men  of  full  age  and  competent  understand- 
ing shall  have  the  utmust  liberty  of  con- 
tracting, and  that  contracts,  when  entered  in- 
to freely  and  ^oluntarily,  shall  be  held  good, 
and  shall  be  enforced  by  courts  of  justice." 

It  has  sometimes  been  suggested  that  the 
doctrine  that  contracts  In  general  restraint 
of  trade  are  void,  is  founded  Ln  part  upon  the 
policy  of  preventing  monopolies,  which  are  op- 
posed to  the  liberty  of  the  subject,  and  the 
granting  of  which  by  the  king  under  claim  of 
roj'al  prerogative  led  to  conflicts  memorable 
in  English  history.  But  covenants  of  the 
cliaracter  of  the  one  now  In  question  operate 
simply  to  provont  tho  pnvcnnntor  from  en- 
,L;:iL;iii.L,'  in  the  liiisiiuss  which  lie  soils,.  SO  as 
to^pruliH't  IIk'  iiiircti.'isir  in  the  enjoyment  of 
what  lio  h;is  iHiivii.i-,  ,1.  To  the  extent  that 
the  contruct  piwunts  the  vendor  from  carry- 
ing on  the  particular  trade,  it  deprives  the 
community  of  any  benefit  it  might  derive 
from  his  entering  into  competition.  But  the 
business  is  open  to  all  others,  and  there  is 
little  danger  that  the  public  will  suffer  harm 
from  lack  of  persons  to  engage  in  a  profitable 
industry.  Such  contracts  do  not  create  mo- 
nopolies.  Tixe^-  coufer  no  special  or  exclu- 
sive  privilege.  If  contracts  in  general  restraint 
of  trade,  where  the  trade  is  general,  are  void 
as  tending  to  monopolies,  contracts  In  partial 
restraint,  where  the  trade  is  local,  are  sub-^ 
ject  to  the  same  objection,  because  they  de- 
prive the  local  community  of  the  services  of 
the  covenantor  in  the  particular  trade  or  call- 
ing, and  prevent  his  becoming  a  competitor 
with  the  covenantee.  We  are  not  aware  of 
any  rule  of  law  which  makes  the  motive  of 
the  covenantee  the  test  of  the  validity  of  such 
a  contract.  On  the  contrarj',  we  suppose  a 
party  may  legally  purchase  the  trade  and  busi- 
ness of  another  for  the  very  purpose  of  pre- 
venting competition,  and  the  validity  of  the 
contract,  if  supported  by  a  consideration,  will 
depend  upon  its  reasonableness  as  between 
the  parties.  Combinations  between  producers 
to  limit  production,  and  to  enhance  prices, 
are  or  may  be  unlawful,  but  they  stand  on  a 
different  footing. 

We  cite  some  of  the  cases  showing  the  ten- 
dency of  recent  judicial  opinion  on  the  gener- 
al subject:  Whittaker  v.  Howe,  3  Beav.  3S3; 
Jones  v.  Lees,  1  Hurl.  &  N.  ISO;  Rousillon  v. 
Rousillon,  supra;  Leather  Co.  v.  Lorsont,  L. 
R.  9  Eq.  345;  Collins  v.  Locke,  4  App.  Cas. 
G74;  Steam  Go.  v.  Winsor,  20  Wall.  04; 
Morse,  etc.,  Co.  v.  Morse.  103  Mass.  73.  In 
Whittaker  v.  Howe,  a  contract  made  by  a 
solicitor  not  to  practice  as  a  solicitor  "in  any 
part  of  Great  Britain,"  was  held  valid.  In 
Rousillon  V.  Rousillon  a  genenil  contract  not 
to  engage  in  the  sale  of  champagne,  without 
limit  as  to  space,  was  enforced  as  being  under 
tlie  circumstances  a  reasonable  contract     In 


Jones  V.  Lees,  a  covenant  by  the  defendant, 
a  licensee  under  a  patent,  that  he  would  not 
during  the  license  make  or  sell  any  slubbing 
machines  without  the  Invention  of  the  plain- 
tiff applied  to  them,  was  held  valid.  Bram- 
well,  J.,  said:  "It  is  objected  that  the  re- 
straint extends  to  all  England,  but  so  does 
the  privilege."  In  Steam  Co.  v.  Win.sor  the 
court  enforced  a  covenant  by  the  defendant 
made  on  the  purchase  of  a  steam-ship,  that 
it  should  not  be  run  or  employed  in  the  freight 
or  pas.seuger  business  upon  any  waters  in  the 
state  of  California  for  the  period  of  10  years. 
In  the  prescLt  state  of  the  authorities,  we 
think  it  cannot  be  .said  that  the  early  doctrine 
that  contracts  in  general  restraint  of  trade  are 
void,  without  regard  to  circumstances,  has 
been  abrogated.  But  It  Is  manifest  that  it 
has  been  much  weakened,  and  that  the  foun- 
dation upon  which  it  was  originally  placed 
has,  to  a  considerable  extent  at  l&ast,  by 
the  change  of  circumstances,  been  removed. 
The  covenant  In  the  present_case  Is  paxtiai, 
antf^not  general.  It  is  practically  unlimit- 
ed as  to  time,  but  this  under  the  authorities 
is  not  an  objection,  if  the  contract  is  oth- 
erwise good.  Ward  v.  Byrne,  5  Mees.  &  W. 
548;  Mumford  v.  Gething,  7  C.  B.  «N.  S.)  317. 
It  Is  limited  as  to  space  since  it  excepts  the 
state  of  Nevada  and  the  territory  of  Montanii 
from  its  operation,  and  therefore  is  a  partial, 
and  not  a  general,  restraint,  unless,  as  claim- 
ed by  the  defendant,  the  fact  that  the  cove- 
nant applies  to  the  whole  of  the  state  of  New 
York  constitutes  a  general  restraint  within 
the  authorities.  In  Chappel  v.  Brockway,  su- 
pra, Bronson,  J.,  in  stating  the  general  doc- 
trine as  to  contracts  in  restraint  of  trade,  re- 
marked that  "contracts  which  go  to  the  total 
restraint  of  trade,  as  that  a  man  wiU  not  pur- 
sue his  occupation  anywhere  in  the  state,  are 
void."  The  contract  under  consideration  in 
that  case  was  one  by  which  the  defendant 
agreed  not  to  run  or  be  interested  in  a  line 
of  packet-boats  on  the  canal  between  Roches- 
ter and  Buffalo.  The  attention  of  the  court 
was  not  called  to  the  pomt  whether  a  contract 
was  partial,  which  related  to  a  business  ex- 
tending over  the  whole  country,  and  which  re- 
strained the  carrying  on  of  business  Ln  the 
state  of  New  Yorlc.  but  excepted  other  states 
from  its  operation.  The  remark  rdied  upon 
was  obiter,  and  in  reason  cannot  be  consid- 
ered a  decision  upon  the  point  suggested. 
We  are  of  the  opinion  that  the  contention  of 
the  defendant  is  not  sound  in  principle,  and 
should  not  be  sustained.  The  boundaries  of 
the  states  are  not  those  of  trade  and  com- 
merce, and  business  is  restrained  within  no 
such  limit.  The  country  as  a  whole  is  that 
of  which  we  are  citizens,  and  our  duty  and 
allegiance  are  due  both  to  the  state  and  na- 
tion. Nor  is  it  true  as  a  general  rule  that  a 
business  e.'^tablished  here  cannot  extend  be- 
yond the  state,  or  that  it  may  not  be  succes.s- 
fully  established  outside  of  the  state.  There 
are  trades  and  employments  which  from  their 
nature  are  localized,  but  this  Is  not  true  of 


464 


ILLEGALITY  OF  OBJECT. 


manufaclTiring  industries  in  general.  We  are 
unwilling  to  say  tliat  the  doctrine  as  to  what 
is  a  general  restraint  of  trade  depends  upon 
state  lines,  and  we  cannot  say  that  the  ex- 
ception of  Nevada  and  Montana  was  colorable 
merely.  The  rule  itself  is  arbitrary,  and  we 
are  not  disposed  to  put  such  construction  up- 
on this  contract  as  will  make  it  a  contract  in 
general  restraint  of  trade,  when  upon  its  fact 
it  is  only  partial.  The  case  of  Steam  Co.  v. 
"Winsor,  supra,  supports  the  view  that  a  re- 
straint is  not  necessarily  general  which  em- 
braces an  entire  state.  In  this  case  the  de- 
fendant entered  Into  the  covenant  as  a  con- 


sideration in  part  of  the  purchase  of  his  prop- 
ertj-  by  the  Swift  «&  Courtney  &  Beecher  Com- 
pany, presumably  because  he  considered  it  for 
his  advantage  to  make  the  sale.  He  realized 
a  large  sum  in  money,  and  on  the  completion 
of  the  transaction  became  interested  as  a 
stocliholder  in  the  very  business  which  he  had 
sold.  We  are  of  opinion  that  the  covenant, 
.being  supported  by  a  good  considev.itiun,  and 
\constituting  a  partial  and  not  a  geueral  i-e- 
ktraint.  and  being,  in  view  of  the  circumstan- 
Ices  disclosed,  reasonable,  la  valid  and  not 
void. 

•         •••«•• 


PUBLIC  POLICY— RESTRAINT  OF  TRADE 

Ik 

CARLL  Y.  SNYDER  et  aL       A^ 


465 


^  t'^^  (-0  Atl   977.) 

Court   of   Chancery  of   New   Jeracf.     July   13, 
1893. 

Suit  by  Charles  W.  Carll  against  John  F. 
Snyder  and  others  for  injunction. 

Barton  &  Dawes,  for  complainant.  Wil- 
liam 'SI.  Lanniujj,  for  defendants. 

BIRD,  V.  C.  On  the  filing  of  this  bill,  an 
order  was  advised,  directing  the  defendants 
to  show  cause  why  an  injunction  should  not 
be  granted  restraining  them  from  engaging 
in  and  carrying  on,  within  the  limits  of  the 
city  of  Trenton,  a  certain  business  called 
the  "galvanized  iron  cornice,  tin,  and  sheet- 
iron  business."  This  application  rests  upon 
an  agreement,  in  writing,  entered  into  be- 
tween the  complainant  and  the  defendants, 
in  the  month  of  January,  1S92,  in  and  by 
which,  for  the  consideration  of  $6^275.  paid 
to  them^by  tlTe  complainant,  the  defendants 
agreed  to  sell  to  him  all  their  interest  in  the 
business  in  which  the  complainant  and  the 
defendants  were  then  engaged  as  partners. 
They  also  agreed  not  to  engage  in  or  carry 
o'n  sugE^usiness  witnin  the  liinits_^f  jaid 
cTEy!  Such  business  included  ~th e~said  gal- 
vafiized  iron  cornice,  tin,  and  sheet-iron  busi- 
ness. The  granting  of  the  injunction  is  re- 
sisted by  the  defendants  upon  two  grounds: 
First,  because  the  proofs  contained  in  the 
affidavit  annexedto  the  bill  are_sufficient; 
and,  second. ~that  thenrestral^t  exprcsied^in 
the  stipulation  is  unlawful,  becaifse  unrea- 
sonabfeT'siffgejtjrs'ihaefl'nlte'  as  to  ti,me._^ 

I  am  salisfiod  thaf  tlie'proof  is  sufficiently 
clear  and  definite  to  justify  the  court  in 
awarding  a  perpetual  injunction  upon  final 
hearing,  in  case  It  should  stand,  as  it  now 
does,  unimpeached.  I  am  equally  well  satis- 
fied that  the  insistmcMit  that  the  restraint  is. 
indefinite  as  to  time,  and  therefore  unrea- 
sonable, ought  not  to  prevail.  I  think  a  care- 
ful study  of  the  case  of  Mitchel  v.  Reynolds, 
reported  in  1  Smith.  Load.  Cas.  (9th  Ed.)  GO-i 
et  seq.,  with  the  various  annotations  both 
by  the  English  and  American  editors,  will 
satisfy  the  mind  as  to  the  principle  upon 
which  contracts  of  this  nature,  not  only  may 
well  be,  but  really  ought  to  be,  supported, 
when  indefinite  as  to  time.  ..^he  purchaser 
of  such  good  wjH  may  fairly  be"supiJO!Jt'd  to 
nm;chaser"nQt  o'niY  ^»^  ^'^  "^"  "immediate 
use  or  benefit,  but  for  the  iia^  of  his  r^(i^rsonaI 
represents  ti VPS.  In  the  same  sense  that  he 
purchases  personal  property  or  real  estate. 
I  can  see  no  just  reason  for  his  not  being 
able  in  the  law  to  make  such  an  investment 
which  shall  pass  to  his  assigns,  executors,  or 
administrators.  It  cannot  be  said,  when  it 
is  limited  to  a  particular  district,  that  this 
in  any  manner  interferes  with  sound  public 
policy.  It  would  not  be  a  violation  of  the 
rule  which  required  such  contracts  to  be  in 
harmony  with  the  interests  of  the  conimunl- 

HOPK.  8BU  CAS.  CONT.  — 30 


ty  at  large  in  case  the  stipulation  were  to  be 
that  the  covenantee  should  not  carry  on  the 
trade  in  qutstion  for  20  or  DO  years;    and,  if 
not  for  t!  at  perioil  of  time,  then  certaijily  it 
would   not  be  If   the  covenant  extended  to 
a  lifetime.    With  this  in  mind,  when  the  ob- 
ject of  the  prohibition   put  upon  such  con- 
tracts, in  view  of  a  sound  public  policy,  is 
considered,    it    will    be    still    more   apparent 
that  this  contract  ought  to  be  upheld.    Sound 
public  policy  requires  that  every  individual 
shall   be   employed.    The  coninnmily    is   en- 
titled  to   his   honest   toil,    whether   manual, 
mechanical,  or  purely  intellectual.    This  be- 
ing so,  and  such  policy  upholding  contracts 
for  a  definite  period  of  time.  It  is  not  to  be 
presumed  that  the  covenantee,  in  Any  such 
case,  will  spend  the  time,  which  the  law  re- 
gards, (supposing  that  there  must  be  a  period 
limited  in  the  contract,)  In  idleness,  or  in  in- 
difference  to   the    demands    of   such   public 
policy,  waiting  the  time  when  the  period  fix- 
ed by  the  contract  shall  have  expired,  in  or- 
der that  he  may  engage  once   more  in   the 
employment  which  he  had  agreed  to  aban- 
don.   In   such    matters   the   public    welfare, 
which  the  law  regards,  is  an  essential  ele- 
ment of   consideration;    but   the   interest  of 
the  individual  in  his  own  welfare  is  infinitely 
more   efficacious   and    potential    in    securing 
the  public  good,  although  that  may  not  be 
in   his  mind.    He   who   has  energy  and   in- 
tegrity enough  to  establish  a  business  which 
is  worthy  of  the  name,  and  for  which  others 
will  bid  a  fair  price,   will  not  wait  for  the 
protection  of  the  paternal  hand  to  make  his 
footprints  in  other  quarters.    In  the  follow- 
ing eases  there  was  no  limit  as  to  time,  and 
it   will   be  observed   that   in  many  of   them 
resistance  was  made  to  their  enforcement  on 
this  account,  but  without  success:    Richard- 
son V.  Peacock,  26  N.  J.  Eq.  40,  2S  N.  J.  Eq. 
151,  and  33  N.  J.  Eq.  597;  Hitchcock  v.  Coker, 
G  Adol.   &  E.   439;    Hastings   v.  WhiUey.  2 
Exch.   Gil;    MaUan  v.  May,  11  Mees.  &  W. 
653;    Bowser  v.  Bliss,  7  Blackf.  344;   Pierce 
V.  Fuller,  8  ISIass.  223;    Palmer  v.  Stebbins, 
3  Pick.  18'^;    Match  Co.  v.  Roeber,  lOG  N.  Y. 
473,  13  N.  E.  419,  423. 

Counsel  for  defendants  urged  that  this  was 
not  a  case  for  a  preliminary  injunction,  since 
the  right  of  the  complainant  had  not  been 
established  at  law.  I  have  given  this  branch 
of  the  case  not  a  little  attention.  It  scorns 
to  me  that.  ij^a4)lain_brcac]j^nf  rnntrniit-wmi 
over  jnstifv_,iL-p]:i.^liminar>'  injunction,  this  is 
such.  The  rights  of  the  parties  are  thorough^ 
ly  well  defined  by  their  agreement  While 
they  might  be  more  securely  fixed  by  a  judg- 
ment at  law,  they  could  not  be  more  certain- 
ly defined,— more  securely  fixed  by  a  judg- 
ment at  law  because  that  is  final,  but  that 
could  only  rest  upon  the  undisputed  evidence 
upon  which  this  court  is  called  upon  to  pro- 
nounce its  judgment  preliminarily.  A  pre- 
liminary injunction  was  awardeil  In  the  case 
of   Richardson    v.    Peacock,    supra,   and,  al- 


466 


ILLEGALITY  OF  OBJECT. 


though  that  case  went  to  the  court  of  errors 
and  appeals,  the  action  of  this  court  in  that 
behalf    was    not   questioned.    33  N.  J.  Eq., 


supra;  Match  Co.  v.  Roeber,  supra.  I  think 
the  order  to  show  cavise  shoiild  be  made  ab- 
solute. 


PUBLIC  POLICY— RESTRAINT  OF  TRADE. 


467 


(Jh*^  TODE  ot  al.  V.  GKOSS.     3  / ^ 

(28  N.  E.  Ai\'.K  IL'T  X.  V.  -ISO.) 

CJourt   of   Appeals  of   New    York,   Second   Divi- 
sion.   Oct.  6,  1891. 

Appeal  by  dek'iidant  from  a  judgment 
of  tlie  K^neral  term  of  tlio  HUpivnie  lourt 
In  the  second  judicial  dejjartiiieut,  aflinii- 
ing  a  judgment  entered  ui)on  the  decisi(ju 
of  the  court  after  a  trial  without  a  jury. 
Allinned. 

Action  for  breach  of  covenant  to  recov- 
er the  sum  of  :jpr),000  aw  Ktipnlated  dani- 
agos.  On  the  15th  of  October,  1SN4,  the  de- 
fendant owned  a  clieetjo  factory  KJtiiate  in 
the  town  of  Monroe,  Orange  county,  com- 
prising two  parcels  of  land,  witli  the 
buildings  thereon,  and  a  quantity  of  fixt- 
ures, machinery,  and  tools  connected 
therewith.  I'or  some  time  prior,  with 
the  assistance  of  her  husltand,  Conrad 
Gross,  her  brother-in-law,  August  Gross, 
and  her  father.  John  Hoffman,  she  had 
been  engaged  in  the  business  of  manufnct- 
uring  cheeses  at  said  factory  l<nown  as 
"  Fromage  de  Brie,"  "Fromage  d'Isigny," 
and  "  Neulchatel. "  Such  clieeses  were 
ni;ide  by    h    sc(;rpt  process  known    only  to 

lu-rself  and  her  said  agents.  On  the  "day 
last  iiaihed,  she  entered  mto  a  sealed 
agreement  with  the  plaintiffs,  whereby' she 
agjceil  to_sell  and  tranwfer  to  tnem-THe 
eaid  f ;u' t  < »Vy  ;wid  all  its  belongings,  togeth- 
er  wiLh  llie  "good-will,  custom,  trade- 
marks, and  names  used  in  and  belonging 
to  the  said  business."  for  the  sum  of  .l?!'."),- 
000,  to  be  paid  and  secured  Maich  1,  l^s5, 
when  possession  was  to  be  given.  Said 
instrument  contained  a  covenant  on  her 
part  that  she  would  "communicate  after 
the  first  daj'  of  March.  1S,S5-,  or  cause  to  be 
communicated,  to"  said  plaintiffs,  "by 
Conrad  <7ross,  John  Hoffman,  and  August 
Gross,  or  one  or  other  of  them,  the  secret 
of  the  manufacture  of  the  cheeses  known 
as  'Fromage  de  Brie,' '  Neufchatel,'  and 
'D'Isigny,'  and  the  recipe  therefor,  and 
for  each  of  them,  and  will  instruct  or 
cause  to  be  instructed  them,  and  each  ot 
them,  in  the  manuiacture  thereof.  And 
that  she  and  the  said  Conrad  Gross,  John 
Hoffman,  and  August  Gross ,,ii:iU._Xii£raiii 
Irotn  communicating  the  secret  lecipe  and 
jms^tructidns  for  the  manufacture  of  said 
clu'cse.s,  or  either  of  tliem,  to  any  and  all 
persons  other  thnn  tlie  above-named  par- 
ti^^s  of  the  second  part,  [plaintiffs,]  and 
will  also,  after  the  first  day  of  April,  ISS."). 
refrain  from  engaging  in  the  l)usiness  of 
making,  manufacturing,  or  vending  of 
said  cheeses,  or  either  of  them,  and  ii'om 
the  use  of  the  trade-marks  or  names,  or  ei- 
ther of  them,  hereby  agreed  to  be  trans- 
ferred in  connection  with  said  cheeses,  or 
either  of  them,  or  with  anj- simihir  juod- 
uct,  under  the  penaltv  of  five  thousand 
dollars,  W'Tiich  is  liel'etTy  nanuMl  as  slipu- 
^7rted  damages  to  be  paid  by  the  party  of 
the  first  part,  [defendant,]  or  her  heirs, 
executors,  administrators,  or  assigns,  in 
case  of  a  violation  by  the  party  of  the 
first  part  [defendant]  of  this  covenant, 
of  this  contract,  or  any  part  thereof,  witli- 
in  five  years  from  the  date  hereof. "  She 
turther  covenanted  that  she  herself,  as 
well  as  "snid  Conrad  (-rross.  John  Hoff- 
man, and  August  Gross,  during  and  up  to 


and  until  the  tirst  day  (jf  M.iy,  lS^."i,  shall 
ct^ntinue  and  remain  in  said  county  of 
Orange,  and  from  time  to  time,  and  at  all 
reasfuialile  times  during  said  period,  liy 
hi-rself,  or  by  said  Conrad  (Jro.ss,  John 
Hoffman,  and  August  Gross,  whenever  so 
reijuesteil  by  the  said  j)artiesof  the  second 
part,  [plaintiffs,]  impart  to  them,  or  ei- 
ther of  them,  the  secret  of  making  sui.h 
cheeses,  and  each  of  them,  and  instruct 
them,  and  each  of  them,  iu  the  process  of 
manufacturing  the  same,  and  eacli  of 
them,  as  fully  as  she  ov  the  said  Conrad 
Grcjss,  John  Hoffman,  or  August  (iross, 
or  either  of  them,  are  informed  concern- 
ing the  same."  Both  parties  appear  to 
have  duly  kept  and  ix-rfcjrmed  the  agree- 
ment, except  that,  as  t  hetrial  court  fiiund, 
"subsequently  to  the  1st  day  of  .May,  l"**^."), 
Conrad  Gross,  the  husb;ind  of  defendant, 
went  to  New  York  city,  and  engag<'il  in 
the  business  of  selling  'f<jreign  and  domes- 
tic fruits,  and  all  kinds  (;f  cheese  and  saus- 
ages, &c.,'  *  •  »  and  while  so  engnued 
*  •  •  sold  and  personally  delivered 
from  his  place  of  business  to  one  John 
Wassung  three  boxes  of  cheese  marked 
and  named  '  Fromage  d'Isigny.'  and  hav- 
ing substantially  the  same  trade-marks 
thereon  as  that  sold  by  defendant  to 
plaintiffs,  and  having  stamped  tliereon 
the  name  'Fromage  d'Isigny,'  and  that 
said  cheese  so  sohi  by  him  to  said  Was- 
sung was  a  similar  product  to  that  for- 
merly manufactured  by  defendant."  .■Ms<j, 
that  "said  August  Gross,  the  brother-in- 
law  of  defendant,  sulisequent  to  the  1st 
day  of  May,  1SS5,  engaged  in  the  business 
of  retailing  fancy  groceries  in  the  city  of 
New  York,  and  in  and  during  the  fall  of 
1S87,  and  prior  to  the  commencement  of 
this  action,  kept  for  sale  at  his  place  of 
business  in  New  York  city  boxes  of  cheese 
marked  or  stamped  'Fromage  d'Isigny."" 
The  court  further  found  that  the  cheese 
so  sold  by  Conrad  Gross  under  the  name 
of  "Fromage  d'Isigny,"  "  was  never  st)ld  by 
l)laintiffs,  nor  made  or  manufactured  by 
them,  or  either  of  them,  but  that  t!ie 
same  was  a  similar  product.  "  Thecourt 
found  as  conclusions  of  law  that  said 
agreement  was  a  reasonable  one.  and 
was  founded  upon  a  good  and  sullicient 
consideration;  that  said  sale  by  Cuiuad 
and  said  keeping  for  sale  by  August 
Gross  was  a  direct  violation  of  the  cove- 
nant in  question;  that  the  restrictitm  im- 
posed was  no  more  than  the  interests  of 
the  parties  required,  and  that  it  was  not 
in  restraint  of  trade  or  against  public 
policy.  Judgment  was  ordered  for  tiie 
plaintiffs  for  the  sum  of  f  5,000  as  stipulat- 
ed damages. 

John  Fennel,  for  appellant.  Henry  Ba- 
con, for  resi)ondent8. 

VANN,  J.  (after  stating  the  facts). 
The  business  carried  on  by  the  defend- 
ant was  founded  on  a  secret  process 
known  only  to  herself  and  her  agents. 
She  had  the  right  to  continue  the  busi- 
ness, and  by  keeping  her  secret  to  enjoy 
its  l)enetits  to  any  practical)le  extent. 
She  also  had  the  right  to  sell  the  business, 
including  as  an  essential  part  thereof  the 
secret  process,  and,  in  order  to  place  the 
purchasers   in   the  same  positiou  that  she 


468 


ILLEGALITY  OF  OBJECT. 


occupied,  to  promise  to  divulse  the  secret 
to  them  alone,  aud  to  keep  it  from  every 
one  else.  In  no  other  waj'  could  she  sell 
what  she  had,  and  ^et  what  it  was  worth. 
Having  the  right  to  make  this  promise, 
she  also  had  the  riglit  to  make  it  good  to 
her  vendees,  and  to  protect  them  bj'  cove- 
nants with  proper  safeguards  against  the 
consequences  of  any  violation.  Such  a 
contract  simply  left  matters  substantially 
as  they  were  before  the  sale,  except  that 
the  seller  of  the  secret  had  agreed  that  she 
would  not  destroy  its  value  after  she  had 
received  full  value  for  it.  The  covenant 
was  not  in  general  restraint  of  trade,  but 
was  a  reasonable  measure  of  mutual  pro- 
tection to  the  parlies,  as  it  enabled  the 
one  to  sell  at  the  highest  price,  and  the 
other  to  get  what  they  paid  for.  It  im- 
posed no  restriction  upon  either  that  was 
not  beneficial  to  the  other,  b3'-  enhancing 
the  price  to  the  seller,  or  protecting  the 
purchaser.  Recent  cases  make  it  very 
clear  that  such  an  agreem?nt  is  not  op- 
posed to  public  policy',  even  if  the  restric- 
tion was  unlimited  as  to  both  time  and 
territorj'.  Match  Co.  v.  Roeber,  100  N.  Y. 
473,  13  N.  E.  Ren.  419;  Hodge  v.  Sloan,  107 
N.  Y.  244,  17  N.  E.  Rep.  335;  Leslie  v.Loril- 
lard,  110  N.  Y.  519,  534.  18  N.  E.  Rep.  3G3; 
Thermometer  Co.  v.  Pool,  (Sup.)  4  N.  Y. 
Supp.  SGI.  The  restriction  under  consider- 
ation, however,  was  not  unlimited  as  to 
time. 

The  chief  reliance  of  the  defendant  in 
this  court,  where  the  point  seems  to  have 
been  raised  for  the  first  time,  is  that  the 
covenant,  so  far  as  stipulated  damages 
are  concerned,  is  confined  to  the  x^ersonal 
acts  of  Mrs.  GrSssT^hd  does  not  einbi'iice 
th^iuitaxjf  her  agents.  A  careful  reading 
of  the  agreeuienl,  iiowever,  in  the  light  of 
the  circumstances  surrounding  the  parties 
when  it  was  made,  shows  that  no  such  re- 
sult was  intended.  What  was  the  object 
of  the  covenant?  It  was  to  keep  secret, 
at  all  hazards,  the  process  upon  which  the 
success  of  the  business  depended.  On  no 
other  basis  could  the  j)lain tiffs  safely  buy, 
orthe  defendantsell,  for  what  her  property 
was  worth.  Who  had  the  power  to  keep 
the  process  secret?  Clearly  the  defendant, 
if  any  one.  as  she  had  confided  it  t(j  no  one 
except  her  trusted  agents,  who  were  near- 
ly related  to  her  by  blood  or  marriage. 
But  could  she  covenant  against  the  attii-of 
tiiose_,Qair_wJiom  she  iiad  ruj  coni  i'mI  ?  She 
had  the  right  to  so  (.'(jvL-iiant,  by  assmii- 
fng  the,  riiik_of  their  acti(\ns;  and,  (ililess 
slie  iiad  done  so,~prestlfnptive!y  she  could 
not  have  sold  her  factory  for  so  large  a 
sum.  It  was  safer  for  her  to  sell  Avith 
such  a  covenant  than  it  was  for  the  plain- 
tiffs to  buy  without  it.  She  could  exercise 
some. power  over  her  own  husband  and 
her  father  and  her  husband's  biother.  all 
of  whom  had  been  associated  with  her  in 
carrying  on  the  business,  and  whose  ac- 
tions in  certain  other  respects  she  assumed 
to  control  for  a  limited  time,  whereas  the 
plaintiffs  were  powerless,  unless  they  had 
her  promise  to  keep  the  process  secret  at 
the  peril  of  paying  heavily  if  she  did  not. 
It  is  not  surprising,  therefore,  to  find  that 
the  restrictive  part  of  the  covenant  ap- 
plies with  the  same  force  to  her  agents 
that  it  does  to  herself;  for  she  undertakes 


that  neither  she  nor  they  will  disclose  the 
secret,  or  engage  in  making  or  selling  ei- 
ther kind  of  cheese,  or  use  the  trade-marks 
or  names  connected  with  the  business. 
We  do  not  think  that  a  personal  act  of  the 
defendantis  essential  to  a  violation  of  thiej 
covenant  by  her;  for  if  she  permits,  or 
even  does  not  prevent,  her  agents  from 
doing  the  prohibited  acts,  the  promise  is 
broken.  While  it  is  her  exclusive  cove- 
nant, it  relates  to  the  action  of  others; 
and,  if  they  do  what  she  agreed  that  they 
would  not  do,  it  is  a  breach  by  her.  al- 
though not  her  own  act.  She  violated  Ijer 
agreement,  not  by  selling  -trgrgem_buf.  l^y. 
TnTT'prV'vcnting  ot  liri's  from  selliii^-.  This 
construction  of  the  rcslrictivc'part  of  the 
covenant  would  hardly  be  open  to  ques- 
tion, were  it  not  that  in  the  same  sentence 
occurs  the  reparative  or  compensatory 
part  designed  to  make  the  plaintiffs  whole 
if  the  defendant  either  could  not  or  did 
not  keep  her  agreement.  W'hile  this  pro- 
vides that  any  violation  involves  the  pen- 
alty of  !§5,000,  it  adds,  "  which  sum  is  here- 
by named  as  stipulated  damages  to  b© 
paid  "  by  the  defendant  in  case  of  a  viola- 
tion by  her  of  the  covenant  in  question. 
What  kind  of  violation  is  thusreferred  to? 
The  deiendant  says  a  personal  violation 
by  her  only,  but  we  think,  for  the  reasons 
already  given,  that  the  spirit  of  the  agree- 
ment includes  both  a  violation  by  her 
own  act  and  by  the  act  of  those  whom 
she  did  not  prevent  from  selling,  although 
she  had  agreed  that  they  would  not  sell. 
As  no  one  not  a  party  to  a  contiact  can 
violate  it,  every  act  of  defendant's  former 
agents  contrary  to  her  covenant  was  a  vi- 
olation thereof  by  her,  whether  she  knew 
of  it  or  assented  to  it  or  not.  Whenever 
that  was  done  which  she  agreed  should 
not  be  done,  it  was  a  breach  of  a  covenant 
by  her,  even  if  the  act  was  contrary  to  her 
wishes,  and  in  spite  of  her  efforts  to  pre- 
vent it.  Her  covenant  was  against  a  cer- 
tain act  by  any  one  of  four  perst)ns,  in- 
cluding herself.  Two  of  those  persons 
separately  did  the  act  which  she  had 
agreed  that  neither  of  them  should  do, 
and  thus  there  was  a  violation  of  the  cove- 
nant by  her,  the  same  as  if  she  had  done 
the  act  in  person.  Tlie  argument  of  the 
learned  counsel  for  the  defendant  that  the 
contract  tixed  a  sum  to  be  paid  in  case  of 
a  violation  by  the  defendant,  but  not  in 
case  of  a  violation  "by  the  other  parties," 
while  plausible,  is  unsound,  for  there  were 
no  "other  parties"  who  could  break  the 
covenant.  She  was  the  sole  covenantor, 
and  unless  she  kept  the  covenant  she  broke 
it;  and  she  did  not  keep  it.  As  the  actual 
damages  for  a  breach  of  the  covenant 
would  uecessarilj'  l)e  "  wholly  uncertain, 
and  inca])able  of  being  ascertained  except 
by  conjecture, "  we  think  that  the  parties  in- 
tended to  li(iuidate  them  when  they  pro- 
vided that  the  sum  named  should  be  "  as 
stipulated  damag(>s."  The  use  of  the  word 
"penalty "  under  tlie  circumstances  is  not 
controlling.  Baglev  v  Peddle,  16  N.  Y. 
4G9;  Dakin  v.  Williams,  17  Wend.  44S, 
affirmed  22  W'end.  201 ;  Wooster  v.  Kisch, 
2G  Hun,  61.  As  there  is  no  other  question 
that  requires  discussion,  the  judgment 
should  be  athrmed.  with  costs.  All  con- 
cur, except  Ruowx  J.,  not  silting. 


J 


PUBLIC  rOLlCY— UNLAWFUL  COMBINATIONS— MONOPOLIES,  ETC.     469 


'  MOEEIS  RUN  COAL  CO.  v.  BARCLAY 

/  COAL  CO. 

(G8  Pa.  St.  173.) 

Supreme    Court    of    Pt'iinsylvania.      March    15, 
18  7  L 

Error  to  court  of  couiiuou  pleas,  Bradford 
county. 

U.  Mercur  and  E.  Overton,  Jr.,  for  plaintiff 
in  error.     J.  Ui-  Witt,  for  defendant  in  error. 

AGNEW,  J.     This  was  an  action  on  a  bill 
drawn  upon  one  party   in   favor   of  another 
party   to  a  conti-act  between  five   coal  com- 
panies, for  a  sum  found  due  in  the  equaliza- 
tion of  prices  under  the  contract.     It  raises  a 
question  of  great  importance  to  the  citizens 
of  this   state   and    the   state   of   New    York, 
where  the  contract   was   made,   and   was  in 
part  to  be  executed,  to  wit,  whether  the  con- 
tract  was   illegal,  as   being  contrary   to   the 
statute  of  New  York,  or  at  common  law,  or 
against  public  policy.     The  instrument  bears 
date   the  15th  day  of   February,  18GU.     The 
parties  are  five  coal  companies,  incorporated 
under  the  laws  of  Pennsylvania,  to  wit,  the 
Fall   Brook  Coal  Company   and   Morris    Run 
Coal  Company,  of  the  Blossburg  coal  region; 
and  the  Barclay  Coal   Company,  Fall  Creek 
Bituminous  Coal  Company,  and  Towauda  Coal 
Company,   of   the    Bai'clay    coal    region.     By 
the  agreement,  the  market  for  the  bituminous 
coal  from  these  two  regions  is  divided  among 
these  parties  in  certain  proportions.     A  com- 
mittee of  three  is  appointed  to  take  charge 
and  control  of  the  business  of  all  these  com- 
panies, to  decide  all  questions  by  a   certain 
vote,  and  to  appoint  a  general  sales  agent  to 
be  stationed  at  Watkins,  New  York.     Provi- 
sion is  made  for  the  mining  and  delivery  of 
coal,  their  kinds,  and  for  its  sale  through  the 
agent,  subject,  however,  to  this  important  re- 
striction,  that   each  party   shall,   at   its  own 
costs  and  expense,  deliver  its  proportion  of 
the  different  kinds  of  coal   in  the   different 
markets  at  such  times  and  to  such  parties  as 
the  committee  shall  from  time  to  time  direct. 
The  committee   is   authorized   to   adjust   the 
prices  of  coal  In  the  diffeVeut   markets  and 
the  rates   of  freight,  and  also  to  enter  into 
such  an  agreement  with  the  anthracite  coal 
companies   as   will   promote   the    interest   of 
these  parties.     Then  comes  an  important  pro- 
vi.siou  that  the  companies  may  sell  their  coal 
themselves,  but  only  to  the  extent  of  their 
proportion,  and  only  at  the  prices  adjusted  by 
the  committee.     It  is  also  provided  that  the 
general  sales  agent  shall  direct  a  suspojision 
of  shipment  or  deliveries  of  coal  by  any  party 
making  sales  or  deliveries  beyond  its  propor- 
tion, and  thereupon  such  party  shall  suspend 
shipments  until  the  committee  shall  direct  a 
resumption.     Detailed  reports  of  the  business 
are  to  be  made  by  the  companies  to  the  gen- 
eral sales  agent  at  fixed  and  short  Intervals, 
and  settlements  are  to  be  made  by  the  com- 
mittee   monthly,    prices    averaged,   and   pay- 


ments made  by  the  companies  in  excess  to 
those  in  arrear;  and  finally,  each  partj-  binds 
itself  not  to  cause  or  permit  any  coal  to  be 
shipped  or  sold  otherwise  than  as  the  same 
has  been  agreed  upon,  and  that  all  ruh.'.s  and 
regulations  by  the  executive  committee  in 
relation  to  the  business  shall  be  faithfully  car- 
ried out. 

In  regard  to  the  relation  these  companies 
hold  to  the  public,  the  field  of  their  uiinlug 
operations,  the  markets  they  supply,  the  ex- 
tent of  their  coal-fields,  and  the  general  sup- 
ply of  coal,  the  distinguished  referee,  Judge 
Elwell,  finds  as  follows:  "The  Barclay  and 
Blossburg  coal-mines  are  the  only  coal  mines 
furnishing  the  kind  of  coal  mined  and  ship- 
ped by  these  companies,  except  the  Cumljer- 
land  coal,  which  latter,  in  order  to  reach  the 
same  markets,  north,  would  have  to  be  ship- 
ped by  tidewater.  There  was  some  of  the 
same  kind  of  coal  mined  in  McKean  and  Elk 
counties,  in  this  state,  but  In  quantities  so 
small  that  it  was  not  considered  by  these 
companies  as  coming  into  competition  with 
them.  The  coal  of  the  Blossburg  and  Bar- 
clay regions  is  adapted  to  mechanical  pur- 
poses and  for  generating  steam.  Wherever 
sold,  it  comes  into  competition  with  anthra- 
cite coal,  and  also  with  the  Cumberland  coal 
sent  by  tidewater  to  Troy,  New  York,  to 
which  point  both  kinds  of  bituminous  coal 
are  shipped." 

During  the  season  of  ISGG  these  companies 
made  sales  of  coal  at  Oswego  and  Buffalo,  to 
parties  who  shipped  to  Chicago,  Milwaukee, 
and  other  Western  cities.  It  there  came  into 
competition  to  some  extent  with  Pittsburgh 
coal.  The  latter  is  used  for  making  gas,  but 
the  coal  of  these  companies  cannot  be  used 
for  that  purpose. 

The  referee  found  that  the  statute  of  New 
York  is,  "if  two  or  more  persons  shall  con- 
spire," first,  "to  commit  any  offence;"  sec- 
ond, "to  commit  any  act  injurious  to  the  pub- 
lic health,  to  public  morals,  or  to  ti-ade  or 
commerce,  they  shall  be  deemed  guilty  of  a 
misdemeanor." 

The  referee  found,  as  his  conclusion  upon 
the  whole  case,  that  the  contract  was  void 
by  the  statute,  and  void  at  common  law,  as 
against  public  policy.  The  restraint  of  the 
contract  upon  trade  and  its  injury  to  the  pub- 
lic is  thus  clearly  set  forth  by  the  referee: 
"These  corporations  [he  says]  represented  al- 
most the  entire  body  of  bituminous  coal  In 
the  northern  part  of  the  state.  By  combina- 
tion between  themselves,  they  had  the  power 
to  control  the  entire  market  in  that  district 
And  they  did  control  it  by  a  contract  not  to 
ship  and  sell  coal  otherwise  than  as  therein 
providoil.  And  in  order  to  destroy  competi- 
tion, they  provided  for  an  an-angomout  with 
dealers  and  shippers  of  anthracite  coal.  They 
were  thereby  prohibited  from  selling  under 
prices  to  be  fixed  by  a  committee  representing 
each  company.  And  they  were  obliged  to 
suspend  shipments  upon  notice  from  an  agent 
that  their  allotted  share  of  the  market   had 


470 


ILLEGALITY  OP  OBJECT. 


been  forwarded  or  sold.  Instead  of  regulat- 
ing the  business  by  the  natural  laws  of  ti-ade, 
to  wit,  those  of  demand  and  supply,  these 
companies  entered  into  a  league,  by  which 
they  could  limit  the  supply  below  the  demand 
in  order  to  enhance  the  price.  Or  if  the  sup- 
ply was  greater  than  the  demand,  they  could 
nevertheless  compel  the  payment  of  the  price 
arbitrarily  fixed  by  the  joint  committee.  The 
restraint  on  the  trade  in  bituminous  coal  was 
by  this  contract  as  wide  and  extensive  as  the 
market  for  the  article.  It  already  embraced 
the  state  of  New  York,  and  was  intended  and 
no  doubt  did  affect  the  market  in  the  West- 
em  states.  It  is  expressly  stipulated  that 
the  parties  to  this  contract  shall  not  be  con- 
sidered as  partners.  The  agreement  was 
not  entered  into  for  the  purpose  of  aggregat- 
ing the  capital  of  the  several  companies, 
nor  for  greater  facilities  for  the  transaction 
of  their  business,  nor  for  the  protection  of 
themselves  by  a  reasonable  restraint,  as  to  a 
limited  time  and  space  upon  others  who 
might  interfere  with  their  business." 

The  plaintiff  in  error's  reply  to  this  vigor- 
ous statement  of  the  purpose  of  the  contract 
and  its  effect  upon  the  public  interest,  al- 
leges that  its  true  object  was  to  lessen  ex- 
penses, to  advance  the  quality  of  the  coal, 
and  to  deliver  it  in  the  markets  it  was  to 
supply,  in  the  best  order,  to  the  consumer. 
This  is  denied  by  the  defendant;  but  it 
seems  to  us  it  is  immaterial  whether  these 
positions  are  sustained  or  not.  Admitting 
their  correctness,  it  does  not  follow  that  these 
advantages  redeem  the  contract  from  the  ob- 
noxious effects  so  strikingly  presented  by  the 
referee.  The  important  fact  is  that  these 
companies  control  this  immense  coal-field; 
that  it  is  the  great  source  of  supply  of  bitu- 
minous coal  to  the  state  of  New  York  and 
large  territories  westward;  that  by  this  con- 
tract they  control  the  price  of  coal  in  this  ex- 
tensive market,  and  make  it  bring  sums  it 
would  not  command  if  left  to  the  natural 
laws  of  trade;  that  it  concerns  an  article  of 
prime  necessity  for  many  uses;  that  its  oper- 
ation is  general  in  this  large  region,  and  af- 
fects all  who  use  coal  as  a  fuel;  and  this  is 
accomplished  by  a  combination  of  all  the 
companies  engaged  in  this  branch  of  business 
In  the  large  region  where  they  operate.  The 
combination  is  wide  in  scope,  general  in  its 
Influence,  and  injurious  in  effects.  These 
being  its  features,  the  contract  is  against  pub- 
lic policy,  illegal,  and  therefore  void. 

The  illegality  of  contracts  affecting  public 
trade  appears  in  the  books  under  many  forms. 
The  most  frequent  Is  that  of  contracts  be- 
tween individuals  to  restrain  one  of  them 
from  performing  a  business  or  employment. 
The  subject  was  elaborately  discussed  in  the 
leading  case  of  Mitchel  v.  Reynolds,  1  P. 
Wms.  181,  to  be  found  also  In  1  Smith,  Lead. 
Cas.  172.  The  distinction  is  there  taken 
which  now  marks  the  current  of  judicial  de- 
cision everywhere;  that  a  restraint  upon  a 
trade   or   employment    which    is    general,    is 


void,  being  contrary  to  public  interest,  really 
beneficial  to  neither  party,  and  oppressive  at 
least  to  one.  "General  restraints  (says  Park- 
er, J.)  are  all  void,  whether  by  bond,  cove- 
nant or  promise,  with  or  without  considera- 
tion, and  whether  it  be  of  the  party's  own 
trade  or  not;"  citing  Cro.  Jac.  ij'JG;  2  Bulst. 
130;  Allen,  G7.  To  obtain,  he  says,  the  sole 
exercise  of  any  known  ti-ade  throughout  Eng- 
land, is  a  complete  monopoly,  and  against  the 
policy  of  the  law.  A  reason  given  is  "the 
great  abuses  these  voluntary  restraints  are 
liable  to,  as,  for  instance,  from  corporations, 
who  were  perpetually  laboring  for  exclusive 
advantages  in  trade,  and  to  reduce  it  into 
as  few  hands  as  possible."  In  reference  to 
a  contract  not  to  trade  in  any  part  of  Eng- 
land, it  is  said,  there  is  something  more  than 
a  presumption  against  it,  because  it  never  can 
be  useful  to  any  man  to  restrain  another 
from  trading  in  all  places,  though  it  may  be 
to  restrain  him  from  trading  in  some,  unless 
he  intends  a  monopoly,  which  is  a  crime. 
These  principles  have  been  sustained  in  many 
cases  which  need  not  be  cited,  as  most  of 
them  will  be  found  in  Mr.  Smith's  note  1o 
the  leading  case.  The  result  of  those  in 
which  particular  restraints  upon  trade  have 
been  held  to  be  valid  between  individuals  is, 
that  the  restraint  must  be  partial  only,  the 
consideration  adequate  and  not  colorable,  and 
the  restriction  reasonable.  Upon  the  last  req- 
uisite, Tindal,  C.  J.,  remarks,  in  Horner  v. 
Graves,  7  Bing.  743:  "We  do  not  see  how 
a  better  test  can  be  applied  to  the  question 
whether  reasonable  or  not  than  by  consider- 
ing whether  the  restraint  is  such  only  as  to 
afford  a  fair  protection  as  to  the  interests  of 
the  party  in  favor  of  whom  it  is  given,  and 
not  so  large  as  to  interfere  with  the  interests 
of  the  public.  Whatsoever  restraint  is  larger 
than  the  necessary  protection  of  the  party 
can  be  of  no  benefit  to  either;  it  can  only  be 
oppressive,  and  if  oppressive,  it  is  in  the 
eye  of  the  law  unreasonable.  What  is  inju- 
rious to  the  public  interest  is  void  on  the 
ground  of  public  policy." 

Many  cases  have  been  decided  as  to  what 
is  a  reasonable  restriction  and  what  is  not, 
and  is  thei*efore  void,  but  two  only  may  be 
referred  to  as  illustrations.  In  Mallan  v. 
May,  11  Mees.  &  W.  G.53,  a  covenant  not  to 
practice  as  a  dentist  in  London,  or  in  any  of 
the  places  in  England  or  Scotland,  where  the 
I)laintiff  might  have  been  practicing  before 
the  expiration  of  the  term  of  service  with 
them  was  held  to  be  reasonable  as  to  the  lim- 
it of  London,  but  unreasonable  and  void  as 
to  the  remainder  of  the  restriction.  So,  In 
Green  v.  Price.  13  Mees.  &  W.  69.5,  a  cove- 
nant not  to  follow  the  perfumery  business  in 
the  cities  of  London  and  Westminster,  or 
within  the  distance  of  GOO  miles  therefrom, 
was  good  as  to  the  cities,  and  void  as  to  the 
limit  of  600  miles.  See,  also,  Pierce  v.  Ful- 
ler, 8  Mass.  223,  and  Chappel  v.  Brockway, 
21  Wend.  158.  An  important  principle  stated 
In  these  cases  Is  that,  as  to  contracts  for  a 


rUBLIC  I'ULICY— UNLAWFUL  CUMBINATIONS— MONOPOLIES,  ETC.     471 


limited  restraint,  the  courts  start  witli  a  pre- 
Bumptioa  that  they  are  Illegal  unless  shown  to 
have  been  made  upon  adequate  consideration, 
and  upon  cireuinsiaucos  both  reasonable  and 
useful.  This  presumption  is  a  necessary  con- 
sequence of  the  general  principle,  that  the 
public  Interest  Is  superior  to  private,  and  that 
all  restraints  on  trade  are  injurious  to  the 
public  in  some  degree.  The  general  rule  (said 
Woodward,  C.  J.)  Is  that  all  restraints  of 
trade,  If  nothing  more  appear,  are  bad. 
Keeler  v.  Taylor,  3  P.  F.  Smith,  4aS.  That 
case  may  be  instanced  as  a  strong  illustra- 
tion of  the  rule  as  to  what  is  not  a  reastjna- 
ble  restriction;  and  the  principles  I  have  been 
stating  are  recognized  in  the  opinion.  Keeler 
agreed  to  instruct  Taylor  in  the  art  of  making 
platform  scales,  and  to  employ  him  in  that 
business  at  $1.75  per  day.  Taylor  engaged 
to  pay  Keeler  or  his  legal  representatives  $50 
for  each  and  every  scale  he  should  thereafter 
make  for  any  other  person  than  Keeler,  or 
which  should  bo  made  by  imparting  liis  in- 
formation to  others.  This  was  held  to  be  an 
unreasonable  restriction  upon  Taylor's  labor, 
and  tlierefore  void,  as  in  restraint  of  ti-ade. 
Testing  the  present  contracts  by  these  prin- 
ciples, the  restrictions  laid  upon  the  produc- 
tion and  price  of  coal  cannot  be  sanctioned 
as  reasonable,  in  view  of  their  intimate  rela- 
tion to  the  public  interests.  I'hc  field  of  oper- 
ation is  too  wide,  and  the  influence  too  gen- 
eral. 

The  effects  produced  on  the  public  intei-ests 
lead  to  the  consideration  of  another  feature 
of  great  weight  in  determining  the  illegality 
of  the  contract,  to  wit,  the  combination  re- 
sorted to  by  these  five  companies.  Singly 
each  might  have  suspended  deliveries  and 
sales  of  coal  to  suit  its  own  interests,  and 
might  have  raised  the  price,  even  though  this 
might  have  been  detrimental  to  the  public  in- 
terest. There  is  a  certain  fi-oedom  which 
must  be  allowed  to  every  one  in  the  manage- 
ment of  his  own  affairs.  When  competition 
is  left  free,  individual  error  or  foUy  will  gen- 
erally find  a  correction  in  the  conduct  of 
others.  But  here  is  a  combination  of  all  the 
companies  operating  in  the  Blossburg  and 
Barclay  mining  regions,  and  controlhng  their 
entire  productions.  They  have  combined  to 
gether  to  govern  the  supply  and  the  price  or 
coal  in  all  the  markets  from  the  Hudson  to 
the  Mississippi  rivers,  and  from  I\^uusyl- 
vania  to  the  lakes.  This  combination  has  a 
power  in  its  confederated  form  which  no  in- 
dividual action  can  confer.  The  public  inter- 
est must  succumb  to  it,  for  It  has  left  no 
competition  free  to  correct  its  baleful  in- 
fluence. When  the  supply  of  coal  is  suspend- 
ed, the  demand  for  it  becomes  importunate, 
and  prices  must  rise.  Or  if  the  supply  goes 
forward,  the  price  fixed  by  the  confederates 
must  accompany  it.  The  domestic  hearth, 
the  furnaces  of  the  iron  master,  and  the  tires 
of  the  manufacturer,  all  feel  the  restraint, 
while  many  dependent  hands  are  paralyzed, 
and  himgry  mouths  are  stinted.     The  influ- 


ence of  a  lack  of  supply  or  a  rise  in  the  price 
of  an  article  of  such  prime  necessity  cannot 
be  measured.  It  permeates  the  entire  mass 
of  the  community,  and  leaves  few  of  its  mem- 
bers untouched  by  its  withering  blight  Such 
a  combination  is  more  than  a  contract;  it  is 
an  offence.  "I  take  it,"  said  Gib.son,  J.,  "a 
combination  Is  criminal  whenever  the  act  to 
be  done  has  a  necessary  tendency  to  prejudice 
tlie  pul)lic  or  oppress  individuals,  by  unjustly 
subjecting  them  to  the  power  of  the  confed- 
erates, and  giving  effect  to  the  purpose  of  the 
latter,  whether  of  extortion  or  of  mischief." 
Com.  V.  Carlisle,  Brightly,  N.  P.  40.  In  all 
such  combinations,  where  the  purpose  is  inju- 
rious or  unlawful,  the  gist  of  the  offence  ia 
the  conspiracy.  Men  can  often  do  by  the 
combination  of  many  what  severally  no  one 
could  accomplish,  and  even  what  when  done 
by  one  would  be  innocent  It  was  held  In 
Com.  V.  Eberle,  3  Sorg.  &  R.  9,  that  it  was  an 
indictable  conspiracy  for  a  portion  of  a  Ger- 
man Lutheran  congregation  to  combine  and 
agree  together  to  prevent  another  portion  of 
the  congregation,  by  force  of  arms,  from  us- 
ing the  English  language  in  the  worship  of 
God  among  the  congregation.  So  a  confed- 
eracy to  assist  a  female  infant  to  escape  from 
her  father's  control,  with  a  view  to  marry 
her  against  his  will,  is  Indictable  as  a  con- 
spiracy at  common  law,  while  it  would  have 
been  no  criminal  offence  if  one  alone  had  in- 
duced her  to  elope  with  and  marry  him. 
Mifflin  V.  Commonwealth,  5  Watts  &  S.  4tJl. 
One  man  or  many  may  hiss  an  actor;  but  if 
they  conspire  to  do  it,  they  may  be  punished. 
Per  Gibson,  C.  J.,  Hood  v.  Palm,  8  Pa.  St 
238;  2  Russ.  Crimes,  5G6.  And  an  action  for 
conspiracy  to  defame  will  be  supported 
though  the  words  be  not  actionable  if  six)ken 
by  one.  Hood  v.  Palm,  supra.  "Defama- 
tion by  the  outcry  of  numbers,"  says  Gibson, 
C.  J.,  "is  as  resistless  as  defamation  by  the 
written  act  of  an  individual."  And  says 
Coulter,  J.:  "The  concentrated  energj-  of  sev- 
eral combined  wills,  operating  simultaneou.sly 
and  by  concert  upon  one  individual,  is  dan- 
gerous even  to  the  cautious  and  circumspect 
but  when  brought  to  bear  upon  the  unwary 
and  unsa«;pecting,  it  is  fatal."  Twitchell  v. 
Com.,  9  Pa.  St.  211.  There  is  a  potency  in 
numbers  when  combined  which  the  law  can- 
not overlook,  where  injury  Is  the  consequenca 
If  the  conspiracy  be  to  commit  a  crime  or  un- 
lawful act  it  is  easy  to  determine  its  indict- 
able character.  It  Is  more  difficult  when  the 
act  to  be  done  or  purpKise  to  be  accomplished 
Is  innocent  in  Itself.  Then  the  offence  takes 
Its  hue  from  the  motives,  the  means  or  the 
consequences.  If  the  motives  of  the  confed- 
erates be  to  oppress,  the  means  they  use  un- 
lawful, or  the  consequences  to  others  injuri- 
ous, their  confederation  will  become  a  con- 
spiracy. Instances  are  given  In  Com.  v.  Car- 
lisle, Brightly,  N.  P.  40.  Among  those  men- 
tioned as  criminal  is  a  combination  of  em- 
ployers to  depress  the  wages  of  journeymen 
below  what  they  would  be  if  there  were  no 


47; 


ILLEGALITY  OF  OBJECT. 


resort  to  axtificial  moans;  and  a  combination 
of  the  bakers  of  a  town  to  hold  up  the  article 
of  bread,  and  by  means  of  the  scarcity  thus 
produced  to  extort  an  exorbitant  price  for  it 
The  latter  instance  is  precisely  parallel  with 
the  present  case.  It  is  the  effect  of  the  act 
upon  the  public  which  gives  that  case  and 
this  its  evil  aspect  as  the  result  of  confedera- 
tion; for  any  baker  might  choose  to  hold  up 
his  own  bread,  or  coal  operator  his  coal, 
rather  than  to  sell  at  ruling  prices;  but  when 
he  destroys  competition  by  a  combination 
with  others,  the  public  can  buy  of  no  one. 

In  Rex  V.  De  Berenquetal,  3  Maule  &:  S.  G7, 
it  was  held  to  be  a  conspiracy  to  combine  to 
raise  the  public  funds  ou  a  particular  day  by 
false  rumors.  "The  purpose  itself,"  said  Lord 
EUenborough,  "is  mischievous;  it  strikes  at 
the  prices  of  a  valuable  commodity  in  the 
market,  and  if  it  gives  a  fictitious  price  by 
means  of  false  rumors,  it  is  a  fraud  levelled 
against  the  public,  for  it  is  against  all  such 
as  may  possibly  have  anything  to  do  with 
the  funds  on  that  particular  day."  Every 
"comer,"  In  the  language  of  the  day,  whether 
it  be  to  affect  the  price  of  articles  of  com- 
merce, such  as  breadstuffs,  or  the  price  of 
vendible  stocks,,  when  accomplished  by  con- 
federation to  raise  or  depress  the  price  and 
operate  on  the  markets,  is  a  conspiracy.  The 
ruin  often  spread  abroad  by  these  heartless 
conspiracies  is  indescribable,  frequently  filling 
the  land  with  stp^rvation,  poverty  and  woe. 
Every  association  is  criminal  whose  object  is 
to  raise  or  depress  the  price  of  labor  beyond 
what  it  woul'l  bring  if  it  were  left  without 
artificial  aid  or  stimulus.  Rex  v.  Byerdike, 
1  :Maule  &  S.  179.  In  the  case  of  such  asso- 
ciations the  illegality  consists  most  frequent- 
ly in  the  means  employed  to  carry  out  the  ob- 
ject. To  fix  a  standai-d  of  pric^^s  among  men 
in  the  same  employment,  as  a  fee  bill,  is  not 
In  itself  criminal,  but  may  become  so  when 
the  parties  resort  to  coercion,  restraint  or  pen- 
alties upon  the  employed  or  employers,  or, 
what  is  worse,  to  force  of  arms.  If  the 
means  be  unlawful  the  combination  is  indict- 
able. Cora.  V.  Hunt,  4  Mete.  (Mass.)  111.  A 
conspiracy  of  journeymen  of  any  trade  or 
handicraft  to  raise  the  wages  by  entering  into 
combination  to  coerce  journeymen  and  master 
workmen  employed  in  the  same  branch  of 
industry  to  conform  to  rules  adopted  by  such 
combination  for  the  purpose  of  regulating  the 
price  of  labor,  and  carrying  such  rules  into 
effect  by  overt  acts,  is  indictable  as  a  misde- 
meanor.    3  Whart.   Cr.   Law,   §  13G6,   citing 


People  V.  Fisher,  14  Wend.  9.  Without  multi- 
plying examples,  those  are  sufficient  to  illus- 
trate the  true  aspect  of  the  case  before  us, 
and  to  show  that  a  combination  such  as  these 
companies  entered  into  to  control  the  supply 
and  price  of  the  Blossbm'g  and  Barclay  re- 
gions is  illegal,  and  the  contract  therefore 
void. 

A  second  question  is,  whether  the  bill 
drawn  in  this  case  by  the  general  sales  agent 
on  the  Barclay  Coal  Company  in  favor  of  the 
Morris  Coal  Company  to  equalize  prices  up- 
on a  settlement  under  the  contract,  is  such  an 
independent  cause  of  action  as  will  support 
the  suit  When  a  biU,  note  or  bond  is  but  an 
instrument  to  execute  an  illegal  contract,  it 
is  tainted  by  the  illegality,  and  cannot  be  re- 
covered. The  illegal  consideration  enters  di- 
rectly into  the  insti'ument,  and  is  followed  up 
because  the  law  will  not  permit  Itself  to  be 
violated  by  mere  indirection.  This  is  the 
principle  mentioned  in  the  cases  of  Stears  v. 
Lashley,  6  Term  R.  61;  Swan  v.  Scott  H 
Serg.  &  R.  164;  Stanton  v.  Allen,  5  Denio,  434; 
Fisher  v.  Bridges,  3  El.  &  BL  642;  Lestapies 
V.  Ingraham,  5  Pa.  St  82.  In  the  last  case. 
Gibson,  C.  J.,  says:  "The  solemnity  of  the 
security  would  not  preclude  an  inquiry  into 
the  consideration  of  it  had  it  been  illegal;" 
and  in  Swan  v.  Scott,  Duncan,  J.,  said  of  a 
bond,  the  consideration  of  which  grew  out  of 
an  illegal  transaction,  "there  the  illegal  con- 
sideration is  the  sole  basis  of  the  bond,  and 
there  can  be  no  recovery."  In  the  present 
case  the  bill  itself  refers  directly  to  the  equal- 
ization account,  and  was  given  in  immediate 
execution  of  the  contract  This  being  the 
case,  it  is  distinguishable  from  Fackney  v. 
Reynous,  4  Burrows,  2065;  Petrie  v.  Hannay, 
3  Term  R.  418;  Warner  v.  Russell,  1  Bos.  & 
P.  295;  Lestapies  v.  Ingraham,  supra;  Thom- 
as V.  Bracey,  10  Pa.  St  1&4,— cases  where  the 
action  was  not  upon  the  illegal  contract,  or 
upon  an  instrument  in  execution  of  it,  but 
was  founded  upon  a  new  consideration.  The 
distinction  is  well  stated  by  Judge  Washing- 
ton, in  Toler  v.  Annstrong,  3  Wash.  C.  C.  297, 
Fed.  Cas.  No.  14,078,  affirmed  in  the  United 
States  supreme  court,  11  Wheat.  258.  The 
present  case  is  free  of  difficulty,  the  money 
represented  by  the  bill  arising  directly  upon 
the  contract  to  be  paid  by  one  party  to  an- 
other party  to  the  contract  in  execution  of  its 
terms.  The  bill  itself  Ls  therefore  tainted  by 
the  illegality,  and  no  recovery  can  be  had  up- 
on it 

The  judgment  is  therefore  affirmed. 


"public  policy— unlawful  combinations— monopolies,  etc.     473 


CENTRAL  SHADE-ROLLER  CO.  v.  CDSH- 
MAN. 

(9  N.  E.  629,  143  Mass.  353.) 

Supreme   Judicial    Court   of   MassachuBetts, 
Sullolk.    Jan.  11,  1887. 

Bill  in  equity  for  au  accouut,  and  for  an 
injunction  to  restrain  the  defendant  from 
violatinj^  an  agreement  made  by  him  with 
the  plaintiff.  Hearing  in  the  supreme  court 
on  the  demurrer  of  the  defendant,  before 
Devens,  J.,  who  sustained  the  demurrer,  and 
the  plaintiff  appealed.  The  facts  are  stated 
in  the  opinion. 

J.  B.  Warner,  for  plaintiff.  Moorfield 
Storey,  for  respondent. 

ALLEN,  J.  The  contract  which  Is  sought 
to  be  enforced  by  this  bill  (and  the  validity 
of  which  is  the  only  question  presented  by 
the  demurrer  and  argued  by  the  parties)  was 
made  between  the  plaintiff,  of  the  first  part, 
and  three  manufacturers,  under  several  pat- 
ents of  certain  curtain  fixtures  linown  as 
"Wood  Balance  Shade-rollers,"  of  the  sec- 
ond part,  in  pursuance  of  an  arrangement 
between  the  persons  forming  the  party  of 
the  second  part  that  the  plaintiff  corporation 
should  be  created  for  the  purpose  of  becom- 
ing a  party  to  the  combination,  was  to  pre- 
vent, or  rather  to  regulate,  competition  be- 
tween the  parties  to  it  in  the  sale  of  the  par- 
ticular commodity  which  they  made.  This  is 
a  lawful  purpose,  but  it  is  argued  that  the 
means  employed  to  carry  it  out— the  creation 
of  the  plaintiff  corporation  and  the  terms  of 
the  contract  with  it— are  against  public  poli- 
cy and  invalid.  The  fact  that  the  parties  to 
the  combination  formed  themselves  into  a 
corporation  of  which  they  were  the  stock- 
holders, that  they  might  contract  with  it, 
instead  of  witli  each  other,  and  carry  out 
their  scheme  through  its  agency,  instead  of 
that  of  a  pre-existing  person,  is  obviously  im- 
material, and  the  only  ground  upon  which  it 
can  be  argued  that  the  contract  is  invalid 
is  the  restraint  it  puts  upon  the  parties  to  it 

Does  the  contract  impose  a  restraint  as 
to  the  manufacture  on  the  sale  of  balance 
and  shade-rollers  wliich  is  void  as  against 
public  policy?  The  contract  certainly  puts  no 
restraint  upon  the  production  of  the  com- 
modity to  which  it  relates.  It  puts  no  obli- 
gation upon  and  offers  no  inducement  to  any 
person  to  produce  less  than  to  the  full  extent 
of  his  capacity.  On  the  contrary,  its  appar- 
ent purpose  is,  by  mailing  prices  more  uni- 
form and  regular,  to  stimulate  and  increase 
production.  The  contract  does  not  restrict 
the  sale  of  the  commodity.  It  does  not  look 
towards  withholding  a  supply  from  the  mar- 
ket in  order  to  enhance  the  price,  as  in  Craft 
V.  McConoughy,  79  III.  346,  and  other  cases 
-cited  by  the  defendant.    On  the  contrary,  the 


contract  intends  that  the  parties  shall  make 
sales,  and  gives  them  full  power  to  do  so; 
the  only  restrictions  being  that  sales  not  at 
retail  or  for  export  shall  be  in  the  name  of 
the  plaintitr,  and  reported  to  it,  and  the  ac- 
counts of  them  kept  by  it;  and  the  provision 
that,  when  any  party  shall  establish  an  agen- 
cy in  any  city  or  town  for  the  sale  of  a  roller 
made  exclusively  foi»  that  purpose,  no  other 
party  shall  take  orders  for  the  same  roller 
in  the  same  place.  To  these  restrictions, 
clearly  valid,  there  is  added  the  one  which 
affords  an  argument  for  the  invalidity  of 
the  contract,— the  restriction  as  to  price. 
That  restriction  is,  in  substance,  that  the 
prices  for  rollers  of  the  same  grade,  made 
by  different  parties,  shall  be  the  same,  and 
shall  be,  according  to  a  schedule  contained 
in  the  contract,  subject  to  changes  whick 
may  be  made  by  the  plaintiff  upon  recom- 
mendation of  three-fourths  of  its  stockhold- 
ers. In  effect.  It  is  an  agreement  between 
three  makers  of  a  commodity  that  for  three 
years  they  will  sell  it  at  a  uniform  price 
fixed  at  the  outset,  and  to  be  changed  only 
by  consent  of  a  majority  of  them.  The 
agreement  does  not  refer  to  an  article  of 
prime  necessity,  nor  to  a  staple  of  commerce, 
nor  to  merchandise  to  be  bought  and  sold  in 
the  market,  but  to  a  particular  curtain  fix- 
ture of  the  parties'  own  manufacture.  It 
does  not  loolc  to  affecting  competition  from 
outside, — the  parties  have  a  monopoly  by 
their  patents,— but  only  to  restrict  competi- 
tion in  price  between  themselves.  Even  if 
such  an  agreement  tends  to  raise  the  price 
of  the  commodity,  it  is  one  which  the  parties 
have  a  right  to  make.  To  hold  otherwise 
would  be  to  impair  the  right  of  persons  to 
make  contracts,  and  to  put  a  price  on  the 
products  of  their  own  industry'. 

But  we  cannot  assume  that  the  purpose 
and  effect  of  the  combination  Is  to  unduly 
raise  the  price  of  the  commodity.  A  natural 
purpose  and  a  natural  effect  is  to  maintain 
a  fair  and  uniform  price,  and  to  prevent  the 
Injurious  effects,  both  to  producers  and  con- 
sumers, of  fluctuating  prices  caused  by  un- 
due competitition.  When  it  appears  that  the 
combination  is  used  to  the  public  detriment, 
a  different  question  will  be  presented  from 
that  now  before  us.  The  contract  is  appar- 
ently beneficial  to  the  parties  to  the  cuiu- 
bination,  and  not  necessarily  injurious  to  the 
public,  and  we  know  of  no  authority  or  reason 
for  holding  it  to  be  invalid  as  in  restraint 
of  ti-ade  or  against  public  policy.  We  have 
not  overlooked  other  provisions  of  the  con- 
tract, which  were  adverted  to  in  the  argu- 
ment, but  we  do  not  find  anything  which  ren- 
ders it  invalid,  or  calls  for  special  consider- 
ation. 

In  the  opinion  of  a  majority  of  the  court, 
the  entry  must  be,  demurrer  overruled. 


ILLEGALITY  OF  OBJECT. 


GOOD  V.  DALAXD. 
(24  N.  E.  15,  121  N.  Y.  1.) 


■^  Court  of  Appeals  of  New  York-      April  15, 

1890. 

Appeal  from  supreme  court,  general  term, 
second  department. 

The  case  came  befure  the  court  on  ap- 
peal from  the  decision  of  the  general  term, 
(6  N.  Y.  Supp.  204 J  sustaining  the  trial 
court  in  overruling  the  defendants'  demur- 
rer to  the  complaint.  The  demurrer  was 
based  upon  two  grounds:  (1)  That  there 
was  a  misjoinder  of  causes  of  action;  and 
(21  that  the  complaint  did  not  state  facta 
sutlicient  to  constitute  a  cause  of  action. 
The  complaint  alleged,  in  substance,  that 
the  Tucker  &  Carter  Cordage  Company, 
being  a  member  of  the  United  States  Cord- 
age Manufacturing  Association  of  the  City 
and  County  of  New  York,  together  with 
other  members  of  said  association,  autho- 
rized William  S.  Daland,  as  trustee  of  said 
association,  to  make  a  certain  contract 
with  the  plaintiff,  John  Good,  which  he 
did.  Said  contract,  which  is  set  out  in 
full,  recites  that  "the  members  "of  said  as- 
sociation, in  consideration  of  Good's 
agreement  to  allow  them  the  exclusive  use 
and  sale  on  the  western  continent  of  cer- 
.tain  inventions  patented  by  him,  and  to 
warrant  and  protect  them  therein,  agree 
to  pay  him  one-eighth  of  one  cent  per 
pound  on  all  manilla  and  sisal  fibers 
worked  by  them  into  cords,  twine,  and 
rope,  and  sold  by  them  in  the  United  States, 
during  the  time  they  shall  have  the  exclu- 
sive use  and  sale  of  said  inventions;  and, 
further,  that  "the  members  of  said  asso- 
ciation shall  respectively  submit  to  said 
Good  monthly  sworn  statements  of  the 
quantities  of  such  flbers  so  worked  and 
sold "  by  them  during  the  preceding 
month.  Daland  is  then  empowered  by 
Good  to  bring  suit  in  his  name,  and  at 
his  expense,  for  infringements  of  said  pat- 
ents; and  agrees,  on  his  part,  that  if  said 
association,  (jr  any  of  its  n}embers,  make 
default  in  submitting  a  monthly  sworn 
statement,  or  in  paying  the  amount  due 
as  provided,  he  will  bring  suit  against  such 
defaulting  member  for  the  collection  there- 
of, and,  if  he  fail  to  do  so,  that  Good  may 
bring  suit  in  his  name,  and  at  his  expense. 
The  complaint  then  alleges  that  the  plain- 
tiff has  performed  his  agreements;  but 
that  the  defendant  company  made  and 
sold  large  quantities  of  such  goods  during 
the  months  of  March,  April,  May,  June, 
and  July,  1887,  of  which  it  neglected  to 
make  him  any  statement ;  and  that  the  de- 
fendant Daland,  though  requested,  neglect- 
ed to  bring  suit  against  said  company. 
Plaintiff  asks  judgmentthatthe  rights  and 
liabilities  under  the  agreement  may  be  de- 
clared ;  that  an  accounting  maybe  had 
against  the  defendant  company  of  fibers 
so  worked  and  sold;  and  for  damages 
against  Daland  for  the  amount  of  the 
agreed  percentage  thereon,  or  for  such 
pc>rtion  thereof  as  he  could  by  due  diligence 
have  collected. 

Calvin  Frost,  for  appellants.  Albert  C. 
McDonald,  for  respondent. 


PECKHAM.J.  Although,  perhaps,  Da- 
land was  not  a  necessary  party  defendant 
to  this  action  upon  the  agreement  stated 
in  tlie  complaint,  yet  we  think  he  was  a 
proper  party.  As  trustee  for  the  varioua 
companies  represented  in  the  agreement, 
it  was  by  that  instnjment  made  his  duty 
to  bring  an  action  against  any  defaul'Ling 
member,  and  to  use  all  diligence  in  prose- 
cuting it.  The  plaintiff  claims  that  the 
corporation  defendant  was  a  defaulting 
member,  and  that  it  was  the  duty  of  Da- 
land to  prosecute  it,  but  that  he,  upon  re- 
quest to  bring  an  action  for  that  purpose, 
refused  so  to  do.  If  the  corporation  de- 
fendant were  in  fact  as  described  in  the 
agreement,  a  defaulting  member,  it  was 
the  duty  of  Daland  to  bring  suit  against 
it;  and  his  refusal  was  a  breach  of  that 
duty  and  of  his  agreement.  It  is  true  the 
agreement  provided  that,  in  case  Daland 
failed  to  bring  such  suit,  the  plaintiff 
might,  at  his  election,  bring  it  in  Daland's 
name,  and  at  his  expense.  But  the  plain- 
tiff was  notconfined  to  bringingan  action 
in  Daland's  name.  He  could  bring  it  in 
his  own  name,  and  join  Daland  as  defend- 
ant, and  charge  him  with  costs,  because 
of  this  breach  of  duty.  In  this  light,  there 
is  no  misjoinder  of  causes  of  action.  No 
cause  of  action  is  stated  against  Daland 
for  daniagTS  in  consequence  of  his  failure 
to  bring  suit  to  collect  the  percentage  due 
from  the  corporation  defendant,  when  re- 
quested by  the  plaintiff.  The  damages 
which  the  plaintiff  had  sustained  by  such 
failure  cannot  be  ascertained  from  any  al- 
legation in  the  complaint;  nor  can  it  b6 
said,  as  matter  of  mw  arising  from  tne 
facts  stated,  that  plaintiff  sustained  any 
damage.  As  there  are  not  facts  enough 
alleged  upon  which  a  good  cause  of  action 
against  Daland  could  be  predicated  on 
the  ground  of  his  failure  to  prosecute,  it 
cannot  be  ui-ged  that  the  two  causes  of 
action  have  been  iinproiwrly  united. 

As  other  grounds  for  sustaining  the  de- 
murrer, the  defendants  say  that  the  unin- 
corporated association  of  which  the  cor- 
poration defendant  is  alleged  to  be  a  mem- 
ber is  a  partnership,  and  theagreement  al- 
leged is  ultra  vires  the  corporation.  It  is 
also  stated  that  the  agreement  is  void  as 
in  restraint  of  trade,  and  as  tending  to  cre- 
ate a  monopoly.  The  complaint  gives  no 
information  as  to  the  character  of  the  asso- 
ciation known  as  the  "United  States  Cord- 
age Manufacturing  Association  of  the  City 
of  New  York. "  There  is  nothing  in  that 
pleading  which  shows  that  the  associa- 
tion is  a  partnership,  and  no  inference  to 
that  effect  can  be  drawn  from  the  allega- 
tions which  are  therein  set  forth.  All  that 
can  be  learned  from  the  complaint  is  that 
certain  corporations  have,  for  some  pur- 
pose which  is  undiscovered,  associated 
them-selves  in  some  way  together  under  a 
certain  name.  This  is  no  allegation  either 
of  partnarship,  or,  indeed,  of  any  illegal 
action  whatever.  The  agreement  which 
is  there  set  up  is  one  which  each  member 
of  the  association  authorized  theindividu- 
al  defendant  to  make,  as  trustee  for  the 
association,  with  the  plaintiff.  That  agree- 
ment shows  no  partnership,  but  is  an 
agreement  that  each  meml)erof  the  associ- 
ation will  pay  the   plaintiff  a  certain  price 


PUBLIC  POLICY— UNLAWFUL  COMBINATIONS— MONOPOLIES,  ETC. 


47: 


on  each  pcMind  of  man  ilia  and  sisal  fibers 
worked  by  such  member  and  offered  for 
sale.  No  member  is  responsible  for  any- 
tliinf?  but  its  own  worlc;  and  its  liai)ility 
is  based  entirely  upon  the  amount  wcjrked 
and  offered  for  sale  by  itself.  There  is  no 
community  of  profits  orof  losses  [)rovided 
for  in  the  agreement;  and  no  one  member 
has  any  rif;ht  to  speak  for  or  to  bind  any 
other memberin  regard  to thesubject-mat- 
ter  of  the  agreement.  We  can  see  nothing 
of  a  partnership  nature  set  forth  in  the 
complaint. 

The  last  objection  urged,  viz.,  that  the 
contract  set  forth  in  the  complaint  is  in  re- 
straint of  trade,  cannot  be  supijcn^led.  It 
appears  from  thecomplaint  that  thei)lain- 
tiff  had  in  vented  and  patented  certain  ma- 
chinery, and  parts  thereof,  for  dressing 
fibers,  spinning  yarns,  and  making  twines 
and  cordage  from  manilla  and  sisal  fibers, 
for  wliich  he  had  obtained  letters  patent 
from  the  Uniteil  States.  He  agreed  with 
the  defendant  Daland,  as  trustee  for  and 
representing  the  association  already  re- 
ferred to,  that  he  would,  in  North  and 
South  America,  confine  the  sale  and  use  of 
all  his  methods  and  macliinery,  then  or 
thereafter  to  be  invented  and  patented,  to 
the  members  of  the  association ;  who,  on 
tlieir  part,  covenanted  through  Daland  to 
pay  plaintiff  a  certain  sum  on  all  manilla 
and  sisal  fibers  worked  by  them  intocords, 
twine,  or  rope,  and  offered  forsale  and  use 
in  theUnited  States,  and  sold  or  delivered, 
during  the  time  they  should  have  the  sole 
and  exclusive  use  of  the  machinery  above 
mentioned,  provided  they  were  fully  pro- 
tected in  such  use  by  the  plaintiff.  It  is 
true  the  members  of  tlie  association  do  not 
agree  to  themselves  use  this  machinery  at 
all ;  nor  do  they  agree  as  to  any  speciaJ 
amount  of  twine  or  rope  which  shall  by 
each  or  all  of  them  be  offered  forsale;  and 
the  practical  result  is  to  take  the  machin- 
ery out  of  use,  unless  these  memlDers  them- 
selves use  or  permit  others  to  use  it.  This 
is  a  peculiarity  of  a  patented  article.  The 
owner  does  not  possess  his  patent  upon 
the  condition  that  he  shall  make  or  vend 
the  article  patented,  or  allow  others  t(j  do 
so  for  a  fair  and  reasonable  compensation. 
When  he  has  once  secured  his  patent,  he 
may,  if  he  choose,  remain  absolutely  quiet, 
and  not  only  neglect  and  refuse  to  make 
the  patented  article,  but  he  may  likewise 
refuse  to  permit  any  one  else  to  do  so  on 
any  terms.  If  the  patent  he  a  valuable 
one,  self-interest  may  be  relied  upon  as  a 
strong  enough  motiveto  induce  the  owner 
either  to  take  himself,  or  to  permit  others 


to  take,  some  steps  towards  introducing 
his  invention  into  use.  ilow  fur  it  will  go 
depends  upon  the  (jwner;  and  his  right  to 
decide  that  question  is  not  in  the  least  cir- 
cumscribed f)y  tlie  interests  of  tin,'  public 
in  obtaining  such  machinery  or  invention, 
or  a  right  to  its  use.  He  may  keep  such 
right  himself,  or  make  the  machint-ry  or 
manufacture  the  patented  article  alone,  or 
ho  may  permit  others  to  share  such  right 
with  him,  or  he  may  allow  them  an  ex- 
clusive right,  and  retain  none  himself.  It 
all  follows  and  is  founded  ujjon  the  abso- 
lute and  exclusive  right  which  theownerof 
the  patent  has  in  the  article  patented. 
Having  such  right, he  must  ijlainiy  be  per- 
mitted to  sell  to  another  the  right  itself, 
or  to  agree  with  him  that  he;  will  permit 
none  other  than  such  person  to  use  it. 
That  person  need  not  agree  to  make  the 
patented  article,  orto  sell  it.  It  is  a  ques- 
tion solely  for  the  parties  interested.  This 
right  is  necessary,  in  order  that  the  owner 
of  the  patent  shall  have  the  largest  mea.s- 
ure  of  prcjtection  under  it.  Considerations 
which  might  obtain  if  the  agreement  were 
In  i-egard  to  other  articles  cannot  be  of 
any  weight  in  the  decision  of  a  question 
arising  upon  an  agreement  as  to  patented 
articles.  If  an  owner  of  a  patent  should 
choose  to  refuse  to  manufacture  the  article 
covered  by  his  patent,  could  any  one  else 
claim  such  right?  His  simple  neglect  or 
refusal  to  manufacture  would  stand  as  a 
conclusive  reason  why  it  was  not  manu- 
factured. An  owner  might  sometimes 
make  more  money  by  not  manufacturing 
than  by  doing  so;  but  of  that  question  he 
is  the  sole  and  absolute  judge. 

There  is  nothing  in  this  agreement 
which  can  be  regarded  as  illegal,  within 
the  principles  above  stated,  which  are  not 
in  the  least  new  or  unknown.  The  plain- 
tiff probably  thought  his  inventions  would 
prove  sufficiently  remunerative  to  him  if 
he  sold  the  exclusive  right  to  use  them  to 
the  members  of  this  association  even 
though  they  did  not  themselves  agree  to 
use  the  same  in  the  process  of  the  manu- 
facture of  cord  or  twine.  His  compensa- 
tion was  measured  b\'  the  amount  of  cord 
and  twine  worked,  sold,  and  delivered  by 
these  members ;  and  whether  they  should 
use  his  inventions,  or  keep  them  uueni- 
pl03-ed,  was  not  thereafter  a  question  of 
interest  to  him,  so  long  as  the  agreement 
remained  in  force.  We  think  the  demur- 
rers were  not  well  taken.  The  judgment 
overruling  them  should  be  alTirmed.  with 
.costs,  with  leave  to  answer  on  payment 
of  costs.     All  concur. 


i76  4 


ILLEGALITY  OF  OBJECT. 


i/v<- 


'^.. 


-y 


MORE  et  al.  v.  BENNETT  et  al. 

(29  N.  E.  SS8.  140  111.  69.) 

Supreme  Court  of  Illinois.    Jan.    IS,   1892. 


Appeal  from  appellate  court,  first  dis- 
trict. 

Action  by  R.  Wilson  More  and  others 
against  J.  L.  Bennett  and  others  for  dam- 
ajies  for  violation  of  rules  of  an  associa- 
tion of  wliich  both  parties  were  members. 
Judgment  sustaining  a  demurrer  to  the 
complaint  was  atlirmed  by  the  appellate 
court.    Plaintiff  appeals.     Affirmed. 

The  other  facts  fully  uppear  in  the  fol- 
lowing statement  by  BAILEY,  J. : 

This  was  a  suit  in  assumpsit,  brought  by 
R.  Wilson  More  and  others, composing  the 
firm  of  More  &  Dundas,  against  J.  L.  Ben- 
nett and  others,  composing  th'«  firm  of 
Bennett.  Edwards  &,  Pettit,  to  recover 
damages  resulting  from  an  alleged  bi'each 
of  certain  rules  and  by-laws  of  the  Chica- 
go Law  Stenographers'  Association,  of 
which  both  the  plaintiffs  and  defendants 
are  members.  To  the  declaration,  which 
consists  of  two  special  counts,  a  demurrer 
was  sustained,  and,  the  plaintiffs  electing 
to  abide  bj'  their  declaration,  judgment 
was  rendered  in  favor  of  the  defendants 
for  costs.  Said  judgment  has  been  af- 
firmed bj'  the  appellate  court  on  appenl, 
and  the  present  appeal  is  from  said  judg- 
m?nt  of  affirmance. 

The  first  count  of  the  declaration  alleges 
In  substance,  that  the  plaintiffs  and  de- 
fendants are  all  stenographers  by  profes- 
sion, and  have,  from  the  time  of  its  organ- 
ization, been  members  of  said  association, 
an  association  formed  to  promote  the 
interest  of  its  m?mbersby  all  proper  meth- 
ods, and  to  establish  and  maintain  rea- 
sonable, proper,  and  uniform  rates  for 
stenographic  work  done  by  the  members 
of  said  association,  and  to  secure  to 
judges,  lawyers,  and  citizens  of  Chicago 
efficient,  competent,  and  reliable  law  re- 
porting, at  reasonable,  proper,  and  uni- 
form rates,  and  to  furnish  them  with  the 
means  of  obtaining  efficient  and  compe- 
tent reporters,  and  to  increase  the  effi- 
ciency of  law  reporting  in  the  county  of 
Cook.  That,  in  accordance  with  its  con- 
stitution and  by-laws,  said  association 
had  adopted  a  schedule  of  rates  which 
were  and  are  fair  and  reasonable,  and  had 
for  more  than  15  years  prior  to  the  organ- 
ization of  said  association  been  the  estab- 
lished rates  among  law  stenographers, 
and  had  been  and  are  still  recognized  as 
reasonable  and  established  rates  by  judges 
and  members  of  the  legal  fraternity,  and 
by  law  stenographers  of  the  city  of  Chi- 
cago, there  having  been  during  said  time 
no  material  variation  from  said  rates 
among  law  stenographers,  said  rates  be- 
ing less  than  those  established  in  certain 
other  large  cities  of  the  United  States  for 
the  same  class  of  work.  Said  count  fur- 
ther alleges  that,  in  consideration  of  like 
promises  and  agreements  on  the  part  of 
the  plaintiffs,  and  like  payment  of  the 
membership  fee  of  $.5  by  each  of  the  plain- 
tiffs to  become  members  of  said  associa- 
tion, the  defendants  promised  and  agreed 
with  the  plaintiffs  that  they  would  be 
bound   in    their  charges  for  work  by    the 


schedule  of  rates  adopted  by  said  associa- 
tion. That  the  defendants  might  cut  rates 
against  pei-sons  not  members  of  said  asso- 
ciation, provided  such  cutting  was  in  good 
faith  and  the  rights  of  the  plaintiffs  were 
respected.  That  in  no  case  where  the  de- 
fendants had  anV  knowledge  of  the  exist- 
ence of  a  contract  or  reporting  arrange- 
ment between  the  plaintiffs  and  any  law- 
yer, corporation,  or  any  other  person 
would  they  attempt,  by  underbidding  the 
rate  established  by  said  association  or 
other  unfair  means,  to  secure  such  report- 
ing. That  the  rates  established  by  said 
association  were  as  follows:  Not  less 
than  20  cents  per  folio  for  single  copy  ;  not 
less  tlian  25  cents  per  folio  for  two  copies; 
not  less  than  28  cents  per  folio  for  three 
copies;  and  the  rate  of  .$10  per  day  for 
attendance,  with  the  qualification  that, 
if  a  reporter  was  engaged  by  one  of  the 
I)arties  to  a  suit,  he  or  any  other  reporter, 
knowing  of  such  engagement,  might  take 
the  other  side  of  the  case  for  $5  per  day; 
but  in  no  case  should  the  reporter  make 
any  offer  to  any  attorney  after  being 
informed  by  such  attorney  that  he  had  en- 
gaged a  reporter.  That  while  said  asso- 
ciation was  in  existence,  and  the  plaintiffs 
and  defendants  were  members  thereof,  the 
plaintiffs  entered  into  a  contract  or  re- 
porting arrangement  with  the  county  of 
Cook,  by  which  said  county  employed  the 
plaintiffs  to  report  the  proceedings  and 
furnish  transcripts  thereof,  as  said  county 
should  require,  in  a  certain  celebrated 
murder  case  then  pending  in  the  criminal 
court  of  Cook  county,  to-wit,  the  case  of 
People  V.  O'SuUivan  and  others,  known 
as  the"Cronin  Trial,"  said  employment 
by  said  county  being  on  the  following 
terms,  to-wit,  .flO  per  day  for  attendance, 
and  the  regular  rates  for  transcripts  as 
established  by  said  association,  the  plain- 
tiffs agreeing  with  said  connty  to  do  said 
work,  if  the  county  should  demand  it,  at  as 
low  a  rateasany  reputableand established 
stenographer  or  firm  of  stenographers 
should  in  good  faith  bid  for  said  work. 
That  the  plaintiffs  entered  upon  the  per- 
formance of  said  contract,  and  were  en- 
gaged in  reporting  theproceedings  at  said 
trial  at  said  regular  rates,  yet  the  defend- 
ants, well  knowing  the  premises,  and  the 
aforesaid  contract  or  reporting  arrange- 
ment between  the  plaintiffs  and  said  coun- 
ty, and  after  the  plaintiffs  had  been  en- 
gaged on  said  case  for,  to-wit,  seven 
weeks,  and  ata  time  when  defendants  well 
knew  that  the  plaintiff  had  performed  the 
most  unprofitable  part  of  said  contract, 
and  not  regarding  their  said  promise  so 
made  to  the  plaintiffs,  did  not  respect  the 
rights  of  the  plaintiffs  and  the  schedule 
rates  so  adopted  by  said  association,  and 
the  fact  that  they  knew  that  there  was  a 
reporting  arrangement  or  contract  be- 
tween the  plaintiffs  and  said  county,  but 
solicited  said  county,  and  endeavored  to 
secure  from  said  county,  by  underbidding 
and  other  unfair  means,  employment  as 
law  stenographers  to  report  and  fnrnish 
transcripts  of  the  proceedings  at  said  trial, 
and  made  a  certain  t>id  to  said  county,  by 
which  th<iy  offered  to  do  said  work  at  a 
less  rate  than  that  established  by  said  as»- 
sociation   to-wit,  $5   per  day  for   attend- 


PUBLIC  POLICY— UXLAWFUL  COMBINATIONS— MONOPOLIES,  EtC.     477 


anco,  20  centH  per  folio  for  a  single  copy, 
22  cents  per  folio  for  two  copieH,  and  all 
copies  above  two  free  of  cliarge.  Tlint 
thereupon  the  plaintiffs,  liecausr«  of  said 
bid  of  tlie  defendants,  were  re(|iiire(l  by 
said  county  to  meet  said  l»id,  or  to  cease 
their  emi)loyineut  on  said  trial,  as  by  the 
terms  of  said  employment  said  county 
had  a  right  to  do;  and  that  the  iJJaintiffs, 
for  the  puri)ose  of  remaining  in  employ- 
ment on  said  trial,  did  meet  the  said  bid 
of  the  dt'fcndants,  and  afterwards  re[)ort- 
ed  and  furnished  transcripts  of  the  [iro- 
ceedings  on  said  trial  at  th3  rates  offered 
by  the  defendants;  by  means  whereof 
they  were  deprived  of  divers  gains  and 
profits  which  wonld  have  accrued  to  them 
from  the  reporting  and  furnishing  tran- 
scripts on  said  trial  under  the  regular 
rates  of  said  association,  and  in  accord- 
ance with  their  original  l)id,  and  have 
suffered  great  loss  and  damage  through 
the  wrongful  conduct  of  the  defendants, 
to  the  damage  of  the  plaintiffs  in  the 
sum  of  $;5,0()0;  and  therefore  they  bring 
their  suit,  etc. 

The  second  connt  contains  substantial- 
ly the  same  allegations  as  the  fii-st,  and 
also  the  following:  That  said  associa- 
tion numbers  among  its  members  only  a 
small  portion  of  the  law  stenographers  of 
the  city  of  Chicago,  and  that  said  associa- 
tion was  formed  because  a  system  of  ruin- 
ous competition  had  sf)rung  up  an:!ong 
the  stenographers  of  said  city,  by  which 
the  prices  of  stenographic  work  were  de- 
pressed below  reasonable  rates,  and  also 
because  a  discreditable  and  dishonorable 
system  of  solicitation  for  business  had 
sprung  up,  by  which  efforts  were  made  on 
the  part  of  stenographers  to  induce  at- 
torneys, corporations,  and  other  persons 
to  break  their  contracts  already  made 
witli  other  stenographers,  and  that  the 
objects  of  said  association  were  to  pre- 
vent said  discreditable  and  disiioriorahle 
solicitation,  and  to  promote  the  interests 
of  the  members  thereof  by  all  proper 
methods,  and  to  establish  and  maintain 
l)roper  and  uniform  rates  forstenographic 
work  done  by  its  members.  Said  second 
count  also  set  out,  in  cxtenso,  the  consti- 
tution, by-laws,  and  schedule  of  rates  of 
said  association,  said  constitution  con- 
taining, among  other  things,  the  follow- 
ing provisions:  "The  object  of  this  asso- 
ciation shall  be  to  promote  the  interests 
of  the  members  thereof  by  all  proi)er  meth- 
ods, particularly  to  establish  and  main- 
tain proper  rates  for  stenographic  work 
(lone  by  members  of  the  association.  Any 
reputable  stenographer,  regularly  en- 
gaged in  law  reporting  in  Cook  county, 
shall  be  eligible  to  membership  under  the 
rules  hereinafter  provided.  The  associa- 
tion may  adopt  a  schedule  of  rates  to  be 
charged  by  the  members  for  stenographic 
work  done  by  them,  which  schedule  shall 
be  binding  upon  every  member."  Among 
the  by-laws  adopted  l)y  said  association 
were  the  following:  "The  membership  fee 
shall  be  $5.  The  expenses  of  the  associa- 
tion, above  amount  received  for  member- 
ship fees,  shall  be  paid  out  of  a  fund  to  be 
collected  by  assessment,  to  be  levied  by 
the  board  of  directors  from  time  to  time, 
as   may    be  necessary.     The    members   of 


this  association  shall  respect  each  other's 
rights,  and  In  no  case  where  a  member  has 
knowledge  of  the  existence  (jf  a  contract 
or  repf)rting  arrangi'inent  bitween  a  fel- 
low-member and  a  la w.vcr,  corporation, 
or  any  other  person  shall  he  attemjtt.  by 
underbidding  or  other  unfair  means,  to 
secure  such  reporting;  but  members  of 
this  association  may  cut  rates  against 
outsi'lers,  if  they  choose;  such  cutting, 
however,  must  be  done  in  good  faith,  or 
the  member  will  be  liable  to  fine,  as  i)ro- 
vided  for  other  violations  of  the  constitu- 
tion and  b3'-laws."  Said  by-laws  also 
provide,  in  case  of  any  violatitui  of  the 
rules  of  said  association  by  any  of  its 
members,  for  a  trial  of  the  member  ac- 
cused of  such  violation  by  a  special  arbi- 
tration committee,  and  the  im[)osition  of 
a  fine,  in  case  of  conviction,  of  not  less 
than  $10.  nor  more  than  S'J5,  to  be  paid 
into  the  treasury  of  the  association,  with 
the  right  on  the  part  of  the  accused  to  an 
appeal  to  a  meeting  of  the  entire  associa- 
tirjn  to  be  called  for  that  purpose;  and  it 
is  further  provided  that,  "in  cases  where 
the  differences  between  members  require 
financial  adjustment,  the  said  arbitration 
committee  shall  decitle  between  the  par- 
ties." with  right  of  appeal  from  the  decis- 
ion of  said  committee  to  any  regular  or 
special  meeting  of  the  association,  whose 
decision  in  the  matter  is  final.  The  as- 
signments of  error  call  in  question  the  de- 
cision of  the  circuit  court  sustaining  the 
demurrer  to  said  declaration. 

Mntz  &  Fisher,  for  appellants.  J.  L. 
Benuett,  for  appellees. 

BAILEY,  J.,  (after  stating  the  facts.) 
The  question  is  raised  by  counsel,  and 
discussed  at  some  length,  whether  mem- 
bership in  the  Chicago  Law  Stenographic 
Association  established  a  contractual  re- 
lation between  the  plaintiffs  and  defend- 
ants which  gives  to  the  plaintiffs  a  right 
of  action  against  the  defendants  for  a  vio- 
lation of  any  of  the  rules  of  said  associa- 
tion, as  for  a  breach  of  contract;  and  al- 
so whether  the  only  remedy  for  a  viola- 
tion of  said  rules  is  not  that  provided  by 
the  by-laws  of  the  association,  viz..  a 
tine,  to  be  imposed  upon  the  offender, 
after  a  trial  and  conviction  before  an  ar- 
bitration committee,  duly  ajipointed  for 
that  purpose.  But,  as  we  view  the  case, 
it  will  be  unnecessary  for  us  to  consider 
these  questions;  since,  admitting  that 
the  constitution  and  by-laws  of  the  asso- 
ciation were  in  the  natiire  of  a  contract 
as  between  the  members  intfr  se,  we  are 
of  the  opinion  that  the  contract  thus  es- 
tal)lished  is  so  far  obnoxious  to  well-set- 
tled rules  of  public  policy  as  to  render  it 
improper  for  the  courts  to  lend  their  aid 
to  its  enforcement.  Whatever  may  be 
the  professed  objects  of  the  association, 
it  clearly  appears,  both  from  its  consti- 
tution and  by-laws,  and  from  the  aver- 
ments of  th?  declaration,  that  one  of  its 
objects,  if  not  its  leading  object,  is  to  con- 
trol the  prices  to  be  charged  bj-  its  mem- 
bers for  stenographic  work,  by  restrain- 
ing all  competition  between  them. 
Power  is  given  to  the  association  to  fix  a 
schedule  of  prices  which  shall  be  binding 
upon  all  its  members,  and  not  onl^'  do  the 


478 


ILLEGALITY  OF  OBJECT. 


members,   by   assenting  to   the  constitu- 
tion and   by-laws,   agreo   to  be  bound    by 
the  schedule  thus   fixed,  but    their  compe- 
tition Avith   each   other,  eirlier  by    taking 
or  ofieiing  to  take  a  less   price,  is  punish- 
able  b3'  the  imposition  of  lines,  as  well  as 
by    such   other  disciplinary   measures   as 
associations  of   this  character  may  adopt 
for  the  enforcement   of  their  rules.     The 
rule    uf    public    policy    here    involved    is 
closely  analogous   to  that  which    declares' 
illegal   and  void   contracts   in   general  re- 
straint   of  trade,  if  it  is  not,  indeed,  a  sub- 
ordinate   application   of    the    same  rule. 
As  said  by  Mr.  Tiedeman  :    "  Following  the 
reason   of   the  rule   which   p"ohibits  con- 
tracts in  restraint  of   trade,  we   find    that 
it  is  made  to  prohibit  all   contracts  which 
in  any  way  restrain    the  freedom  of  trade 
or  diminish   competition,  or   regulate  the 
prices    of    commodities    or    services.     All 
combinations  of  capitalists  or  of  workmen 
for    the   purpose   of  influencing    trade   in 
their  especial   favor,  by  raising   or  reduc- 
ing prices,    are  so   far  illegal   that   agree- 
ments to  combine  cannot    be   enforced  by 
the    courts."    Tied.   Ccjm.    Paper,    §    190. 
Many  cases   may  be  found   in  which   the 
doctrine   here  stated   has  been    laid  down 
and   enforced.     Thus   in  vStanton  v.  Allen, 
5  Denio,  4.34,  where  an  association  among 
the  whole  or  a  large  part  of  the  proprie- 
tors of  boats  on  the  Erie  and   Oswego  ca- 
nals was   formed  upon    an    agreement    to 
regulate   the  price  of  freight   and   passage 
by  a  uniform  scale  to  be   fixed    by  a   com- 
mittee chosen  by  themselves,  and  to  divide 
the  profits   of  their  business  according  to 
the  number  of   boats  employed    by  each, 
with  provisions  prohibiting  the   members 
from   engaging  in  similar  business  out  of 
the  association,  it  was  held  that,  as  the 
tendency  of  such  agreement  was  to  increase 
prices  and  to  prevent   wholesome   compe- 
tition, as  well  as  diminish    the  public   rev- 
enue, it    was   against   public    policy   and 
void,   by    the  principles    of   the  common 
law.    In  Hooker  v.  Vaudewater,  4  Denio, 
;j49,  the  proprietors  of  five  several   lines  of 
boats   engaged   in  the  business   of  trans- 
porting jjersons  and  freight   on   the   Erie 
and  Oswego  canals  entered  into  an  agree- 
ment in  which,  "for  the  purpose  of  estab- 
lishing and  maintaining  fair  and  uniform 
rates  of  freight,  and   equalizing  the  busi- 
ness among  themselves,  and   to  avoid  all 
unnecessary   expense  in   doing  the  same,  " 
they  agreed   to  run  for   the  residue   of  the 
season   of  navigation  at  certain   rates   of 
freight   and  passage   then  fixed  upon,  but 
which   should    be  changed    whenever   tlie 
parties  should  deem   expedient,  and  to  di- 
vide the  net  earnings   among   themsolv(!s 
according   to  certain    fixed    proportions; 
and   it  was  held,  in   a  suit  on   the   agree- 
ment against  a  party  who  failed   to  make 
payment   according  to  its  terms,  that  the 
agreement   was  a   conspiracy   to   commit 
an  act  injurious  to  trade,  and  was  illegal 
and  void.     In  Morris  Run  Coal  Co  v.  Bar- 
clay Coal  Co.,  68  Pa.  St.  173,  five  coal  com- 
panies  in   Pennsylvania   entered   into   an 
agreement  in   N3W   York    to   divide   two 
coal  regions  of   which   they   had   control; 
to  appoint  a  committee  to  take  charge  of 
their   interests,  and    decide  all    questions; 
and    appoint  a  general   agent  at  a  certain 


point  in  the  state  oi  New  York,  the  coal 
mined  to  be  delivered  through  him,  each 
company  to  deliver  its  proportion  at  its 
own  cost  at  the  different  markets,  at  such 
time  and  to  such  persons  as  the  commit- 
tee should  direct,  the  (rommittee  to  adjust 
all  prices,  rates  of  freight,  etc.,  and  settle- 
ments to  be  made  between  the  several 
companies  monthly;  ajid  it  was  held,  in  a 
suit  brought  by  one  of  said  companies 
against  another,  to  enforce  a  liability 
arising  under  said  contract,  that  the  con- 
tract was  in  violation  of  a  statute  of  New 
York  making  it  a  misdemeanor  to  con- 
spire to  commit  any  act  injurious  to  trade 
or  comuicrce.  and  was  also  against  pub- 
lic policy,  and  therefore  illegal  and  void; 
the  court  laying  down  the  rule,  among 
other  things,  that  every  association 
formed  to  raise  or  depress  prices  beyond 
what  they  would  be,  if  left  without  aid 
or  stimulus,  was  criminal.  In  Craft  v. 
McConoughy,  79  111.  346,  a  contract  was 
entered  into  by  all  the  grain  dealers  in  a 
certain  town  which,  on  its  face,  indicated 
that  they  had  formed  a  partnership  for 
the  purpose  of  dealing  in  grain,  but  the 
true  object  of  which  was  to  form  a  secret 
combination  which  would  stifle  all  com- 
petition, and  enable  the  parties,  by  secret 
and  fraudulent  means,  to  control  the  price 
of  grain,  costs  of  storage,  and  expense  of 
Bhij)raent  at  such  town;  and  it  was  held, 
on  bill  filed  for  an  accounting  and  distri- 
bution of  profits,  that  such  contract  was 
in  restraint  of  trade,  and  consequently 
void  on  grounds  of  public  policy.  In  dis- 
cussing the  principles  involved,  this  court 
said:  "  While  these  parties  were  in  busi- 
ness in  competition  with  each  other,  they 
had  the  undoubted  right  to  establish 
their  own  rates  for  grain  stored  and 
commissions  for  shipment  and  sale. 
They  could  pay  as  high  or  low  a  price 
for  grain  as  they  saw  proper,  and  as 
they  could  make  contracts  for  with  the 
producer.  So  long  as  competition  was 
free,  the  interest  of  the  public  was  safe. 
The  laws  of  trade,  in  connection  with  the 
rigor  of  competition,  were  all  the  guiiran- 
ty  the  public  required  ;  but  the  secret  com- 
bination created  by  the  contract  de- 
stroyed all  competition,  and  created  a 
monopoly  against  which  the  public  inter- 
est had  no  protection." 

The  doctrine  of  the  foregoing  decisions 
may,  in  our  opinion,  be  fairly  applied  to 
the  facts  in  the  present  case.  While  some 
of  the  cases  cited  involve  elements  not 
present  here,  the  determining  circumstance 
in  all  of  them  seems  to  have  been  a  com- 
bination or  conspiracy  among  a  number 
of  persons,  engaged  in  a  particular  busi- 
ness, to  stifle  or  prevent  competition,  and 
therel)y  to  enhance  or  diminish  prices  to  a 
point  above  or  below  what  they  would 
have  been  if  left  to  the  Influence  of  unre- 
stricted competition.  All  such  combina- 
tions are  held  to  be  contrary  to  public 
policy,  and  the  courts,  therefore,  will  re- 
fuse to  lend  their  aid  to  the  enforcement  of 
the  contracts  by  which  such  combinations 
are  sought  to  be  effected.  Counsel  seek  to 
distinguish  this  case  from  those  cited  by 
the  circumstance,  alleged  in  the  second 
count  of  the  declaration,  that  but  a  small 
portion   of   the  law  stenographers  of  Chi 


PUBLIC  POLICY— UNLAWFUL  COMBINATIOXS— MOXOPOLIES,  ETC     479 


cago  belong  to  said  association.  An  an- 
alogy is  thereby  souglit  to  be  raised  be- 
tween the  contract  in  this  case  and  those 
contracts  in  partial  restraint  of  trade, 
wliicii  the  law  upholds.  We  think  tiie  an- 
alogy thus  sought  to  be  raised  does  not 
exist.  Contracts  in  partial  restraint  ol 
trade  which  tlie  law  sustains  are  those 
wiiich  are  entered  into  by  a  vendor  of  a 
business  and  its  good-will  with  his  vendee, 
by  which  the  vendor  agrees  not  to  engage 
in  the  Ranie  business  within  a  liniitecl  ter- 
ritory, and  the  restraint,  to  be  valid,  must 
be  no  more  extensive  than  is  reasonably 
necessary  for  the  protection  of  the  vendee 
in  the  enjoyment  of  the  business  pur- 
chased. But  in  the  present  case  there  is 
no  purchase  or  sale  of  any  business,  nor 
any  other  analogous  circumstance  giving 
to  one  party  a  just  right  to  be  protected 
against  competition  from  the  other.  All 
of  the  members  of  the  association  are  en- 
gaged in  the  same  business  within  the 
same  territory,  and  the  object  of  the  as- 
sociation is  purely  and  simply  to  silence 
and  stifle  all  competition  as  between  its 
members.  No  equitable  reason  for  such 
restraint  exists;  the  only  reason  put  for- 
ward being  that,  under  the  influence  of 
competition  as  it  existed  prior  to  the  or- 
ganization  of   the  association,  prices  for 


stenographic  work  had  been  reduced  too 
far,  and  the  association  was  organized 
for  the  purpose  of  putting  an  end  to  all 
competition,  at  least  as  between  those 
who  could  be  induced  to  become  members. 
True,  the  restraint  is  not  s(j  far-reaching 
as  it  would  have  been  if  all  the  stenogra- 
phers in  the  city  had  j<jincil  the  associa- 
tion, but,  so  far  as  it  goes,  it  Is  of  precise- 
ly the  same  cliaracter,  produces  the-  same 
results,  and  is  subject  to  the  same  legal 
objection.  It  raaj'  also  be  observed  that, 
by  the  constitution  of  the  association,  any 
reputable  stenographer, regularly  engaued 
in  law  reporting  in  Cook  county,  is  eli«^i- 
ble  to  memljership,  and,  if  all  or  a  n)aj(jr 
part  of  the  stencjgraphers  in  said  county 
engaged  in  that  business  are  not  already 
members,  it  is  because  the  association  has 
not  yet  fully  accomplished  the  purposes  of 
its  organization.  We  can  see'  no  legal 
difference  between  the  restraint  upon  com- 
petition which  it  now  exercises  and  that 
which  it  will  exercise  when  it  is  in  a  position 
to  dictate  terras  to  all  who  are  engaijed 
in  the  business,  and  to  all  who  may  wish 
to  obtain  the  services  of  law  stenographic 
reporters.  We  are  of  the  opinion  that 
the  demurrer  to  the  declaration  was  prop- 
erly sustained,  and  the  judgment  will 
therefore  be  affirmed. 


480 


f 


„X, 


i 


ILLEGALITY  OF  OBJECT. 


(^"^     RAILROAD  CO  v.  LOCKWOOD. 

(17  WaU.  357.) 

Supreme  Court  of  the  United  States.    Oct^ 
1873. 

Error  to  the  circuit  court  for  the  Southern 
district  of  New  York;    the  case  being  thus: 

Lockwood,  a  drover,  was  injured  whilst 
travelLng  on  a  stock  train  of  the  New  York 
Central  Railroad  Company,  proceeding  from 
Buffalo  to  Albany,  and  brought  this  suit  to 
recover  damages  for  the  injury.  He  had  cat- 
tle in  the  train,  and  had  been  required,  at 
Buffalo,  to  sign  an  agreement  to  attend  to  the 
loading,  transporting,  and  unloading  of  them, 
and  to  take  all  risk  of  injury  to  them  and  of 
personal  injurj-  to  himself,  or  to  whomsoever 
went  with  the  cattle;  and  he  received  what  is 
called  a  drover's  pass;  that  is  to  say,  a  pass 
certifying  that  he  had  shipped  sufficient  stock 
to  pass  free  to  Albany,  but  declaring  that  the 
acceptance  of  the  pass  was  to  be  considered 
a  waiver  of  all  claims  for  damages  or  injuries 
received  on  the  train.  The  agreement  stated 
Its  consideration  to  be  the  carrying  of  the 
plaintiff's  cattle  at  less  than  tariff  rates.  It 
was  shown  on  the  trial,  that  these  rates  were 
about  three  times  the  ordinary  rates  charged, 
and  that  no  drover  had  cattle  carried  on  those 
terms;  but  that  all  signed  similar  agreements 
to  that  which  was  signed  by  the  plaintiff,  and 
received  similar  passes.  Evidence  was  giv- 
en on  the  trial  tending  to  show  that  the  in- 
jury complained  of  was  sustained  in  conse- 
quence of  negligence  on  the  part  of  the  de- 
fendants or  their  servants,  but  they  insisted 
that  they  were  exempted  by  the  terms  of  the 
contract  from  responsibility  for  all  accidents, 
including  those  occurring  from  negligence,  at 
least  the  ordinary  negligence  of  their  ser^'- 
ants;  and  requested  the  judge  so  to  charge. 
This  he  refused,  and  charged  that  If  the  jury 
were  satisfied  that  the  injury  occurred  with- 
out any  negligence  on  the  part  of  the  plain- 
tiff, and  that  the  negligence  of  the  defend- 
ants caused  the  injury,  they  must  find  for  the 
plaintiff,  which  they  did.  Judgment  being  en- 
tered accordingly,  the  railroad  company  took 
this  writ  of  error. 

It  is  unnecessary  to  notice  some  subordinate 
points  made,  as  this  court  was  of  opinion 
that  all  the  questions  of  fact  were  fairly  left 
to  the  jury,  and  that  the  whole  controversy 
depended  on  the  main  question  of  law  stated. 

■T.  R.  Strong,  for  plaintiff  in  error.  Messrs. 
Truman  Smith  and  Cephas  Bi-alnerd,  contra. 

Mr  Justice  BRADLEY  delivered  the  opinion 
of  the  court. 

It  may  be  assumed  in  limine,  that  the  case 
was  one  of  carriage  for  hire;  for  though  the 
pass  certifies  that  the  plaintiff  was  entitled  to 
pass  free,  yet  his  passage  was  one  of  the  mu- 
tual terms  of  the  arrangement  for  carrying  his 
cattle.  The  question  is,  therefore,  distinctly 
raised,  whether  a  railroad  company  carrying 
passengers  for  hire,  can  lawfully  stipulate 
not  to  be  answerable  for  their  own  or  their 


servants'  negligence  in  reference  to  such  car- 
riage. 

As  the  duties  and  responsibilities  of  public 
carriers  were  prescribed  by  public  policy,  it 
has  been' seriously  doubted  whether  the  courts 
did  wisely  in  allowing  that  policy  to  be  de- 
parted from  without  legislative  interference, 
by  which  needed  modifications  could  have  been 
introduced  into  the  law.  But  the  great  hard- 
ship on  the  carrier  in  certain  special  cases, 
where  goods  of  great  value  or  subject  to  extra 
risk  were  delivered  to  him  without  notice  of 
their  character,  and  where  losses  happened 
by  sheer  accident  without  any  possibility  of 
fraud  or  collusion  on  his  part,  such  as  by  col- 
lisions at  sea,  accidental  fire,  &c.,  led  to  a 
relaxation  of  the  rule  to  the  extent  of  author- 
izing certain  exemptions  from  liability  in  such 
cases  to  be  provided  for,  either  by  public  no- 
tice brought  home  to  the  owners  of  the  goods, 
or  by  inserting  exemptions  from  liability  in  the 
bill  of  lading,  or  other  contract  of  carriage. 
A  modification  of  the  strict  rule  of  respon- 
sibility, exempting  the  carrier  from  liability 
for  accidental  losses,  where  it  can  be  safely 
done,  enables  the  carrying  interest  to  reduce 
its  rates  of  compensation;  thus  proportionally 
relieving  the  transportation  of  produce  and 
merchandise  from  some  of  the  burden  with 
which  it  is  loaded. 

The  question  is,  whether  such  modification 
of  responsibility  by  notice  or  special  con- 
tract may  not  be  carried  beyond  legitimate 
bounds,  and  introduce  evils  against  which 
it  was  the  direct  policy  of  the  law  to  guard; 
whether,  for  example,  a  modification  which 
gives  license  and  immunity  to  negligence  and 
carelessness  on  the  part  of  a  public  carrier  or 
his  servants,  is  not  so  evidently  repugnant  to 
that  policy  as  to  be  altogether  null  and  void; 
or,  at  least  null  and  void  under  certain  cir- 
cumstances. 

In  the  case  of  sea-going  vessels,  congress 
has,  by  the  act  of  1S51,  relieved  ship-owners 
from  all  responsibility  for  loss  by  fire  unless 
caused  by  their  own  design  or  neglect;  and 
from  responsibility  for  loss  of  money  and  oth- 
er valuables  named,  imless  notified  of  their 
character  and  value;  and  has  limited  their 
liability  to  the  value  of  ship  and  freight, 
where  losses  happen  by  the  embezzlement 
or  other  act  of  the  master,  crew,  or  passen- 
gers; or  by  collision,  or  any  cause  occurring 
without  their  privity  or  knowledge;  but  the 
master  and  crew  themselves  are  held  respon- 
sible to  the  parties  injured  by  their  negligence 
or  misconduct  Similar  enactments  have  been 
made  by  state  legislatures.  This  seems  to  be 
the  only  important  modification  of  previously 
existing  law  on  the  subject,  which  in  this 
countrj'  has  been  effected  by  legislative  inter- 
ference. And  by  this,  it  is  seen,  that  though 
intended  for  the  relief  of  the  ship-owner,  it 
stiU  leaves  him  liable  to  the  extent  of  his  ship 
and  freight  for  the  negligence  and  misconduct 
of  his  employes,  and  liable  without  limit  for 
his  own  negligence. 

It  is  true  that  the  first  section  of  the  above 


PUBLIC  rOIJCY— LIMITING  LIABILITY  FOR  NEGLIGENCE. 


481 


act  reLiting  to  loss  by  fire  has  a  proviso,  that 
nothing  in  the  act  contained  shall  prevent  the 
parties  from  making  sucli  contract  as  they 
please,  extending  or  limiting  the  liability  of 
ship-owners.  This  proviso,  however,  neither 
enacts  nor  aflirras  anything.  It  simply  ex- 
presses the  intent  of  congress  to  leave  the 
right  of  contracting  as  it  stood  before  the  act. 

The  courts  of  New  York,  where  this  ca.se 
arose,  for  a  long  time  resisted  the  attempts 
of  common  carriers  to  limit  their  common- 
law  liability,  except  for  the  purpose  of  pro- 
curing a  disclosure  of  the  character  and  value 
of  articles  liable  to  extra  hazard  and  risk. 
This,  they  were  allowed  to  enforce  by  means 
of  a  notice  of  non-liability,  if  the  disclosure 
was  not  made.  But  such  announcements  as 
"all  baggage  at  the  risk  of  the  owner,"  and 
such  exceptions  in  bills  of  lading  as  "this  com- 
pany will  not  be  responsible  for  injuries  by 
fire,  nor  for  goods  lost,  stolen,  or  damaged," 
were  held  to  be  unavailing  and  void,  as  being 
against  the  policy  of  the  law.  Cole  v.  Good- 
win, 19  Wend.  257;   Gould  v.  Hill,  2  Hill,  G2.3. 

But  since  the  decision  in  the  ca.se  of  New 
Jersey  Steam  Nav.  Co.  v.  Merchants'  Bank,  6 
How.  344,  by  this  court,  in  January  term, 
1848,  it  has  been  Tmiformly  held,  as  well  in 
the  courts  of  New  York  as  in  the  federal 
courts,  that  a  common  carrier  may,  by  special 
contract,  limit  his  common-Law  liability;  al- 
though considerable  diversity  of  opinion  has 
existed  as  to  the  extent  to  which  such  limita- 
tion is  admissible. 

The  case  of  New  Jersey  Steam  Nav.  Co.  v. 
Merchants'  Bank,  above  adverted  to,  grew  out 
of  the  burning  of  the  steamer  Lexington. 
Certain  money  belonging  to  tlie  bank  had  been 
intnisted  to  Hamden's  Express,  to  be  car- 
ried to  Boston,  and  was  on  board  the  steam- 
er when  she  was  destroyed.  By  agreement 
between  the  steamboat  company  and  Harn- 
den,  the  crate  of  the  latter  and  its  contents 
were  to  be  at  his  sole  risk.  The  court  held 
this  agreement  valid,  so  far  as  to  exonerate 
the  steamboat  company  from  the  responsibili- 
ty imposed  by  law;  but  not  to  excuse  them 
for  misconduct  or  negligence,  which  the  court 
said  it  would  not  presume  that  the  parties 
intended  to  include,  although  the  terms  of  the 
contract  wore  broad  enough  for  that  pmpose; 
and  that  inasmuch  as  the  company  had  un- 
dertaken to  carry  the  goods  from  one  place 
to  another,  they  wore  deemed  to  have  in- 
curred the  .same  degree  of  responsibilitj-  as 
that  which  attaches  to  a  private  person  en- 
gaged casually  In  the  like  occupation,  and 
were,  therefore,  bound  to  use  ordinary  care 
in  the  custody  of  the  goods,  and  in  their  de- 
livery, and  to  provide  proper  vehicles  and 
means  of  conveyance  for  their  transportation; 
and  as  the  court  -n-ns  of  opinion  that  the 
steamboat  company  had  been  guilty  of  negli- 
gence in  these  particulars  as  well  as  in  the 
management  of  the  steamer  during  the  fire, 
they  held  them  responsible  for  the  loss. 

As  this  has  been  regarded  as  a  leading  case, 
we  may  pause  for  a  moment  to  observe  that 

nOPK.  SEL. CAS.  COXT.  — 31 


the  case  before  us  seems  almost  precisely  with- 
in the  categorj'  of  that  decision.  In  that  ca.se, 
as  in  this,  the  contract  was  gener.i!,  exempt- 
ing the  carrier  from  every  ri.sk  and  imposing 
it  all  upon  the  party;  but  the  court  would 
not  presume  that  the  parties  intended  to  in- 
clude the  negligence  of  the  carrier  or  his 
agents  in  that  exception. 

It  is  strenuously  insisted,  however,  that  a.s 
negligence  is  the  only  ground  of  liability  in 
the  carriage  of  passengers,  and  as  the  con- 
tract is  absolute  in  its  terms,  it  must  be  con- 
strued to  embrace  negligence  as  well  as  acci- 
dent, the  former  in  reference  to  passengers, 
and  both  in  reference  to  the  cattle  carried  in 
the  train.  As  this  argument  seems  plausible, 
and  the  exclusion  of  a  liability  embraced  in 
the  terms  of  exemption  on  the  ground  that 
it  could  not  have  been  in  the  mind  of  the  par- 
ties is  .somewhat  arbitrary,  we  will  proceed 
to  examine  the  question  before  propounded, 
namely,  whether  common  carriers  may  ex- 
cuse themselves  from  liability  for  negligence- 
In  doing  so  we  shall  first  briefly  review  the 
course  of  decisions  in  New  York,  on  which 
great  stress  has  been  laid,  and  which  are- 
claimed  to  be  decisive  of  the  question.  Whilst 
we  cannot  concede  this,  it  is,  nevertheless, 
due  to  the  courts  of  that  state  to  examine 
carefully  the  groimds  of  their  decision  and  to 
give  them  the  weight  which  they  justly  de- 
serve. We  think  it  will  be  found,  however, 
that  the  weight  of  opinion,  even  in  New  York, 
it  not  altogether  on  the  side  that  favors  the 
right  of  the  carrier  to  stipulate  for  exemp- 
tion from  the  consequences  of  his  own  or 
his  servants'  negligence. 

The  first  recorded  case  that  arose  in  New 
York  after  the  before-mentioned  decision  in 
this  couil,  involving  the  right  of  a  carrier  to 
limit  his  liability,  was  that  of  Dorr  v.  New 
Jersey  Steam  Nav.  Co.  (decided  in  1S50)  4 
Sandf.  136.  This  case  also  arose  out  of  the 
burning  of  the  Lexington,  under  a  bill  of  lad- 
ing which  excepted  from  the  company's  risk 
"danger  of  fire,  water,  breakage,  leakage,  and 
other  accidents."  Judge  Campbell,  dehver- 
iug  the  opinion  of  the  court,  says:  "A  com- 
mon carrier  has  in  truth  two  distinct  liabili- 
ties,—the  one  for  losses  by  accident  or  mis- 
take, where  he  is  liable  as  an  insurer;  the 
other  for  losses  by  default  or  negligence, 
where  he  is  answerable  as  an  ordinary  bailee. 
It  would  certainly  seem  reasonable  that  he 
might,  by  express  special  contract,  restrict 
his  liability  as  insurer;  that  he  might  pro- 
tect himself  against  misfortune,  even  though 
public  policy  should  require  that  he  should 
not  be  permitted  to  stipulate  for  impunity 
where  the  loss  occurs  from  his  own  default 
or  neglect  of  duty.  Such  we  understand  to 
be  the  doctrine  laid  down  in  the  case  of 
New  Jersey  Steam  Nav.  Co.  v.  Merchants' 
Bank,  in  6  How.,  and  such  we  consider  to 
be  the  law  in  the  present  case."  And  in 
Stoddard  v.  Railroad  Co.,  5  Sandf.  ISO.  an- 
other express  case,  in  which  it  was  stipulated 
that  the  express  company  should  be  alone  re- 


482 


ILLEGALITY  OF  OBJECT. 


sponsfhle  for  all  losses,  Judge  Duer,  for  tbe 
court,  says:  "Couforming  our  decision  to  that 
of  the  supreme  court  of  the  United  States, 
we  must,  therefore,  hold:  1st.  That  the  lia- 
bility of  the  defendants  as  common  carriers 
was  restricted  by  the  tenns  of  the  special 
agn'eement  between  them  and  Adams  &  Co., 
and  that  this  restriction  was  valid  in  law. 
2d.  That  by  the  just  interpretation  of  this 
agreement  the  defendants  were  not  to  be  ex- 
onerated from  all  losses,  but  remained  lia- 
ble for  such  as  might  result  from  the  wrong- 
ful acts,  or  the  want  of  due  care  and  dili- 
gence of  themselves  or  their  agents  and 
seiTants.  8d.  That  the  plaintiffs,  claiming 
through  Adams  &  Co.,  are  bound  by  the 
special  agreement."  The  same  view  was 
taken  in  subsequent  cases  (Parsons  v.  Mon- 
teath,  13  Barb.  353;  Moore  v.  Evans,  14 
Barb.  524),  all  of  which  show  that  no  idea 
was  then  entertained  of  sanctioning  exemp- 
tions of  liability  for  negligence. 

It  was  not  tiU  1S5S,  in  the  case  of  Welles 
V.  Railroad  Co.,  26  Barb.  Ml,  that  the  su- 
preme court  was  brought  to  assent  to  the 
proposition  that  a  common  carrier  may  stipu- 
late against  responsibility  for  the  negligence 
of  his  servants.  That  was  the  case  of  a 
gratuitous  passenger  travelling  on  a  free 
ticket,  which  exempted  the  company  from  lia- 
bility. In  1SG2  the  court  of  appeals  by  a , 
majority  affirmed  this  judgment  (24  N.  Y. 
ISl),  and  in  answer  to  the  suggestion  that 
public  policy  required  that  railroad  companies 
should  not  be  exonerated  from  the  duty  of 
carefulness  in  performing  their  important  and 
hazardous  duties,  the  court  held  that  the  ease 
of  free  passengers  could  not  seriously  affect 
the  incentives  to  carefulness,  because  there 
were  very  few  such,  compared  with  the  great 
mass  of  the  travelling  public.  Perkins  v. 
Railroad  Co.,  Id.  196,  was  also  the  case  of  a 
free  passenger,  with  a  similar  ticket,  and  the 
court  held  that  the  indorsement  exempted  the 
company  from  all  kinds  of  negligence  of  its 
agents,  gross  as  well  as  ordinary;  that  there 
is,  in  truth,  no  practical  distinction  in  the  de- 
grees of  negligence. 

The  next  cases  of  importance  that  arose  In 
the  New  York  courts  were  those  of  drovers' 
passes,  in  which  the  passenger  took  all  re- 
sponsibility of  injury  to  himself  and  stock. 
The  first  was  that  of  Smith  v.  Railroad  Co. 
(decided  in  March,  1859),  29  Barb.  132.  Tlie 
contract  was  precisely  the  same  as  that  in  the 
present  case.  The  damage  arose  from  a  flat- 
tened wheel  in  the  car,  which  caused  it  to 
jump  the  track.  The  supreme  court,  by  Hoge- 
boom,  J.,  held  that  the  railroad  company  was 
liable  for  any  injury  happening  to  the  passen- 
ger, not  only  by  the  gross  negligence  of  the 
company's  servants,  but  by  ordinary  negli- 
gence on  their  part.  "For  my  part,"  says 
the  jtidge,  "I  think  not  only  gross  negligence 
is  not  protected  by  the  terms  of  the  contract, 
but  what  is  termed  ordinary  negligence,  or 
the  withholding  of  ordinary  care,  is  not  so 
(Protected-     I  think,  notwithstanding  the  con- 


tract, the  carrier  is  responsible  for  what.  In- 
dependent of  any  peculiar  responsibility  at- 
tached to  his  calling  or  employment,  would 
be  regarded  as  fault  or  misconduct  on  his 
part."  The  judge  added  that  he  thought  the 
carrier  might,  by  positive  stipulation,  relieve 
himself  to  a  limited  degree  from  the  c<mse- 
quences  of  his  own  negligence  or  that  of  his 
servants.  But,  to  accomplish  that  object,  the 
contract  must  be  clear  and  specific  in  its 
terms,  and  plainly  covering  such  a  case.  Of 
course,  this  remark  was  extrajudicial.  The 
judgment  itself  was  affirmed  by  the  court  of 
appeals  in  1862  by  a  vote  of  five  judges  to 
three.  24  N.  Y.  222.  Judge  Wright  strenu- 
ously contended  that  it  is  against  public  pol- 
icy for  a  carrier  of  passengers,  where  human 
life  is  at  stake,  to  stipulate  for  immunity  for 
any  want  of  care.  "Contracts  in  restraint  of 
trade  are  void,"  he  says,  "because  they  inter- 
fere with  the  welfare  and  convenience  of  the 
state;  yet  the  state  has  a  deep  interest  in 
protecting  the  lives  of  its  citizens."  He  ar- 
gued that  it  was  a  question  affecting  the  pub- 
lic, and  not  alone  the  party  who  is  carried. 
Judge  Sutherland  agreed  in  substance  with 
Judge  Wright.  Two  other  judges  held  that 
if  the  party  injured  had  been  a  gratuitous 
passenger  the  company  would  have  been  dis- 
charged, but  in  their  view  he  was  not  a  gratu- 
itous passenger.  One  judge  was  for  affirm- 
ance, on  the  ground  that  the  negligence  wa? 
that  of  the  company  itself.  The  remaining 
three  judges  held  the  contract  valid  to  the 
utmost  extent  of  exonerating  the  company, 
notwithstanding  the  grossest  neglect  on  the 
part  of  its  servants. 

In  that  case,  as  in  the  one  before  us,  the 
contract  was  general  in  its  terms,  and  did 
not  specify  negligence  of  agents  as  a  risk  as- 
sumed by  the  passenger,  though  by  its  gen- 
erality it  included  all  risks. 

The  next  case,  Bissell  v.  Railroad  Co.,  29 
Barb.  602,  first  decided  in  September,  1859, 
differed  from  the  preceding  in  that  the  ticket 
expressly  stipulated  that  the  railroad  com- 
pany should  not  be  liable  under  any  circum- 
stances, "whether  of  negligence  by  their 
agents,  or  otherwise,"  for  injury  to  the  per- 
son or  stock  of  the  passenger.  The  latter 
was  killed  by  the  express  train  running  into 
the  stock  train,  and  the  jury  found  that  his 
death  was  caused  by  the  gross  negligence  of 
the  agents  and  servants  of  the  defendants. 
The  supreme  court  held  that  gross  negligence 
(whether  of  servants  or  principals)  cannot  be 
excused  by  contract  in  reference  to  the  car- 
riage of  passengers  for  hire,  and  that  such  a 
contract  is  against  the  policy  of  the  law,  and 
void.  In  December,  18G2,  this  judgment  was 
reversed  by  the  court  of  appeals  (25  N.  Y. 
442),  four  judges  against  three;  Judge  Smith, 
who  concurred  in  the  judgment  below,  hav- 
ing in  the  meantime  changed  his  views  as 
to  the  materiality  of  the  fact  that  the  negli- 
gence stipulated  against  was  that  of  the  serv- 
ants of  the  company,  and  not  of  the  company 
itself.     The  majority  now  held  that  the  ticket 


rUBLIC  POLICY— LIMITIXG  LIABILITY  FOR  XEGLIGEXCE. 


433 


was  a  free  ticket,  as  it  purported  to  be,  and, 
therefore,  that  the  case  was  governed  by 
Welles  V.  Rjiilroad  Co.;  but  whether  so, or  not, 
the  contract  was  founded  on  a  valid  considera- 
tion, and  the  passenger  was  bound  I)}-  it  even 
to  the  assumption  of  the  risk  arising  from  the 
gross  negligence  of  the  company's  servants. 
Elaborate  opinions  were  read  by  Justice  Sel- 
den  in  favor,  and  by  Justice  Denio  against  the 
conclusion  reached  by  the  court.  The  former 
considered  that  no  rule  of  public  policy  for- 
bids such  contracts,  because  the  public  is 
amply  protected  by  the  right  of  every  one  to 
decline  any  special  contract,  on  paying  the 
regular  fare  prescribed  by  law,  that  is,  the 
highest  amount  which  the  law  allows  the 
company  to  charge.  In  other  words,  unless 
a  man  chooses  to  pay  the  highest  amount 
which  the  company  by  its  charter  is  author- 
ized to  charge,  he  must  submit  to  their 
terms,  however  onerous.  Justice  Denio,  with 
much  force  of  argument,  combated  this  view, 
and  insisted  upon  the  impolicy  and  immoral- 
ity of  contracts  stipulating  immimity  for  neg- 
ligence, either  of  servants  or  principals,  where 
the  lives  and  safety  of  passengers  are  con- 
cerned. The  late  case  of  Poucher  v.  Rail- 
road Co.,  49  N.  Y.  2G3,  is  in  all  essential  re- 
spects a  similar  case  to  this,  and  a  similar  re- 
sult was  reached. 

These  are  the  authorities  which  we  are 
asked  to  follow.  Cases  may  also  be  found 
in  some  of  the  other  state  courts  which,  by 
dicta  or  decision  either  favor  or  follow,  more 
or  less  closely,  the  decisions  in  New  York. 
A  reference  to  the  principal  of  them  is  all 
that  is  necessary  here:  Ashmore  v.  Penn- 
sylvania Transportation  Co.,  28  N.  J.  Law, 
ISO;  Kinney  v.  Railroad  Co.,  32  N.  J.  Law, 
407;  Hale  v.  Navigation  Co.,  15  Conn.  539; 
Peck  V.  Weeks,  34  Conn.  14.");  Lawrence  v. 
Railroad  Co.,  30  Conn.  63;  Kimball  v.  Rail- 
road Co.,  26  Vt.  247;  Mann  v.  Birchard,  40 
Vt.  326;  Express  Co.  v.  Haynes,  42  111.  89; 
Id.  458;  Illinois  Cent.  R.  Co.  v.  Adams  Exp. 
Co.,  Id.  474;  Hawkins  v.  Railroad  Co.,  17 
Mich.  57,  18  Mich.  427;  Railroad  Co.  v.  Bra- 
dy, 32  Md.  333,  25  Md.  128;  Levering  v. 
Tiansportation  Co.,  42  Mo.  88. 

A  review  of  the  cases  decided  by  the  courts 
of  New  York  shows  that  though  they  have 
carried  the  power  of  the  common  carrier  to 
make  special  contracts  to  tlie  extent  of  en- 
abling him  to  exonerate  himself  from  the 
effects  of  even  gross  negligence,  yet  that 
this  effect  has  never  been  given  to  a  con- 
tract general  in  Its  terms.  So  that  If  we 
only  felt  bound  by  those  precedents,  we 
could  perhaps,  find  no  authority  for  revers- 
ing the  judgment  In  this  case.  But  on  a 
question  of  general  commercial  law,  the  fed- 
eral courts  administering  justice  in  New  Y'ork 
have  equal  and  co-ordinate  jurisdiction  with 
the  courts  of  that  state.  And  In  deciding  a 
case  which  involves  a  question  of  such  im- 
portance to  the  whole  country;  a  question  on 
which  the  courts  of  New  York  have  express- 
ed such  diverse  views,  and  have  so  recently 


and  with  such  slight  preixtnderancy  of  Judicial 
suffrage,  come  to  the  conclusion  that  they 
have,  we  should  not  feel  satisfied  without 
being  able  to  place  our  decision  upon  grounds 
satisl'actory  to  oui-selves,  and  resting  up<jn 
what  we  consider  sound  principles  of  law. 

In  passing,  however,  it  is  apposite  to  call 
attention  to  the  testimony  of  an  authori- 
tative witness  as  to  the  operation  and  effect 
of  the  recent  decisions  referred  to.  "The 
fruits  of  this  rule."  says  Judge  Davis,  "are 
already  being  gathered  in  increasing  acci- 
dents, through  the  decreasing  care  and  vigil- 
ance on  the  pa'-t  of  those  corporations;  and 
they  will  continue  to  be  reaped  until  a  just 
sense  of  public  policy  shall  lead  to  legislative 
restriction  upon  the  power  to  make  this  kind 
of  contracts."  Stinson  v.  Railroad  Co.,  32 
N.  Y.  337. 

We  now  proceed  to  notice  some  cases  de- 
cided in  other  states,  in  which  a  dillerent 
view  of  the  subject  Is  taken. 

In  Pennsylvania,  it  is  settled  by  a  long 
couree  of  decisions,  that  a  common  carrier 
cannot,  by  notice  or  special  contract,  limit 
his  liability  so  as  to  exonerate  him  from  re- 
sponsibility for  his  own  negligence  or  mis- 
feasance, or  that  of  his  servants  and  agents. 
Laing  v.  Colder,  8  Pa.  St.  479;  Railroad  Co. 
V.  Baldauf,  IG  Pa.  St.  67;  Goldey  v.  Railroad 
Co.,  30  Pa.  St.  242;  Powell  v.  Railroad  Co.. 
32  Pa.  SL  414;  Railroad  Co.  v.  Henderson, 
51  Pa.  St.  315;  Farnham  v.  Railroad  Co..  55 
Pa.  St.  53;  Express  Co.  v.  Sands,  Id.  140; 
Empire  Trausp.  Co.  v.  Wamsutta  Oil  Co..  63 
Pa.  St.  14.  "The  docUine  is  firmly  settled.  ' 
says  Chief  Justice  Thompson,  in  P^amham 
V.  Railroad  Co..  55  Pa.  St.  62,  "that  a  com- 
mon carrier  cannot  limit  his  liability  so  as 
to  cover  his  own  or  his  servants'  negligence." 
This  inability  is  affirmed  both  when  the 
exemption  stipulated  for  is  general,  covering 
all  risks,  and  where  it  specifically  includes 
damages  arising  from  the  negligence  of  the 
carrier  or  his  servants.  In  Railroad  Co.  v. 
Henderson,  51  Pa.  St.  315,  a  drover's  pass 
stipulated  for  immunity  of  the  company  in 
case  of  injury  from  negligence  of  Its  agents, 
or  otherwise.  The  court.  Judge  Read  de- 
livering the  opinion,  after  a  careful  review 
of  the  Pennsylvania  decisions,  saj-s:  "This 
indorsement  relieves  the  company  from  all 
liability  for  any  cause  whatever,  for  any  loss 
or  injury  to  the  person  or  property,  however 
it  may  have  been  occasioned;  and  our  doc- 
trine, settled  by  the  above  decisions,  made 
upon  grave  deliberation,  declares  that  such 
a  release  is  no  excuse  for  negligence." 

The  Ohio  cases  are  very  decided  on  tills 
subject,  and  reject  all  attempts  of  the  carrier 
to  excuse  his  own  negligence,  or  that  of  his 
servants.  In  Davidson  v,  Graham.  2  Ohio  St. 
131,  the  court,  after  conceding  the  right  of 
the  carrier  to  make  special  contracts  to  a 
certain  extent,  says:  "He  cannot,  however, 
protect  himself  from  losses  occasioned  by 
his  own  fault.  He  exercises  a  public  em- 
ployment,  and   diligence  and   good   faith   in 


4S4 


ILLEGALITY  OF  OBJECT. 


the  discharge  of  his  duties  are  essential  to 
the  public  interests.  *  *  *  And  public 
policy  forbids  that  he  should  be  relieved  by 
special  a.sreement  from  that  degree  of  dili- 
gence and  fidelity  which  the  law  has  exacted 
in  the  discharge  of  his  duties."  In  Welsh 
V.  Railroad,  10  Ohio  St.  75,  76,  the  court 
says:  "In  this  «;tate,  at  least,  railroad  com- 
panies are  rapidly  becoming  almost  the  ex- 
clusive carriei-s  both  of  passengers  and  goods. 
In  consequence  of  the  public  character  and 
agency  which  they  have  voluntarily  assum- 
ed, the  most  important  powers  and  privi- 
leges have  been  granted  to  them  by  the  state." 
From  these  facts,  the  court  reasons  that  it  Is 
specially  important  that  railroad  companies 
should  be  held  to  the  exercise  of  due  dili- 
gence at  least.  And  as  to  the  distinction  tak- 
en by  some,  that  negligence  of  sei-vants  may 
be  stipulated  for,  the  court  pertinently  says: 
"This  doctrine,  when  applied  to  a  coi-pora- 
tiou  which  can  only  act  through  its  agents 
and  servants,  would  secure  complete  immu- 
nity for  the  neglect  of  every  duty."  And  in 
relation  to  a  drover's  pass,  substantially  the 
same  as  that  in  the  present  case,  the  same 
court,  in  Railroad  v.  Curran,  19  Ohio  St.  1,  12, 
13.  held:  1st.  That  the  holder  was  not  a  gi-a- 
tuitous  passenger;  2dly.  That  the  contract 
constituted  no  defense  against  the  negligence 
of  the  company's  servants,  being  against  the 
policy  of  the  law.  and  void.  The  court  re- 
fers to  the  cases  of  Bissell  v.  Railroad,  25 
N.  Y.  442,  and  of  Pennsylvania  RaQroad  v. 
Henderson,  51  Pa.  St.  315,  and  expresses  its 
concurrence  in  the  Pennsylvania  decision. 
This  was  in  December  term,  1869. 

The  Pennsylvania  and  Ohio  decisions  differ 
mainly  in  this,  that  the  former  give  to  a  spe- 
cial contract  (when  the  same  is  admissible) 
the  effect  of  converting  the  common  carrier 
into  a  special  bailee  for  hire,  whose  duties 
are  governed  by  his  conti-act,  and  against 
whom.  If  negligence  is  charged,  it  must  be 
proved  by  the  party  injured;  whilst  the  lat- 
ter hold  that  the  character  of  the  carrier 
is  not  changed  by  the  contract,  but  that  he 
is  a  common  carrier  still,  with  enlarged  ex- 
emptions from  responsibility,  within  which 
the  burden  of  proof  is  on  him  to  show  that 
an  injury  occurs.  The  effect  of  this  differ- 
ence is  to  shift  the  burden  of  proof  from  one 
party  to  the  other.  It  is  unnecessary  to  ad- 
judicate that  point  in  this  case,  as  the  judge 
on  the  trial  cliarged  the  jui-y,  as  requested 
by  the  defendants,  tliat  the  burden  of  proof 
was  on  the  plaintiff. 

In  Maine,  whilst  it  is  held  that  a  common 
carrier  may,  by  special  contract,  be  exempted 
from  responsibility  for  loss  occasioned  by 
natural  causes,  such  as  the  weather,  fire, 
heat,  frost,  &c.,  yet  in  a  case  where  it  was 
stipulated  that  a  railroad  company  should 
be  exonerated  from  all  damages  that  might 
happen  to  any  horses  or  cattle  that  might  be 
sent  over  the  road,  and  that  the  owners 
should  take  the  risk  of  all  such  damages, 
the  court  held   that  the   company  were  not 


thereby  excused  from  the  consequences  of 
their  negligence,  and  that  the  distinction  be- 
tween negligence  and  gross  negligence  in 
such  a  case  is  not  tenable.  "The  very  great 
danger,"  says  the  court,  "to  be  anticipated 
by  permitting  them"  [common  carriers]  "to 
enter  into  contracts  to  be  exempt  from  losses 
occasioned  by  misconduct  or  negligence,  can 
scarcely  be  overestimated.  It  would  remove 
the  principal  safeguard  for  the  preservation 
of  life  and  property  in  .such  conveyances." 

To  the  same  purport  it  was  held  in  Massa- 
chusetts in  the  late  case  of  School  Dist.  v. 
Boston,  etc.,  R.  Co.,  102  Mass.  552,  5.56, 
where  the  defendant  set  up  a  special  con- 
tract that  certain  iron  castings  were  taken 
at  the  owner's  risk  of  fracture  or  injury  dur- 
ing the  course  of  transportation,  loading,  and 
unloading,  and  the  court  say:  "The  special 
conti-act  here  set  up  is  not  alleged,  and  could 
not  by  law  be  permitted,  to  exempt  the  de- 
fendants from  liability  for  injuries  by  their 
own  negligence."  To  the  same  purport,  like- 
wise, are  many  other  decisions  of  the  state 
courts,  some  of  which  are  argued  with  great 
force  and  are  worthy  of  attentive  penasal, 
but,  for  want  of  room,  can  only  be  referred 
to  here. 

These  views  as  to  the  impolicy  of  allowing 
stipulations  against  liability  for  negligence 
and  misconduct  are  in  accordance  with  the 
early  English  authorities.  St.  Germain,  in 
the  Doctor  and  Student  (Dialogue  2,  c.  38), 
pointedly  says  of  tbe  common  carrier:  "If 
he  would  per  case  refuse  to  carry  it"  [arti- 
cles delivered  for  carriage]  "unless  promise 
were  made  unto  him  that  he  shall  not  be 
charged  for  no  misdemeanor  that  should  be 
in  him,  the  promise  were  void,  for  it  were 
against  reason  and  against  good  manners, 
and  so  it  is  in  all  other  cases  like." 

A  centurj^  later  this  passage  is  quoted  by 
Attorney-General  Noy  in  his  book  of  Max- 
ims as  unquestioned  law.  Noy's  Maxims,  92. 
And  so  the  law  undoubtedly  stood  in  Eng- 
land until  comparatively  a  very  recent  per- 
iod. Serjeant  Steven,  in  his  Commentaries 
(volume  2,  p.  13.5),  after  stating  that  a  com- 
mon carrier's  liability  might,  at  common  law, 
be  varied  by  contract,  adds  that  the  law  still 
held  him  responsible  for  negligence  and  mis- 
conduct 

The  question  arose  in  England  principally 
upon  public  notices  given  by  common  car- 
riers that  they  would  not  be  responsible  for 
valuable  goods  unless  entered  and  paid  for 
according  to  value.  The  courts  held  tliat  this 
was  a  reasonable  condition,  and,  if  brought 
home  to  the  owner,  amounted  to  a  special 
contract  valid  in  law.  But  it  was  also  held 
that  it  could  not  exonerate  the  carrier  if  a 
loss  occurred  by  his  actual  misfeasance  or 
gross  negligence.  Or,  as  Starkie  says,  "proof 
of  a  direct  misfeasance  or  gross  negligence  is 
in  effect  an  answer  to  proof  of  notice."  2 
Starkie,  Ev.  (Gth  Am.  Ed.)  p.  205.  But  the 
term  "gross  negligence"  was  so  vague  and 
uncertain  that  it  came  to  represent  every  in- 


PUBLIC  POLICY— LIMITING  LIABILITY  FOR  XEGLIOENCE. 


485 


stance  of  actual  noKllgence  of  the  carrier  or 
his  servant— or  ordinary  negligence  in  the  ac- 
customed mode  of  speaking.  Justice  Story, 
in  his  work  on  Bailments  (section  571).  orig- 
inally published  In  1832,  says  that  it  Is  now 
held  that,  in  cases  of  such  notices,  the  car- 
rier is  liable  for  losses  and  injury  occasion- 
ed not  only  by  gross  negligence,  but  by  or- 
dinary negligence;  or,  in  other  words,  the 
carrier  is  bound  to  ordinary  diligence. 

In  estimating  the  ellect  of  these  decisions 
It  must  be  remembered  that,  in  the  cases  cov- 
ered by  the  notices  referred  to,  the  exemp- 
tion claimed  was  entire,  covering  all  cases  of 
loss,  negligence  as  well  as  others.  They  are, 
therefore,   directly  in  point. 

In    18G3,    in    the    great    case    of    Peek    v. 
Railway   Co.,   10  H.   L.   Cas.   473,   Mr.   Jus-  i 
tice    Blackburn,    in    the    course    of    a    very 
clear  and  able  review  of  the  law  on  the  sub-  i 
Ject,   after  quoting   this   passage   from  Jus- 
tice Story's  work,  proceeds  to  say:     "In  my  [ 
opinion,    the    weight    of   authority    was,    in  j 
1832,  in  favor  of  this  view  of  the  law,  but 
the  cases  decided  in  our  courts  between  1832 
and  1854  established  that  this  was  not  the 
law,  and  that  a  carrier  might,  by  a  special 
notice,  make  a  contract  limiting  his  respon-  | 
sibility  even  in  the  cases  here  mentioned,  of  | 
gross  negligence,  misconduct,  or  fraud  on  the 
part  of  his  servants;  and,  as  it  seems  to  me,   i 
the  reason  why  the  legislature  intervened  in  | 
the  railway  and  canal  traffic  act,  1854.  was 
because  it  thought  that  the  companies  took 
advantage  of  those  decisions  (in  Story's  Ian-  I 
guage),  'to  evade  altogether  the  salutary  pol- 
icy of  the  common  law.'  "  I 

This  quotation  is  sufficient  to  show  the 
state  of  the  law  in  England  at  the  time  of 
the  publication  of  Justice  Story's  work;  and 
it  proves  that,  at  that  time,  common  car-  ; 
riers  could  not  stipulate  for  immunity  for  i 
their  own  or  their  servants'  negligence.  | 
But  in  the  case  of  Carr  v.  Railroad  Co..  7 
Exch.  707,  and  other  cases  decided  whilst 
the  change  of  opinion  alluded  to  by  Justice 
Blackburn  was  going  on  (several  of  which 
related  to  the  carriage  of  horses  and  cattle), 
it  was  held  that  carriers  could  stipulate  for 
exemption  from  liability  for  even  their  own 
gross  negligence.  Hence  the  act  of  1854 
was  passed,  called  the  railway  and  canal 
traffic  act.  declaring  that  railway  and  canal 
companies  should  be  liable  for  negligence  of 
themselves  or  their  servants,  notwithstand- 
ing any  notice  or  condition,  unless  the  court 
or  judge  trying  the  cause  should  adjudge  the 
conditions  just  and  reasonable.  Upon  this 
statute  ensued  a  long  list  of  cases  deciding 
what  conditions  were  or  were  not  just  and 
reasonable.  The  truth  Is,  that  this  statute 
did  little  more  than  bring  back  the  law  to  the 
original  position  in  which  it  stood  before  the 
English  courts  took  their  departure  from  it. 
But  as  we  shall  have  occasion  to  advert  to 
this  subject  again,  we  pass  it  for  the  present. 
It  remains  to  see  what  has  been  held  by 


this  court  on  the  subject  now  under  consid- 
eration. 

We  have  already  referred  to  the  leading 
case  of  New  Jersey  Steam  Nav.  Co.  v.  Mer- 
chants' Bank,  d  How.  .383.  On  the  precise 
point  now  under  consideration,  Justice  Nel- 
son said,  "If  it  is  competent  at  all  for  the 
carrier  to  stipulate  for  the  gross  negligence 
of  himself  and  his  servants  or  agents,  in  the 
transportation  of  gofids,  it  should  be  required 
to  be  done,  at  least,  in  terms  that  would 
leave  no  doubt  as  to  the  meaning  of  the  par- 
ties." 

As  to  carriers  of  passengers,  Mr.  Justice 
Grier.  in  the  case  of  Itailroad  v.  Derby.  14 
How.  48G,  delivering  the  opinion  of  the  court, 
said:  "When  carriers  undertake  to  convf-y 
persons  by  the  powerful  but  dangerous 
agency  of  steam,  public  policy  and  safety  re- 
quire that  they  be  held  to  the  greatest  pos- 
sible care  and  diligence.  And  whether  the 
consideration  for  such  transportation  be  pe- 
cuniary or  otherwise,  the  personal  safety  of 
the  passengers  should  not  be  left  to  the 
sport  of  chance,  or  the  negligence  of  care- 
less agents.  Any  negligence,  in  such  cases, 
may  well  deserve  the  epithet  of  'gross.' " 
That  was  the  case  of  a  free  passenger,  a 
stockholder  of  the  company,  taken  over  the 
road  by  the  president  to  examine  its  condi- 
tion; and  it  was  contended  in  argument  that, 
as  to  him.  nothing  but  "gross  negligence" 
would  make  the  company  liable.  In  the  sub- 
sequent case  of  New  World  v.  King,  16  How. 
469,  474,  which  was  also  the  case  of  a  free 
passenger  carried  on  a  steamboat,  and  in- 
jured by  the  explosion  of  the  boiler.  Curtis, 
Justice,  delivering  the  judgment,  quoted  the 
above  proposition  of  Justice  Grier,  and  said: 
"We  desire  to  be  understood  to  reaffirm  that 
doctrine,  as  resting  not  cnly  on  public  policy, 
but  on  sound  principles  of  law." 

In  York  Co.  v.  Central  R.  R..  3  Wall.  113, 
the  court,  after  conceding  that  the  responsi- 
bility imposed  on  the  carrier  of  goods  by  the 
common  law  may  be  restricted  and  qualilied 
by  express  stipulation,  adds:  "When  such 
stipulation  Is  made,  and  it  does  not  cover 
losses  from  negligence  or  misconduct,  we 
can  perceive  no  just  reason  for  refusing  its 
recognition  and  enforcement."  In  the  case 
of  Walker  v.  Transportation  Co.  (decided  at 
the  same  term).  Id.  1.50.  It  Is  true,  the  owner 
of  a  vessel  destroyed  by  fire  on  the  lakes, 
was  held  not  to  be  responsible  for  the  negli- 
gence of  the  officers  and  agents  having 
charge  of  the  vessel:  but  that  was  under  the 
act  of  1S51.  which  the  court  held  to  apply  to 
our  great  lakes  as  well  as  to  the  sea.  And  in 
Express  Co.  v.  Kountze.  8  Wall.  342.  3.53. 
where  the  carriers  were  sued  for  the  loss  of 
gold-dust  delivered  to  them  on  a  bill  of  lad- 
ing excluding  liability  for  any  loss  or  dam- 
age by  lire,  act  of  God.  enemies  of  the  gov- 
ernment, or  dangers  incidental  to  a  time  of 
war,  they  were  held  liable  for  a  robbery  by 
1  a  predatory  band  of  armed  men  (one  of  the 


486 


ILLEGALITY  OF  OBJECT. 


excepted  risks),  because  thoy  neglisontly  and 
needlessly  took  a  route  which  was  exposed 
to  such  incursions.  The  judge,  at  the  trial, 
charged  the  jury  that  although  the  contract 
was  legall.v  sufficient  to  restrict  the  liability 
of  the  defendants  as  common  carriers,  yet  if 
they  were  guilty  of  actual  negligence,  they 
were  responsible;  and  that  they  were  charge- 
able with  negligence  imloss  they  exercised 
the  care  and  prudence  of  a  prudent  man  in 
his  own  affairs.  This  was  held  by  this  court 
to  be  a  correct  statement  of  the  law. 

Some  of  the  above  citations  are  only  ex- 
pressions of  opinion,  it  is  true;  but  they  are 
the  expressions  of  judges  whose  opinions  are 
entitled  to  much  weight;  and  the  last-cited 
case  is  a  judgment  upTu  the  precise  point. 
Taken  in  connection  with  the  concurring  de- 
cisions of  state  courts  before  cited  they  seem 
to  us  decisive  of  the  question,  and  leave  but 
little  to  be  added  to  the  considerations  which 
they  suggest. 

It  is  argued  that  a  common  carrier,  by  en- 
tering into  a  special  contract  with  a  party 
for  carrying  his  goods  or  person  on  modified 
terms,  drops  his  character  and  becomes  an 
ordinary  bailee  for  hire,  and,  therefore,  may 
make  any  contract  he  pleases.  That  is,  he 
may  make  any  contract  whatever,  because 
he  is  an  ordinary  bailee;  and  he  is  an  or- 
dinary bailee  because  he  has  made  the  con- 
tract. 

We  are  unable  to  see  the  soundness  of  this 
reasoning.  It  seems  to  us  more  accurate  to 
say  that  common  carriers  are  such  by  virtue 
of  their  occupation,  not  by  virtue  of  the  re- 
sponsibilities under  which  they  rest.  Those 
responsibilities  may  vary  in  different  coun- 
tries, and  at  different  times,  without  chang- 
ing the  character  of  the  employment.  The 
common  law  subjects  the  common  carrier  to 
insurance  of  tlie  goods  carried,  except  as 
against  the  act  of  God  or  public  enemies. 
The  civil  law  excepts,  also,  losses  by  means 
of  any  superior  force,  and  any  inevitable  ac- 
cident. Yet  the  employment  is  the  same  in 
both  cases.  And  if  by  special  agreement  the 
carrier  is  exempted  from  still  other  responsi- 
bilities. It  does  not  follow  tliat  his  employ- 
ment is  changed,  but  only  that  his  responsi- 
bilities are  changed.  The  theory  occasion- 
ally announced,  that  a  special  contract  as  to 
the  terms  and  responsibilities  of  carriage 
changes  the  nature  of  the  employment,  is 
calculated  to  mislead.  The  responsibilities 
of  a  common  carrier  may  be  reduced  to  those 
of  an  ordinary  bailee  for  hire,  whilst  the  na- 
ture of  his  business  renders  him  a  common 
carrier  still.  Is  there  any  good  sense  in  hold- 
ing that  a  railroad  company,  whose  only 
business  is  to  carry  passengers  and  goods, 
and  which  was  created  and  established  for 
that  purpose  alone,  is  changed  to  a  private 
carrier  for  hire  by  a  mere  contract  with  a 
customer,  whereby  the  latter  assumes  the 
risk  of  inevitable  accidents  In  the  carriage 
of  his  goods.    Suppose  the  contract  relates  to 


a  single  crate  of  glass  or  crockery,  whilst 
at  the  same  time  the  carrier  receives  from 
the  same  person  twenty  other  parcels,  re- 
specting which  no  such  contract  is  made. 
Is  the  company  a  public  carrier  as  to  the 
twenty  parcels  and  a  private  carrier  as  to 
the  one? 

On  this  point  there  are  several  authorities 
wliich  support  our  view,  some  of  which  are 
noted  in  the  margin. i 

A  common  carrier  may,  undoubtedly,  be- 
come a  private  carrier,  or  a  bailee  for  hire, 
when,  as  a  matter  of  accommodation  or  spe- 
cial engagement,  he  undertakes  to  can-y 
something  which  it  is  not  his  business  to  car- 
ry. For  example,  if  a  carrier  of  produce, 
running  a  truck  boat  between  New  York  City 
and  Norfolk,  should  be  requested  to  carry  a 
keg  of  specie,  or  a  load  of  expensive  furni- 
ture, which  he  could  justly  refuse  to  take, 
such  agreement  might  be  made  in  reference 
to  his  taking  and  carrying  the  same  as  the 
parties  chose  to  make,  not  involving  any  stip- 
ulation contrai*y  to  law  or  public  policy.  But 
when  a  carrier  has  a  regularly  established 
business  for  carrying  all  or  certain  articles, 
and  especially  if  that  carrier  be  a  corporation 
created  for  the  purpose  of  the' carrying  trade, 
and  the  carriage  of  the  articles  is  embraced 
within  the  scope  of  its  chartered  powers,  it  is 
a  common  carrier,  and  a  special  contract  about 
its  responsibility  does  not  divest  it  of  the 
character. 

But  it  is  contended  that  though  a  carrier 
may  not  stipulate  for  his  own  negligence, 
there  is  no  good  reason  why  he  should  not  be 
permitted  to  stipulate  for  immunity  for  the 
negligence  of  his  servants,  over  whose  actions, 
in  his  absence,  he  can  exercise  no  control.  If 
we  advert  for  a  moment  to  the  fundamental 
principles  on  which  the  law  of  common 
carriers  is  founded,  it  will  be  seen  that 
this  objection  is  inadmissible.  In  regulating 
the  public  establishment  of  common  carriers, 
the  great  object  of  the  law  was  to  secure  the 
utmost  care  and  diligence  in  the  performance 
of  their  important  duties — an  object  essential 
to  the  welfare  of  every  civilized  community. 
Hence  the  common-law  rule  which  charged 
the  common  carrier  as  an  insurer.  Why 
charge  him  as  such?  Plainly  for  the  purpose 
of  raising  the  most  stringent  motive  for  the 
exercise  of  carefulness  and  fidelity  in  his 
trust.  In  regard  to  passengers  the  highest 
degree  of  carefulness  and  diligence  is  ex- 
pressly exacted.  In  the  one  case  the  secur- 
ing of  the  most  exact  diligence  and  fidelity 
underlies  the  law,  and  is  the  rea.son  for  it; 
in  the  other  it  is  directly  and  absolutely  pre- 
scribed by  the  law.  It  is  obvious,  therefore, 
that  if  a  carrier  stipulate  not  to  be  bound 
to  the  exercise  of  care  and  diligence,  but  to 
be  at  lilx>rty  to  indulge  in  the  contrary,   he 

1  Davirlson  v.  Graham,  2  Ohio  St.  LSI;  Gra- 
ham V.  Davis,  4  Ohio  St.  362:  Swindler  v.  Hil- 
liard,  2  Ilich.  286;  Baker  v.  Brinson,  9  Rich. 
201;    Steele  v.  Townsend,  37  Ala.  247. 


rUBLIC  rOLICY— LIMITING  LIAIULITY  FOIl  NEGLIGENCE. 


4S7 


socks  to  put  off  the  essential  duties  of  his  em- 
ployment. And  to  assert  that  he  may  do  so 
seems  almost  a  contradiction  in  tenns. 

Now,  to  what  avail  does  the  law  attach 
these  essential  duties  to  the  employment  of 
the  common  carrier,  if  they  may  be  waived 
in  respect  to  his  agents  and  servants,  espe- 
ciaJly  where  the  carrier  Ls  an  artiUeial  being. 
Incapable  of  acting  except  by  agont.s  and  serv- 
ants? It  Is  carefulness  and  diligence  in  per- 
forming the  service  which  the  law  demands, 
not  an  abstract  carefulness  and  diligence  in 
proprietors  and  stockholders  who  take  no  ac- 
tive part  In  the  business.  To  admit  such  a 
distinction  in  the  law  of  common  carriers,  as 
the  business  is  now  carried  on,  would  be  sub- 
versive of  the  very  object  of  the  law. 

It  is  a  favorite  argument  in  the  cases  which 
favor  the  extension  of  the  carrier's  right  to 
contract  for  exemption  from  liability,  that 
men  must  be  permitted  to  make  their  own 
agreements,  and  that  it  is  no  concern  of  the 
public  on  what  terms  an  individual  chooses  to 
have  his  goods  carried.  Thus,  In  Dorr  v. 
New  Jersey  Steam  Nav.  Co.,  11  N.  Y.  485,  the 
^•ourt  sums  up  its  judgment  thus:  "To  say  the 
parties  have  not  a  right  to  make  their  own 
contract,  and  to  limit  the  precise  extent  of 
rlieir  own  respective  risks  and  liabilities,  in  a 
matter  no  way  affecting  the  public  morals,  or 
conflicting  with  the  public  interests,  would,  in 
my  judgment,  be  an  unwarrantable  restric- 
tion upon  trade  and  commerce,  and  a  most 
palpable  invasion  of  personal  right." 

Is  it  true  that  the  public  interest  Is  not  af- 
fected by  individual  contracts  of  the  kind  re- 
ferred to?  Is  not  the  whole  business  com- 
mimity  affected  by  holding  such  contracts 
valid?  If  held  valid,  the  advantageous  posi- 
tion of  the  companies  exercising  the  business 
of  common  carriers  is  such  that  it  places  it 
in  their  power  to  change  the  law  of  common 
carriers  in  effect,  by  introducing  new  rules  of 
obligation. 

The  carrier  and  his  customer  do  not  stand 
on  a  footing  of  equality.  The  latter  is  only 
one  individual  of  a  million.  He  cannot  at- 
ford  to  higgle  or  stand  out  and  seek  redress 
in  the  courts.  His  business  will  not  admit 
such  a  course.  He  prefers,  rather,  to  accept 
any  bill  of  lading,  or  sign  any  paper  the  car- 
rier presents;  often,  indeed,  without  knowing 
what  the  one  or  the  other  contains.  In  most 
cases,  he  has  no  alternative  but  to  do  this,  or 
Ml)audon  hLs  business.  In  the  present  case, 
for  example,  the  freight  agent  of  the  company 
testified  that  though  they  made  forty  or  fifty 
contracts  every  week  like  that  under  consid- 
eration, and  had  carried  on  the  business  for 
years,  no  other  arrangement  than  this  was 
ever  made  with  any  drover.  And  the  reason 
is  obvious  enough. — if  they  did  not  accept  thi.s, 
they  must  pay  tariff,  rates.  These  rates  were 
70  cents  a  hundred  pounds  for  cai-rylug  from 
Buffalo  to  Albany,  and  each  horned  animal 
was  rated  at  2000  pounds,  making  a  charge  of 
J14  for  every  animal  carried,  instead  of  the 
usual  charge  of  $70  for  a  car-load;    being  a 


difference  of  three  to  one.  Of  course  no  drov- 
er could  afford  to  pay  such  tariff  rates.  This 
fact  is  adverted  to  for  the  purpose  of  illus- 
trating how  completely  in  the  power  of  the 
railroad  companies  parties  are;  and  how  nec- 
essary it  is  to  stand  firmly  by  those  principles 
of  law  by  which  the  public  interests  are  pro- 
tected. 

If  the  customer  had  any  real  freedom  of 
choice,  if  he  had  a  reasonable  and  practica- 
ble alternative,  and  if  the  employment  of  the 
carrier  were  not  a  public  one,  charging  him 
with  the  duty  of  accommodating  the  public  In 
the  line  of  his  employment;  then,  if  the  cus- 
tomer chose  to  assume  the  risk  of  negligence, 
it  could  with  more  reason  be  said  to  be  his 
private  affair,  and  no  concern  of  the  pub- 
lic. But  the  condition  of  things  is  entirely 
different,  and  especially  so  under  the  mudified 
arrangements  which  the  carrying  trade  has 
assumed.  The  business  is  mostly  concentrat- 
ed in  a  few  powerful  corporations,  whoso  po- 
sition in  the  body  politic  enables  them  to  con- 
trol it  They  do,  in  fact,  control  it,  and  impose 
such  conditions  upon  travel  and  transporta- 
tion as  they  see  fit,  which  the  public  is  com- 
pelled to  accept.  These  circumstances  fur- 
nish an  additional  argument,  if  any  were 
needed,  to  show  tliat  the  conditions  imposed 
by  common  carriers  ought  not  to  be  adverse 
(to  say  the  least)  to  the  dictates  of  public  pol- 
icy and  morality.  The  status  and  relative  po- 
sition of  the  parties  render  any  such  condi- 
tions void.  Contracts  of  common  carriers, 
like  those  of  persons  occupying  a  fiduciary 
character,  giving  them  a  position  In  which 
they  can  take  undue  advantage  of  the  per- 
sons with  whom  they  contract,  must  rest  up- 
on their  fairness  and  reasonableness.  It  was 
for  the  reason  that  the  limitations  of  liability 
first  introduced  by  common  carriers  into  their 
notices  and  bills  of  lading  were  just  and  rea- 
sonable, that  the  courts  sustained  them.  It 
was  just  and  reasonable  that  they  should  not 
be  re.«5ponsibIe  for  losses  happening  by  ;heer 
accident,  or  dangers  of  navigation  that  no 
human  skill  or  vigilance  could  guard  against; 
it  was  just  and  reasonable  that  they  should 
not  be  chargeable  for  money  or  other  valua- 
ble articles  liable  to  be  stolen  or  damaged,  un- 
less apprised  of  their  character  or  value;  it 
was  just  and  reasonable  that  they  should  not 
be  responsible  for  articles  liable  to  rapid  de- 
cay, or  for  live  animals  liable  to  get  unruly 
from  fright  and  to  injure  themselves  in  that 
state,  when  such  articles  or  live  animals  be- 
came injured  without  their  fault  or  negli- 
gence. And  when  any  of  these  just  and  rea- 
sonable excuses  were  incorporated  into  notices 
or  special  contracts  assented  to  by  their  cus- 
tomers, the  law  might  well  give  effect  to  them 
without  the  violation  of  any  important  prin- 
ciple, altliough  modifying  the  strict  rules  of 
responsibilitj'  imposed  by  the  common  law. 
The  improved  state  of  society  and  the  better 
administration  of  the  laws,  had  diminished 
the  opportunities  of  collusion  and  bad  faith 
on  the  part  of  the  carriei",  and  rendered  less 


48S 


ILLEGALITY  OF  OBJECT. 


Imperative  the  application  of  the  iron  rule, 
that  he  must  be  responsible  at  all  events. 
Hence,  the  exemptions  refen-ed  to  were  deem- 
ed reasonable  and  proper  to  be  allowed.  But 
the  proposition  to  allow  a  public  carrier  to 
abandon  altogether  his  obligations  to  the  pub- 
lic, and  to  stipulate  for  exemptions  that  are 
unreasonable  and  improper,  amounting  to  an 
abdication  of  the  essential  duties  of  his  em- 
ployment, would  never  have  been  entertained 
by  the  sages  of  the  law. 

Hence,  as  before  remarked,  we  regard  the 
English  statute  called  the  railway  and  canal 
trafliic  act,  passed  in  1S54,  which  declared 
Toid  all  notices  and  conditions  made  by  com- 
mon carriers  except  such  as  the  judge,  at 
the  trial,  or  the  courts  should  hold  just  and 
reasonable,  as  substantially  a  return  to  the 
ndes  of  the  common  law.  It  would  have 
been  more  strictly  so,  perhaps,  had  the  rea- 
sonableness of  the  contract  been  referred  to 
the  law  instead  of  the  individual  judges.  The 
decisions  made  for  more  than  half  a  centui-y 
before  the  courts  commenced  the  abnormal 
•course  which  led  to  the  necessity  of  that  stat- 
ute, giving  effect  to  certain  classes  of  ex- 
emptions stipulated  for  by  the  carrier,  may  be 
regarded  as  authorities  on  the  question  as  to 
what  exemptions  are  just  and  reasonable.  So 
the  decisions  of  our  own  courts  are  entitled  to 
Uke  effect  when  not  made  under  the  falla- 
cious notion  that  every  special  contract  im- 
posed by  the  common  carrier  on  his  customers 
must  be  carried  into  effect,  for  the  simple  rea- 
son that  it  was  entered  into,  without  regard 
to  the  character  of  the  contract  and  the  rela- 
tive situation  of  the  parties. 

Conceding,  therefore,  that  special  contracts, 
made  by  common  carriers  with  their  custom- 
ers, limiting  their  liability,  are  good  and  valid 
BO  far  as  they  are  just  and  reasonable;  to  the 
extent,  for  example,  of  excusing  them  for  all 
losses  happening  by  accident,  without  any 
negligence  or  fraud  on  their  part;  when  they 
ask  to  go  still  further,  and  to  be  excused  for 
negligence — an  excuse  so  repugnant  to  the  law 
of  their  foundation  and  to  the  public  good — 
they  have  no  longer  any  plea  of  justice  or  rea- 
son to  snpport  such  a  stipulation,  but  the 
contrary.  And  then,  the  inequality  of  the  par- 
ties, the  compulsion  under  which  the  custom- 
er is  placed,  and  the  obligations  of  the  carrier 
to  the  public,  operate  with  full  force  to  divest 
the  transaction  of  validity. 

On  this  subject  the  remarks  of  Chief  Justice 
Redfield,  in  his  recent  collection  of  American 
Railway  Cases,  seem  to  us  eminently  just. 
"It  being  clearly  established,  then,"  saj's  he, 
■"that  common  carriers  have  public  duties 
which  they  are  bound  to  discharge  with  im- 
partiality, we  must  conclude  that  they  cannot, 
either  by  notices  or  special  contracts,  release 
themselves  from  the  perfonnance  of  these 
public  duties,  even  by  the  consent  of  those 
who  employ  them;  for  all  extortion  is  done 
by  the  apparent  consent  of  the  victim.  A 
public  officer  or  servant,  who  has  a  monopoly 
in  his  department,  has  no  j  ust  right  to  impose 


onerous  and  unreasonable  conditions  upon 
those  who  are  compelled  to  employ  him." 
And  his  conclusion  is,  that  notwithstanding 
some  exceptional  decisions,  the  law  of  to-day 
stands  substantially  as  follows:  "L  That  the 
exemption  claimed  by  carriers  must  be  rea- 
sonable and  just,  otherwise  it  will  be  regarded 
as  extorted  from  the  owners  of  the  goods  by 
duress  of  circumstances,  and  therefore  not 
binding.  2.  That  every  attempt  of  carriers, 
by  general  notices  or  special  contract,  to  ex- 
cuse themselves  from  responsibility  for  losses 
or  damages  resulting  in  any  degree  from  their 
own  want  of  care  and  faithfulness,  is  against 
that  good  faith  which  the  law  requires  as  the 
basis  of  all  contracts  or  employnienta,  and, 
therefore,  based  upon  principles  aiid  a  policy 
which  the  law  will  not  uphold." 

The  defendants  endeavor  to  make  a  distinc- 
tion between  gross  and  ordinary  negligence, 
and  insist  that  the  judge  ought  to  have  char- 
ged that  the  contract  was  at  least  effective 
for  excusing  the  latter. 

We  have  already  adverted  to  the  tendency 
of  judicial  opinion  adverse  to  the  distinction 
between  gross  and  ordinary  neghgence. 
Strictly  speaking,  these  expressions  are  indic- 
ative rather  of  the  degree  of  care  and  dili- 
gence which  is  due  from  a  party  and- which 
he  fails  to  perform,  than  of  the  amount  of  in- 
attention, carelessness,  or  stupidity  which  he 
exhibits.  If  very  little  care  is  due  from  him, 
and  he  fails  to  bestow  that  little,  it  is  called 
gross  negligence.  If  very  great  care  is  due, 
and  he  fails  to  come  up  to  the  mark  required, 
it  is  called  slight  negligence.  And  if  ordinary 
care  is  due,  such  as  a  prudent  man  would  ex- 
ercise in  his  own  affairs,  failure  to  bestow 
that  amount  of  care  is  called  ordinaiy  neg- 
ligence. In  each  case,  the  negligence,  what- 
ever epithet  we  give  it,  is  failure  to  bestow 
the  care  and  skill  which  the  situation  de- 
mands; and  hence  it  is  more  strictly  accurate 
perhaps  to  call  it  simply  "negligence."  And 
this  seems  to  be  the  tendency  of  modem  au- 
thorities. If  they  mean  more  than  this,  and 
seek  to  abolish  the  distinction  of  degrees  of 
care,  skill,  and  diligence  required  in  the  per- 
formance of  various  duties  and  the  fullilment 
of  various  contracts,  we  think  they  go  too 
far;  since  the  requirement  of  different  de- 
grees of  care  in  different  situations  is  too  firm- 
ly settled  and  fixed  in  the  law  to  be  ignored 
or  changed.  The  compilers  of  the  Frencli 
Civil  Code  imdertook  to  abolish  these  distinc- 
tions by  enacting  that  "every  act  whatever  of 
man  that  causes  damage  to  another,  obliges 
him  by  whose  fault  it  happened  to  repair  it." 
(Article  1382.)  Toullier,  in  his  commentary  en 
the  Code,  regards  tliis  as  a  happy  thought, 
and  a  return  to  the  law  of  nature.  Volume  6, 
p.  243.  But  such  an  iron  rule  is  too  regardless 
of  the  foundation  principles  of  human  duty, 
and  must  often  operate  with  great  severity 
and  injustice. 

In  the  case  before  us,  the  law,  in  the  ab- 
sence of  special  contract,  fixes  the  degree  of 
care  and  diligence  due  from  the  railroad  com- 


PUBLIC  POLICY— LIMITING  LIABILITY  FUR  XEGLICEXCE. 


489 


pany  to  the  persons  carried  on  Its  trains.  A 
failure  to  exercise  such  care  and  diligence  is 
negligence.  It  needs  uo  epithet  properly  and 
legally  to  describe  it  If  it  is  against  the  pol- 
icy of  the  law  to  allow  stipulations  wliich 
wiU  relieve  the  company  from  the  exercise  of 
that  care  and  diligence,  or  which,  in  other 
words,  will  excuse  them  for  negligence  in  the 
performance  of  that  duty,  tlien  the  company 
remains  liable  for  such  negligence.  The  ques- 
tion whether  the  company  was  guilty  of  negli- 
gence in  this  case,  which  caused  the  injury 
sustained  by  the  plaintiff,  was  fairly  left  to 
the  jury.  It  was  unnecessary  to  tell  them 
whether,  In  the  language  of  law  writers,  sucli 
negligence  would  be  called  gross  or  ordinary. 
The  conclusions  to  which  we  have  come 
are- 
First.  That  a  common  carrier  cannot  law- 
fully stipulate  for  exemption  from  responsi- 


bility when  such  exemption  is  not  just  and 
reasonable  In  the  eye  of  the  law. 

Secondly.  That  It  Is  not  just  and  reasonable 
in  the  eye  of  the  law  for  a  common  carrier  to 
stipulate  for  exemption  from  responsibility 
for  the  negligence  of  himself  or  his  servants. 

Thirdly.  That  these  rules  apply  both  to  car- 
riers of  goods  and  carriers  of  passengers  for 
hire,  and  with  special  force  to  the  latter. 

Fourthly.  That  a  drover  travelling  on  a 
pass,  such  as  was  given  in  this  case,  for  the 
purpose  of  taking  care  of  lils  stock  on  the 
train,  is  a  passenger  for  hire. 

These  conclusions  decide  the  present  case, 
and  require  a  judgment  of  afTirniMnr-e.  We 
purposely  abstain  from  expressing  any  opinion 
as  to  what  would  have  been  the  result  of  our 
judgment  had  we  considered  the  plaintiff  a 
free  passenger  instead  of  a  passenger  for  hire. 

Judgment  affirmed- 


3 


490  ILLEGALITY  OF  OBJECT. 

^  SULLTTAN  v.  HERGAN.     '  -^  ^ 

(20  AU.  232.  17  R.  I.  109.) 


b^ 


Supreme  Court  of  Rhode  Island-    July  12, 
1S90. 

On  petition  for  a  new  trial. 

Patrick  ,7.  Galvin,  for  plaintiff.  Francis 
B.  Peckham  and  William  P.  SbeSeld,  Jr., 
for  defendant. 

MATTESON,  J.  This  is  an  action  of  as- 
sumpsit to  recover  moneys  c\aimed.  to  be 
due  to  the  plaintiff  from  the  defendant  un- 
der a  contract  of  hiring.  It  appears  from 
the  evidence  reported  that  the  plaintiff 
was  emplo.yod  by  the  defendant  in  h[& 
Busmess  of  a  dealer  in  groceries  and  liq- 
uors, as  bar-tender  and  clerk,  from  No- 
vember 27,'  ISSG,  until  April  19,  1SS8,  and 
was  to  receive  as  wages  $1S  per  month  un- 
til May  1,  1SS7,  and  $25  per  month  there- 
after. At  the  trial  the  defendant  set  up  as 
a  defense  the  illegality  of  the  contract,  the 
sale  of  liquors  being  prohibited  by  law 
when  the  contract  of  hiring  was  made, 
and  during  the  period  of  the  plaintiff's  em- 
ployment. The  jury  returned  a  verdict  for 
the  plaintiff  for  $187.84.  The  defendant 
moves  for  a  new  trial,  on  the  ground  that 
the  verdict  is  against  the  law  and  the  evi- 
dence. 

The  principle  that  if  a  contract  or  prom- 
ise be  founded  on  a  legal  and  an  illegal 
consideration,  and  the  illegal  considera- 
tion cannot  be  separated  from  the  legal, 
and  rejected,  the  illegality  of  part  vitiates 
the  whole,  so  that  no  action  can  be  main- 
tained upon  it  as  a  contract,  is  conceded; 
but  it  is  suggested  that,  inasmuch  as  the 
contract  is  illegal  and  void,  and  is  there- 
fore, as  it  is  contended,  a  nullity,  the  plain- 
tiff is  entitled  to  recover  for  that  portion 
of  his  services  performed  as  clerk  in  the 
grocery  part  of  the  business,  upon  a  quan- 
tum meruit,  what  such  services  were  rea- 
sonably worth,  and  therefore  that  the  ver- 
dict may  be  supported.  We  do  not,  how- 
ever, agree  with  the  suggestion.  Although 
a  contract  thus  infected  with  illegality  is 
regarded  in  law  as  a  nullity,  in  so  farthat 
tlie  law  will  not  lend  its  aid  to  enforce  it, 
it  is  nevertheless  not  treated  as  if  it  had 
no  existence  in  fact.  The  illegality  ex- 
tends to  every  part  of  the  transaction,  and 
it  cannot,  therefore,  be  made  the  founda- 
tion of  an  assumpsit.  Both  parties  are  in 
pari  delicto,  and  the  law  will,  for  that  rea- 
son, not  aid  either  party  to  enforce  the 
contract,  but  leaves  them  where  it  finds 
them.  It  may  sometimes  happen,  in  con- 
sefjuence,  that  a  defendant  may  gain  a  pe- 
cuniary benefit  by  reason  of  his  wrong-do- 
ing, or  of  that  in  which  he  has  equally 
participated  ;  but  it  is  not  for  the  sake  of 
the  defendant  that  his  objection  to  Ids 
owu  illegal  contract  is  sustained.  In  Hol- 
man  v.  Johnson,  Cowp.  341,  343,  Lord 
Mansfield  remarks:  "The  objection  that 
a  contract  is  immoral  or  illegal  as  between 
plaintiff  and  defendant  sounds  at  all 
times  very  ill  in  the  mouth  of  the  defend- 
ant. It  is  not  for  his  sake,  however,  that 
the  objection  is  ever  allowed,  but  it  is 
founded  in  general  principles  of  policy, 
whicli  thedcfendant  has  theadvantage  of, 


contrarj"  to  the  real  justice,  as  betweea 
him  and  the  plaintiff, by  accident,  if  I  may 
BO  say.  The  principle  of  public  policy-  is 
this:  ex  dolo  malo  nan  oritur  actio.  No 
court  will^lend  its  aid  to  a  man  who  founds 
his  cause  of  aclion  upon  an  immoraror  an 
illegal  act.  If,  from  the  plaintiff's  own 
BtatrTrg'^t"5thcrwise,  the  cause  of  action 
appears  to  arise  ex  turpi  causa,  or  from 
tlie  transgression  of  a  positive  law  of  this 
country,  there  the  court  says  he  has  no 
right  to  be  assisted.  It  is  upon  that 
ground  the  court  goes,  not  for  the  sake  of 
the  defendant,  but  because  it  will  not 
lend  its  aid  to  such  a  plaintiff.  So  if  the 
plaintiff  and  defendant  were  to  change 
sides,  and  the  defendant  was  to  bring  his 
action  against  the  plaintiff,  the  latter 
would  then  have  the  advantage  of  it,  for 
where  both  are  equally  in  fault,  potior 
est  conditio  defendentis.  "  Bixby  v.  Moor, 
51  N.  H.  402,  is  a  case  strongly  in  point. 
In  that  case  it  appears  that  the  defendant 
kept  a  billiard  saloon  and  a  bar  for  the 
sale  of  liquor.  The  liquor  traffic  was  ille- 
gal, 'i'he  plaintiff  was  employed  by  the 
defendants  to  work  generally  in  and  about 
the  saloon.  There  was  no  special  agree- 
ment that  he  should  or  should  not  sell 
liquor,  or  what  particular  duty  he  should 
do.  But  he  was  accustomed  to  work  gen- 
erally in  and  about  the  saloon,  taking  care 
of  the  room,  building  fires,  taking  care  of 
the  billiard  tables,  tending  bar,  and  wait- 
ing upon  customers,  and,  in  the  absence  of 
the  defendant,  ho  had  the  whole  charge  of 
the  business.  In  assumpsit,  upon  a  quan- 
tum meruit,  it  was  held  that  he  could  not 
recover  compensation  for  any  portion  of 
his  services.  The  court  say:  "In  the  pres- 
ent case,  however,  there  is  room  for  but 
one  conclusion,  namely,  that  the  agree- 
ment was  that  the  plaintiff  at  the  defend- 
ant's request  should  perform  all  the  serv- 
ices which  he  did  in  fact  pei-form,and  that 
the  defendants,  in  consideration  of  the 
promise  to  perform  (and  the  performance 
of)  all  those  services,  the  illegal  as  well  as 
the  legal,  should  pay  the  plaintiff  the  rea- 
sonable worth  of  the  entire  services.  In 
other  words,  the  plaintiff  made  an  entire 
promise  to  perform  both  classes  of  serv- 
ices. This  entire  promise  (and  the  per- 
formance thereof)  formed  an  entire  con- 
sideration for  the  defendant's  promise  to 
pay,  and  a  part  of  this  indi\isible  consid- 
eration was  illegal."  In  the  present  case 
the  sums  which  the  defendant  promised 
to  pay  formed  one  entire  consideration 
for  all  the  services  to  be  rendered  by  the 
plaintiff,  both  those  in  tending  the  bar, 
which  were  illegal,  and  those  as  clerk  in 
the  grocery  store,  which  wei-e  legal.  Had 
one  price  been  agreed  upon  for  the 
services  as  bar-keeper,  and  another  as 
clerk  in  the  grocery  business,  so  that  it 
would  have  been  possible  to  separate  the 
legal  from  the  illegal  part  of  the  transac- 
tion, an  action  could  have  been  maintained 
for  the  services  which  were  legal ;  but,  as 
it  is,  the  defendant's  promise  being  entire, 
and  the  consideration  for  it  being  partly 
legal  and  partly  illegal  and  indivisible, 
both  parties  are  to  be  regarded  as  equally 
in  fault,  and  the  law  will  lend  its  aid  to 
neither.    Petition  granted. 


(y  SHAW  V.  carpe: 


EFFECT  OF  ILLKGALITY. 


491 


PEXTER  et  aL 

(54  Vt.  155.) 

Supremo  Court  of  Vcrniont.      Montpclier.    Oct, 
1881. 

ROYCE.CIi.J.  riiiscauHe  was  hearrl  iij). 
fill  the  roptirt  of  a  spfcial  tDastcr  .ipiioin t- 
6(3  to  ascertain  and  report  tlie  amount 
due  on  the  niortgajje  described  iu  the 
petition. 

It  ajjpears  from  the  report  that  on  the 
24tii  day  of  July.  1S72.  one  Benj.  D.  Peter- 
son, who  was  then  enf;aKedin  the  business 
of  bottling  cider,  soda,  and  mineral  wa- 
ters, at  the  city  of  I>uiiiniL;ton,  sold  the 
good  will  of  the  business  and  all  his  stock, 
—tools,  bottles,  machinery,  and  fixtures, 
then  in  u.se  by  him  in  said  business,  as 
specified  in  certain  inventories,  which  were 
signed  by  the  said  Peterson,  to  the  defend- 
ant Carpenter. 

Upon  said  inventories  the  varions  arti- 
cles sold  were  separately  carried  out,  with 
a  separate  price  f<jr  each  item.  The  foot- 
ings of  the  separate  pages  were  brought 
forward  upon  the  last  page,  where  the 
aggregate  correctly  appeared  of  the  sura 
f:!L'21..sl.  To  this  amount  an  item  of  $116 
was  added,  which  was  included  in 
the  *note  first  due.  It  is  not  found  •160 
what  the  consideration  for  that  item 
M'as.  The  good  will  of  the  business  was 
included  in  the  sale,  and  was  not  estimat- 
ed in  the  inventory.  It  is  probable  that  it 
may  have  been  estimated  by  the  parties 
at  that  time.  For  the  amount  so  ascer- 
tained the  defendant  Car[)enter  executed 
four  promissory  notes  payable  to  saJd 
l*eterson,  or  order,  and  secured  the  same 
by  the  mortgage  sought  to  be  foreclosed. 
Said  notes  have  all  been  paid,  but  the  last, 
which  was  for  $S00;  and  that  fell  due  on 
the  24tli  of  July,  1S76.  The  interest  on 
that  note  was  paid  to  the  24th  of  July, 
ls7(J. 

On  the  2Sth  day  of  October,  1S72,  and 
before  the  maturity  of  any  of  said  notes, 
Peterson  sold  them  and  the  mortgage  for 
an  adequate  consideration  to  the  peti- 
tioner; the  petitioner,  then  believing  the 
notes  to  be  based  on  a  valid  and  legal 
consideration,  and  not  suspecting  that 
any  illegal  element  entered  into  the  con- 
sideration. 

Of  the  property  sold  by  Peterson  to  Car- 
penter,  and  which  formed  apart  of  the 
consideration  of  said  notes,  the  master 
has  found  there  were  the  following  goods, 
in  kind  and  amount:  Lager  beer.  $23.94; 
Cider,  .$422;  Ale,  $209.38;  Porter,  $0.72;  Al- 
cohol, $2.2.'j. 

The  defendant  Carpenter  claims  that  if 
any  part  of  theconsideration  for  the  notes 
was  illegal,  they  are  void  ;  that  no  recov- 
ery could  be  had  upon  them;  and  that 
a  court  of  e(iuity  cannot  grant  any  relief 
to  the  i)etitioner. 

The  lirst  inquiry  is,  was  the  sale  of  any 
of  the  articles  above  enumerated  prohibit- 
ed by  law?  It  is  found  that  the  lager 
beer  was  not  an  intoxicating  drink,  and 
its  sale  was  not  then  prohibited,  the  act 
forbidding  its  sale  having  been  passed  in 
1S7S.  The  sale  of  the  cider  was  not  illegal, 
unless  the  place  where  it  was  sold  was  a 
place  of  public  resort.     The  question  as  to 


what  constitutes  a  place  of  public  resort, 
under  s.  3^00  of  R.  L.,  does  nrjt  appear  to 
have  been  before  this  court,  except  in  the 
ca.se  of  State  v.  Pratt.  34th  Vt.323;  and  in 
that  it  was  submitted  to  the  jury  to  lind 
from  the  evidence  wh«'ther  the  place  where 
it  was  shown  the  intoxicating  liquor  wan 
furnished  was  a  place  of  public  resort  or 
not.  Thesale(jf  spirituous  or  intoxi- 
•101  eating  licjuor,  or  of  mixed  'liquor, 
of  which  a  partis  spirituous  or  in- 
toxicating, is  prohibited  generally;  its 
sale  is  made  illegal,  without  reference  to  the 
place  where  the  sah;  is  made.  The  sale  (jf 
cider  is  not  generally  prohibited,  and  its 
sale  is  only  made  illegal  when  it  is  sold  at 
or  in  a  victualling  house,  tavern,  grf)cery. 
shop,  or  cellar,  or  otlx-r  place  of  public  re- 
sort, or  at  any  place  to  an  habitual 
drunkard. 

If  the  defendant  would  avoid  paj-ment 
for  the  cider,  he  must  show  that  the  sale 
was  an  illegal  sale,  that  it  was  prohibited 
by  law.  The  only  ground  upon  which  it 
is  claimed  the  sale  was  illegal  is,  that  it 
was  made  at  or  in  a  place  of  public  resort. 
The  master  has  not  found  that  the  sale 
was  made  at  or  in  the  establishment  ot 
Peterson,  which  it  is  claimed  was  a  place 
of  public  resort;  or  where  it.  in  fact,  was 
made;  or  that  the  cider  was  in  or  about 
that  establishment;  or  where  it  was, 
when  sold.  So  that,  from  what  apiiears 
iu  the  report,  the  court  cannot  hold,  as 
matter  of  law,  conceding  that  the  estab- 
lishment of  Peterson  was  a  place  of  pub- 
lic resort,  that  the  sale  of  the  cider  was 
illegal.  But  we  do  not  think  the  estab- 
lishment of  Peterson  was  a  place  of  public 
resort,  or,  rather,  such  a  place  as  rendered 
the  sale  of  the  cider  illegal  by  reason  of 
its  have  been  there  made. 

The  words,  "  place  of  public  resort,  "  in 
the  statute,  are  used  in  connection  with 
the  victualling  house,  tavern,  grocery, 
shop,  and  cellar,  in  which  the  selling  or 
furnvshing  of  cider  is  absolutely  prohibit- 
ed. We  all  understand  that  such  jjlacesare 
resorted  to,  to  a  greater  or  less  extent, 
and  hence  tliey  become,  and  are  known 
as,  ])laces  of  public  resort.  But  in  the  as- 
certainment of  what  is  meant  by  "other 
places  of  public  resort"  we  have  to  inquire 
as  to  what  places  were  intended  to  come 
within  that  description.  The  legislature 
did  not  intend  t(j  jtroliibit  the  sale  of 
cider  as  an  article  of  commerce.  This  is 
evident  from  the  fact  that  its  mantifacture 
and  sale  are  not  generally  prohibited. 
Its  sale  is  only  prohibited  in  particular 
places,  and  to  an  habitual  drunkard. 
And  whether  a  place  is  a  place  of  |)ublic 
resort  must  depend  upon  the  evidence 
which  gives  character  to    the  place. 

In  order  to  constitute  it  such  a  place  as 
would  render  a  sale  of  cider  made  at  it  ille- 
gal, it  must  appear  that  it  was  a  place  re- 
sorted to  by  the  public  for  the  purchase  of 
cider.  The  fact  that  it  is  not 
*1G2  "drank  at  the  place  where  it  is  ob- 
tained would  not  probably  be  regard- 
ed as  contr(^)lling,  if  it  appears  that  those 
who  want  it  can  and  will  be  suijplicd  at 
such  place.  The  de.-.ign  of  the  legislature 
was  to  remove  the  temi)tation  to  its  use, 
by  putting  it  out  of  the  power  of  those 
addicted  to  its  use  to  obtain  it,  to  use  as  a 


492 


ILLEGALITY  OF  OBJECT. 


beverage  at  the  places  enumerated  in  the 
Btatute. 

This  establishment  was  for  the  bottlins 
of  cider  and  otiier  beverages  for  the  mar- 
ket. It  was  a  sort  of  waielioiise,  where 
cider  and  other  drinks  were  pr(-i)ared  and 
stored  in  bulk  ;  and  tliecider  was  put  up  in 
bottles  for  the  market,  and,  when  thus 
prepared  was  mostly  sold  at  wholesale  to 
dealers  out  of  town,  on  orders  received  by 
mail.  Some  was  sold  to  wholesale  deal- 
ers in  town,  upon  orders.  There  were  no 
conveniences  for  selling  it  to  be  drank 
on  the  premises,  and  ncue  was  so  sold  or 
drank.  And  it  was  not  a  place  that  peo- 
ple resorted  to  for  the  purpose  of  buying 
cider,  or  that  was  generally  resorted  to  for 
any  purpose.  This,  in  our  judgment,  does 
not  show  that  the  establishment  was 
guch  a  place  of  public  resort  as  was  intend- 
ed by  the  statute. 

The  ale.  porter  and  alcohol  were  intoxi- 
cating liquors,  and,  notwithstanding  the 
ale  and  porter  were  in  a  damaged  condi- 
tion and  unpalatable,  as  long  as  their  in- 
toxicating properties  remained,  it  was  ille- 
gal to  sell  them.  The  sale  of  the  alcohol 
was  prohibited;  and  the  belie!  of  Peter- 
son that  it  was  to  be  used  fora  legitimate 
and  proper  purpose,  connected  with  the 
manufacture  of  a  nou-intoxicating  drink, 
did  not  make  the  sale  legal.  State  v. 
Pratt,  34  Vt.  ;^23. 

The  sale  of  the  ale^  porter,  and  alcohol 
being  illegal,  the  consideration  for  the 
notes,  as  far  as  the  value  of  those  articles 
went  to  make  up  the  amount  for  which 
the  notes  were  given,  was  an  illegal  con- 
sideration. 

The  imi)ortant  question  in  the  case  is, 
as  to  the  effect  that  such  partial  illegality 
of  consideration  is  to  have  upon  the 
rights  of  the  parties.  Robinson  v.  Bland, 
administratrix  of  Sir  John  Bland,  2  Burr. 
1077,  has  always  been  regarded  as  a  lead- 
ing case;  and  opinions  were  given  in  it 
by  Lord  Ma.nsi  ield  and  .Justices  Denison 
and  WiLMOT.  The  declaration  contained 
three  counts;  the  first,  upon  a  bill  of  ex- 
change; the  second,  for  money 
*lent  and  advanced ;  and  the  third,  *1G3 
for  money  had  and  received.  A  ver- 
dict was  found  for  the  plaintiff  for £(572,  the 
amount  of  the  bill  of  exchange.  It  was 
found  tiiat  the  consideration  for  the  bill 
of  exchange  was  £300,  lent  bj'  the  plaintiff 
to  Sir  John  Bland  at  the  time  and  place 
of  play;  and  £372  were  lost  at  the  same 
time  and  place  by  Sir  John  Bland  to  the 
plaintiff  at  play.  It  was  held  that  the 
£372,  part  of  the  consideration  for  the  bill, 
being  for  money  lost  at  play,  could  not 
be  recovered,  all  such  securities  being  void 
under  the  statute;  and  that  a  part  of  the 
consideration  for  the  bill  being  illegal, 
no  recover^'  could  be  had  under  the  first 
count;  that  the  plaintiff  was  entitled  to 
the  £300  lent,  and  was  allowed  to  recover 
it,  under  the  count  for  money  lent  and 
ailvanced. 

Judge  DioNisoN  says  there  is  a  distinc- 
tion between  thecontractand  security.  If 
part  of  the  contract  arises  upon  a  good 
consideration,  and  part  of  it  upon  a  bad 
one,  it  is  divisible.  I'.ut  it  is  otherwise  as 
to  the  secui'ity.  That,  being  entire,  is  bad 
for  the  whole. 


Judge  Wit, mot:  "As  to  contracts  being 
good  and  thesecurity  void, — the  contracts 
may  certainly  be  good,  though  the  securi- 
tj'  be  void. " 

The  same  principle  as  to  such  a  security 
being  void  was  enunciated  in  Scott  v.  Gill- 
more,  3  Taunt.  22i;.  See  also  Yundt  v. 
lloberts,  ,5  Serg.  and  Kavvle,  139;  Phillips 
v.  Cockayne,  3  Campbell,  119;  Edgell  v. 
Stanford,  6  Vt.  55L  These  two  first  cases 
have  oftenest  been  quoted  as  authority 
for  the  rule  that  has  generally  prevailed  in 
the  English  and  American  courts,  that 
where  a  part  oi  the  consideration  for  a 
security  is  illegal  the  whole  security  is 
void. 

The  cases  referred  to  by  counsel  for  de- 
fendant were  all  cases  where  attempt.s 
were  made  to  enforce  such  securities,  and 
the  cases  of  Hinesburgh  v.  Sumner,  9  Vt. 
23,  and  Woodruff  v.  Hinman,  11  Vt.  592, 
were  of  the  same  kind.  In  none  of  these 
cases  was  the  court  called  upoia  to  decide 
what  the  effect  of  holding  the  security 
void  would  be  upon  the  original  contract, 
where  that  was  bad.  in  part,  uponagood 
and  legal  consideration. 

In  Carleton  v. Woods,  28  N.  H.  290, 
*164  the  question  was  pre*sented.  The 
declaration,  in  that  case,  contained 
counts  upon  several  promissory  notes, 
and  a  count  for  goods  sold  and  delivered. 
The  plaintiff  agreed  to  sell  the  defend- 
ant a  stock  of  goods  and  groceries  at  cost 
and  freight.  A  schedule  of  the  articles 
was  made,  and  the  cost  of  each.  The  sum 
total  of  the  cost  of  all  the  articles  was  di- 
vided into  several  pans,  and  the  notes  de- 
clared upon  were  given  for  the  same. 
Among  the  articles  so  sold  were  some 
spirituous  liquors  illegally  sold,  the  price 
of  which  formed  a  part  of  the  considera- 
tion for  the  notes.  A  verdict  was  taken 
for  the  plaintiff,  for  the  cost  of  the  goods 
remaining  unpaid,  except  the  spirituous 
li(luors;  and  judgment  was  to  be  rendered 
on  the  verdict,  or  it  was  to  be  set  aside, 
as  the  opinion  of  the  court  should  be.  It 
was  held  that  the  counts  upon  the  notes 
were  not  maintainable;  that  the  consid- 
eration of  the  several  notes  was,  in  part, 
illegal,  and,  therefore,  no  recovery  could 
he  had  upon  them;  that  the  legal  effect 
of  the  contract  was,  that  each  article  was 
to  be  valued  separately,  and  that  thesale 
and  delivery  of  each  article  formed  thecon- 
slderation  for  the  promise  to  pay  for  it; 
that  the  contract  was  divisible;  and, 
while  the  separate  value  of  the  articles 
sold  could  be  ascrertained,  as  fixed  by  the 
parties,  the  principle  is  not  readily  seen, 
which  would  defeat  the  right  of  recovery 
for  the  stipulated  price  of  that  portion, 
the  sale  of  which  was  legal;  and  judg- 
ment was  rendered  on  the  verdict.  The 
same  was  substantially  held  in  Walker  v. 
Lovell,  in  the  same  volume,  138.  The  law- 
does  not  favor  any  party  in  evading  i)ay- 
ment,  while  he   retains  the  consideration. 

The  notes  vvliich  were  given  for  the  good 
will  and  property  sold  to  Carpenter  were 
all  infected  with  illegality,  and  the  defence 
of  illegality  attached  to  all  of  them  ;  so 
that,  if  what  is  now  claimed  as  a  defence 
can  be  allowed,  if  proceedings  had  been 
instituted  to  compel  payment  before  any- 
thing had  been  paid,  the  entire  claim  could 


EFFECT  OF  ILLEGALITY. 


493 


have  been  defeated,  notwitlistandiiip:  Car- 
penter had  received,  anrl  was  in  the  enjoy- 
ment of  thepro|ierty,  u[>on  the^i'^imd  that 
the  [)ortion  of  the  [)i-opei'Ly  above  enunjer- 
ated  was  illegally  sold.  It  has  somewhere 
been  said,  that  tiic  dcclarinw  such  a  secu- 
rity void  was  to  be  reyar<h'd  as  a  punish- 
ment of  the  party  for  havinj;  made  an  ilJe- 
j^ai  contract. 

*The  loss  of  the  property  iilcfrally  *1G." 
sold  wouhl  generally  be  considered 
a  siilficient  puiusliment,  certaiidy,  wlien 
the  sale  was  only  inulnin  pioliihitiitn,  and 
no  wron;;ful  intention  appears.  I'ut  a 
court  of  ecpiity  couhl  never  lioid  tliat  one 
Hiijiht  be  deprived  of  his  entire  ftu-tuue,  be- 
cause in  the  consideration  agreed  to  be 
paid  for  it,  there  was  intcrmin<::Ied  some 
article  ttie  sale  of  whicii  was  prohibited. 

W'ere^ard  tiiecaseof  Carleton  v.  NVcJods, 
supra,  as  sound  law  and  well  sustained 
by  authority.  Its  application  worlis  out 
just  and  ecpiitable  results,  and  we  shall 
api)ly  the  principles  there  enunciated  in 
I  lie  decision  of  this  case. 

I'eterson  could  have  recovered  aj^ainst 
rar[)enter  in  an  action  of  assn/npsit,  for 
all  that  was  sold  to  him,  except  the  ale, 
porter,  and  alcohol.  The  mortfj^ase  would 
be  treated  as  secuiity  for  the  debt  due 
from  Carpenter,  on  account  of  the  proper- 
ty lejialiy  sold  to  him.  Peterson  mijjjht 
liave  foreclosed  the  mortsaffe,  and  thub 
have  conii)ellcd  i)ayment  of  the  debt. 

The  petitioner,  by  his  purchase  of  the 
notes  and  mort$?age,  acquired  all  the 
rights,  le<?al  and  equitable,  of  Peterson. 
He  could  maintain  a  suit  at  law  for  his 
own  benelU,  in  the  name  of  Peterson,  or 
a  petition  in  equity,  as  assignee  of  the 
mortgage,  to  foreclose  it.  And  in  the  dis- 
position of  such  a  petition  it  is  the  dutj' 
of  a  court  of  equity,  which  has  been  said 
to  be  the  gieat  sanctuary  of  plain  dealing 
and  honesty,  to  compel  the  payment  of 
that  portion  of  the  debt  that  was  secured 
bv  it,  that  was  legally  and  fairly  ccjutract- 
ed. 

The  decree  of  the  Court  of  Chancery  is 
reversed  and  cause  remanded,  with  man- 
date that  a  decree  be  entered  for  the  peti- 
tioner for  the  amount  due  on  the  note  for 
^SOO  described  in  the  petition,  with  interest 
after  deducting  therefrom  the  sums  of 
.Sl'()'.).;>8,  $6.72,  and  .f  J.lV),  being  for  th(^  ale, 
l)orter,  and  alcohol  illegally  sold, — as  of 
the  date  of  the  note.  If  the  amount  due 
cannot  be  ascertained  from  the  computa- 
tions made  by  the  master,  it  is  to  be  as- 
certained in  such  manner  as  the  court  may 
direct. 

Dissenting  opinion  was  delivered  by 

IIOS8,  J.  I  am  unable  to  concur  in  the 
decision  of  the  court  in  this  case.  On  the 
facts  found  by  the  master,  it  may  be 
question*able  whether  the  sale  of  the  *1G6 
cider  was  illogal,  within  the  exact 
terms  and  language  of  the  statute.  How- 
ever, when  a  man  establishes  a  busine.sis 
ft)r  the  bottling  and  sale  of  cider  and  oth- 
er fermented  drinks, in  a  city,  like  I'.urling- 
ton,  has  a  wareliouse  for  storing,  nianu- 
lacturing,  bottling,  and  vending  the  same, 
and  keeps  an  ottice,  he  so  far  makes  the 
placeof  liisbusiness  a  placeof  publicresort 
for  the  sale  of  cider,  although  the  vending 


is  carried  on  by  solicitation  of  orders  at 
the  hoiisi's  and  [)laces  of  business  of  his 
customers,  and  the  delivery  of  the  bottled 
cider  is  at  the  latter  places,  that  in  my 
opinion,  it  comes  within  the  spirit  and 
seop"  of  the  statute,  and  without  any 
forced  consti-ucti<jn,  within  its  language. 
l'>ut  I  do  not  i-egard  this  jxjint  very  mate- 
rial;  and  should  not  on  tliis  gi(jund  have 
placed  my  dissent  upon  ree(jril.  A  i)art  of 
the  consideration  of  tiie  note  being  idegal, 
the  note  is  void  and  no  action  can  be 
maintained  thereon  to  enforce  its  collec- 
tion. To  the  cases  cited  by  the  court,  in 
the  main  of)inion,  may  be  added  CobI)  v. 
Cowdery  et  al.,  40  Vt.  L'.j;  I'cjwen  v.  I'lick, 
2S  Vt.  ;JU8.  In  Cobb  v.  Cowdery,  supra, 
the  distinction  is  tjiken  between  a  consid- 
eration, in  part  voiij,  and  a  consideration 
in  part  illegal.  The  note  failing,  what  is 
there  left  for  the  mortgage  to  stand  ui)on  ? 
The  moi'tgage  is  but  an  incident  to  the 
debt  it  secures.  On  the  autlujrities  cited 
by  the  court  in  support  of  its  decision,  at 
well  as  all  the  reasoning,  partial  illegality 
of  consideration  avoids  all  securities.  The 
note  was  a  security,  or  evidence  of  the 
ilebt,  of  a  higher  nature  than  the  original 
contract.  Ttie  latter  was  merged  in  the 
note.  The  n(Jte  in  suit,  and  all  the  notes 
secured  by  the  mortgage,  were  tainted  by 
illegal  consideration  entering  into  them. 
Each  note  being  an  entire  contract  of  it- 
self, no  division  of  the  legal  from  the  ille- 
gal, part  of  the  consideration  could  be 
effected.  Courts  established  for  the  en- 
forcement of  law,  will  not  give  aid,  or 
countena!ice  to  anything  illegal;  nor, 
where  the  illegal  is  commingled  with  the 
legal,  will  they  aid  in  separating,  or  purg- 
ing the  former  from  the  latter.  Their 
proper  function  is  to  establish  and  enforce 
the  legal  a!ul  to  condemn  and  i)unish  the 
illegal.  Where  a  part,  however  email — of 
the  consideration  of  an  entire  contract  is 
illegal,  the  whole  cfintract  is  tainted,  and 
courts  will    not   compel   its   performance 

Collins  V.  r.lantern.  2  Wils.  :!41,  is  a 
*167    leading    case    on     *lhis    suliject.    iu 

which,  the  Lord  Chief  Justice  Wil- 
MOT  uses  the  (juaint  but  foi'cible,  and  often 
quoted  language:  "You  shall  not  stii)U- 
late  for  iniquity  ;  all  writers  upon  our  law 
agree  in  this,n«j  polluted  hand  shall  touch 
the  pure  fountains  of  justice:  whoever  is  a 
party  to  an  unlawful  contract,  if  he  hath 
onc3  paid  the  money  stipulated  to  be  paid 
in  pursuance  thereof,  he  shall  not  have  the 
hell)  of  a  court  to  fetch  it  back  again;  you 
shall  not  have  a  right  of  action  when  you 
come  into  a  court  of  justice  in  this  unclean 
manner  to  recover  it  back.  Frocul!  O 
prociil  estf,  profuui. "  The  mortgage  is  an 
entire  contract.  Its  consideration  was 
the  notes,  the  payment  of  which  was 
therein  secured;  every  one  of  which  was 
tainted  with  an  illegal  consideration  in 
part.  It  was  not  given  to  secure  the  per- 
formance by  Carjienter  of  his  contract 
with  Peterson,  of  .Inly  24,  1S72.  by  which 
he  purchased  his  business  and  stock  in 
trade,  but  was  given  solely  to  secure  the 
payment  of  the  notes  which  were  executed 
in  jiayment  of  that  purchase.  If  the  ac- 
tion were  upon  the  notes,  it  is  conceded 
that  no  recovery  could  be  had;  because 
every  one  of  them  is   tainted    with   illegal 


494 


ILLEGALITY  OF  OBJECT. 


coDsideration.     The  illegal  could    not  be 
separated  from   the  le«al  portion   of  the 
consideration;  and  an  enforcement   of  the 
collection   of  the  notes  would    be   the  en- 
forcement   of  an   illegal    contract.     How 
does  it  differ  when  the  mortgage,  which  is 
but   an  incident  to  the  notes,  is   allowed 
to   be  foreclosed?     Is  it   not   an   enforce- 
ment of  an  illegal  contract?    To  foreclose 
the  mortgage  for  the  legal  part  of  the  con- 
sidenition   must  not  the  illegal  portion  oe 
ascertained    and    rejected;  which  the  mu- 
joritj'  hold  could  not  be  done,  if  the  action 
were  upon    the  notes?     What   is  the  fore- 
closure but  an   action   upon  the   notes  de- 
scribed in  its  condition?    and  to  ascertain 
the  legal   part   of  the  consideration  of  the 
mortgage   must   not  the   notes  be  treated 
as  divisible?     I  can  see   no  other  means  of 
separating  the  legal  from  the  illegal   part 
of  its  consideration.     In  Vinton  v.  King, 
4  Alien,  odi.'.  Metcalf,  J., says:   "In  an  ac- 
tion brought  by  a  mortgagee   against  his 
mortgagor,  on  a  mortgage  given  to  secure 
payment  of    a  note,   the    defendant   may 
show    the   same   matters  in    defence   (the 
Statute  of  Limitations   excepted,  19   Pick. 
o3"i,)  which  he  raigb.t  show  in  defence  of  an 
action  on  the  note."   I  am  not  aware 
of  any  exception   to   the  rule  *thus     *168 
stated,  nor  of  any  case  to  the  con- 
trary.   I  am  not  unaware,  that  Mr.  Jones 
1   his   work   on   mortgages,  s.   G20,  says: 
"The   mortgage   maybe   upheld   for  such 
part  of  the  consideration  as  was  free  from 
the  taint  of  illegality  when  the  considera- 
tion is  made  up  of  several  distinct  transac- 
tions, some  of  which  are  legal,  and  others 
are  not,  and  the  one  can  be  separated  with 
certainty  from   the  other."    The  cases   he 
cites   support   this   doctrine.     Feldman  v. 
Gambel,  26  N.  J.  Eq.494;   Williams  v.  Fitz- 
hugh,  37  N.  Y.  444;  McCraney    v.  Alden,  46 
Barb.  (N.  Y.)  '272;  Cook    v.  Barnes,  36  N. 
Y.  520. 

It  may  well  be  admitted  that  a  mort- 
gage, given  to  secure  the  payment  of  sev- 
eral notes,  or  debts,  a  part  of  which  arose 
out  of  wholly  legal  transactions,  and  a 
part  of  which  were  tainted  with  illegali- 
ty, could  be  enforced  to  compel  the  pay- 
ment of  the  former  alone.  In  such  a  case 
the  orator  would  not  have  to  show  in 
evidence,  norrely  upon  anything  illegal,  in 
maintaining  his  suit.  In  the  laniruage  of 
GiBBS,  Ch.  J.,  in  Simpson  v.  Bloss,  7 
Taunt.  246,  in  speaking  of  Faikney  v.  liey 
nous,  4  Burr.  206!),  and  Petrie  v.  Hannay, 
3  Term  Kep.  418:  "The  ground  of  their  de- 
cision was,  that  the  plaintiffs  required  no 
aid  from  the  illegal  transaction  to  estab- 
lish their  case. "  This,  as  I  understand,  is 
the  test  most  frequently  applied  in  this 
class  of  cases.  If  the  plaintiff  can  show  a 
good  cause  of  action,  independent  of,  and 
without  bringing  into  the  case  anything 
illegal,  either  by  way  of  proof  or  other- 
wise, he  may  maintain  his  action  therufor. 
If,  on  the  other  hand,  he  derives  any  aid 
from  the  illegal  part  of  the  transaction, 
by  being  obliged  to  show  it  to  make  out 
the  legal  part,  or  otherwise,  he  must  fail. 
The  court  will  not  allow  the  unclean 
thing  within  the  temple  of  justice.  In  the 
foreclosure  of  his  mortgage  the  orator 
was  bound  to  show  in  proof  his  notes, 
every  one  of  which  was    tainted  with   ille- 


gality; and  for  that  reason  the  notes  all 
fall,   and  the  mortgage  given   to    secure 
them   alone,  falls  with   them.     This  point 
my  brethren   have  not  deemed  worthy  of 
their  attention,  nor  alluded   to.     But  if  I 
am  in  error  on  this  point,  1  cannot  concur 
with   my   associates  in   holding  that  the 
original  contract  is  divisible.  It  is  in  writ- 
ing, and  amenable  to  the  rules  of  evidence 
which  forbid  varying,  lessening  or  enlarg- 
ing   such    contracts    by    parol    tes- 
*169     "timony.     It  is  in   the  following  lan- 
guage:   "In   consideration    of    three 
thousand    three  hundred  thirty-seven  dol- 
lars and  eighty -one  cents  received  of  John 
W.  Carpenter,  I,  Benjamin  D.  Peterson  do 
hereby  sell,  transfer  and   assign  unto  said 
Carpenter  the  good  will  of  a  certain  busi- 
ness for  bottling  cider,  soda  and  mineral 
waters,  now  carried   on  by  me  in  Burling- 
ton,  together   with    all    the  stock,  tools, 
bottles,  machinery   and   fixtures,   now   in 
use  in  said  business,  as  specified  in  certain 
inventories   hereto   attached,  and    I  agree 
to   deliver  to   said    Carpenter    the    gross 
amount   of  property  described   in   said  in- 
ventories,    which    said     inventories    are 
signed  with  my   name."     Qlie  inventories 
are  referred  to  and  madea  part  of  the  con- 
tract toshow  what  personal  property  was 
to  pass  with  the  good  will  of  the  business. 
They  ai-e  not  referred   to   for  the  price  of 
the  several  articles  included.     The  master 
has  found  that  the  aggregate  of  the  prices 
there  carried   out,  did  not   amount  to  the 
sum  named  in  the  contract,  and  for  which 
the  notes  were  given,  into  .«116.     Hence,  if 
the  prices  carried    out  on  the  inventories 
are  to   be  regarded   as  a  part  of  the  ccm- 
tract,  they  do   not  show  that  the  articles 
were  severally  sold  for  the  price  set  against 
them,  but  the  reverse.    The  contract   is  to 
be  construed  as  a  whole.    Thus  construed, 
it  is  an  entire,  indivisible  contract.    It  was 
a  sale  of  a   business,  as   a  going  concern, 
including  the  good    will,  stock   in   trade, 
machinery  and  fixtures.    It  is  not  to  be  in- 
ferred, or  intended,  that   Peterson  would 
have  sold   the  good  will   of  the  businass, 
without  selling   the  stock   in   trade,  ma- 
chinery and   fixtures,  nor  that  Carpenter 
would  have  purchased   the  latter  without 
the  former.     It  was   not   the   sale   of  the 
good  will   as  one  separate  transaction,  of 
each  bottle,  barrel,  and  fixture  as  another 
separate     transaction,    and    so    divisible. 
But  one  consideration   is  named  or  paid  ; 
and    but   one  thing  is  sold— the    business, 
including   the  stock,  &c.,  and  good  will  as 
a  going  concern.     As  said   by  Dkvens,  J., 
in  Young  &  Conant  Mfg.  Co.  v.  Wakefield, 
121    Mass.  91:   "If  but  one  consideration  is 
paid   for  all   the  articles  sold,  so  that  it  is 
not    possible  to  determine  the  amount  of 
consideration   paid   for  each,  the  contract 
is  entire.     Miner   v.  Bradley,  22  Pick,   457. 
So  if  the  purchase  is  of  goods  as  a  partic- 
ular lot,  even   if  the   price  is   to   be  ascer- 
tained  by  the  number  of  pounds  in 
♦170    the    lot,   or  num*ber  of    barrels  in 
which  the  goods  are  packed,  the  con- 
tract is  also    held   entire,     Clark  v.  Baker, 
5   Met.   452;  Morse   v.  Brackett,   98   Mass. 
205;    Mansfield     v.    Trigg,   113    Mass.   350, 
While  in  the  cases  last  referred  to,  it  could 
be  ascertained    what    was  the  amount    of 
consideration  paid  foreach  pound,  or  bar- 


EFFECT  OF  ILLEGALITY. 


495 


rcl,  yet  the  articles  having  been  sold  as 
one  lot,-  it  wan  to  lie  inforred  that  one 
pound  or  barrel  would  not  have  been  sold 
nnh'KS  all  were  sold."  On  these  principles, 
if  tiio  mortgage  can  be  upheld  as  as(;curity 
■tov  the  payment  of  the  consideration  of 
the  original  c(jntract,  as  well  as  the  notes 
given  in  payment  therefor,  the  considera- 
tion of  tlie  contract  is  ontiri?,  indivisible, 
and  tainted  with  illegality,  and  for  that 
reason  void,  and  shoulJ  not  bo  enforced. 
To  my  mind,  tiie  cases  principally  relied 
UF)on  by  my  associates  are  not  authority 
for  their  decision.  In  Kohinsonv.  IMand,  2 
Uurr.  1077,  tiie  transactions  were  separate 
and  distinct.  One  was  horrowing  three 
hundred  pounds;  the  other  losing  three 
huudi'cd  sev(nit3'-t\vo  j^ounds  in  gaming. 
While  the  bill  of  exchangi;  given  for  the 
two  was  held  to  be  void  because  tainted 
Avith  in  part  illegal  consideration,  the 
plaintiff  was  allowed  to  recover  on  the 
count  for  money  loaned, for  the  three  hun- 
dred i)ound8  borrowed  by  the  intestate. 
The  plaintiff  could  establish  this  part  of 
his  claim  without  the  aid  of  the  other,  in 
anj'  manner.  The  remark  of  Justice  Deni- 
eoN,  made  in  that  case:  "There  is  a  dis- 
tinction between  the  contract  and  the  se- 
curity'. If  part  of  thecontract  arises  ui)on 
ag(Jod  consideration,  and  partnponabad 
one, it  is  divisible.  But  it  is  otherwise  as 
to  thesccurity  ;  thatbeingentire,  is  badfor 
the  whole,  "  is  not  to  be  pressed  beyond  the 
case  in  hand,  and  given  universal  applica- 
tion. His  language,  as  to  its  being  "divis- 
ible," was  true  as  applied  to  the  facts  of 
that  case.  The  law  vs^as  more  accurately 
expressed  by  Mr.  Justice  Wilmot:  "Here 
are  two  sums  demanded,  which  are  blend- 
ed togetherin  oncbill  of  exchange;  but  are 
divisible  in  their  nature,  as  to  the  money 
lent.  The  cases  that  have  been  cited  are 
In  point,  that  it  is  recoverable."  Carleton 
V.  Woods,  28  N.  H.  290,  comes  nearer  to 
supporting  the  decision  of  the  majority  of 
the  court,  but  in  my  judgment,  is  distin- 


guishable from  thecase  at  bar.  It  is  there 
distinctly  held  that  if  the  contra'jt  is  en- 
tire, and  part  of  the  consideration  is 
illegjil,  *the  contract  is  void;  but  •171 
that  where  an  entire  stock  of  goods 
is  sold,  at  one  and  the  same  time,  but 
each  article  for  a  separate  and  distinct 
agreed  value,  the  contract  is  not  t(j  be  re- 
garded as  entire  and  indivisible.  The  sale 
was  for  cost  and  freight,  and  Woons,  J., 
says:  "We  are  unalde  to  see  how  this  case 
differs  frf)rn  the  case  of  a  sale  by  a  mer- 
chant of  varioii.s  goods  to  his  customers, 
at  one  and  the  same  time,  for  soiiarate 
values,  stated  at  the  time,  wliicli,  when 
computed,  would,  of  course,  auKjunt  to  a 
certain  sum  in  the  aggregate."  It  was  on 
this  theory  tliat  the  court  held,  that,  al- 
though the  notes  could  not  be  main- 
tained, because  a  part  of  the  considera- 
tion was  for  spirituous  liquors  illegally 
Kold.j'et.on  the  general  cf)unts  in  assump- 
sit, for  goodssold  aJid  delivered,  the  plain- 
tiff might  recover  for  the  goods  sold,  as 
the  court  held,  independentl3'  of,  and  as 
transactions  separate  from,  the  purchase 
of  the  liquors.  To  say  the  least,  this  wa.s 
pressing  the  doctrine  of  divisibility  of  a 
contract  to  the  extreme  verge,  and  I  ara 
unwilling  to  go  further.  There  may  have 
been  more  in  the  case  than  appears  in  the 
report,  justifying  the  holding  of  the  court. 
On  the  facte  stated,  I  think  the  authority 
is  clearly  against  that  contract  being  di- 
visible. That  case,  however,  lacks  the  ele- 
ment of  being  the  sale  of  a  going  business, 
including  the  good  will,  and  does  not 
appear  to  have  been  reduced  to  writing. 
In  my  judgment,  the  decree  of  the  Court 
of  Chancery  should  be  reversed,  and  the 
cause  remanded,  with  a  mandate  to  enter 
a  decree  dismissing  the  bill  with  costs. 

TAFT,  J.,  desires  me  to  say  that  he  con- 
curs in  the  views  I  have  expressed,  except 
in  regard  to  the  sale  of  the  cider  being  ille- 
gal, on  which  point  he  concurs  in  the 
views  of  the  majority  of  the  court. 


496 


ILLEGALITY  OF  OBJECT. 


h 


^ 


EOYS  V.  JOHNSON  et  al. 
(7  Gray,  162.) 


^ 


Snpreme  Judicial   Court   of  Massachusetts. 
Middlesex.    October  Term,  1856. 

L.  J.  Fletcher,  for  plaintiff.  W.  S.  Gard- 
ner, for  defendants. 

METCALF,  J.  It  is  agreed  by  the  parties 
that  the  plaintiff  performed  for  the  defend- 
ants the  services  for  which  he  now  seeks 
to  recover  payment  and  that  they  have  not 
paid  him.  It  is  for  them,  therefore,  to  show 
that  he  is  not  entitled  to  recover.  This,  in 
our  opinion,  Is  not  shown  by  the  statement 
of  facts  submitted  to  us.  It  appears,  indeed, 
from  that  statement,  that  the  defendants, 
without  a  license,  set  up  theatrical  exhibi- 
tions, in  which  they  employed  the  plaintiff 
as  an  actor;  and  it  follows,  of  course,  that 
they  thereby  violated  the  law,  and  subject- 
ed themselves  to  punishment  But  it  does 
not  appear  that  the  plaintiff  knew  that  they 
had  no  license.  Unless  he  knew  that  tact, 
Ee  Ts  in  ho  legal  fault;  and  where  a  defend-, 
ant  is  the  only  person  who  has  violated  the! 
law,  he  cannot  be  allowed  to  take  advantage 
of  his  own  wrong,  to  defeat  the  rights  of  aj 
plaintiff  who  is  innocent. 

In  the  cases  cited  by  the  defendants'  coun- 
sel, where  defences  were  sustained  because 
the  claims  were  void  for  illegality,  the  par- 
ties suing  knew,  or  were  bound  to  know,  that 
they  or  the  parties  sued  were  violating  or 
undertaking  to  violate  the  law.  And  this 
distinguishes  all  those  cases,  as  well  in  law 
as  in  common  justice,  from  the  case  at  bar; 
as  was  held  in  Bloxsome  v.  Williams,  3  Barn. 
&  C.  232.  In  that  case,  a  suit  was  brought 
to  recover  damages  for  breach  of  a  warranty 
of  a  horse  sold  to  the  plaintiff  on  Sunday. 
The  defence  was,  that  the  contract  was  void 
within  St.  29  Car.  2,  which  prohibits  worldly 
labor,  business  or  work,  in  the  exercise  of 
one's  ordinary  calling.  It  appeared  that  the 
defendant's  ordinary  calling  was  that  of  a 
dealer  in.  horses,  and  therefore,  that  ho  had 
violated  the  statute  by  selling  and  warrant- 


ing the  horse;  but  that  dealing  m  horses 
was  not  the  plaintiff's  ordinary  calling,  and 
therefore,  that  he  had^-not  violated  the  stat- 
ute by  purchasing  the  horse  and  taking  a 
warranty.  But,  as  the  case  states,  there  was 
no  evidence  that  the  plaintiff  knew  that  the 
defendant  was  by  trade  a  horsedealer  at  the 
time  the  bargain  was  entered  into.  The 
court  held  that  the  defendant  wns  answer- 
able for  the  breach  of  his  contract.  Bayley, 
J.,  said.  "The  deftn  lant  was  the  person  of- 
fending, within  the  meaning  of  the  statute, 
by  exercising  his  ordinary  calling  on  the 
Sunday.  He  might  be  thereby  deprived  of 
any  right  to  sue  upon  a  contract  so  illegally 
made;  and  upon  the  same  principle  any  oth- 
er person  knowingly  aiding  him  in  a  breach 
of  the  law,  by  becoming  a  party  to  such  a 
contract,  with  the  knowledge  that  it  was  il- 
legal, could  not  sue  upon  it.  But  in  this 
case,  the  fact  that  the  defendant  was  a  deal- 
er in  horses  was  not  known  to  the  plaintiff. 
He,  therefore,  has  not  knowingly  concurred 
in  aiding  the  defendant  to  offend  the  law; 
and  that  being  so,  it  is  not  competent  to  the 
defendant  to  set  up  his  own  breach  of  the 
law  as  an  answer  to  this  action."  See  re- 
port of  the  same  case  in  5  DowL  &  R.  82, 
and  a  recognition  of  the  doctrine  of  that  case 
in  Fennell  v.  Ridler,  8  Dowl.  &  R.  207,  208, 
and  5  Barn.  &  C.  409,  and  also  in  Bcgbie  v. 
Levy,  1  Tyrw.  131,  and  1  Cromp.  &  J.  183. 

It  is  to  be  noticed  that  in  the  case  of  Blox- 
some V.  Williams,  it  was  said  that  it  was 
not  known  to  the  plaintiff  that  the  defend- 
ant was  a  dealer  in  horses,  because  there  was 
no  evidence  that  he  knew  it.  In  the  present 
case,  we  treat  the  plaintiff  as  not  knowing 
that  the  defendant  had  no  license,  because 
the  statement  of  facts  does  not  show  that 
he  knew  it. 

It  is  ignQEapce  of  a  fact,  and  not-oi  the 
law,  that  saves  the  plaintiff's  case.  He  un- 
doubtedly knew,  or  was  bound  to  know,  that 
unlicensed  theatrical  exhibitions  were  im- 
lawful;  but  he  was  not  bound  to  know  that 
the  defendants  had  no  license  and  were  do- 
ing unlawful  acts. 

.Tndgiiif>nt  for  the  plaintiff. 


/  '2-7 


TRACT  r.  TALMAGE 


EFFECT  OF  ILLEGALITY. 

3^K 


497 


rf.3^ 


^  -STATE  OF  INDIANA  v.  LEAVI 
<^^^  (14  n;    Y.  lOli.)  J y^-d[  future  day,   which   was  spfciliod;   each  cer 


Court  of  Apponls  of  Now   York.      IS.jO, 

The  North  Aiuericau  Trust  and  Banking 
Company  was,  in  July,  18^8,  or;;anizcd  iu 
the  city  of  New  York  as  a  corporaiiou,  under 
and  by  virtue  of  the  act  "to  authorize  the 
business  of  baiUuuf,'."  Laws  1838,  p.  245. 
By  the  articles  of  association  the  capital  was 
$2,0uu,0U0,  with  power  to  increase  the  same 
to  $r)0,(J<X),UOO.  The  amount  of  the  capital 
was  subscribed,  a  small  portion  thereof  paid 
in  cash,  and  the  residue  secm-ed  by  bonds 
and  mortgages  and  stocks. 

In  August,  1838,  the  company  purchased 
$1,000,000  of  Arkansas  bonds,  paying  there- 
for $300,000  iu  cash,  and  issuing  certificates 
of  deposit  lor  $700,000,  the  residue  of  the 
price  payable  monthly,  during  some  fifteen 
months.  Of  those  bonds  $200,000  were  de- 
posited with  the  comptroller  of  the  state  as 
secm-ity  for  bank  notes  issued  to  the  com- 
pany, and  the  residue  were  sent  to  Europe, 
and  sold  on  behalf  of  the  company  to  meet 
drafts  which  it  had  drawn  on  its  corre- 
spondents in  London.  About  the  15th  of 
September,  1838,  the  company  commenced 
receiving  deposits  and  discoimting  commer- 
cial paper.  The  company  never  received 
from  the  comptroller  bank  notes  to  exceed 
$330,000.  In  January,  1839,  the  Trust  and 
Banking  Company  purchased  of  the  Morris 
Canal  and  Banking  Company,  a  corporation 
created  by  the  laws  of  the  state  of  New 
Jersey,  but  which  had  an  otliee  and  did  busi- 
ness in  the  city  of  New  York,  bonds  made 
by  the  state  of  Indiana,  to  the  amount  of 
$1,200,000,  at  par,  and  gave  therefor,  to  the 
Morris  Canal  and  Banking  Company,  its  ob- 
ligations, in  the  form  of  negotiable  certifi- 
cates of  deposit,  payable  with  interest  at  a 
future  day.  The  most  of  these  bonds  were 
sent  to  the  correspondents  of  the  Trust  and 
Banking  Company,  in  London,  and  there  sold 
at  a  discount  to  raise  funds  to  meet  the 
drafts  of  the  company.  In  the  fall  of  1839 
the  Trust  and  Banking  Company  agreed  to 
purchase,  of  the  Mon-is  Canal  and  Banking 
Company,  bonds  of  the  state  of  Indiana, 
amounting  to  $1,000,000  at  par,  and  to  pay 
for  the  same,  at  98  per  cent.,  in  negotiable 
certificates  of  deposit,  made  by  the  Ti'ust  and 
Banking  Company,  payable  at  a  future  day. 
This  agreement  was  not  in  writing.  On  or 
about  the  28th  of  October,  1839,  these  bonds 
were  delivered  by  the  Morris  Canal  and 
Banking  Company  to  the  Ti-ust  and  Bank- 
ing Company,  and  the  latter  made  and  de- 
livered to  the  former  certificates  of  deposit 
for  the  amount  of  the  purchase  price.  The 
most  of  these  certificates  were  for  $1,000 
each.  They  respectively  bore  date  October 
28,  1839.  were  signed  by  the  president  and 
cashier  of  the  North  American  Ti-ust  and 
Banking  Company,  and  stated  that  James 
Kay  had  deposited  iu  the  bank  a  sum,  which 

HOPK.SEL.CAS.CONT.— 3'2 


was  named,  payable  to  his  order,  on  the  re- 
turn of  the  certificate,   on   demand  after  a 


tificate  was  enduised  by  Kay  in  blank. 
These  Indiana  bonds  were  sent  to  London 
by  the  Trust  and  Banking  Company  to  be 
sold  to  raise  funds  to  meet  its  drafts  and 
obligations  payable  there;  and  they  were 
sold  there  at  a  large  discount  soon  after  the 
purchase.  Kay,  the  payee  named  in  and 
who  endorsed  the  certificates,  was  a  clerk 
for  the  Morris  Canal  and  Banking  Company; 
he  never  deposited  any  money  with  the 
Trust  aud  BanJviug  Company,  and  had  no  in- 
terest in  the  certificates.  On  the  11th  of 
December,  1839,  a  wTitten  agreement  was 
made  between  the  Morris  Canal  and  Bank- 
ing Company  and  the  state  of  Indiana,  which 
recited  tliat  the  former  was  indebted  to  the 
latter  for  Indiana  state  stocks,  theretofore 
sold  and  delivered  by  the  latter  to  the  for- 
mer, and  by  which  the  Morris  Canal  and 
Canal  and  Banking  Company  agreed  to  de- 
liver to  the  state  of  Indiana,  among  other 
securities,  certificates  of  deposit  in  the 
North  American  Trust  and  Banking  Com- 
pany to  the  amount  of  $190,000.  Subsequent- 
ly, and  diu-ing  the  same  month,  the  Canal 
and  Banking  Company  transferred  and  de- 
livered to  the  stiite  of  Indiana  $196,000  of 
the  certificates  issued  to  it  by  the  Trust  and 
Banking  Company  under  date  of  October  28. 
1839,  and  payable  after  Januai-y  l.st.  1841,  and 
the  same  were  receipted  bj'  the  state  of  In- 
diana on  the  back  of  the  agreement  last 
above  mentioned.  On  the  2d  of  January. 
1841,  the  state  of  Indiana  sm-rendered  to  the 
Trust  and  Banking  Company  a  portion  of 
these  certificates,  to  the  amount  of  $175,000. 
and  received  therefor  eighteen  other  certifi- 
cates of  deposit,  in  the  aggregate,  for  the 
same  amount,  dated  on  that  day,  signed  by 
the  president  and  cashier  of  the  Trust  and 
Banking  Company,  and  payable  to  the  order 
of,  aud  endorsed  by,  James  Kay.  Five  of 
those  certificates  were  for  .$9,000  each,  and 
thirteen  of  them  for  $10,000  each.  Eacb 
stated  that  James  Kay  had  deposited,  with  the 
Trust  and  Banking  Company,  a  sum,  whicb 
was  specified,  and  that  the  company  en- 
gaged to  repay  the  holder  of  the  certificate 
this  sum  upon  the  surrender  thereof  at  a 
future  day  named,  with  interest,  at  the  rate 
of  seven  per  cent,  per  annum.  Of  the.se 
eighteen  certificates,  the  one  first  due  was 
payable  five  months  from  date,  and  one  be- 
came payable  every  month  thereafter.  The 
purchases  of  the  Indiana  bonds  were  ne- 
gotiated and  constimmated  in  the  city  of 
New  Y'ork,  and  all  the  certificates  were  is- 
sued there. 

In  August,  1841,  the  plaintiff  herein,  being 
a  stockholder  and  creditor  of  the  Trust  and 
Banking  Company,  commenced  this  suit 
against  it  in  the  court  of  chancery.  The  bill 
was  filed  imder  the  Revised  Statutes  (2  Rev, 
St.  p.  463.  §§  39-42).  and  alleged  that  the 
company  was  insolvent,  and  that  it  had  vio- 


49S 


ILLEGALITY  OF  OBJECT. 


lated  the  law.  &c.     It  prayed  that  the  com- 
pany might  be  eujoiuod  from  transactiug  busi- 
ness, that  a  receiver  of  its  effects  might  be 
appointed  and  the  corporation  dissolved,  «S:c. 
In  September,  thereafter,  David  Leavitt  was 
appointed   receiver,   with   the   usual  powers; 
and  in  June,  1S43,  a  decree  was  made  in  the 
suit  by  which  the  Trust  and  Banlviug  Com- 
pany was  adjudged  to  be  insolvent,  and  it 
and  its  officers  were  perpetually  enjoined,  &c. 
An  order  was  made  in  October,   184.j,   that 
the  creditors  of   the  company   exhibit  their 
claims  to  the  receiver  or  be  precluded  from 
shai-ing  in  the  funds,  and  providing  that  any 
claimant  might  enter  his  appearance  in  the 
action;    and   that  if  any  claim   were   disal- 
lowed by  the  receiver,  it  should  be  referred 
to  referees.     Pursuant  to  this  order  the  state 
of  Indiana,  in  December,  1845,  exhibited  the 
claim  in  controvei-sy  to  the  receiver.     In  the 
notice  of  the  claim  fm-nished  to  the  receiver 
it  was  stated  that  the  state  of  Indiana  had  a 
debt  against   the  Trust   and   Banking  Com- 
pany of  $175,000  with  interest  thereon  from 
the  2d  of  January,   1841,  for  a  balance  due 
at  that  date  for  bonds  issued  by  said  state 
and    sold    and   delivered    to    the    Trust   and 
Banking  Company  by  the  Morris  Canal  and 
Banking  Company  or  otherwise.     That  this 
debt  was  owned  by  the  state  of  Indiana,  and 
that  it  should  be  allowed  and  paid  to  it,  or 
that  it  should  be  allowed  in  the  name  of  the 
Morris  Canal  and  Banking  Company  for  the 
use  and  benefit  of  the  state  of  Indiana,  and 
paid  to  the  latter  as  the  assignee  of  the  de- 
mand.    Attached  to  the  notice  of  claim  were 
the  eighteen  certificates  for  .*pl75,000,  above 
mentioned,  Avhich  it  was  alleged  were  issued 
by  the  Trust  and  Banking  Company  for  the 
debt  claimed.     In  March,  1S4G,  the  receiver 
disallowed  the  claim,  and  in  March,  1847,  an 
order  was  made  referring  it  to  three  referees, 
who,  after  hearing  the  proofs,  in  Septemher, 
1850,    reported   against   the   validity   of   the 
claim.     The  report  of  the  referees  contained 
aU  the  evidence  given  before  them;   and  stat- 
ed that  they  were  of  opinion,  upon  the  proofs, 
that  the  claim  was  not  valid,  and  that  there 
was  nothing  due  from  the  Ti-ust  and  Banking 
Company    or    its    receiver   to    the    claimant. 
Other  than  this  the  particular  conclusions  of 
the  referees  as  to  the  facts  or  law  did  not  ap- 
pear.    The  evidence  proved  the  facts  above 
stated.    It  also  proved  that  the  Indiana  bonds 
were  purchased   by  the  Trust  and  Banking 
Company  with  the  intention  of  selling  them 
to  raise  money,  and  that  they  were  so  sold, 
principally  in  England,  at  a  large  discount. 
There  was  some  evidence  tending  to  prove 
that  the  Morris  Canal  and  Banking  Company 
knew  at  the  time  of  the  sale  that  the  Trust 
and  Banking  Company  purchased  the  bonds 
with   this   intention.     It  also  appeared  that 
the  Trust  and  Banking  Company,  both  before 
and  after  the  purchase  of  the  $1,000,000  of 
bonds  in  October,  1849,   was  accustomed  to 
make  and  issue  negotiable  certificates  of  de- 
posit, payable  on  time;   and  that  dm-ing  the 


time  it  carried  on  business,  it  issued  negotia- 
ble paper,  payable  at  a  future  day,  to  over 
$15,000,000.  All  the  certificates  issued  on  ac- 
count of  the  Indiana  bonds,  except  those  in 
question,  appeared  to  have  been  paid.  There 
was  evidence  tending  to  prove  that  in  making 
the  sale  of  the  bonds,  the  Morris  Canal  and 
Banking  Company  was  in  fact  the  agent  of 
the  state  of  Indiana.  The  state  of  Indiana 
filed  exceptions  to  the  report  of  the  relLTees, 
which,  in  September,  1851,  were  overruled  at 
a  special  term  of  the  supreme  court  held  in. 
New  York  by  Justice  Edmonds,  and  the  re- 
port made  by  the  referees  affirmed.  An  ap- 
peal was  taken  by  the  state  of  Indiana,  and  in 
1854,  the  court,  at  a  general  term  held  in  New 
York,  reversed  the  judgment  rendered  at  spe- 
cial term,  and  adjudged  that  the  claim  was 
lawful  and  valid  against  the  Trust  and  Bank- 
ing Company,  and  was  justly  due  and  owing 
to  the  claimant,  with  interest  from  January 
2d,  1841,  "as  the  balance  remaining  impaid 
for  state  bonds  sold  and  delivered  to  the 
Trust  and  Banking  Company  by  the  Morris 
Canal  and  Banking  Company,  and  by  the  last 
mentioned  company  transferred  to  the  claim- 
ant." The  decree  fixed  and  adjudged  the 
amount  of  the  demand  to  be  $343,437.50,  be- 
ing the  amoimt  of  the  $175,000  and  interest 
from  January  2d,  1841;  and  the  receiver  was 
directed  to  pay  the  same  in  the  due  adminis- 
tration of  the  assets  of  the  company.  From 
this  decree  the  receiver  appealed  to  this 
court. 

The  catise  was  argued  in  this  court  in  1855, 
and  the  court  ordered  a  re-argument.  It 
was  again  argued  at  the  March  term,  1856. 

SELDEN,  J.  To  avoid  confitsion,  I  shall 
consider  this  case  in  the  first  instance  as 
though  the  Morris  Canal  and  Banking  Com- 
pany, instead  of  the  state  of  Indiana,  was 
the  claimant  upon  the  record.  The  general 
ground  upon  which  the  claim  is  resisted  is, 
that  it  arises  upon  an  illegal  contract.  Three 
grounds  of  illegality  are  alleged:  (1)  That 
the  pm-chase  of  state  stocks  by  the  North 
American  Trust  and  Banking  Company  for 
the  pm"pose  of  re-sale,  upon  speculation,  was 
beyond  the  scope  of  its  corporate  powers, 
and,  therefore,  illegal,  and  that  the  Morris 
Canal  and  Banking  Company  knew  that  such 
was  the  object  of  the  purchase.  (2)  That  the 
North  American  Trust  and  Banking  Com- 
pany had  no  power  to  issue  negotiable  prom- 
issory notes  upon  time;  that  such  notes, 
therefore,  and  the  contract  of  sale  which 
provided  for  receiving  them  in  payment,  are 
illegal  and  void.  (3)  That  the  certificates  or 
post  notes  delivered  in  payment  for  the  state 
stock,  being  calculated  and  intended  for  cir- 
culation, were  issued  in  violation  of  the  re- 
straining act;  and  that  the  Morris  Canal  and 
Banking  Company  was  particeps  criminis. 

In  examining  the  first  of  these  grounds,  I 
shall  not  notice  the  position  taken  by  the 
counsel  for  the  receiver,  that  a  mere  excess 
of  authority  on  the  part  of  a  corporation  in 


EFFECT  OF  ILLEGALITY. 


409 


making  a  contract,  is  equivalent  in  its  effect 
to  the  violation  of  a  positive  penal  enact- 
ment; because,  so  far  as  the  alleged  illegal- 
ity consists  in  tlie  purpose  for  which  llie 
stocks  were  purchased,  the  case  can,  1  think, 
be  disposed  of  upon  principles  which  do  not 
involve  that  question.  That  the  North  Amer- 
ican Trust  and  Banking  Company  made  the 
I)iirfliase  with  a  view  to  a  re-sale,  and  not  to 
a  deposit  with  the  comptroller,  seems  to  be 
established  by  the  proof;  and  that  such  a 
piu'eliase  and  re-sale  were  unauthorized  and 
beyond  the  scoi)e  of  the  corporate  powers  of 
tlie  company,  was  settled  by  this  court  in 
the  case  of  Talmage  v.  Pell,  7  N.  Y.  328. 
/^J-It  is  contended  by  the  counsel  for  the 
claimant,  that  there  is  no  evidence  that  the 
vendors,  the  Morris  Canal  and  Banking  Com- 
pany, had  any  knowledge  of  the  object  of  the 
vendees  in  making  the  purchase.  I  shall, 
however,  assume  that  they  had  such  knowl- 
edge; because,  in  the  view  I  take  of  the 
subject,  it  cannot  affect  the  result.  The  ques- 
tion presented  upon  this  branch  of  the  case 
is,  whether  the  bare  knowledge  by  a  vendor 
that  the  purchaser  intends  to  make  an  un- 
lawful use  of  the  article  sold,  will  prevent  a 
recoverj'  for  the  purchase  money.  Although 
I  deem  this  question  clear  upon  principle,  I 
shall,  nevertheless,  rest  my  opinion  in  regard 
to  it  mainly  upon  the  authorities. 

A  question  somewhat  analogous  arose  in 
the  court  of  king's  bencli,  in  England,  in  the 
case  of  Faikney  v.  Reynous,  4  Buri'ows, 
20G9.  The  plaintiff  and  one  of  the  defend- 
ants had  been  jointly  concerned  in  stock- 
jobbing; and  the  plaintiff,  in  contravention 
of  an  express  statute,  had  advanced  £3,000, 
In  compounding  certain  differences,  for  one- 
half  of  which  the  defendants  had  given  the 
bond  upon  which  the  action  was  brought. 
Upon  demurrer  to  a  plea  setting  up  these 
facts,  the  court  held  the  plaintiff  entitled  to 
recover.  Althoudi  that  case  differs  from  the 
one  under  consideration,  in  its  facts,  yet  the 
principle  upon  which  the  case  was  decided, 
viz.  that  a  party  to  a  contract,  innocent  in 
Itself,  is  not  responsible  for  or  affected  by  the 
use  which  the  other  may  make  of  the  sub- 
ject of  the  contract,  is  equally  applicable 
here.  Lord  Mansfield  said,  in  speaking  of 
the  act  of  the  defendant  in  giving  the  bond: 
"This  is  not  prohibited.  He  is  not  concerned 
in  the  use  wliicli  the  other  makes  of  the 
money;  he  may  apply  it  as  he  thinks  proper. 
But  certainly  this  is  a  fair,  honest  transac- 
tion between  these  two." 

There  is  a  class  of  English  cases  which 
seems  to  me  identical  in  principle  with  the 
present,  and  concerning  which  the  decisions 
have  been  unvarying.  I  refer  to  the  cases 
of  goods  purchased  for  the  express  purpose 
of  being  smuggled  into  England,  in  violation 
of  the  revenue  laws,  and  where  the  object 
of  the  purchase  was  known  to  the  vendor. 
The  first  of  these  cases  is  that  of  Holman  v. 
.Tohnson.  Cowp.  341,  where  the  plaintiff',  re- 
siding at  Dunkirk,  had  sold  to  the  defendant 


a  quantity  of  tea,  knowing  that  the  latter  in- 
tended to  smuggle  it  into  England,  but  had 
himself  no  concern  in  the  smuggling.  The 
action  was  brought  for  the  price  of  the  tea. 
and  it  was  held,  upon  these  facts,  that  the 
plaintiff  could  recover.  The  principle  of  the 
case  is  the  same  as  that  adopted  in  Faikney 
V.  Reynous,  supra,  that  mere  knowledge  by 
the  vendor  of  the  unlawful  intent  did  not 
make  him  a  participator  in  the  guilt  of  the 
purchaser.  Lord  Mansfield,  who  delivered 
the  opinion  in  this  case  also,  says:  "The  sell- 
er  indeed  knows  wlmt  the  buver  is  going  to 
"tIo"jvitb  the  goods;  but  the  interest  of  the 
yeudor  is  totally  at  an  end,  and  his  coutra3~ 
couiplete  by  the  delivery  of  the  goods." 

Where,  however,  the  seller  does  any  act 
which  is  calculated  to  facilitate  the  smug- 
gling, such  as  packing  the  goods  in  a  particu- 
lar manner,  he  is  regarded  as  particeps 
criminis,  and  cannot  recover;  as  is  shown  by 
the  subsequent  cases  of  Biggs  v.  Lawrence, 
3  Term  R.  454;  Clugas  v.  Penaluna,  4  Term 
R.  4GG;  and  Waymell  v.  Reed,  5  Term  R. 
599.  These  were  all  cases  where  the  itlain- 
tiff  had  sold  goods  to  the  defendant,  knowing 
that  they  were  to  be  smuggled  into  England; 
and  in  each  of  them  the  plaintiff  was  non- 
suited. But  they  all  differed  from  the  ca.se 
of  Holman  v.  Johnson,  in  this,  tliat  the  plain- 
tiff had  in  each  case  done  some  act.  in  addi- 
tion to  the  sale,  in  aid  and  fm-therance  of 
the  defendant's  design  to  violate  the  revenue 
laws,  and  the  decision  was  in  each  case 
placed  distinctly  upon  this  ground.  The  lan- 
guage of  Buller,  J.,  in  the  case  of  Waymell 
V.  Reed,  is  very  explicit.  He  says:  "In 
Holman  v.  Johnson,  the  seller  did  not  as- 
sist the  buyer  in  the  smuggling.  He  merely 
sold  the  goods  in  the  common  and  ordinary 
course  of  trade.  But  this  case  does  not  rest 
merely  on  the  circumstance  of  the  plaintiff's 
knowledge  of  the  use  intended  to  be  made  of 
the  goods;  for  he  actually  assisted  the  de- 
fendants in  the  act  of  smuggling,  by  packing 
the  goods  up  in  a  manner  most  convenient 
for  that  purpose." 

In  each  of  the  three  cases  last  cited,  spe- 
cial care  is  taken  to  guard  against  any  in- 
ference that  it  was  intended  to  impair  the 
force  of  the  decision  in  Holman  v.  Johnson. 
Indeed,  that  decision  seems  to  have  been  uni- 
formly followed  by  the  courts  of  England 
from  that  day  to  the  present.  In  1S35  the 
question  again  arose  in  the  ease  of  Pellecat 
V.  Augell,  2  Cromp.,  M.  &  R.  311,  and  the 
court  held  that  the  plaintiff  could  recover 
the  price  of  goods  sold  to  the  defendant,  al- 
though he  knew  at  the  time  of  the  sale  that 
they  were  bought  to  be  smuggled  into  Eng- 
land. Lord  Abinger  says:  "The  distinction 
is.  where  he  takes  an  actual  part  in  the  ille- 
gal adventure,  as  in  packing  the  goods  in 
prohibited  parcels  or  otherwise,  there  he 
must  take  the  consequences  of  his  own  act." 
Again  he  says:  "The  plaintiff  sold  the  goods; 
the  defendant  miglit  smuggle  them  if  he 
liked,  or  he  might  change  his  mind  the  next 


500 


ILLEGALITY  OF  OBJECT. 


day;  it  does  not  at  all  import  a  contract,  of 
which  the  smuggling  was  an  essential  part." 
It  is  true,  the  chief  baron  in  one  part  of  his 
opinion  seems  to  lay  some  stress  upon  the 
fact  that  the  plaintiff  was  a  foreigner;  but 
it  is  clear  that  this  can  have  nothing  to  do 
with  the  principle  upon  which  those  cases 
rest  which  is.  that  th_e  act  of  selling  is  not  in 
itself  a  violation  of  the  law ;  "and  the  mere 
fact  of  knowledge  of  the  unlawful  intent  of 
the  vendee  does  not  make  the  vendor  a  par- 
ticipator in  the  guilt.  The  language  of  the 
a.^sociates  of  the  chief  baron  goes  to  show 
that  the  domicil  of  the  plaintiff  had  no  influ- 
ence upon  the  decision.  Bollaud,  B.,  saj's: 
"I  think  the  distinction  pointed  out  by  the 
lord  chief  baron,  between  merely  knowing  of 
the  illegal  purpose,  and  being  a  party  to  it 
by  some  act.  is  the  true  one."  Alderson,  B., 
says:  "If  the  plea  disclosed  circumstances 
from  which  it  followed,  that  permitting  the 
plaintiff  to  recover  would  be  permitting  him 
to  receive  the  fruits  of  an  illegal  act,  the  ar- 
gument for  the  defendant  would  be  right; 
but  that  gi'ound  fails,  because  the  mere  sale 
to  a  party,  although  he  may  intend  to  commit 
an  illegal  act,  is  no  breach  of  law."  That 
the  place  of  residence  of  the  vendor  has 
nothing  to  do  with  the  question,  and  that  the 
principle  of  the  case  of  Holman  v.  Johnson 
is  sound,  is  further  shown  by  the  case  of 
Hodgson  v.  Temple,  5  Taunt.  181,  decided  by 
the  court  of  common  pleas  in  England. 
There,  as  it  would  seem,  all  the  parties  re- 
sided in  London.  The  plaintiffs,  who  were 
distillers,  had  sold  spirituous  liquors  to  the 
defendant  with  full  knowledge  that  the  lat- 
ter intended  to  retail  them,  in  express  viola- 
tion of  the  revenue  laws.  It  was  insisted,  in 
defence  to  an  action  brought  for  the  pur- 
chase money  of  the  liquors,  that  the  plain- 
tiffs were  particeps  crlminis,  and  could  not 
recover.  But  Mansfield,  C.  J.,  said:  "This 
would  be  carrying  the  law  much  further 
than  it  has  ever  yet  been  carried.  The  mere- 
ly selling  goods  knowing  that  the  buyer  will 
make  an  illegal  use  of  them,  is  not  sufficient 
to  deprive  the  vendor  of  his  just  right  of  pay- 
ment; but  to  effect  that  it  is  necessary  that 
the  vendor  should  be  a  sharer  in  the  illegal 
transaction." 

Opposed  to  this  series  of  cases,  holding  one 
uniform  language,  and  sanctioned  by  such 
names  as  Mansfield,  Buller.  Kenyon,  Abin- 
ger  and  others,  I  know  of  but  a  single  En- 
glish case,  viz.,  that  of  Langton  v.  Hughes, 
1  ?klaule  &  S.  .593.  By  a  statute  of  42  Geo. 
III.  c.  38,  brewers  were  prohibited  from  us- 
ing anything  but  malt  and  hops  in  the  brew- 
ing of  beer.  The  plaintiffs,  who  were  drug- 
gists, had  sold  to  the  defendants,  who  were 
brewers,  certain  drugs  knowing  that  they 
were  to  be  used  contrary  to  the  statute.  In 
the  51  Geo.  III.  c.  87,  another  statute  was 
passed  prohibiting  druggists  from  selling  to 
brewers  certain  articles,  and  among  them 
those  sold  to  defendants.  The  sale  in  ques- 
tion was  made  before  the  latter  statute,  but 


the  suit  was  brought  afterwards.  The  court 
held  that  the  plaintiff  could  not  recover.  It 
is  difiicult  to  ascertain  from  the  opinions  the 
precise  ground  upon  which  the  court  intend- 
ed to  rest  its  decision.  The  case  was  so 
clearly  within  the  terms  of  the  statute  of  51 
Geo.  HI.  that  the  judges  were  evidently  in- 
duced to  resort  to  a  somewhat  strained  con- 
struction of  the  previous  statute,  and  even  to 
an  attempt  to  connect  that  with  the  statute 
passed  after  the  sale,  for  the  sake  of  sus- 
taining the  defence.  Le  Blanc,  J.,  after  stat- 
ing the  question,  says:  "That  depends  upon 
the  provisions  of  42  Geo.  III.  coupling  them 
in  their  construction  with  those  of  51  Geo. 
HI."  It  is  apparent,  I  think,  upon  a  review 
of  the  whole  case,  that  it  was  not  very  well 
considered,  and  that  the  decision  was  real- 
ly produced  by  the  reflex  influence  of  the 
latter  statute.  This  case,  therefore,  which 
does  not  appear  to  have  been  followed  either 
in  England  or  in  this  countiy,  and  which  is 
vii'tually  overruled  by  the  subsequent  case  of 
Pellecat  v.  Angell,  2  Cromp.,  M.  &  R.  311, 
can  have  but  little  weight  in  opposition  to  the 
numerous  authorities  to  which  I  have  re- 
feiTed,  going  to  establish  the  contraiy  prin- 
ciple. 

There  is  another  class  of  English  cases 
which  have  been  sometimes  supposed  to 
conflict  with  the  doctrine  advanced  in  Faik- 
ney  v.  Reynous  and  Holman  v.  Johnson,  su- 
pra, but  which,  when  the  precise  ground  up- 
on  which  they  were  decided  is  considered, 
will  be  found  to  support  rather  than  to  de- 
tract from  the  doctrine.  That  ground  is 
this:  that  it  was  the  express  object  of  the 
plaintiffs  in  those  cases,  in  selling  the  goods 
or  lending  the  money,  that  they  should  be 
used  for  an  unlawful  purpose,  and  that  such 
purpose  entered  into  and  formed  a  part  of 
the  contract  of  sale  or  loan.  A  brief  refer- 
ence to  those  cases  will  show  that  this  is 
the  principle  upon  which  they  rest.  The 
first  case  of  this  class  is  that  of  Lightfoot  v. 
Tenant,  1  Bos.  &  P.  551.  The  action  was 
upon  a  bond  given  for  goods  sold,  and  the 
defendant  pleaded  that  the  plaintiff  sold 
the  goods  "in  order  that"  they  should  be 
shipped  to  the  East  Indies  without  the  li- 
cense of  the  East  India  Company,  in  viola- 
tion of  an  express  statute.  The  issue  upon 
this  plea  was  foimd  for  the  defendant,  and  a 
motion  for  judgment  non  obstante  veredicto 
was  denied.  Eyre,  C.  J.,  argues,  that  the 
jury  having  found  that  the  plaintiff  sold 
the  goods  "in  order  that"  they  should  be 
shipped,  «S:c.,  it  canuot  be  said  that  he  had  no 
interest  in  their  futiu'e  destination;  that  he 
may  well  have  sold  the  goods  for  an  en- 
hanced price,  relying  exclusively  upon  the 
profits  to  be  realized  from  the  illicit  trade 
for  payment.  He  says:  "It  is  a  possible 
case,  that  a  tradesman  may  wish  to  specu- 
late in  this  contraband  trade,  and  to  do  it 
by  dividing  the  profits  with  some  man  of 
spirit  and  enterprise,  but  without  capital. 
Such  a  man  would  stipulate  that  the  goods 


EFFECT  OF  ILLEGALITY. 


601 


which  he  sold  should  be  put  on  board  a  ship 
under  a  foreifju  comiuissiou,  aud  should  be 
sent  to  Calcutta  to  be  there  sold.  His  share 
of  the  profits  would  be  found  in  the  price 
oriiL;iually  fixed  on  the  goods,  but  his  hopes 
of  payment  would  rest  entirely  on  the  re- 
turns of  this  contraband  trade."  Again  ho 
says:  "But  the  jury  having  found  for  the 
plea,  the  court  cannot  say  that  the  plaintiff 
had  nothing  to  do  with  the  future  destina- 
tion of  the  goods;  unless  it  was  impossible 
to  state  a  case  in  which  they  could  have 
anything  to  do  with  it."  The  decision  in 
this  case  clearly  is  based  upon  the  fact,  that 
the  future  use  to  be  made  of  the  goods  en- 
tered into  and  formed  a  part  of  the  contract 
of  sale.  There  are  two  other  English  cases 
belonging  to  the  same  class.  The  first  is 
that  of  Caunau  v.  Bryce,  3  Barn.  &  Aid.  179. 
The  defendant  had  lent  money  to  a  firm, 
which  afterwards  became  bankrupt;  for  the 
purpose  of  paying  a  balance  due  upon  cer- 
tain illegal  stock-jobbing  transactions,  and 
which  had  been  applied  to  that  object.  He 
having  afterwards  received  money  belong- 
ing to  the  bankrupts,  the  assi'gnees  brought 
their  action  to  recover  those  monej's,  and  it 
was  held  that  the  defendant  could  not  set 
off  his  demand  for  the  money  loaned.  The 
other  case  Is  that  of  McKiunell  v.  Robin- 
son, 3  Mees.  &  W.  434,  which  was  an  ac- 
tion of  assumpsit  for  money  lent.  The  de- 
fendant pleaded  that  the  money  was  lent 
in  a  certain  common  gambling  room,  for  the 
purpose  of  the  defendant's  illegally  play- 
ing and  gaming  therewith;  and  on  demur- 
rer the  plea  was  held  good.  In  each  ot 
these  cases  it  will  be  seen  that  the  illegal 
use  was  the  express  object  for  which  the 
money  was  lent;  and  this  is  relied  upon  by 
the  court  in  both  cases  in  giving  their  judg- 
ment. In  the  case  of  Caunan  v.  Bryce,  Ab- 
bott, C.  J.,  says:  "It  will  be  recollected 
that  I  am  speaking  of  a  case  wherein  the 
means  were  furnished  with  a  full  knowl- 
edge of  the  object  to  which  they  were  to  be 
applied,  and  for  the  express  purpose  of  ac- 
comi)lishing  that  object;"  and  in  the  case 
of  McKinnell  v.  Robinson,  Lord  Abinger,  in 
stating  the  principle  by  which  the  case  was 
governed,  says:  "This  priiieiple  is,  that  the 
repayment  of  money  lent  for  the  express 
purpose  of  accomplishing  an  illegal  object, 
cannot  be  enforced." 

It  is  worthy  of  note  that  the  three  cases 
last  referred  to  present  the  views  respective- 
ly of  the  heads  of  the  three  principal  Eng- 
lish courts,  viz.,  Abbott,  chief  justice  of  the 
king's  bench.  Eyre,  chief  justice  of  the  com- 
mon pleas,  and  Abinger,  chief  baron  of  the 
exchequer;  and  their  concurrence  in  resting 
their  decisions  upon  the  fact  that  the  illegal 
object  was  in  the  contemplation  of  both  par- 
ties, and  formed  a  part  of  the  original  con- 
tract, goes  strongly  to  confirm  the  doctrine 
of  the  cases  of  Faikney  v.  Reynous  and  Hol- 
man  v.  Johnson,  supra.  Indeed  the  whole 
current  of  Euglish  authority  goes  to  support 


those  ca.sos,  with  the  single  exception  of 
Langtou  et  al.  v.  Hughes,  supra.  They 
have  also  frequently  been  referred  to  by  the 
courts  in  this  country  as  containing  sound 
doctrine.  De  Groot  v.  A'an  Duzer,  17  Wend. 
170;  Bank  v.  Spalding,  12  Barb.  302;  Arm- 
strong V.  Toler,  11  Wheat.  258.  In  the  lat- 
ter case.  Chief  Justice  Marshall  refers  to 
the  case  of  Faikney  v.  Reynous  in  the  fol- 
lowing terms:  "The  general  proposition 
stated  by  Lord  Mansfield,  in  Faikney  v. 
Reynous,  that  if  one  person  pay  the  debt 
of  another  at  his  request,  an  action  may  be 
sustained  to  recover  the  money,  although  the 
original  contract  was  unlawful,  goes  far  in 
deciding  the  question  now  before  the  court. 
That  the  person  who  paid  the  money  knew 
it  was  paid  in  discharge  of  a  debt  not  re- 
coverable at  law,  has  never  been  held  to 
alter  the  case." 

The  principles  established  by  this  strdug 
array  of  authorities  are  in  entire  accordance 
with  the  case  of  Talmage  v.  Pell,  7  X.  Y. 
328,  decided  by  this  cotirt  It  was  a  part 
of  the  contract  in  that  case,  between  the 
banking  company  and  the  commissioners  of 
the  state  of  Ohio,  that  the  bonds  should  re- 
main in  the  hands  of  the  agent  of  the  state, 
to  be  sold  on  account  of  the  banking  com- 
pany; and  this  fact  Is  rcfen-ed  to  and  relied 
upon  by  Gardiner.  J.,  by  whom  the  opinion 
of  the  com't  was  delivered.  He  says:  "I 
am,  for  the  reasons  suggested,  of  the  opinion 
that_this  bank  had  no  authority  to  traffic  in 
stocks~~a"s~an"  article  of  merchhpdisp.  or  lo 
purchase  them  for  the  purpose  of  selling,  as 
a  means  of  obtaining  money  to  discharge 
existing  liabilities;  that  as  the  object  of  the 
purchase  in  this  case  w;i3  known  to  both 
parties,  and.  made  a  part  of  their  contract, 
the  debt  for  the  purchase  money  cannot  be 
enforced  by  the  vendors,  aud  that  the  col- 
lateral securities  must  stjind  or  fall  with  the 
principal  agreement."  The  case  contains  no 
intimation  whatever  that  the  mere  knowl-, 
edge,  by  the  agents  of  the  state  of  Ohio,  that! 
.the  banking  company  purchased  the  bonds 
:with  a  view  to  a  resale,  would  have  defeated' 
a  recovery.  On  the  contrary,  such  an  infer- 
ence was  carefully  guarded  against  by  the 
learned  judge  who  delivered  the  opinion,  as 
appears  from  the  exti-act  just  given. 

I  consider  it,  therefore,  as  entirely  settled 
by  the  authorities  to  which  I  have  referred, 
that  it  is  no  defence  to  an  action  brought  to 
recover  the  price  of  goods  sold,  that  the  ven- 
dor knew  that  they  were  bought  for  an  ille- 
gal purpose,  provided  it  is  not  made  a  part 
of  the  contract  that  they  shall  be  used  for 
that  purpose;  and  provided,  also,  that  the 
vendor  has  done  nothing  in  aid  or  fm-ther- 
ance  of  the  unlawful  design.  If,  in  this 
case,  the  bank  had  had  no  right  to  pm'chase 
state  stocks  for  any  purpose,  then  the  con- 
tract of  sale  woidd  have  been  necessarily  il- 
legal, and  the  vendor  would,  perhaps,  be  pre 
eluded  from  all  remedy  for  the  purchase 
money.     But  here  the  piu'chase  and  sale  for 


:.02 


ILLEGALITY  OF  OIUECT. 


a  la\rfiil  object  was  a  contract  which  each 
party  had  a  perfect  right  to  make.  Suppose 
the  banking  company,  although  intending  at 
the  time  of  the  purchase  to  use  the  stocks 
for  trading  piu-poses,  had,  the  next  day, 
abandoned  this  intention,  and  deposited 
them  with  the  comptroller;  would  this 
change  of  piu-pose  reflect  back  upon  the  con- 
ti-act  of  pm-chase,  if  it  was  corrupt,  and  di- 
vest it  of  its  illegal  taint?  This  could  hard- 
ly be  pretended;  and,  if  not,  then  the  conse- 
quence of  the  docti-ine  contended  for  here, 
would  inevitably  be,  that  the  veudor  of  the 
stocks,  without  having  participated  in  any 
illegal  act,  or  even  illegal  intent,  but  having 
simply  knoT\-n  of  such  an  intent  subsequent- 
ly abandoned,  would  be  punished  with  a  to- 
tal loss  of  the  property  sold,  and  tb;rt  for  the 
benefit  of  the  party  alone  guilty,  if  guilt 
could  be  preilicated  of  such  a  ti'ansaction. 

I  am  not  aware  of  any  principle  which 
could  justify  this.  The  law  does  not  punish 
a  wi'ongful  intent,  when  nothing  is  done  to 
carry  that  intent  into  effect;  much  less,  bare 
knowledge  of  such  an  intent,  without  any 
participation  in  it.  Upon  the  whole,  I 
think  it  clear,  in  reason  as  well  as  upon  au- 
thority, that  in  a  case  like  this,  where  the 
sale  is  not  necessarily  per  se  a  violation  of 
law,  unless  the  unlawful  purpose  enters  into 
and  forms  a  part  of  the  contract  of  sale,  the 
vendee  cannot  set  up  his  own  illegal  intent 
in  bar  of  an  action  for  the  purchase  money. 

It  follows,  from  this,  that  the  sale  of  the 
stocks  would  have  created  a  valid  and  legal 
obligation  on  the  part  of  the  banking  com- 
pany to  pay  the  purchase  money,  but  for  the 
form  of  the  security  agi-eed  to  be  taken  in 
payment;  and  this  brings  me  to  the  considera- 
tion of  the  second  gi-ound  of  defence,  viz., 
that  the  North  American  Trust  and  Banking 
Company  had  no  authority  to  issue  nego- 
tiable promissory  notes,  paj-able  at  a  future 
day;  and  consequently,  that  the  contract 
which  provided  for  their  issue  and  for  re- 
ceiving them  in  payment,  was  illegal  and 
void. 

n  considering  this  branch  of  the  case,  I 
shall  not  examine  at  length  the  questions  so 
ably  argued  at  bar,  in  regard  to  the  nature 
of  corporations  and  the  limitations  of  their 
powers,  but  shall  assume  it  to  have  been  es- 
tablished, for  the  pm'poses  of  this  case,  at 
least,  that  associations  under  the  general 
banking  law,  even  prior  to  the  act  of  1840 
(Laws  1840,  p.  306,  §  4),  had  no  power  to  is- 
sue negotiable  notes  upon  time;  placing  this 
assumption,  however,  not  upon  the  safety 
fund  act  of  1829  (Laws  1829,  p.  1G7),  but  up- 
on the  general  principle  of  law  which  limits 
corporations  to  the  exercise  of  powers  ex- 
piessly  given  to  them,  or  such  as  are  neces- 
sarily incident  thereto,  and  upon  tlie  statute 
confirmatory  of  that  principle.  1  Rev.  St.  p. 
600,  §  3. 

It  follows,  that  in  issuing  the  certificates 
of  post  notes  delivered  to  the  Morris  Canal 
and   Banking   Company  in   consideration  of 


the  stocks  transferred,  the  North  American 
Trust  and  Banking  Company  exceeded  its 
corporate  powers.  That  those  certificates 
were  negotiable  promissory  notes,  is  clear. 
Bank  v.  Merrill,  2  HiU,  295;  Leavitt  v. 
Palmer,  3  N.  Y.  19;  Talmage  v.  Pell,  7  N.  Y. 
328.  Does  this  act  of  the  Trust  and  Bank- 
ing Company,  thus  transcending  its  legiti- 
mate powers,  so  taint  and  coiTupt  the  con- 
tract of  sale  as  to  deprive  the  vendors  of  the 
stocks  of  all  remedy  for  the  purchase  mon- 
ey? The  counsel  for  the  claimants  souglit 
upon  the  argument  to  maintain  that  the  sale 
of  the  stocks  and  the  receipt  of  the  certifi- 
cates were  distinct  transactions;  and,  hence, 
that  the  debt  created  by  the  sale  would  re- 
main, notwithstanding  the  illegality  of  the 
securities.  In  this,  however,  he  is  not  sus- 
tained, I  think,  by  the  evidence.  The  proof 
seems  to  be  clear,  that  the  agreement  to  re- 
ceive the  certificates  or  post  notes  was  si- 
multaneous with  and  formed  a  part  of  the 
contract  of  purchase.  It  becomes  necessary, 
therefore,  to  meet  the  question  whether  the 
consent  and  agreement  of  the  vendors  to  re- 
ceive the  certificates  in  payment,  will  pre- 
vent a  I'ecoveiy  in  any  form  for  the  stock 
sold. 

It  results,  from  what  has  been  previously 
said,  that  there  was  nothing  in  the  contract 
of  sale,  considered  by  itself,  separately  from 
the  agi'oement  in  relation  to  the  secvu-ity,  to 
impair  the  validity  of  the  debt;  but,  on  the 
contrary,  that  the  sale  of  the  stocks  created 
as  valid  and  meritorious  a  consideration  for 
the  obligation  assumed  by  the  Trust  and 
Banking  Company  as  if  the  money  had  act- 
ually been  deposited  according  to  the  tenor 
of  the  certificates.  The  objection  to  the 
claim,  therefore,  rests  upon  the  nature  of  the 
secm'ities  alone,  and  acquires  no  additional 
force  fi'om  the  want  of  power  in  the  Trust 
and  Banking  Company  to  traffic  in  stocks. 

It  has  long  been  settled  that  contracts 
founded  upon  an  illegal  consideration,  or 
Avhich  contemplate  the  performance  of  that 
which  is  either  malum  in  se,  or  prohibited 
by  some  positive  statute,  are  void.  But  the 
application  of  this  rule  to  contracts  made 
\iy  corporations,  the  sole  objection  to  which 
consists  in  their  being  ultra  vires,  is  com- 
paratively modern.  The  doctrine  rests  main- 
ly upon  three  recent  English  cases,  viz.: 
East  Anglian  Ry.  Co.  v.  Eastern  Counties 
Ry.  Co.,  7  Eng.  Law  et  Eq.  50.5;  McGregor  v. 
Manager,  16  Eng.  Law  &  Eq.  ISO;  and  May- 
or, etc.,  of  Norwich  v.  Norfolk  Ry.  Co.,  30 
Eng.  Law  &  Eq.  120. 

That  a  eonti-act  by  a  corporation,  which 
it  has  no  legal  capacity  to  make,  Is  void 
and  cannot  be  enforced,  it  would  seem  diffi- 
cult to  deny;  and  this  principle  alone  is 
abundantly  sufficient  to  sustain  the  cases 
above  cited,  which  were  all  actions  founded 
upon  and  affirming  the  validity  of  the  ille- 
gal contract.  But  it  is  quite  another  ques- 
tion whether  such  a  contract  is  so  tainted 
with  corruption,  that  the  party  dealing  with 


EFFECT  OF  ILLEOALITY. 


503 


the  corporation  will  be  refused  all  remedy 
iu  a  suit  procoediu;^  iipon  the  ground  of  a 
•  disafflrmauce  of  the  contract,  and  asking; 
only  such  relief  as  equity  demands.  Wheth- 
er a  contract  of  this  nature  can  fairly  be 
brought,  consistently  with  either  reason  or 
adjudj^ed  cases,  within  the  ranjje  of  the 
maxim,  "ex  turpi  causa  non  oritur  actio," 
cannot  be  considered  as  settled  by  the  cases 
referred  to;  especially  as  in  the  last  of  those 
cases  the  com-t  was  equally  divided,  and  it 
was  only  disposed  of  by  one  of  the  judges 
withdrawing'  his  opinion  with  a  view  to  an 
appeal. 

Prior  to  the  case  of  East  Aniilian  Ry.  Co. 
V.  Eastern  Counties  Ky.  Co.,  supra,  the  rule 
which  denied  all  relief,  in  ecpiitj',  as  well 
as  at  law,  to  any  party  to  an  ille^^al  contract, 
had  been  jrenerally  applied  only  to  cases 
where  the  contract  was  either  malum  in  se 
or  specifically  prohibited  by  statute.  It  was 
wholly  unnecessary  to  the  decision  of  that 
case  to  resort  to  any  extension  of  that  rule; 
because,  to  enforce  a  contract  against  a  par- 
ty, which  that  party  was  incompetent  in  law 
to  make,  would,  indeed,  be,  in  the  langriagre 
•  of  some  of  the  cases,  "to  make  the  law  an  in- 
strument in  its  own  subversion."  The 
com-ts,  however,  in  that  as  well  as  the  two 
subsequent  cases,  do  appear  to  have  been  in- 
clined to  hold  that  contracts  of  corporations, 
which  are  ultra  vires  merely,  come  within 
the  jyeneral  rule  which  denies  all  aid  to  ei- 
ther party  to  a  contract  made  in  violation 
of  law.  But  it  will  not  be  necessat-y  here  to 
pass  upon  the  correctness  of  this  docti'ine 
advanced  in  those  cases,  as  in  the  view  I 
take  of  this  case,  it  falls  clearly  within  an 
exception  to  that  rule;  and,  for  the  purposes 
of  this  question,  I  shall  concede:  (1)  That 
the  issuing  and  delivery  by  the  North  Amer- 
ican Trust  and  Banking  Company,  of  its 
promissory  notes  payable  on  time,  was  ultra 
vires;  and  that  the  effect  of  this  upon  the 
contract  was  the  same  as  if  it  had  been 
specifically  prohibited  \inder  a  penalty,  and 
(2)  that  the  notes  issued  were  calculated 
and  intended  for  circulation  as  money,  and 
were,  therefore,  issued  contrary  to  the  in- 
hibitions of  the  restraining  act.  These  con- 
cessions are  made  for  the  purposes  of  this 
case  only,  and  witliout  intending  definitely 
to  decide  the  points  conceded. 
^  There  are  one  or  two  classes  of  cases  to 
which  it  will  be  necessary  to  refer  in  order 
to  afford  a  clear  view  of  the  question  here 
presented.  The  first  consists  in  a  series  of 
cases  in  which  a  distinction  has  been  taken 
between  those  illegal  contracts  where  botii 
parties  are  equally  culpable,  and  those  in 
which,  although  both  have  participated  in 
the  illegal  act,  the  guilt  rests  chiefiy  upon 
one.  The  maxim  "ex  dolo  malo  non  oritur 
actio"  is  qualified  by  another,  viz.,  "in  pari 
delicto  melior  est  conditio  defendentis."  Un- 
less, therefore,  the  parties  are  in  pari  de- 
licto as  well  as  particeps  criminis.  the  courts, 
although  the  contract  be  illegal,  will  afford 


relief,  where  equity  reiiuires  it,  to  the  more 
innocent  party. 

It  was  insisted  by  the  counsel  for  the  re- 
ceiver, upon  the  argument,  that  in  no  case 
would  relief  be  afforded  to  any  party  to  an 
illegal  contract,  unless  he  applied  for  such  re- 
lief, or,  at  least,  had  elected  to  disaftirm 
the  contract  while  it  remained  executory. 
This  position  cannot,  I  think,  be  sustiiined. 
It  overlooks  distinctions  which  are  clearly 
settled.  The  cases  in  which  the  courts  will 
give  relief  to  one  of  the  parties  on  the  gi-ouud 
that  he  is  not  in  pari  delicto,  form  an  in- 
dependent class,  entirely  distinct  from  those 
cases  which  rest  upon  a  disaffirmance  of  the 
conti'act  before  it  is  executed.  It  is  essen- 
tial, to  both  classes,  that  the  contract  be 
merely  malum  prohibitum.  If  malum  in  se. 
tlie^courts  will  in  no  case  interfere  to  relieve 
either  party  from  any  of  its  consequences. 
But  where  the  contract  neither  Invdlves  moi-- 
al  tm-pitude  nor  violates  any  general  prin- 
ciple of  public  policy,  and  monej'  or  property 
has  been  advanced  upon  it,  relief  will  be 
granted  to  the  party  making  the  advance  (IV 
where  he  is  not  in  pari  delicto;  or  (2)  in 
some  cases  where  he  elects  to  disaffirm  the 
contract  while  it  remains  executory.  In 
cases  belonging  to  the  first  of  these  classes, 
it  is  of  no  importiince  whether  the  contract 
has  been  executed  or  not;  and  in  those  be- 
longing to  the  second,  it  is  equally  unim- 
portant that  the  parties  are  in  pari  delicto. 
This  will  clearly  appear  upon  a  brief  review 
of  some  of  the  leading  cases. 

The  first  case  which  I  deem  it  material  to 
notice  is  that  of  Smith  v.  Bromley.  Doug. 
09o,  note.  The  plaintiff's  brother  having  be- 
come bankrupt,  and  a  commission  having 
been  taken  out  against  him.  the  plaintiff  ad- 
vanced £40  to  the  defendant,  who  was  the 
principal  creditor,  to  induce  him  to  sign  the 
cgrtificate.  The  action,  which  was  brought 
to  recover  this  money,  was  sustained.  In  re- 
ply to  the  argument  tliat  the  plaintiff  was 
seeking  to  recover  back  money  paid  upon  an 
illegal  contract.  Lord  Mansfield  said:  "If 
the  act  is  in  itself  immoral,  or  a  violation  of 
the  general  laws  of  public  policy,  then  the 
party  paying  sliall  not  have  this  action;  for 
when  both  parties  are  equally  criminal 
against  such  general  laws,  the  rule  is  'potior 
est  conditio  defendentis.'  But  there  are  .oth- 
er laws  which  ai'e  calculated  for  the  protec- 
tion of  the  subject  against  oppression,  ex- 
tortion, deceit.  &c.  If  such  laws  are  vio- 
lated, and  the  defeudan^Tfakes  advantage  of 
the  i>laintifT"s  condition  or  situation,  then  the 
plaintiff  shall  fffcover;  and  ijt  is  astonishing 
that  the  reports  do  not  distinguish  between 
violations  of  .tlie_ime-soi-t  AQd.ihe,  o.ther." 
Two  things  are  to  be  noted  in  this  extract: 
That  a  distinction  is  taken  between  contracts 
lualum  prohibitum  merely,  and  such  as  are 
immoral  or  contrary  to  general  principles  of 
policy;  and  also  that  stress  is  laid  upon  the 
fact  that  the  law  contravened  in  this  case 
was  intended  to  protect  one  party  from  op- 


50  i 


ILLEGALITY  OF  OBJECT. 


pression  by  ibe  other.  Tlie  tirst  is  a  valid 
distinction,  wliicli  runs  through  all  the  sub- 
sequent cases— the  last  was  merely  incidental 
to  the  particular  case,  and  not  essential  to 
the  principle.  The  first  cases  in  which  the 
principle  was  applied,  were  naturally  those 
where  the  statute  violated  was  intended  for 
the  special  protection  of  the  pai-ty  seeking 
relief  from  some  undue  advantage  taken  by 
the  other,  because  those  were  the  cases  in 
which  the  injustice  of  applying  the  same 
rule  to  both  parties  would  be  the  most  glar- 
ing. But  it  soon  came  to  be  seen  tliat  the 
principle  was  equally  applicable  to  cases 
where  the  law  infringed  was  intended  for 
the  protection  of  the  public  in  general. 

The  case  of  Jaques  v.  Golightly,  2  W.  Bl. 
1073,  was  an  action  brought  to  recover  back 
money  paid  for  insuring  lottery  tickets.  The 
defendant  kept  an  office  for  insurance  con- 
trary to  the  statute  14  Geo.  III.  c.  76.  It 
was  urged  that  the  plaintiff  being  particeps 
criminis,  and  having  knowingly  transgressed 
a  public  law,  was  not  entitled  to  relief;  but 
the  action  was  sustained  by  the  unanimous 
opinion  of  the  court.  Blackstone,  J.,  said: 
"These  lottery  acts  differ  from  the  stock- 
jobbing act  of  7  Geo.  II.  e.  8,  because  there 
both  parties  are  made  criminal  and  subject 
to  penalties."  The  rule  here  suggested  for 
determining  whether  the  parties  are  in  pari 
delicto,  seems  reasonable  and  just.  There 
are,  undoubtedly,  other  cases  in  which  the 
parties  are  not  equally  guilty;  but  it  is  safe 
to  assume^  that  whenever  the  statute  imposes 
a  penalty  upon  one  party  and  none  upon  the 
QUier^ they  are  not  to  be  regarded,  as  par 
delictum.  In  Browning  v.  Morris.  2  Cowp. 
T^OTLord  Mansfield,  after  referring  with  ap- 
probation to  the  case  of  Jaques  v.  Golightly, 
reiterates  the  argument  of  Blackstone,  J.,  in 
that  case.  He  sqys:  "And  it  is  very  ma- 
terial that  the  statute  itself,  by  the  distinc- 
tion it  makes,  has  marked  the  criminal,  for 
the  penalties  are  all  on  one  side,— upon  the 
officekeeper." 

The  question  next  arose  in  the  case  of 
Jaques  V.  Withy  (1  H.  Bl.  G5),  which  is  iden- 
tical with  the  case  of  Jaques  v.  Golightly,  de- 
cided by  the  same  com-t  fifteen  years  before. 
The  action  was  brought  to  recover  back 
money  paid  for  insurance  to  the  keeper  of  a 
lottery  insurance  office,  and  it  was  held  to 
lie.  '  It  will  be  seen  that  these  two  cases  are 
not  Uke  tliat  of  Smith  v.  Bromley,  where  an 
undue  advantage  was  taken,  of  the  peculiar 
situation  of  the  plaintiff;  and  that  although 
some  effort  is  made  in  .Taques  v.  Golightly, 
and  by  Lord  Mansfield  in  Browning  v.  Mor- 
ris, supra,  to  bring  them  within  the  reason- 
ing of  that  case,  they  are  really  placed  upon 
the  broad  ground  that  the  parties  are  not  in 
pari  delicto,  and,  as  evidence  of  this,  the 
court  rely  upon  the  fact  that  the  penalty  was 
Imposed  upon  the  defendant  alone.  A  simi- 
lar question  came  before  the  court  of  king's 
bench  in  the  case  of  ■\Yilliams  v.  Hedley,  8 
East,   378,    where   the   previous   cases   were 


ably  and  elaborately  reviewed  by  Lord  Ellen- 
borough.  The  action  was  brought  to  recover 
back  money  which  had  been  paid  by  the 
plaintiff  to  compromise  a  qui  tam  action 
pending  against  him  for  usury.  The  princi- 
ple of  the  decision  cannot  be  better  stated 
than  by  ti'anscribing  the  head  note  of  the 
reporter,  which  is  this:  "Money  paid  by  A. 
to  B.,  in  order  to  compromise  a  qui  tam  ac- 
tion of  usurj'  brought  by  B.  against  A.  on 
the  ground  of  a  usurious  ti-ansaction  between 
the  latter  and  one  E.,  may  be  recovered  back 
in  an  action  by  A.  for  money  had  and  re- 
ceived; for  the  proliibition  and  penalties  of 
the  statute  of  18  Eliz.  c.  5,  attach  only  on  the 
informer  or  plaintiff  or  other  person  suing 
out  process  in  the  penal  action  making  com- 
positicn,  &c.,  contrai-y  to  the  statute,  and  not 
upon  the  party  paying  the  composition;  and, 
therefore,  the  latter  does  not  stand,  in  this 
respect,  in  pari  delicto,  nor  is  he  particeps 
criminis  with  such  compounding  informer  or 
plaintiff'." 

These  are  the  leading  English  cases  on  this 
subject;  and  it  is  plain  that  they  do  not  rest 
solely  upon  the  ground  that  the  statute  jn- 
f ringed  Avas  intended  to  protect' "one  pait^' 
from  acts  of  oppression  or  extortion  by  Jhe 
other;  and  equally  plain  that  relief  is  grant- 
ed in  this  class  of  cases  entirely  irrespective 
of  the  question  whether  the  coutraci-..l^e 
executed  or  executorj\  It  was,  in  fact,  exe- 
cuted in  all  these  cases. 

The  series  of  cases  here  referred  to  have 
never  been  overruled.  On  the  contrary,  they 
have  been  expressly  sanctioned  and  ap- 
proved in  several  American  cases.  In  In- 
habitants V.  Eaton,  11  Mass.  3G8,  Chief  Jus- 
tice Parker,  after  referring  to  the  cases  of 
Smith  V.  Bromley  and  Browning  v.  Morris, 
supra,  and  to  the  distinction  there  taken, 
saj's:  "This  distinction  seems  to  have  been 
ever  afterwards  observed  in  the  English 
courts;  and  being  founded  in  sound  prin- 
ciple, is  worthy  of  adoption  as  a  principle 
of  common  law  in  this  comitry."  The  case 
of  White  V.  Bank,  22  Pick.  181,  proceeds  up- 
on the  same  distinction.  It  is  impossible, 
as  it  seems  to  me,  to  distinguish  this  case 
in  principle  from  that  now  before  the  court. 
The  Revised  Statutes  of  Massachusetts 
(chapter  36,  §  57)  pi:ohibited  banks  from  .mak- 
ing any  contract  "for  the  payment..of  money 
at  a  future  day  certain,"  under  a  penalty  of 
a  forfeitm-e  of  their  charter.  The  plaintiff 
had  deposited  money  with  the  defendant  in 
February,  to  remain  imtil  the  10th  day  ot 
August;  and  the  action  was  brought  to  re- 
cover this  money.  It  was  objected  that  the 
contract  was  illegal  and  the  parties  particeps 
criminis,  but  the  defence  was  overruled. 
This  is  by  no  means  an  anomalous  case,  as 
the  counsel  for  the  receiver  upon  the  argu- 
ment of  this  case  seemed  to  suppose.  On  the 
contrary,  it  belongs  clearly  to  the  same  class 
with  the  English  cases  just  reviewed.  Wilde, 
J.,  who  delivei-ed  the  opinion  of  the  conrt, 
after  referring  to  those  cases,   and  quoting 


EFFECT  OF   ILLEGALITY. 


505 


tlie  ronuirks  of  Chu-f  Justk-o  raikcr  in  In- 
habitants of  Worcester  v.  Eaton,  given  abuve, 
says:  "The  principle  is  in  eveiy  respect  ap- 
plicable to  the  present  case,  and  is  decisive. 
The_prolirbiUon  is  particularly  leveled-against 
thebajaiv,  and  nut  at'aiiist  any  person  jjeaj- 
lng__wilh  the  bunjc.  In  the  words  of  Lord 
'~5lausfield,  'the  statute  itself,  by  the  distinc- 
tion it  makes,  has  marked  the  criminal.' 
The  plaintiff  is  subject  to  no  penalty,  but 
the  defendants  are  liable  for  the  violation  of 
the  statute  to  a  forfeiture  of  their  charter." 

Again,  in  the  case  of  Lowell  v.  Railroad 
Co.,  23  Pick.  24,  where  the  objection  was 
raised  that  the  parties  were  partlceps  crim- 
inis.  the  same  justice  says:  "In  respect  to  of- 
fences in  which  is  involved  any  moral  de- 
linquency or  turpitude,  all  parties  are  deemed 
equally  f::uilty,  and  courts  will  not  inquire 
into  their  relative  guilt.  But  where  the  of- 
fense  is  merely  malum  prohibitum,  nTirriS'Tn 
no  respect  immoral,  it  "is  not  against  the. 
policy  of  the  law  to  inquire  into  the  relatjve 
dellhqueiicy  of  the  parlies,  and  to  administer 
jiistrce  between  them,  although  both  parties 
are  wTong-doers."  The  same  doctrine  was 
reiteraTed  in  Atlas  Bank  v.  Nahant  Bank,  3 
Mete.  nsi.  The  principle  of  these  cases  was 
also  adopted  bj'  our  own  supreme  court  in  the 
case  Mount  v.  Waite,  7  Johns.  434.  The  ac- 
tion was  to  recover  back  money  which  the 
plaintiffs  had  paid  to  the  defendants  for  in- 
sm'ing  lottery  tickets  contraiy  to  the  policy 
of  a  statute  passed  in  1S07.  Kent,  C.  J., 
says:  "The  plaintiffs  here  committed  no 
crime  in  making  the  contract.  They  violat- 
ed no  statute,  nor  was  the  contract  malum 
in  se.  I  think,  therefore,  the  maxim  as  to 
parties  in  pai'i  delicto  does  not  apply,  for 
the  plaintiffs  were  not  in  delicto." 

This  case  is  the  last  of  the  class  to  which  I 
shall  refer;  and  I  think  it  would  be  diflicult  to 
find  a  series  of  cases,  running  through  almost 
a  century,  more  uniform  and  consistent  in 
tone  and  principle  and  in  the  distinctions  upon 
which  they  are  based.  They  have  never,  so 
far  as  I  am  aware,  been  overmled;  and  I 
know  of  no  principle  which  would  justify 
this  court  in  disregarding  them.  The  doc- 
trine seems  to  me  eminently  reasonable  and 
just,  and  I  discover  no  principle  of  pul)lic 
policy  to  which  it  stands  opposed.  On  the 
contrary,  I  concur  in  the  sentiment  which 
Judge  Wilde,  in  White  v.  Bank,  expresses, 
thus:  "To  decide  that  this  action  cannot  be 
maintained,  would  be  to  secure  to  the  de- 
fendants the  fruits  of  an  illegal  transaction, 
and  would  operate  as  a  temptation  to  all 
banks  to  violate  the  statute  by  taking  ad- 
vantage of  the  unwary  and  of  those  who  may 
have  no  actual  knowledge  of  the  existence  of 
the  prohibition,  and  who  may  deal  with  a 
bank  without  any  suspicion  of  the  illegality 
of  the  ti-ansaetiou  on  the  part  of  the  bank." 

This  language  is  as  applicable  to  the  case 
before  us  as  to  that  in  which  it  was  used. 
It  is  said  that  all  persons  dealing  with  banks 
and  other  corporations  are  presumed  to  know 


the  extent  of  their  powers.  This  is  no  doubt 
technically  true,  and  yet  we  cannot  shut  our 
eyes  to  tlie  fact,  that  in  veiy  many  cases 
it  is  a  mere  legal  fiction.  If  we  take  the 
present  ca.se  as  an  example,  it  is  plain  that 
it  would  not  have  been  easy  for  the  Morris 
Canal  and  Banking  Company,  with  the  char- 
ter of  the  Trust  and  Banking  Company  and 
the  restraining  act  both  before  them,  to  de- 
termine whether  the  issue  of  these  certifi- 
cates in  payment  for  state  stocks  would  vio- 
late either;  and  yet,  upon  the  doctrine  here 
contended  for,  an  honest  mistake  in  this 
respect  would  visit  upon  the  former  com- 
pany a  forfeiture  of  the  entire  amount  of 
stocks  transferred,  which  the  latter  com- 
pany, if  disposed,  might  pocket.  Such  a 
principle  would  afford  the  strongest  possible 
inducement  for  banks  to  transgress  the  law. 
All  that  they  could  get  into  their  hands,  by 
persuading  others  to  take  their  unauthorized 
paper,  would  be  theirs.  Under  such  a  rule, 
arguments  to  make  it  appear  that  they  have 
power  to  do  what  they  reallj-  have  not,  might 
be  made  to  constitute  the  most  available  por- 
tion of  their  capital;  and  unauthorized  deal- 
ing in  large  amounts,  with  foreign  states  or 
corporations  not  familiar  with  our  laws,  the 
most  profitable  branch  of  their  business. 
These  considerations  go,  in  my  judgment,  to 
strengthen  and  confirm  the  doctrine  of  the 
gases  referred  to,  which  hold  that  relief  may 
be  gi'anted  to  the  more  innocent,  when  the 
parties  are  not  in  pari  delicto. 

The  rule  laid  down  in  those  cases  for  de- 
termining which  is  the  more  guilty  part}-  is 
directly  apphcable  to  the  present  case  so  far 
as  the  ti'ansaction  is  held  to  fall  within  the 
provisions  of  the  restraining  act.  It  has 
been  conceded,  as  was  contended  by  the 
counsel  for  the  receiver  upon  the  argimient 
that  the  issuing  of  the  certificates  in  this 
case  was  a  violation  of  sections  3,  0  and  7 
of  the  act  concerning  unauthorized  banking. 
1  Rev.  St.  712.  It  will  be  seen,  by  re- 
feiTiug  to  those  sections,  that  the  penalties 
are  nnposed  exclusively  upon  the  conxiration 
violating  the  provisions  of  the  act,  and  upon 
its  otficei-s  and  members.  So  far,  then-t'oru. 
as  the  defence  is  based  upon  a  violation  of 
the  restraining  act,  there  is  that  sUitutory 
designation  of  the  guilty  party  upon  which 
most  of  the  cases  to  which  I  have  refeiTed 
are  made  to  rest.  But  it  is  obvious  that  the 
general  principle  for  which  I  contend  applies 
equally  to  that  branch  of  the  defence  which 
rests  upon  the  ground  that  the  act  of  the 
banking  company  in  issuing  the  notes,  was 
ultra  vires  and  against  public  pohcy.  The 
imposition  of  the  penalties  for  a  violation  of 
the  restriiining  law  upon  the  corporation 
alone,  does  not  make  it  the  guilty  party,  but 
it  is  simply  evidence  that  the  legislature  so 
regarded  it;  and  the  reasons  are  equally 
sti'ong  for  fixing  the  principal  guilt  upon  the 
same  party  where  its  acts  merely  violate  the 
principle  of  public  policy.  Although  persons 
dealing    with    corporations   are.   for   certain 


506 


ILLEGALITY  OF  OBJECT. 


purposes,  presumed  to  know  the  extent  of 
their  corporate  powers,  yet  this  is  by  no 
means  a  safe  rule  by  which  to  measure  the 
moral  delinquency  of  the  respective  parties. 
To  me,  therefore,  it  seems  plain,  that  wheth- 
er we  reirard  the  act  of  the  Trust  and  Bank- 
ing Company  in  issuing  the  certiticates  in 
question  as  a  violation  of  the  I'estraining 
law.  or  as  simply  ultra  vii-es,  or  as  against 
public  policy,  the  corporation  is  to  be  regard- 
ed as  comparatively  the  guilty  party. 

I  wish  here  briefly  to  refer  to  another  class 
of  cases  decided  in  this  state,  and  known  as 
the  "Utica  Insurance  Cases,"  not  as  avithor- 
ity  for  my  conclusion,  but  by  way  of  illus- 
trating the  distinctions  to  which  I  have  ad- 
verted. The  first  of  these  is  Insurance  Co. 
V.  Scott,  19  .lohns.  1.  The  action  was  vipon 
a  promissory  note  discounted  by  the  insur- 
ance company  in  the  ordinary  way  of  dis- 
counting by  a  bank.  It  was  held  that  the 
insurance  company  had  no  power  to  discount 
notes;  and  that  in  so  doing  it  had  violated 
the  restraining  act.  But  the  court  say:  "In 
analogy  to  the  statute  against  gaming,  the 
notes"  and  securities  are  absolutely  void,  in- 
to whatever  hands  they  may  pass,  but  there 
is  a  material  distinction  between  the  security 
and  the  contract  of  lending.  The  lending  of 
money  is  not  declared  to  be  void,  and,  there- 
fore, whenever  money  has  been  lent,  it  may 
be  recovered  although  the  secunty  itself  is 
void."  Judgment  was,  however,  given  for 
the  defendant  in  that  case,  because  the  ac- 
tion was  brought  upon  the  note  alone.  The 
next  case  was  that  of  Insurance  Co.  v.  Kip, 
8  Cow.  20.  This,  also,  was  an  action  upon  a 
note  discounted  by  the  insurance  company; 
but  the  declaration  also  contained  a  count 
for  money  lent.  The  plaintiff  recovered:  and 
the  court  say:  "The  illegal  contract,  if  any, 
was  not  the  loan,  for  the  plaintiffs  had  a 
right  to  loan  the  money  to  the  defendants; 
but  it  was  the  agi*eement  to  secure  the  loan 
by  a  note  discounted.  Avoiding  what  was 
illegal,  does  not  avoid  what  was  lawful. 
The  action  for  money  lent,  is  rather  a  disaf- 
firmance of  the  illegal  contract."  Similar  de- 
cisions were  made  in  three  subsequent  cases, 
viz.:  Insurance  Co.  v.  Cad  well,  3  Wend.  29G; 
Insurance  Co.  v.  Kip,  Id.  369;  and  Insui~ance 
Co.  V.  Bloodgood,  4  AVend.  G."j2. 

These  cases  have  never  been  overruled;  and 
yet,  I  think  I  rhay  say,  they  have  generally 
been  regarded  with  some  suspicion  as  to 
their  soundness.  In  New  Hope  Delaware 
Bridge  Co.  v.  Poughkeepsie  Silk  Co.,  25 
Wend.  G4S,  Nelson,  J.,  in  speaking  of  them, 
says:  "Whether  the  doctrine  of  these  cases 
is  well  founded  and  may  be  upheld  upon  es- 
tablished principles  or  not,  or  whether  the 
result  was  not  ultimately  influenced  by  the 
peculiar  phraseology  and  powers  of  the  char- 
ter of  the  Utica  Insurance  Company,  in  re- 
spect to  which  they  arose,  it  is  not  necessai*y 
at  present  to  examine.  I  am  free  to  say,  in 
either  aspect,  I  should  have  great  difficulty 
in  assenting  to  them."     There  is,  undoubted- 


ly, "great  difficulty"  in  reconciling  these 
cases  with  the  settled  rules  in  regard  to  il- 
legal contracts;  and  the  dilficulty  consists 
precisely  in  this,  that  the  court,  in  the  Utica 
insurance  cases,  have  given  to  the  guilty 
party  the  benefit  of  a  principle  which  is 
only  applicable  to  the  more  innocent.  In  the 
first  case  in  which  the  insurance  company 
recovered,  viz.,  Insurance  Co.  v.  Kip,  the 
court  cite  and  rely  upon  the  following  pass- 
age from  Comyn:  "Where  the  action  is  in 
affirmance  of  an  illegal  contract,  the  object 
of  which  is  to  enforce  the  performance  of  an 
engagement  proliibited  by  law,  such  an  ac- 
tion can  in  no  case  be  maintained;  but  where 
the  action  proceeds  in  disaffirmance  of  such 
a  contract,  and  instead  of  endeavoring  to  en- 
force it,  presumes  it  to  be  void  and  seeks  ta 
prevent  the  defendant  from  retaining  the 
benefit  which  he  derived  from  an  unlawful 
act,  there  it  is  consonant  to  the  spirit  and 
policy  of  the  law  that  he  should  recover." 
2  Comyn,  Cont.  p.  2,  c.  4,  art.  20.  Comyn 
cites,  as  authority  for  this  passage,  the  case 
of  Jaques  v.  Withy,  1  JI.  Bl.  05,  which  is 
one  of  the  cases  to  which  I  have  referred,  In 
which  the  plaintiff  recovered  on  the  ground 
that  he  was  not  in  pari  delicto  with  the  de- 
fendant; and  on  turning  to  that  case  it  will 
be  seen  that  the  passage  is  copied  verbatim 
from  the  argument  of  Sergeant  Adair,  coun- 
sel for  the  plaintiff.  It  is  thus  made  appar- 
ent that  the  doctrine  of  the  Utica  insurance 
cases  is  built,  in  part,  at  least,  upon  the 
principles  and  arguments  which  lie  at  the 
foundation  of  the  class  of  cases  just  passed 
in  review.  More  can  scarcely  be  needed  to 
justify  the  doubt  which  has  been  cast  upon 
these  insurance  cases.  How  principles,  ap- 
propriately used  to  sustain  a  recovery  against 
a  party,  upon  the  express  ground  that  he  is 
the  party  upon  whom  tl?e  prohibition  and 
penalties  of  the  law  attach,  can  be  made 
available  to  justify  a  recovery  by  a  party  so 
situated,  is  certainly  difficult  to  comprehend. 

But,  notwithstanding  the  misapplication  to 
these  cases  of  the  principles  for  which  I  con- 
tend, the  cases  themselves  afford  strong  evi- 
dence of  the  appreciation,  by  the  court,  of 
the  soundness  of  those  principles.  Indeed, 
few,  as  it  seems  to  me,  will  be  found  to  deny 
either  the  justice  or  policy  of  the  rule  which 
refuses  to  permit  the  guilty  party  to  retain 
the  fruits  of  an  illegal  transaction  at  the  ex- 
pense of  the  more  innocent.  But  were  it 
otherwise,  the  iiile,  as  I  have  showu,  is  in- 
disputably established;  and  that  the  present 
case  falls  within  that  rule  is  entirely  clear. 
We  have  next,  then,  to  ascertain  the  relief 
to  which  the  Morris  Canal  and  Banking  Com- 
pany would,  if  the  claimant  upon  the  records 
be  entitled 

The  illegal  conti'act  itself  is  of  course  void, 
and  no  part  of  it  can  be  enforced.  It  is  impos- 
sible, I  think,  to  sustain  the  reasoning  adopt- 
ed in  the  Utica  insurance  cases,  by  which 
that  part  of  the  conti'act  which  embraces 
tlie  loan  (in  this  case,  the  sale)  is  separated 


EFFECT  OF  ILLEGALITY. 


807 


from  tlie  portion  relating  to  the  security, 
and  uphold  as  a  distinct  and  valid  couti-act. 
The  conti-act  there,  as  here,  was  entire;  and 
it  is  contrary  to  all  the  i-ules  which  have 
been  appUed  to  illegal  contracts  to  discrimin- 
ate between  tln'ir  dillereut  parts,  and  hold 
one  portion  valid  and  tlie  other  void.  Re- 
coveries are  not  had  in  such  cases  upon  the 
basis  of  tlie  express  contract,  which  is  taint- 
ed with  illegality;  but  upon  an  implied  con- 
tract founded  upon  the  moral  obli^'alion 
resting  upon  the  defendant  to  account  for 
the  money  or  property  received.  The  claim 
presented  by  the  state  of  Indiana  to  the 
referees  was  in  general  terms,  and  broad 
enough  to  embrace  a  demand  arising  upon 
an  implied  conti-act  to  pay  for  the  bonds 
ti'ansf erred ;  and  it  has  been  repeatedly  held 
that  a  corporation  may  become  liable  upon 
such  a  contract  founded  upon  a  moral  obliga- 
tion, like  that  existing  in  this  case.  Bank 
V.  Patterson.  7  Cranch.  299;  Danforth  v. 
Tiu-npiko  Koad,  12  Johns.  227;  Bank  v.  Dan- 
dridge,  12  Wheat  64. 

It  follows  from  tliese  principles,  that  if  the 
Morris  Canal  and  Banking  Company  was  the 
claimant  upon  the  record,  it  would  be  en- 
titled to  recover,  not  the  specific  balance  due 
upon  the  certificates,  nor  the  price  agi'eed  to 
be  paid  for  the  stocks,  but  so  much  as  the 
stocks  transferred  were  reasonably  worth  at 
the  time  of  such  transfer,  with  interest,  de- 
ducting thei'efrom  whatever  has  been  actual- 
ly paid  in  any  form  by  the  North  American 
Tinist  and  Banking  Company  for  the  same, 
and  leaving,  however,  the  contract  of  sale, 
so  far  as  it  has  been  executed  by  payment, 
or  its  equivalent  undistiu'bed. 

The  only  remaining  question  is,  whether 
the  state  of  Indiana  has  succeeded  to  the 
rights  of  the  Morris  Canal  and  Banking  Com- 
pany in  this  respect.  If,  as  it  seems  to  have 
been  held  by  the  supreme  com't  both  at 
special  and  general  terras,  the  Canal  and 
Banking  Company  acted  in  the  sale  of  the 
stocks  as  the  agent  of  the  state  of  Indiana, 
then,  of  com*se,  the  latter,  as  the  principal, 
is  the  proper  party  here.  But,  aside  from 
this,  I  cannot  doubt  that  a  court  of  equity 
would  hold,  upon  the  face  of  the  transac- 
tion, that  it  was  the  intention  of  the  MoiTis 
Canal  and  Banking  Company  to  transfer  to 
the  state  its  entire  claim  against  the  Trust 


and  Banking  Company,  growing  out  of  the 
sale  of  the  stocks,  and  would,  if  necessary, 
compel  any  formal  defects  In  such  ti'ansfcr 
to  be  supplied;  and  as  the  proceeding  here 
is  of  an  equitable  nature,  the  court,  upon 
well  settled  principles,  will  regard  what 
ought  to  be  done  as  having  been  done.  The 
judgment  of  the  supreme  court  should  be 
modified  in  accordance  with  tliese  principles, 
and  the  proceedings  remitted. 

MITCHELL,  J.,  delivered  an  opinion  in 
favor  of  afhrming  the  judgment  of  the  su- 
preme com-t  at  general  term.  He  was  of 
the  opinion  that  the  evidence  did  not  estab- 
lish that  the  Morris  Canal  and  Banking  Com- 
pany, or  the  state  of  Indiana,  had  knowledge 
when  the  bonds  were  sold  that  the  Trust  and 
Baulking  Company  purchased  them  for  an  il- 
legal purpose,  or  with  intent  to  make  an  il- 
legal use  of  them,  and  that  tlie  last  named 
company,  at  the  time  of  the  purchase,  in 
1S39,  had  authority  to  make  and  issue  notes 
or  certificates  payable  at  a  future  day.  He 
held,  that  associations  organized  under  the 
general  banking  law  were  not  subject  to  the 
provision  contained  in  the  safety  fund  act 
(Laws  1S29,  p.  173.  §  35),  prohibiting  mon- 
eyed corporations  subject  to  the  provisions  of 
that  act  from  issuing  bills  or  notes,  payable 
on  time;  and  that  such  associations  might 
lawfully  issue  such  notes  for  a  legitimatf 
purpose,  until  prohibited  by  the  act  of  1840 
(Iia^^■s  1S40,  p.  306,  §  4). 

DENIO,  C.  J.,  was  also  in  favor  of  affirm- 
ing the  judgment,  on  substantially  the  same 
grounds  as  those  stated  bv  Judge  MITCH- 
ELL. 

COMSTOCK,  HUBBARD,  T.  A.  JOHN- 
SON, and  WRIGHT,  JJ..  concm-red  in  tlie 
foregoing  opinion  delivered  by  Judge  SEL- 
DEX,  and  were  in  favor  of  modifying  the 
judgment  in  accordance  with  the  principles 
stated  in  that  opinion, 

A.  S.  JOHNSON,  J.,  dissented.  He  was  in 
favor  of  reversing  the  judgment  rendered  at 
general  term  and  atiirming  that  rendered  at 
special  term. 

Judgment  modified. 


G? 


508 


TYLER  V.  CARLISLE. 
(9  Atl.  356.  79  Me.  210.) 


ILLEGALITY 
March    1, 


Snureme   Judicial    Court    of   Maine 
1S87. 

On  exceptions  from  supreme  judicial  court, 
Knox  county. 

Assumpsit  to  recover  money  loaned.  Thv? 
verdict  was  for  the  defendant,  and  the  plain- 
tiff alleged  exceptions. 

C.  E.  Littlefield,  for  plaintifC.  J.  E.  Han- 
ley,  for  defendant. 

PETERS,  C.  J.     The  plaintifC  claims  to  re- 
cover a  sum  of  money  loaned  by  him  while 
the    defendant    was    engaged    in    playing    at 
cards.     The  ruling  at  the  trial  was  that,  if 
the  plaintiff  lent  the  money  with  an  expres^ 
understanding,  intention,  and  jpurpose  that  it 
1  was" Wbe  used  to  gamble  with,  and  it  was  so 
I  used,  the  debt  so  created  cannot  be  recovered; 
MDUt    otherwise    if    the    plaintiff    had    merelv 
knowledge  that  the  money  was  to  be  so  used. 
Upon  authority  and  principle  the  ruling  was 
correct.    Any  different  doctrine  would,  in  most 
instances,    be   impracticable   and   unjust.     It 
does  not  follow  that  a  lender  has  a  guilty  pur- 
pose merely  because  he  knows  or  believes  that 
the  borrower  has.     There  may  be  a  visible 
line  between  the  motives  of  the  two.     If  it 
were  not  so,  men  would  have  great  responsi- 
bilities for  the  motives  and  acts  of  others.    A 
person  may  loan  money  to  his  friend,— to  the 
man,— and  not  to  his  purpose.     He  may  at  the 
"same  time  disapprove  his  purpose.     He  may 
not  be  willing  to  deny  his  friend,   however 
much  disapproving  his  acts.     In  order  to  find 
the  lender  in  fault,  he  must  liimself  have  an 
"intention    that  the   money    shall   be    illegally 
used-     There  must  be  a  combination  of  inten- 
tion between  lender  and  borrower.— a  union  of 
purposes.     The  lender  must  in  some  manner 
be  a  confederate  or  participator  in  the  borrow- 


OF  OBJECT. 

er's  act,— be  himself  implicated  in  it.  He 
must  loan  his  money  for  the  express  purpose 
of  promoting  the  illegal  design  of  the  bon-nw- 
er,  not  intend  merely  to  serve  or  accomuio- 
date  the  man.  In  support  of  this  view  many 
cases  might  be  adduced  A  few  prominent 
ones  will  suffice.  Green  v.  Collins,  3  Cliff. 
494,  Fed.  Cas.  No.  5,755;  Gaylord  v.  Soragen, 
32  Vt.  110;  Hill  V.  Spear,  50  N.  H.  253;  Peck 
V.  Briggs,  3  Denio,  107;  Mclntyre  v.  Parks,  3 
Mete.  (Mass.)  207;  Banchor  v.  Mansel,  47 
Me.  58.  See  Franklin  Co.  v.  Lewiston  Sav. 
Bank,  68  Me.  47. 

Nor  was  the  branch  of  the  ruling  wrong  that 
plaintiff,  even  though  a  participator,  could  re- 
cover his  money  back  if  it  had  not  been  ac- 
tually used  for  illegal  purposes.  In  minor  of- 
fenses, the  locus  penitentise  continues  \mtil 
the  money  has  been  actually  converted  to  the 
illegal  use.  The  law  encourages  a  repudia- 
tion of  the  illegal  contract,  even  by  a  guilty 
participator,  as  long  as  it  remams  an  execu- 
tory contract,  or  the  Ulegal  purpose  has  not 
been  put  in  operation.  The  lender  can  cease 
his  own  criminal  design,  and  leclaim  his  mon- 
ey. "The  reason  is,"  says  Wharton,  "the 
plaintiff's  claim  is  not  to  enforce,  but  to  re- 
pudiate, an  illegal  contract."  Whart.  Cont.  § 
354,  and  cases  there  cited.  The  object  of  the 
law  is  to  protect  the  public,— not  the  parties. 
"It  best  compoi-ts  with  public  policy Jj>  arrp.st 
the  illegal  transaction,  before  it  is  consaom- 
roated/^^^ays  the  court  in  Stacy  v.  Foss,  19 
■lrrerS35.  see  White  v.  Bank,  22  Pick.  181. 
The  rule  allowing  a  recovery  back  does  not 
apply  where  the  lender  knows  that  some  in- 
famous crime  is  to  be  committed  with  the 
means  which  he  furnishes.  It  applies  only 
where  the  minor  offenses  are  involved.  Ex- 
ceptions overruled. 

DANFORTH,     VIRGIN,     LIBBEY,     FOS- 
TER, and  HASKELL,  JJ.,  concurred. 


EFFECT  OF  ILLEGALITY. 


50» 


FROST  V.  GAGE. 

(3  Allen,  560.) 

Supreme  Judicial  Court  of  Mas-sachusotta. 
Middlesex.     Jan.  Term,  1862. 

Contract.  At  the  second  trial  of  this  case, 
aftor  the  facts  roportod  in  1  Allen,  1202,  had 
been  proved,  the  plaintiff  offered  in  evidence 
a  release  of  their  several  claims  by  the  cred- 
itors of  Richard  Frost,  and  Richard  testified 
that,  after  the  release  had  been  signed  by 
the  plaintiff  and  defendant,  the  latter  pro- 
cured the  signatures  of  other  creditors  to  the 
same  and  delivered  It  to  him,  and  he  there- 
upon executed  the  assignment  to  the  defend- 
ant. The  defendant  then  offered  to  prove 
that  he  was  Richard's  largest  creditor;  that 
the  plaintiff,  who  was  Richard's  son,  request- 
ed him  to  aid  in  obtaining  a  settlement  with 
Richard's  creditors,  and  promised  to  make 
no  claim  upon  him  for  any  part  of  the  pro- 
ceeds of  Richard's  estate  which  might  come 
into  his  hands  as  assignee,  but  to  allow  him 
to  retain  the  plaintiflf's  share  for  his  services, 
and  also  to  execute  to  him  a  promissory  note 
for  a  further  sum,  if  he  would  sign  the  re- 
lease and  procure  the  signatures  of  other 
creditors  to  the  same;  and  that  he,  being 
induced  by  said  promise,  did  sign  the  re- 
lease and  procure  the  signatures  of  other 
creditors  to  the  same.  Morton,  J.,  rejected 
this  evidence,  and  the  jury  returned  a  ver- 
dict for  the  plaintiff.  The  defendant  alleged 
exceptions. 

A.  F.  L.  Norris,  for  plaintiff.  W.  P.  Web- 
ster, for  defendant. 

BIGELOW,  C.  J.  The  right  of  the  plain- 
tiff to  maintain  his  action  on  the  second 
count,  on  proof  of  the  facts  therein  set  forth, 
was  determined  at  the  former  hearing  of 
this  case.  1  Allen,  2G2.  The  only  point  now 
raised  which  was  not  then  considered  by 
the  court  arises  on  the  evidence  offered  by 
the  defendant  to  show  that  there  was  an 
agreement  between  him  and  the  plaintiff,  by 
which  the  former  agreed  to  sign  the  com- 
position deed  and  procure  the  release  of  the 
other  creditors  of  Richard  Frost  on  a  prom- 
ise by  the  latter  to  pay  a  portion  of  the  debt 
duo  from  said  Richard  to  the  defendant,  in 
addition  to  the  dividend  which  he  might  re- 
ceive under  the  assignment,  in  common  with 
the  other  creditors.  That  such  an  agreement 
would  be  a  fraud  on  the  other  creditors,  and 
that  the  defendant  could  maintain  no  action 
upon  it  against  the  plaintiff',  is  too  clear  to 
admit  of  any  doubt.  It  was  a  secret  and 
imderhand  contract  by  which  the  defendant 
secured  to  himself  an  advantage  over  other 
creditors  of  the  Insolvent,  while  at  the  same 
time  he  was  holding  out  to  the  same  cred- 
itors that  he  was  to  share  in  the  assets  equal- 
ly with  them,  and  thereby  inducing  them  to 
sign  the  composition  deed  and  release  the 
debtor  from  their  claims.  Story,  Eq.  §  378; 
Cockshott  V.  Bennett,  2  Term  R.  763.  766; 
Lewis  V.  Jones,  4  Barn.  &  C.  511;    Case  v. 


Gerr>3h,  15  Pick.  49.  The  question  then  pre- 
sents itself,  whether  such  a  fraudulent 
agreement  can  be  set  up  by  the  defen  lant, 
who  was  a  party  to  It,  as  a  defense  to  an 
action  by  the  plaintiff  to  recover  the  same 
share  or  dividend  of  the  assets  of  the  debtor 
as  has  been  paid  to  the  other  creditors  by 
the  defendant.  This  is  in  some  respects  a 
novel  question;  but  it  seems  to  us  to  come 
within  principles  recognized  in  the  adjudged 
cases,  by  the  application  of  which  it  can  be 
readily  solved.  Assuming  that  the  defend- 
ant could  establish  all  the  facts  containel 
in  his  offer  of  proof,  It  is  clear  that  the 
plaintiff  was  a  party  to  the  fraudulent  agree- 
ment by  which  the  signatures  of  the  other 
creditors  to  the  release  of  the  debtor  were 
obtained.  It  was  by  his  procurement,  and 
on  a  promise  by  him  to  pay  the  defendant  a 
portion  of  his  debt  beyond  theamount  which 
he  would  receive  from  the  estate  of  the 
debtor,  and  the  latter  was  induced  to  sign 
the  release  and  to  become  the  agent  in  pro- 
curing the  signatures  of  the  other  creditors. 
It  was  through  the  procurement  and  instru- 
mentality of  the  plaintiff,  and  by  means  of 
an  agreement  which  operated  as  a  fraud  on 
the  other  creditors,  to  which  he  was  a  party, 
and  for  which  he  furnished  the  considera- 
tion, that  the  composition  and  release  were 
obtained.  He  was  therefore  a  participator 
in  the  fraud.  Holding  the  relation  of  a 
creditor,  and  bound  to  act  witli  good  faith 
towards  the  other  creditors,  in  entering  into 
an  agi'eement  with  them  to  compound  with 
their  debtor  and  to  release  him  from  their 
debts,  he  became  a  party  to  an  agreement  by 
which  a  secret  advantage  was  attempted  to 
be  secured  to  the  defendant,  by  which  he 
was  induced  to  become  a  party  to  the  assign- 
ment and  release,  and  thereby  to  hold  out 
false  colors  to  the  other  creditors,  and  lead 
them  to  believe  that  all  were  acting  on  equal 
terms,  and  to  grant  a  discharge  to  their 
debtor  on  the  faith  that  all  were  to  receive 
a  like  portion  of  their  respective  debts.  To 
adopt  the  significant  figure  which  has  been 
used  to  describe  the  effect  of  a  transaction 
of  this  nature,  in  Story,  Eq.  §  378,  the  plain- 
tiff did  not  himself  act  as  a  decoy  duck  to 
mislead  the  other  creditors,  but  he  did  that 
which  was  quite  as  effectual  in  accomplish- 
ing the  fraud  on  them;  he  procured  the 
duck,  and  placed  him  in  a  position  in  which 
he  was  enabled  to  practice  a  deception,  and 
to  draw  the  creditors  into  an  arrangement 
with  their  debtor  to  which  otherwise  they 
might  not  have  assented.  In  this  aspect  of 
the  case,  we  do  not  see  that  the  plaintiff 
stnuds  in  any  better  situation,  or  is  entitled 
to  any  greater  favor  in  a  court  of  law  than 
the  defendant.  As  participators  in  the  fraud, 
they  both  stand  on  an  equal  footing.  Nei- 
ther can  claim  to  recover  anything  in  an  ac- 
tion which  can  be  maintained  only  by  proof 
of  a  transaction  into  any  part  of  which  his 
fraud  has  entered  as  an  essential  element, 
affecting  the  rights  of  any  parties  interested 


510 


ILLEGALITY  OF  OBJECT. 


therein.  It  is  on  this  ground  tliat  it  has  been 
belli  thjit  a  creditor  cannot  recover  his  share 
or  dindeud  under  a  composition  deed  to 
whicii  he  became  a  party,  if  he  had  previ- 
ously taJien  a  private  agreement  for  the  pay- 
ment of  the  residue  of  the  debt.  His  right 
to  recover  the  amount  to  which  the  fraudu- 
lent agreement  did  not  extend  is  forfeited 
by  his  participation  in  a  fraud  connected 
with  another  part  of  the  same  transaction. 
The  whole  is  regarded  as  an  entire  agree- 
ment, which  is  vitiated  by  the  fraudulent  act 
of  the  party,  as  to  him,  so  that  he  can  claim 
no  benefit  under  any  of  its  provisions.  Hig- 
gins  V.  Pitt,  4  Exch.  323;  Knight  v.  Hunt, 
5  Bing.  432;  Howden  v.  Haigh,  11  Adol.  & 
E.  1033;  Fors.  Comp.  Cr,  152.  It  Is  quite  im- 
material, that  the  funds  to  be  distributed 
among  other  creditors  are  not  diminished  or 
rendered  less  available  in  consequence  of 
the  secret  agreement.  The  fraud  consists, 
not  in  causing  any  injury  to  the  assets  of  the 
debtor,  or  in  reducing  the  share  or  interest 
to  which  the  creditors  are  entitled  under  the 
composition,  but  in  the  attempt  to  induce 
them  to  enter  into  an  agreement  for  an  equal 
dividend  on  their  debts  in  ignorance  of  a 
private  bargain,  whereby  a  creditor  is  to  re- 
ceive an  additional  sum  to  that  to  which  he 
may  be  entitled  in  common  with  all  the  cred- 
itors. Such  an  agreement  vitiates  the  whole 
transaction,  so  that  the  party  can  claim  no 
benefit  under  a  composition  into  which  he 
entered  in  consequence  of  such  corrupt  or 
fraudulent  contract.  It  is  quite  clear,  there- 
fore, that  the  defendant,  if  he  did  not  stand 
in  the  position  of  assignee  having  possession 
of  the  assets,  and  were  compelled  to  bring 
au  action  for  the  share  or  dividend  on  his 


debt  which  might  be  coming  to  him  In  com- 
mon with  the  other  creditors,  could  not  re- 
cover. The  agreement  into  which  he  enter- 
ed with  the  plaintiff  would  be  a  bar  to  hi3 
right  to  recover  even  that  sum  to  which  the 
fraudulent  agreement  did  not  extend.  For 
a  like  reason,  the  plaintiff  in  this  suit  ought 
not  to  be  allowed  to  recover.  The  fraud  in 
which  he  participated,  and  by  which  he  aid- 
ed in  inducing  creditors  to  become  parties  to 
the  release  of  their  debtor,  taints  the  whole 
transaction  as  to  him,  and  deprives  him  of 
the  right  of  maintaining  an  action  to  enforce 
in  a  court  of  law  that  part  of  the  agreement 
of  composition  to  which  the  secret  agreement 
did  not  immediately  relate. 

It  may  be  suggested  that  the  application  of 
this  rule  leads  in  the  present  case  to  the  re- 
sult of  leaving  in  the  hands  of  the  defendant, 
who  was  equally  guilty  with  the  plaintiff,  the 
fruits  of  the  fraud.  But  this  is  often  the  con- 
sequence of  allowing  a  party  to  plead  in  de- 
fense the  illegality  of  a  transaction  on  which 
a  cause  of  action  is  founded.  Such  defenses 
are  allowed,  not  out  of  favor  to  defendants, 
or  to  protect  them  from  the  effects  of  their 
imlawful  contracts,  but  on  the  ground  of  pub- 
lic policy,  which  does  not  permit  courts  of 
justice  to  be  used  to  aid  either  party  in  en- 
forcing contracts  which  are  unlawful  or 
tainted  with  fraud,  but  leaves  them  in  the 
condition  in  which  their  illegal  or  immoral 
acts  have  placed  them. 

We  axe  therefore  of  opinion  that  the  evi- 
dence offered  at  the  trial  was  competent,  and 
that  it  should  have  been  admitted  and  sub- 
mitted to  the  jury,  with  instructions  in  con- 
formity to  the  principles  above  stated. 

Exceptions  sustained. 


& 


6  ^    WOODWOIITH 


EFFKCT  OF  ILLEGALITY. 


511 


BENNETT.      J "^^ 
(43  N.  Y.  273.J  /{^ 

Ck)nrt  of  Appeals  of  New  York.    1870. 
Action  for  goods  sold.     The  opinion  states 
the  case. 

G.  F.  Bicknell,  for  appellant.  Charles  Ma- 
son, for  respondent. 

CHURCH,  C.  J.  The  point  hi  this  case  Is, 
whether  the  court  below  erred  in  allowing 
to  the  defendant  the  sum  of  ^100  as  an  offset. 
The  facts  are  substantially  as  follows:  The 
plaintiff,  defendant,  Stephens  and  Truesdell, 
made  an  ngreomont  in  the  nature  .of_jL-£0: 
partnership,  to  propose  or  bid  for  public  work 
on  _thg  Seneca^  river  improvement.  The  bid 
was  to  be  put  in  the  name  of  the  plaintiff 
alone,  the  defendant  and  Stephens  to  become 
sureties.  Truesdell  was  at  the  time  an  engi- 
neer in  the  employ  of  the  state  on  the  canals. 
The  bid  was  made  in  the  name  of  the  plain- 
tiff, in  accordance  with  the  arrangement.  Be- 
f  oi;ethe__workwas  ^^varded_the_sa  i  d_par^s 
madeanagreemenf 


with  one  Haroun,  to  wrth- 
dj^  \v  tlJ{nt3ZlIIllH~tD-th^5~\v6fK7ang^ell  jheir  bid 
to  him  for  j400^  he  bfiiiig  a  higher  bidder  for 
tbe^same  work,jwhich_was^;onsujnmated,,  and 
he^^ve~EIs'ndte  for_the_amoimt.  It  was  then 
arranged  tHal'thelQote  should  be  left  with  the 
plaintiff  for  collection,  and  that  when  collect- 
ed each  of  said  persons  should  be  entitled  to 
$100.  The  plaintiff  collected  the  note,  paid  to 
Stephens  and  Truesdell  each  $100,  and  prom- 
ised to  pay  the  defendant,  and  apply  it  on 
their  deal,  but  never  did.  It  is  claimed  that 
It  cannot  be  allowed,  on  account  of  the  ille- 
gality of  the  transaction  out  of  which  it  arose. 
To  enable  the  court  to  apply  correct  legal 
principles,  it  is  necessary  to  analyze  the  trans- 
action and  ascertain  its  true  nature  and  char- 
acter. 

The  original  arrangement  for  a  joint  in- 
terest or  copartnership  .saa,Jllegal,  and  con- 
trary to  a  positive  statute  in  two  respects. 
The  I^aws  of  1S54.  chapter  329,  in  sub:stance 
requires  that  every  proposal  for.  work  shall 
contain  the  names  of  all  persons  -who  are 
interested,  and  prohibits  any  stecret  agree- 
ment or  understanding  that  any  person  not 
named  shall  become  interested  in  any  con- 
tract that  may  be  made,  and  engineers,  and 
all  odier  persons  in  the  employ  O'f  the  state 
on  the  canals,  are  also  prohibited  from  be- 
coming interested  in  any  contract  or  job  on 
the  public  works. 

In  the  next  place,  the  transaction  _with 
Ilaroun  was  "contrary^  to  public  policy,  and 
Tuogal.  It  is  manifest  that  the  object  and 
purpose"  of  the  purchase  of  the  bid  was  to 
have  it  withdra\vn  so  as  to  enable  Haroun 
to  take  the  contract  upon  a  higher  bid.  This 
was  directly  against  the  interests  of  the  state, 
and  tended  to  destroy  that  honest  competition 
which  public  bidding  is  designed  to  secure; 
and  when  as  in  this  case,  it  was  done  partly 
for  the  benefit  of  an  officer  of  the  state  whose 
duty  it  was  to  protect  its  interests,  it  was  not 


only  contrary  to  public  policy  but  was  grossly 
corrupt. 

The  supreme  court  placed  its  decision  in 
favor  of  the  defendant,  upon  the  ground  that 
as  between  the.se  parties_Jbe  illegal  contract 
had  been  fully  executed  when  Haroun  paid 
tEe  mon('yj_aj^iXjhoXXhe  plaintiff  then  became 
ameredepd.sitary.  an3"  held  thel  money  for^ 
fbe  use"^  the  other  parti_es. 

It  Is  undoubtedly  true  that  if  the  contract 
or  obligation  does  not  depend  upon  nor  re- 
quire the  enforcement  of  the  unexecuted  pro- 
visions of  the  illegal  contract.  It  will  be  car- 
ried out.  It  has  been  laid  down  as  a  test,  that 
whether  a  demand  connected  with  an  illegal 
transaction  is  capable  of  being  enforced  at 
law  depends  upon  whether  the  party  requires 
any  aid^ from  _the  illegal  transaction  tg  estnl^ 
lish  the  case.  Chit.  Cont.  G.j7.  So  it  has 
been  settled" that  a  party  who  pays  money  to 
a  third  person  for  the  use  of  another,  which, 
on  account  of  the  illegality  of  the  transaction, 
he  was  not  obliged  to  pay,  .such  third  person 
cannot  interpose  the  defense  of  illegality. 
Tenant  v.  Elliott,  1  Bos.  &  P.  3;  Merritt  v. 
Millard,  *43  N.  Y.  208;  3  Abb.  Dec.  291.  This^ 
principle  is  based  upon  the  undoubted  right  of 
la  person  to  waive  the  illegality,  and  pay  the 
money;  and  that  when  once  paid,  either  to 
|the  other  party  directly  or  to  a  third  person 
^or  his  use,  it  cannot  be  recalled;  and  that 
/the  third  person,  who  was  in  no  way  con- 
[nected  with  the  original  transaction,  cannot 
!avail  himself  of  a  defense  which  his  principal 
Wiw  fit  to  wnive. 

If  the  only  illegal  transaction  was  the  con- 
tract with  Haroun  for  the  sale  of  the  bid, 
these  principles  might  be  applicable,  and 
would  probably  constitute  a  good  answer  to 
the  objection  to  this  counter-claim.  The  pay- 
ment of  the  money  by  Haroim  completed  that 
contract,  and  nothing  remained  unexecuted. 
But  here  the  original  partnership  w'^s  '^fg-T^; 
not  because  oTits  purposes  and. jebific'^-'^i  *^"t 
its  composjtion  was  prohibited_by_law.  If  a 
lawTul  firm  should  receive  funds  from  an 
illegal  traffic  or  business,  it  may  be  that  the 
illegality  would  be  regarded  at  an  end,  and  a 
division  of  the  money  enforced  by  virtue  of 
the  rights  of  the  members  under  the  contract 
of  partnership.  This  is  the  utmost  limit  to 
which  the  riile  can  be  carried.     2  ^Yall.  70. 

In  such  a  case  the  obligation  to  divide  would 
not  arise  out  of  the  illegal  purposes  of  the 
firm,  nor  would  the  division  carry  out  any  of 
those  purposes,  but  the. obligation  would  arise 
out  of  the  contract  of  partnership  itself.  Here 
this  contract  was  illegal.  The  object  of  the 
statute  was  to  enable  the  state  officers  to 
know  with  whom  they  contracted,  and  also  to 
see  that  the  statute,  prohibiting  engineers 
and  other  canal  officers  from  becoming  inter- 
ested, was  not  violated,  and  to  prevent  all 
secret  combinations  in  relation  to  olit^ning 
work.  The  money  obtained  by  this  bid  be- 
longs to  the  firm;  and  the  plaintiff  could 
have  been  compelled  to  divide,  if  the  firm  had 
been  lawful,  by  force  of  the  contract  organlz- 


512 


ILLEGALITY  OF  OBJECT. 


ing  iL  In  thl53  case  he  also  agreed  to  pay  the 
money,  and  defendant  asks  the  court  to  com- 
pel him  to  perform  this  obligation.  The  an- 
swer to  it  is  obvious.  There  is  no  obligatiop, 
because  it  was  incurred  contrary  to  laWr  It 
r'e?T5'npOTr"n]e^_contm.ct  of  partnership. jagd 
that  Ls  void  for  'll^prJ^Jj^y 

In  law  there  was  no  partnership,  and  none 
of  the  parties  obtained  any  rights  under  the 
contract  creating  it.  Armstrong  v.  Lewis,  3 
Mylne  &  K.  45. 

The  sentiment  of  "honor  among,  thieves" 
cannot  be  enforced  in  courts  of  justice.  Sup- 
pose the  engineer  had  sued  for  his  share  after 
an  express  promise,  would  any  court  have 
tolerated  his  claim  for  a  moment  in  the  face 
of  a  statute  prohibiting  him  from  being  inter- 
ested? If  not,  in  what  respect  does  the  de- 
fendant occupy  any  better  position?  The  first 
step  in  his  case  Is  to  prove  that  he  was  a 
secret  partner  and  entitled  to  a  share  of  this 
money.  The  law  prohibits  secret  partners, 
and  he  is  therefore  not  a  partner. 

The  express  promise  does  not  aid  the  de- 
fendant, because  the  promise  was  only  to  car- 
ry out  the  unexecuted  provision  of  the  con- 
tract of  partnership  to  divide  the  money.  The 
two  cases  cited  by  the  counsel  for  the  defend- 
ant, if  they  are  to  be  regarded  as  good  law, 
are  distinguishable  from  this.  In  the  case  of 
Faikney  v.  Renois,  4  Burr,  2069,  one  of  two 
partners  had  paid  £3,000  to  settle  differences 
in  illegal  stock-jobbing  operations,  and  the 
defendant  executed  his  bond  to  secure  the 
share  of  the  other  partner.  The  court  over- 
ruled the  defense  recognizing  the  exploded  dis- 
tinction between  acts  malum  prohibitum  and 
malum  in  se,  and  held  that  as  between  those 
parties  the  bond  was  to  secure  the  plainitff 
for  money  paid,  and  the  purposes  of  the  pay- 
ment would  not  be  inquired  into.  A  similar 
decision  was  made  upon  the  authority  of  this 
case  in  Petrie  v.  Hannay,  3  Term  R.  418, 
Lord  Kenyon  dissenting.  The  distinction  be- 
tween the  above  cases  and  this  is  in  the  cir- 
cumstance that  there  the  illegal  transactions 
had  been  closed  up  and  settled,  and  the  obli- 
gations sought  to  be  enforced  were  for  the 
money  advanced  for  that  purpose.  Here  it  is 
sought  to  consummate  the  illegal  contract  by 
a  new  agreement  that  it  shall  be  performed. 
No  case  has  gone  this  length,  and  the  two 
cases  above  cited  have  been  very  much 
shaken  by  subsequent  decisions,  and  are,  to 
say  the  least,  questionable  authority,  espe- 
cially the  latter.  Aubert  v.  Maze,  2  Bos.  & 
P.  .370;  Mitchell  v.  Qockburne,  2  H.  Bl.  380; 
Ex    parte    Daniels,    14    Ves.    190;    Lowry    v. 


Bourdieu,  Doug.  4G7;  Brown  v.  Turner,  T 
Term  R.  626;  Belding  v.  Pitkin,  2  Caines, 
147,  note  a. 

The  general  rule  on  this  subject,  is  laid 
down  in  this  court,  in  Gray  v.  Hook,  4  N.  Y. 
449,  by  Mullott,  J.,  as  follows:  "The  distinc- 
tion between  a  void  and  valid  new  conti-act 
in  relation  to  the  subject-matter  of  a  former 
illegal  one  depends  upon  the  fact  whether 
the  new  contract  seeks  to  carry  out  or  en- 
force any  of  the  unrxccuted  provisions  of  the 
former  contract,  or  whether  it  is  based  upon 
a  moral  obligation  growing  out  of  the  execu- 
tion of  an  agreement  which  could  not  bo  en- 
forced by  law,  and  upon  the  performance  of 
which  the  law  will  raise  no  implied  promise. 
In  the  first  class  of  cases,  no  change  in  the 
form  of  a  contract  will  avoid  the  illegality 
of  the  fii-st  consideration  while  express  prom- 
ises based  upon  the  last  class  of  considera- 
tions may  be  sustained." 

It  is  sometimes  difficult  to  apply  general 
rules  to  particular  cases,  but  this  case  comes 
clearly  within  the  first  class  mentioned  in 
the  above  rule.  It  is  not  from  any  regard  to 
the  rights  of  the  party  setting  up  this  de- 
fense that  courts  refuse  to  enforce  illegal 
contracts,  but  it  is  for  the  protection  of  the 
public.  The  plaintiff  in  this  case  is  entitled 
to  no  sympathy  or  favorable  consideration. 
He  must  have  made  an  affidavit  that  no  other 
person  was  interested  with  him  in  the  pro- 
posal, and  when  he  received  this  money,  as 
between  him  and  the  defendant,  the  latter 
was  entitled  to  it;  and  while  we  have  no  dis- 
position to  justify  his  conduct,  his  position 
enables  him  to  secure  the  advantage  of  a 
decision  which  we  are  compelled  to  make  in 
obedience  to  a  principle  of  public  policy  which 
is  indispensable  for  the  protection  of  the  com- 
tQunity  against  the  corrupting  influences  of 
illegal  transactions. 

The  observation  of  Lord  Mansfield  in  Hol- 
man  v.  Johnson,  1  Cowp.  343,  is  applicable 
here.  He  said:  "The  objection  that  a  contract 
is  immoral  or  illegal  as  between  pLaintiff  and 
defendant  sounds  at  all  times  very  ill  In  the 
mouth  of  the  defendant  [in  this  case  the 
plaintiff].  It  is  not  for  his  sake  however  that 
the  objection  is  ever  allowed,  but  it  is  found- 
ed in  general  principles  of  policy  which  the 
defendant  has  the  advantage  of,  contrary  to 
the  real  justice,  as  between  him  and  the 
plaintiff,  by  accident.  If  I  may  so  say." 

Judgment  must  be  reversed  and  a  new  trial 
ordered,  costs  to  abide  the  event. 

All  concur. 

Judgment  reversed  and  a  new  trial  ordered. 


EFFECT  OF  ILLEGALITY. 

/  37 

(^  SPRING  CO.  V.  KNOWLTON.     ,  , 

(103. U.  S.  4y.)  ^ 


>13 


Supreme  Court  of  the  United  States.    Oct., 
1S80. 

Error  to  the  circuit  court  of  the  United 
States  for  the  Northern  district  of  New  York. 

This  suit  was  brought  in  1SG9  by  Dexter 
A.  Kuowlton,  a  citizen  of  Illinois,  against 
the  Congress  and  Empire  Spring  Companj-, 
in  the  supreme  court  of  the  state  of  New 
Yorlc,  to  recover  the  sum  of  $13,980,  with 
interest  from  Feb.  20,  1806.  In  187G  he  died, 
and  the  suit  was  revived  and  continued  by 
the  administrators  of  his  estate.  They  are 
citizens  of  Illinois,  and  on  their  application 
the  suit  was,  March  20,  1877,  removed  to 
the  circuit  court  of  the  United  States.  The 
parties,  by  written  stipulation,  waived  a 
jury.  The  court  tried  the  case,  and  found  the 
facts  to  be  substantially  as  follows:— 

The  Congress  and  Empire  Spring  Company 
is  a  corporation  organized  under  the  statute 
of  the  state  of  New  York  of  Feb.  17,  1848, 
airthorlzing  the  formation  of  corporations  for 
manufacturing,  mining,  mechanical,  or  chemi- 
cal purposes,  and  subsequent  acts  amenda- 
tory thereof.  Its  capital  stock  was  $1,000,- 
000,  divided  into  ten  thousand  shares  of  $100 
each,  issued  in  payment  of  property  purchas- 
ed by  the  trustees  of  the  corporation  for  its 
use. 

The  mode  by  which  such  a  corporation 
might  Increase  its  capital  stock  is  prescribed 
by  sections  21  and  22  of  chapter  40  of  the 
laws  of  1848. 

Section  21  prescribes  how  the  notice  of  a 
meeting  of  the  stockholders  to  consider  the 
proposition  to  increase  the  capital  stock  shall 
be  given,  and  what  vote  of  the  stocldiolders 
shall  be  necessary  to  carry  the  proposition. 

Section  22  prescribes  how  the  meeting  of 
the  stockholders,  called  under  section  21, 
shall  be  organized,  and  declares  that  If  a 
sufficient  number  of  votes  has  been  given  in 
favor  of  increasing  the  amount  of  capital 
stock,  "a  certificate  of  the  proceedings,  show- 
ing a  compliance  with  the  provisions  of  this 
act,  the  amount  of  capital  actually  paid  In, 
.  .  .  the  whole  amount  of  debts  and  lia- 
bilities of  the  company,  and  the  amount  to 
which  the  capital  shall  be  increased,  .  .  . 
shall  be  made  out,  signed,  and  verified  by  the 
affidavit  of  the  chairman  and  countersigned 
by  the  secretary,  and  such  certificate  shall 
be  acknowledged  by  the  chairman  and  filed, 
as  required  by  the  first  section  of  this  act; 
and  when  so  filed  the  capital  stock  of  such 
corporation  shall  be  increased  ...  to  the 
amount  specified  in  such  certificate,  .  .  . 
and  the  company  shall  be  entitled  to  the 
privileges  and  provisions,  and  subject  to  the 
liabilities,  of  this  act,  as  the  case  may  be." 

The  corporation  passed  a  resolution,  Jan. 
11,  1866,  to  increase  its  capital  stock  by  the 
addition  thereto  of  $200,000.  for  the  purpose 
of  building  a  glass  factory  for  the  manufac- 

HOPK.SEL..CAS.CONT. — '6'i 


ture  of  bottles  and  providing  a  working 
capital.  It  also  resolved  that  the  books  of 
the  company  should  be  optned  for  subscrip- 
tions to  the  additional  stock,  and  that  each 
stockholder  should  be  allowed  to  take  one 
share  of  the  new  for  every  five  shares  he 
held  of  tlie  original  stock,  and  that  when  he 
had  paid  .?S0  on  each  share  the  company 
should  issue  to  him  a  certificate  as  for  full- 
paid  stock. 

At  a  meeting  of  the  board  of  trustees  of 
the  corporation,  held  Feb.  8,  ISGfJ,  a  divi- 
dend of  four  per  cent  on  the  original  stuck 
was  declared,  payable  Feb.  20,  and  it  was 
resolved  that  a  call  of  twenty  per  cent  on 
the  new  stock  should  be  made,  payable  on 
the  latter  date;  that  the  books  of  the  com- 
pany should  be  at  once  opened  for  sub- 
scriptions to  the  new  stock;  that  each  stock- 
holder should  have  the  privilege  of  taking 
one  share  of  the  new  for  every  five  shares 
of  the  old  stock  held  by  him,  and  that  on 
failure  of  any  stockholder  to  pay,  on  or  be- 
fore that  date,  $20  on  each  share  of  the  new 
stock  taken  by  him,  all  his  claim  to  such 
new  stock  should  be  forfeited  and  the  same 
divided  ratably  among  the  stockholders  who 
had  paid  the  instalment  of  $20  per  share. 

In  pursuance  of  the  resolutions  the  trus- 
tees immediately  issued  a  stock  subscription 
agreement,  by  which  the  subscribers  stipulat- 
ed to  take  the  number  of  shares  set  opposite 
their  names  and  to  pay  for  each  share  $80, 
in  instalments,  as  called  for  by  the  directors; 
and  upon  failure  to  pay  the  instalments  with- 
in sixty  days  after  call,  that  the  money  al- 
ready paid  on  the  stock  should  be  forfeited  to 
the  company.  By  the  same  agreement  the 
company  bound  itself  to  pay  interest  up  to 
Feb.  1,  1SG7,  on  all  sums  paid  on  the  new 
stock,  and  on  Feb.  8,  1867,  to  issue  for  every 
share  of  said  new  stock  on  which  $80  had 
been  paid  a  certificate  to  the  holder  as  for 
full-paid  stock;  and  it  was  provided  that  the 
holders  of  such  stock  should  be  entitled  to 
vote  thereon,  and  the  same  should  draw  divi- 
dends and  be  treated  In  all  respects  as  full- 
paid  stock. 

This  agreement  was  signed  by  one  C.  Shee- 
lian,  who  subscribed  for  six  hundred  and 
ninety  shares  of  the  new  stock,  he  being  the 
holder  of  thirty-four  hundred  and  ninety 
shares  of  the  old  stock. 

Thereupon  a  contract  was  made  between 
Sheehan  and  Knowlton,  whereby  the  former 
agreed  to  lend  the  dividend  on  his  old  stock 
to  the  latter,  who  agreed  to  assume  the  new 
stock  subscribed  for  by  Shoenan,  and  pay  all 
future  calls  thereon.  Sheehan's  dividend  on 
his  old  stock  amounted  to  $13,9SS.  Knowl- 
ton, In  consideration  of  the  transfer  to  him 
of  this  dividend,  delivered  his  note  to  Shee- 
han for  $13,980.  dated  Feb.  20.  1866,  payable 
in  one  year,  and  secured  the  same  by  a  pledge 
of  one  hundred  and  fifty  shares  of  the  stock 
of  the  company.  He  paid  the  residue,  to 
wit,  $S.  in  cash. 

Knowlton  paid   to  the  company,   March  8^ 


514 


ILLEGALITY  OF  OBJECT. 


1866,  the  can  of  twenty  per  cent  on  the  new 
stock,  subscribed  by  and  sold  to  Sheehan  as 
aforesaid,  by  the  application  thereto  of  Shee- 
han's  dividend  on  the  old  stock,  amounting 
to  §;io,9S0.  for  which  the  company  gave 
Knowlton  a  receipt. 

About  December,  1868,  Knowlton  paid  in 
full  his  note  to  Sheehan  for  ?13,9S0. 

Calls  and  personal  demands  were  made  both 
upon  Sheehan  and  Knowlton  more  than  sixty 
days  before  Jan.  25,  1S67,  for  the  payment  of 
subsequent  instalments  on  the  stock  subscrib- 
ed by  Sheehan,  and  both  of  them  neglected 
and  refused  to  pay  the  instalments  called  for; 
whereupon  the  trustees  of  the  company  pass- 
ed a  resolution  by  which  they  declared  that 
the  new  stock  subscribed  by  Sheehan  and 
assumed  by  Knowlton  should  be  and  was  for- 
feited. 

From  August,  1865,  to  August,  1S6G,  Knowl- 
ton was  a  trustee  and  vice-president  of  the 
company;  he  advised  the  increase  of  the  cap- 
ital stock  above  mentioned,  proposed  the  reso- 
lutions in  relation  thereto,  moved  their  adop- 
tion, drew  up  and  signed  the  stock  subscrip- 
tion agreement,  and  advised  others  to  sign  it. 
At  a  meeting  of  the  stockholders  of  the 
company,  held  Aug.  7,  1867,  it  was  resolved 
that  the  capital  stock  of  the  company  should 
be  reduced  to  the  original  sum  of  §1,000,000, 
and  that  the  trustees  be  authorized  to  ar- 
range with  the  holders  of  the  new  stock  for 
retiring  the  same  on  such  terms  and  condi- 
tions as  they  should  deem  for  the  interest  of 

the  company. ■ . _ — 

On  the  same  day  the  beared  of  trustees  met 
and  passed  a  resolution,  whereby  the  execu- 
tive committee  of  the  board  was  authorized 
to  adjust,  on  the  best  terms  for  the  company, 
the  claims  of  all  persons  holding  receipts  for 
payments  on  the  new  stock  ordered  to  be  re- 
tired. 

The  executive  committee  passed  a  resolu- 
tion, March  27,  1868,  that  the  company  issue 
five-year  coupon  bonds  sufficient  to  refund  the 
payments  made  on  the  new  stock  of  the  com- 
pany which  had  been  retired. 

No  tender  of  these  bonds  was  ever  made  to 
Knowlton,  nor  was  any  demand  made  for 
them  by  him;  but  he  demanded  repayment 
of  the  amount  paid  by  him  on  his  new  stocK, 
and  the  company  refused  to  repay  it  or  any 
part  of  it. 

The  majority  of  the  holders  of  the  original 
stock  became  subscribers  for  the  new  stock, 
and  all  of  them  except  Sheehan,  Knowlton, 
and  one  or  two  subscribers  for  small  amounts, 
paid  the  calls  made  on  them  in  respect  to  the 
new  stock.  The  first  call  of  twenty  per  cent 
on  the  new  stock  was  paid  mainly  by  the 
dividend  on  the  old  stock  above  mentioned, 
but  about  .?3,000  were  paid  in  cash.  All  the 
stockholders  who  did  not  subscribe  for  now 
stock  were  paid  their  part  of  the  dividend  in 
cash.  About  ?80,500  of  said  five  per  cent 
bonds  were  issued  by  the  company  to  retire 
the  new  stock. 
As  a  conclusion  of  law  from  these  facts,  the 


court  held  that  the  plaintiffs,  as  such  adminis- 
trators, were  entitled  to  judgment  against  the 
Congress  and  Empire  Spring  Company  for  the 
sum  of  ?13,9S0,  with  interest  from  Feb.  20, 
1866,  and  rendered  judgment  accordingly. 
The  company  sued  out  this  writ  of  error. 

It  appears  by  a  bill  of  exceptions  that  the 
defendant's  counsel  requested  the  court  be- 
low to  decide  that  the  proceedings  of  the  de- 
fendant in  increasing  its  capital  stock,  and 
forfeiting  the  araoimt  paid  by  the  plaintiffs' 
intestate,  were  in  all  respects  legal  and  valid. 
The  court  refused  so  to  find,  and  ruled  that 
the  plan  devised  by  him  and  the  other  ti'us- 
tees  of  the  company  was  contrary  to  the  pro- 
visions of  the  statute,  against  public  policy, 
and  a  fraud  upon  stockholders  not  consenting 
thereto,  and  the  public. 

It  further  appears  that  the  defendant's  coun- 
sel requested  the  court  to  decide  that,  inas- 
much as  the  intestate  devised,  counselled,  and 
assisted  in  passing  and  adopting  all  the  acts 
and  resolutions  for  an  increase  of  stock  by 
the  company,  the  plaintiffs  were  not  entitled 
to  recover.  The  comt  refused  so  to  decide, 
and  ruled  that  the  intestate  had  a  right  to 
abandon  the  illegal  transaction  to  which  he 
was  a  party,  and  that  by  declining  to  pay 
further  calls,  and  demanding  repayment  of 
the  payments  made  before  the  consummation 
of  the  illegal  scheme,  he  did  abandon  it,  and 
his  representatives  were  entitled  to  recover. 
To  these  refusals  and  rulings  the  defendant's 
counsel  excepted. 

The  errors  assigned  here  are  that  the  court 
below  erred  in  each  of  its  refusals  and  rulings, 
and  in  deciding  that  the  plaintiffs  were  enti- 
tled to  recover. 

Francis  Kernan  and  Charles  S.  Lester,  for 
plaintiff  in  error.     H.  M.  Ruggles,  contra. 


Mr.ijJusI 


rustice  WOODS,  after  stating  the  case, 
delivered  the  opinion  of  the  court. 

The  plaintiff  in  error  claims  that  the  plan 
adopted  by  it  tojncrease  its  capital  stock,  by_ 
which  certificatcs_as  jor'f ull-paid_  stock  were 
to""Be-issueg^n  the'pa^TnePt  of  eighty  per 
cent  thereof,  was_a gainst  the  law  and  pub- 
lic policy  of  the^tate  of  New  York,  "and  was, 
therefore,  void;  that  Knowlton,  having  been 
an  active  party  in  devising  this  scheme,  and 
having  paid  his  money  in  part  execution  of 
it,  his  legal  representatives  cannot  recover  the 
sum  so  paid. 

It  is  conceded  by  the  defendants  in  error 
that  the  plan  adopted  by  the  company  to  in- 
crease its  stock  was  in  violation  of  the  law  of 
New  York,  and  therefore  void.  It  has  been 
so  held,  in  effect,  by  the  court  of  appeals  of 
the  state  of  New  York,  in  the  case  of  Knowl- 
ton V.  Spring  Co.,  57  N.  Y.  518. 

We  are,  then,  to  consider  whether,  upon 
the  hypothesis  that  the  plan  for  the  increase 
of  the  stock  was  illegal,  there  can  be  a  re- 
covery upon  the  facts  of  the  case  as  found 
by  the  circuit  court. 

We  think  it  clear  that  there  was  tjuly  a  pa*' 


EFFECT  or  ILLEGALlii 


515 


Ijerformanceof  the  iLle{,'al  contract-bfitmien 
th£  f-nrnt^-rriy''irng3;itno\vItoii  JD  reference  to 
the  new  stuck,  fur  whic-E  Sheeban  subscribed 
and  which  he  aj^reed  to' transfer  to  Knowlton. 
The  compauy,  i^  fact,  created  no_new  stock. 
It  only  proposed  to  do  so.  To  increase  the 
stock~of  the  company  it  was  not  only  neces- 
sary that  the  meeting  of  the  stockholders 
sliuuld  be  called,  as  prescribed  by  the  law,  and 
a  vote  of  two-tliirds  of  all  tlie  shares  of  stock 
shuuld  be  cast  at  the  meeting;  in  favor  of  the 
increase,  but  that  there  should  be  a  certiti- 
cate  of  the  proceedings,  showing,  among  other 
things,  a  complijince  with  the  provisions  of 
the  law,  and  the  amount  of  the  increase  of 
the  stock,  signed  and  verified  by  the  affida- 
vit of  the  chairman  of  the  meeting  at  which 
the  increase  was  voted,  and  countersigned 
by  the  secretary,  and  such  certificate  should 
be  acknowledged  by  the  chairman  and  filed, 
as  required  by  the  first  section  of  the  act. 
And  the  law  declared  that  "when  so  filed  the 
capital  stock  of  such  corporation  shall  be  in- 
creased to  the  amount  si)ecified  in  such  cer- 
tificate." 

It  does  not  appear  from  the  findings  of  the 
circuit  court  that  any  such  certificate  was 
ever  made  or  filed.  Consequently  it  does  not 
appear  that  the  steps  necessary,  under  the 
law,  to  an  increase  of  the  stock  were  ever 
taken.  Neither  does  It  appear  that  _anj 
scrip  or  certififi'^tps  were  pver  issnpd  tn  the 
subscribers  to  the  new  stock.  So  that  all 
that  was  done  amounted  only  to  a  proposi- 
tion by  the  company,  on  the  one  hand,  to  in- 
crease its  stock,  and  an  agreement  by  Knowl-| 
f  ton  to  take  certain  shares  of  the  new  stoc] 
I  when  issued,  and  the  payment  by  him  of 

instalment  of  twenty  per  cent  thereon.    Then 
1  was  no  performance  of  the  contract  whatevei 
\  by   the  company,  and   only  a  part  perform- 
ance by  Knowlton. 
^  It  is  to  be  observed  that  the  maklng^f  the 
illegal  contract  was  malum  prohibitum  ami 
not"  malum  in  seT    There  Ts~no  moral  turpi- 
tude  in  such  a  contract,  nor  is  it  of  'itself 
fraudulent  however  much  it  may  afford  fa- 
cilities for  fraud. 

The  question  presented  is,  therefore, 
•whether,  conceding  the  contract  to  be  illegal, 
money  paid  by  one  of  the  parties  to  it  in_pajt 
pot-formance  can  be  recovcrea.  I5e~  other 
party  not  having  performed  the  contract  qx 
any  p.arTbf  it  and  both  parties  having  aboa- 
doned  the  illegal  agreement  before  it  was 
con^HTOhi'atcd. 

We  tnmk  the  authorities  sustain  the  af- 
firmative of  this  proposition. 

Their  result  is  fairly  stated  In  2  Comyn, 
Cont  3G1,  as  follows:  "Where  money  has 
been  paid  upon  an  illegal  contract,  it  is  a 
general  rule  that  If  the  contract  be  exe- 
cuted and  both  parties  are  in  pari  delicto, 
neither  of  them  can  recover  from  the  other 
the  money  so  paid,  but  if  the  ^contract  con- 
tiniiao  pvi-^ynfnrv  nnd  tbp  pnrtv  paying_t^e 
money  be  desirous  of  rescincTTng  it  he  ma v 
do  ^o  and~  recover   back   by  "action    of_  In- 


debLt^''^^""  flftfjiirnp"''  for  money  had  and  re- 
ceived. And  this  distinction  is  taken  in  the 
books  that  where  the  action  is  in  afliriuance 
of  an  illegal  contract,  the  object  of  which  Is 
to  enfuree  the  performance  of  an  engage- 
ment prohibited  by  law,  clearly  such  an  ac- 
tion can  in  no  case  be  maintained,  but  where 
the  action  proceeds  in  disaffirmance  of  such 
a  contract,  and  instead  of  endeavoring  to  en- 
force it  presumes  it  to  be  void  and  seeks 
to  prevent  the  defendant  from  retaining  the 
benefit  which  he  derived  from  an  unlawful 
act,  then  it  is  consonant  to  the  spirit  and 
policy  of  the  law  that  the  plaintiff  should 
recover." 

Mr.  Parsons,  in  his  work  on  Contracts  (vol- 
ume 2,  p.  74G),  says:  "All  contracts  which 
vprovide  that  anything  shall  be  done  which 
is  distinctly  prohibited  by  law,  or  morality, 
lor  public  policy,  are  void,  so  he  who  advan- 
jces  money  in  consideration  of  a  promise  orj 
lundeilaking  to  do  sueh  a  thing,  may  at  any 
time  before  it  is  done  rescind,  the  contract 
and  prevent  the  thing  froln  being  done  and 
Recover  back  his  money." 

To  the  same  effect  see  2  Add.  Cont  §  1412; 
Chit  Cont  944;  2  Story,  Cont  §  617;  2 
GreenL  Ev.  §  111. 

The  views  of  the  text-writers  are  sustained 
by  a  vast  array  of  authorities,  both  English 
and  American. 

A  few  will  be  cited.  Taylor  v.  Bowers,  1 
Q.  B.  Div.  201,  was  an  action  to  recover 
property  assigned  for  the  purpose  of  de- 
frauding creditors.  A  verdict  was  rendered 
for  the  plaintiff,  with  leave  to  move  to  enter 
a  verdict  for  the  defendant  A  rule  was 
obt'iined  on  the  ground  that  the  plaintiff 
could  not  by  the  allegation  of  his  own  fraud 
get  back  the  goods  from  the  defendant.  The 
queen's  bench  sustained  the  verdict  the 
chief  justice,  Cockburn,  delivering  the  opin- 
ion. The  defendant  then  appealed  to  the 
court  of  appeals,  where  the  judgment  was 
aflirmed.  Both  courts  agreed  that  an  illegal 
contract  partially  performed  might  be  re- 
pudiated and  the  money  paid  upon  it  recov- 
ered. 

Lord  Justice  Mellish,  in  the  court  of  ap- 
peals, said:  "If  the  illegal  transaction  had 
been  carried  out  the  plaintiff  himself,  in 
my  judgment  could  not  afterwards  have  re- 
covered the  goods.  But  the  illegal  transac- 
tion was  not  carried  out;  it  came  wholly  to 
an  end.  To  hold  that  the  plaintiff  is  enti- 
tled to  recover  does  not  carrj-  out  the  illeg;U 
transaction,  but  the  effect  is  to  put  every- 
body in  the  same  situation  as  they  were  be- 
fore the  illegal  transaction  was  determined 
upon,  and  before  the  parties  took  any  stepa 
to  can-y  it  out  That  I  apprehend,  is  the 
true  distinction  In  point  of  law.  If  money 
is  paid  or  goods  delivered  for  an  illegal  pur- 
pose, the  person  who  had  so  paid  the  money 
or  delivered  the  goods  may  recover  them 
back  before  the  illegal  purpose  is  carried 
out;  but  if  he  waits  till  the  illegal  purpose 
is  carried  out,  or  if  he  seeks  to  enforce  the 


516 


ILLEGALITY  OF  OBJECT. 


illegal  transaction,  in  neitlier  can  he  main- 
tain an  action;  the  law  wiU  not  allow  that 
to  be  done." 

The  same  rule  substantially  is  laid  down 
in  the  following  English  cases:  Lowry  v. 
Bourdieu,  2  Doug.  452;  Tappenden  v.  Ran- 
dall, 2  Bos.  &  P.  467;  Hastelow  v.  Jackson, 
S  Barn.  &  C.  221;  Bone  v.  Ekless,  5  Hurl.  & 
X.  925;  Lacaussade  v.  White,  7  Term  R. 
531;  Cotton  v,  Thurland,  5  Term  R.  405; 
Mount  T,  Stokes,  4  Term  R.  5G1;  Smith  v. 
Bickmore,  4  Taunt.  474. 

In  Morgan  v.  Groff,  4  Barb.  524,  it  was 
held  that  money  paid  on  an  illegal  contract, 
which  remains  executory,  can  be  recovered 
back  in  an  action  founded  on  a  disaffirmance, 
and  on  the  ground  that  it  is  void. 

To  the  same  effect  are  the  following  cases: 
Insurance  Co.  v.  Kip,  8  Cow.  (N.  Y.)  20;  Mer- 
ritt  V.  Millard,  *43  N.  Y.  20S;  White  v.  Bank, 
22  Pick,  ISl;  LoweU  v.  Railroad  Corp.,  23 
Pick.  24. 

In  Thomas  v.  City  of  Richmond,  12  Wall. 
349,  this  court  cites  with  approval  the  note 
of  Mr.  Frere  to  the  case  of  Smith  v.  Brom- 
ley, 2  Doug.  G96,  to  the  effect  that  a  recov- 
ery can  be  had  as  for  money  had  and  re- 
ceived when  the  illegality  consists  in  the 
contract  itself,  and  that  contract  is  not  exe- 
cuted; in  such  case_th£r^  ''^  a  locus  D£ni- 
Jentiae;  the  dgllctumTsincomplete;  the  con- 
tract  may  be  rescinrted  by  either  party. 

The  rule  is  applied  in  the  great  majority 
of  the  cases,  even  when  the  parties  to  the 
illegal  contract  are  in  pari  delicto,  the  ques- 
tion which  of  the  two  parties  is  the  more 
blamable  being  often  difficult  of  solution  and 
quite  immaterial.  We  think,  therefore,  that 
the  facts  of  this  case  present  no  obstacle  to 
a  recovery  by  Knowlton's  administrators  of 
the  stun  paid  by  him  on  the  stock  which  had 
been  subscribed  for  by  Sheehan. 

The  law  of  New  York  does  not  in  express 
terms  forbid  a  corporation  from  issuing  cer- 
tificates for  full-paid  stock  when  the  stock 
has  not  been  fully  paid.  The  illegality  of  such 
an  issue  is  deduced  from  several  sections  of 
the  law  under  which  the  Congress  and  Em- 
pire Spring  Company  was  organized,  namely, 
sections  38,  40,  41,  and  49.  We  think  it  is 
fairly  inferable  from  the  record  that  the 
trustees  of  the  company,  one  of  whom  was 
Knowlton,  did  not  know  that  the  plan  adopt- 
ed by  them  for  the  increase  of  the  stock 
was  illegal,  and  that  when  they  discovered 
that  it  was  forbidden  by  the  law,  and  before 
any  harm  was  done  or  could  have  been  done, 
the  scheme  was  abandoned.  Under  such 
circumstances,  the  rule  which  would  pre- 
vent the  recovery  of  the  money  paid  to  carry 
on  the  illegal  plan  would  be  a  very  harsh 
one,  not  founded  on  any  law  or  public  policy. 

It  is  suggested  by  counsel  for  the  plaintiff 
In  error  that  the  court  of  appeals  of  the 
state  of  New  York  has  in  this  identical  suit, 
upon  the  same   state  of  facts,   adjudicated 


the  rights  of  the  parties,  and  that  this  court 
ought  to  consider  the  questions  raised  in  this 
case  as  res  judicata. 

The  reply  to  this  suggestion  is  that  it  no- 
where appears  in  the  record  that  this  case 
was  ever  before  the  court  of  appeals,  or  that 
it  was  ever  decided  by  any  court  except  the 
United  States  circuit  court  for  the  Northern 
district  of  New  York,  from  which  it  has  been 
brought  to  this  court  on  error.  We  cannot 
consider  facts  not  brought  to  our  notice  by 
the  record. 

Judgment  affirmed- 


.fc 


Mr.  Justice  HARLAN  dissenting. 

This  action  was  commenced  in  the  su- 
preme court  of  the  state  of  New  York.  The 
present  transcript  is  imperfect  in  that  it  does 
not  contain  all  the  proceedings  in  the  courts 
of  the  state  up  to  the  removal  of  the  case 
into  the  circuit  court  of  the '  United  States. 
It  is,  however,  conceded,  in  the  briefs  of 
cotinsel,  that  Knowlton  recovered  in  the  su- 
preme court  a  judgment  which,  upon  a  writ 
of  error  from  the  commission  of  appeals, 
was  reversed  upon  the  grounds  stated  in 
Knowlton  v.  Spring  Co.,  57  N.  Y.  518.  The 
learned  district  judge  who  tried  the  case 
commences  his  opinion,  which  is  incorporat- 
ed in  the  transcript,  with  the  statement  that 
"this  case  comes  here  by  removal  from  the 
state  court,  after  a  decision  adverse  to  the 
plaintiff  by  the  commission  of  appeals,  re- 
versing the  judgment  of  the  supreme  court 
in  favor  of  plaintiff,  and  ordering  a  new 
trial.  57  N.  Y.  518."  He  then  proceeds  to 
determine  it  upon  principles  of  law  different 
from  those  announced  in  that  decision.  Had 
it  been  again  tried  in  the  supreme  couil, 
judgment  must  have  been  rendered  against 
these  defendants  in  error,  because  the  re- 
versal was  upon  such  grounds  as  precluded 
any  recovery  whatever  by  them.  That  deci- 
sion should,  in  my  opinion,  have  been  ac- 
cepted as  the  law  of  this  case,  although  the 
proceedings  in  the  commission  of  appeals 
are  not  set  forth  in  the  transcript.  The  re- 
ported case  shows,  beyond  question,  that  it 
is  the  identical  case  now  before  us;  at  any 
rate,  that  it  was  between  these  parties  and 
involved  the  same  issues.  We  know  that 
the  adjudication  of  that  court  was  long  pri- 
f  or  to  the  removal  of  this  case,  and  that  the 
questions  arising  upon  this  record  have  been 
once  determined  by  a  court  of  competent 
jurisdiction  in  a  suit  between  the  same  par- 
ties touching  the  subject-matter  now  in  con- 
troversy. All  this  plainly  appears  by  that 
decision,  the  legal  effect  of  which,  the  de- 
fendants in  error  should  not  be  permitted  to 
escape  by  removing  the  case  into  the  circuit 
court. 

Upon  these  grounds,  and  without  express- 
ing my  own  views  upon  the  propositions  of 
law  discussed  in  the  opinion  of  the  court,  I 
dissent  from  the  judgment  just  rendered. 


Ir 


^^ 


EFFECT  OF  ILLEGALITY. 


517 


FORD    V.    HARRINGTON. 


■j>^ 


(16  N.  Y.  285.) 
Court  of  Appeals  of  New  York.    ISjT. 

This  action  was  brought  by  the  plaintiff  a3 
heir  at  law  of  James  Conway  to  compel  the 
defendant  to  convey  to  her  lifty  acres  of  land. 

The  defendant  was  an  attorney  and  coun- 
selor of  the  supreme  court.  As  such  he  had 
advised  Conway  to  assign  his  contract  for  the 
purchase  of  the  land  Jn  question  to  him,  the 
defoiKlant,  to  preN-ent^Uonway^  crc-ditor  frcon 
reaching  jtZ  Tt  wn.^  understood  between  them 
tliat  afterConway'had  settled  with  the  cred- 
[tpr  t;hp  c^nntrncFjhnuldJffi  reassigned  to  him. 
.The  defendant  gave  his  note  foi  $44,  and  suB-j 
vkequently  paid  the  balance  due  on  the  conj 
cract  and  took  a  conveyance  to  himself. 

About  a  year  afterward  Conway  died.  The 
plaintiff,  as  heir  at  law  of  Conway,  tendered 
to  the  defendant  what  he  had  paid  in  the  mat- 
ter, and  presented  to  him  a  quit-claim  deed 
and  demanded  that  he  execute  it  Upon  his 
refusal  this  action  was  brought.  Conway 
was  an  alien.  The  plaintiff  was.  also  an  alien 
when  the  action  was  brought.  The  case  hav- 
ing been  referred,  the  referee  found  in  favor 
of  the  plaintiff.  Judgment  was  entered  ac- 
cordingly, and  affirmed  at  the?  general  term  of 
the  supreme  court.  The  defendant  appealed 
to  this  court. 

M.  Bumell,  for  appellant  A.  G.  Rice,  for 
respondent 

BOWEN,  J.  The  judgment  appealed  from 
cannot  be  sustained  upon  the  facts  found  by 
the  referee,  unless  the  relation  of  attorney 
and  client,  existing  between  the  plaintiff's  an- 
cestor and  the  defendant  at  the  time  of  tli^ 
assignment  of  the  contract  in  question  by  the 
former  to  the  latter,  distinguishes  this  case 
from  the  ordinary  one  of  the  transfer  of  prop- 
erty by  a  debtor,  with  the  intent  and  for  the 
purpose  of  defrauding  creditors.  The  referee 
has  found  that  James  Conway,  under  whom, 
as  his  heir  at  law,  the  plaintiff  claims  title 
to  the  land  in  dispute,  assigned  the  contract 
for  the  purchase  of  the  land  to  the  defendant, 
for  the  express  purpose  of  placing  it  and  his 
interest  in  the  land  under  the  contract,  be- 
yond the  reach  of  his  creditors.  At  least  such 
is  the  necessary  inference  from  the  facts 
found. 

f  The  general  rule,  that  courts  will,  under 
such  eircumstiinces.  extend  no  remedy  to  a 
grantor  or  vendor  of  property  to  recover  back 

/  from  the  grantee  or  vendee  the  property  thus 
transferred,  although  the  transfer  is  without 
consideration.   Is  too   well   settled  to  be  now 

^called  in  question. 

But  the  referee  has  further  found  that,  at 
the  time  of  the  transaction,  the  defendant  was 
a  practicing  attorney  and  counselor  of  the  su- 
preme court,  and  was  acting  as  the  attorney 
and  counsel  of  Conway,  and  that  it  was  in  ac- 
cordance with  and  pursuant  to  his  advice  as 
such  counsel,  that  the  contract  was  assigned 
to  him  by  Conway;  and  the  referee  states,  as 


a  conclusion  of  law,  "that,  as  agaln.st  an  at- 
torney and  counselor,  the  law  will  set  aside  an 
agreement  made,  with  his  clicnT,  by~wh!f^i 
property  is  placed 'm  his  handsjokeen  it  out 
■Of  the  reach  pf_the  creditors  of~ine  client." 
Courts  scrutinize  closely  transactions  betweim 
attorney  and  clieni;  and  conveyances  and 
transfers  of  property  to  the  former  by  the 
latter,  while  that  relation  exists,  are  fre(iuent- 
ly  set  aside  in  cases  where,  but  for  that  rela- 
tion, they  would  be  upheld.  In  such  cases  the 
law  presumes  that  undue  advantage  has  been 
taken  of  the  confidential  relation  existing  be- 
tween attorney  and  client;  and  attorneys.  In 
order  to  sustain  such  transfers  to  them,  have 
been  required  to  show  affirmatively,  either 
that  they  paid  an  adequate  consideration,  or 
that  a  gratuity  was  intended  by  the  client, 
and  that  to  obtain  it  no  advantage  was  taken 
of  the  confidential  relation  existing  between 
them,  and  that  every  thing  was  honest  and 
fair  on  their  part 

In  this  case  no  gratuity  to  the  attorney  was 
intended.  In  fact  the  client  intended  to  make 
no  transfer  of  property,  for  although  all  the 
forms  necessary  to  constitute  an  assignment 
of  the  contract  were  complied  with,  yet  the 
assignor  intended  that  the  whole  transaction 
should  be  merely  formal,  and  at  the  time  sup- 
posed that  such  was  the  fact.  He  did  not 
intend  to  part  with  any  bancficial  interest  in 
the__property.  On  the  contrary,  the  assign- 
ment was  made  as  a  means  of  preventing  his 
interest  in  the  contract  and  in  the  land  therein 
described  from  being  applied  upon  the  debt 
he  owed,  and  of  thereby  enabling  him  to  con- 
tinue in  the  beneficial  use  and  enjoyment  of 
the  property.  His  object  in  the  transaction 
was  to  benefit  himself  and  not  to  confer  a 
benefit  on  his  attorney.  For  aught  that  ap- 
pears, he  would,  with  equal  willingness,  have 
made  the  assignment  to  some  other  person, 
had  he  been  so  advised. 

The  rule_of_c<l"'ty.  which  throws  upon  the 
.  attorney  the  burden  of  showing  peffc^Ol  futr- 


ness  on  his  part  in  all  his  dealings  with,  an-d 
which  renders  it  almost  impossible  for  him 
to  become  the  recipient  of  a  gratuity  or  boun- 
ty from  his  client,  is  based  upon  the  consid- 
eration that  the  relations  existing  between 
the  parties  is  such  that  the  attorney  has  it  in 
his  power  to  avail  himself  of  the  necessities, 
libei-ality  or  credulity  of,  and  of  his  influence 
over,  the  client,  and  of  that  sense  of  depend- 
ence, on  the  part  of  the  latter,  upon  his  at- 
torney, which  always  exists  to  a  greater  or 
less  extent  and  of  the  confidence  which  the 
client  reposes  in  his  attorney;  and  also  upon 
the  fact  that  It  Is  difficult,  and  in  most  cases 
impossible,  for  the  client  to  show  that  ad- 
vantage has  been  taken  of  the  relation. 

The  reason  of  the  rule  does  not,  perhaps, 
to  the  full  extent  apply  to  this  case;  but  yet 
Conway  had  applied  to  the  defendant._a£  XLix. 
^torney  and  counselor  at~liLW-  for  advice, 
and  it  was  m  accordance  with  and  pursuant 
toV^nd.  as  tt'Ts'to  be  presumed,  in  conse- 
quence of  the  advice  there  given  that  the  as- 


518 


ILLEGALITY  OF  OBJECT. 


signment  was  made.  The  assignment  was 
the  direct  result  of  the  trust  and  confidence 
which  Couway  reposed  in  his  attorney.  1 
think  this  case  does  come  within  the  reason 
of  the  rule  applicable  to  ordinary  cases  of  the 
transfer  of  property  by  a  client  to  his  attor- 
ney, although  Conway's  object  in  making  the 
assignment  was  to  benefit  himself  and  not 
his  attorney.  The  facts  disclosed  present  a 
case  where  the  court  would  be  called  upon 
to  interfere  between  the  defendant  and  the 
representative  of  his  client,  and  compel  the 
former  to  restore  what  he  had  obtained  with- 
out consideration,  were  it  not  for  the  fact 
that  in  making  the  assignment  the  parties 
were  both  perpetrating  a  fraud,  were  both 
committing  a  crime;  and  the  question  is, 
which  rule  is  to  govern  the  case,  the  one  ap- 
plicable to  dealings  between  attorney  and 
client,  or  the  rule  that  the  court  will  not  lend 
its  aid  to  either  of  the  parties  to  an  illegal  or 
fraudulent  contract,  either  by  enforcing  its 
execution,  if  it  be  executory,  or  by  rescinding 
it,  if  it  be  executed. 

The  plaintiff's  counsel  insists  that  the  for- 
mer rule  should  be  applied,  because  it  is 
founded  in  considerations  of  public  policy. 
But  pubhc  policy  also  dictated  the  adoption 
of  the  other  rule. 

The  latter  rule,  however,  is  not  of  universal 
application.  The  l^iking  of  more  than  seven 
per  cent  per  annum  for  the  use  of  money  is 
prohibited  by  statute,  and  all  contracts  re- 
serving a  greater  rate  of  Interest  are  de- 
clared to  be  void;  yet  it  has  been  held  that 
usurious  interest,  paid  by  a  borrower,  may 
be  recovered  back  independently  of  the  statute 
allowing  such  recovery;  that  the  maxim  in- 
ter partes  in  pari  delicto,  potior  est  conditio 
defendentis  does  not  apply  to  such  a  case,  for 
the  reason  that  the  law  considers  the  borrow- 
er the  victim  of  the  usurer.  Wheaton  v.  Hib- 
bard,  20  .Johns.  290.  Upon  the  same  princi- 
ple it  has  been  held  in  England  that  money 
paid  to  a  creditor  as  a  consideration  for  his 
signing  the  certificate  of  a  bankrupt  can  be 
recovered  back,  although  by  statute  all 
agreements  by  a  bankrupt  with  his  creditors 
tj3  pay  money  for  signing  his  certificate  are 
declared  void.  Smith  v.  Bromley,  2  Doug. 
G96. 

In  Browning  v.  Morris,  2  Cowp.  790,  Lord 
Mansfield  laid  down  and  enforced  the  rule 
that  "where  contracts  or  transactions  are 
prohibited  by  positive  statute  for  the  sake  of 
protecting  one  set  of  men  from  another  set 
of  men  (the  one  from  their  situation  and  con- 
dition being  liable  to  be  oppressed  or  imposed 
upon  by  the  other),  there  the  parties  are  not 
in  pari  delicto;  and,  in  furtherance  of  these 
statutes,  the  person  injured,  after  the  trans- 
action is  finished  and  completed  may  bring 
his  action  and  defeat  the  contract." 

Mr.  Justice  Story,  in  his  treatise  on  Equity 
Jurisprudence  (volume  1,  §  300),  says:  "And 
indeed,  in  cases  where  both  parties  are  in 
delicto,  concurring  in  an  illegal  act,  it  does 
not  always  follow   that  they  stand   in  pari 


delicto,  for  there  may  be,  and  often  are,  very- 
different  degrees  in  their  guilt.  One  party 
may  act  under  circumstances  of  oppression, 
imposition,  hardship,  undue  influence  or  great 
inequality  of  age  or  condition,  so  that  his 
guilt  may  be  far  less  in  degree  than  that  of 
his  associate  in  the  offense;  and  besides, 
there  may  be,  on  the  part  of  the  court  itself, 
a  necessity  of  supporting  the  public  interest  or 
public  policy,  in  many  cases,  however  repre- 
hensible the  acts  of  the  parties  maybe."  In  Os- 
borne V.  Williams,  18  Ves.  379,  cited  by  .Jus^ 
tice  Story  under  the  section  above  quoted,  a 
bill  was  filed  by  the  representatives  of  a  de- 
ceased son  against  the  representatives  of  his 
deceased  father  to  compel  the  latter  to  ac- 
count for  the  profits  received  by  him  from 
the  use  of  a  vessel  employed  by  the  post- 
office  department  in  the  public  service  as  a 
mail  packet,  after  a  sale  of  the  vessel  by  the 
father  to  the  son.  The  father  had  been  the 
commander  of  the  vessel,  and,  on  the  trans- 
fer being  made,  the  officers  of  the  post-offlce 
appointed  the  son  as  commander  in  the  place 
of  the  father.  It  appeared  that,  just  prior  to 
the  transfer  and  the  appointment  of  the  son 
as  commander,  an  agreement  had  been  en- 
tered into  between  the  father  and  son,  with- 
out the  knowledge  of  the  ofiicers  of  the  de- 
partment, by  which  agreement,  in  considera- 
tion of  the  father  resigning  the  command, 
allowing  the  son  £200  per  annum,  and  defray- 
ing  the  expenses  of  the  vessel,  the  son  relin- 
quished to  the  father  all  the  earnings  of  the 
vessel  in  as  full  a  manner  as  if  the  transfer 
had  not  been  made  and  the  father  had  re- 
mained in  command;  and  it  was  shown  that 
the  profits,  of  which  an  account  was  sought, 
were  received  by  the  father  under  this  agree- 
ment. It  was  held  that  this  agreement  was 
illegal,  as  being  a  fraud  on  the  post-office, 
and  also  as  being  contrary  to  the  ship  regis^ 
try  acts;  and  the  master  of  the  rolls,  in  his 
opinion  in  the  case,  says:  "The  father,  there- 
fore, could  never  have  enforced  it"  (the 
agreement);  "but  my  doubt  was  whether  the 
father,  having  received  the  profits,  this  court 
would  decree  them  to  be  accounted  for  and 
refunded,  or  whether  the  general  rule  that 
in  pari  delicto  potior  est  conditio  possidentis 
should  prevail,  as  both  are  guilty  of  a  viola- 
tion of  the  law.  Upon  an  examination  of  the 
case,  however,  I  think  the  plaintiffs  are  en- 
titled to  the  relief  sought  by  the  bill.  Courts, 
both  of  law  and  equity,  have  held  that  two 
parties  may  concur  in  an  illegal  act  without 
being  deemed  in  all  respects  in  pari  delicto. 
I  consider  this  agreement  as  substantially 
the  mere  act  of  the  father.  He  put  up  to 
sale  a  situation  which  the  young  man  would 
naturally  be  desirous  of  obtaining,  and  could 
obtain  only  on  the  terms  prescribed  by  the 
father;"  and  the  representatives  of  the  fa- 
ther were  decreed  to  account  to  the  repre- 
sentatives of  the  son  for  all  the  profits  of  the 
vessel  received  under  the  fraudulent  and  il- 
legal contract. 
Transactions,    contracts    and    dealings   be- 


EFFECT  OF  ILLEGALITY. 


il9 


tween  parent  and  cliild  are  classed  with 
those  between  attorney  and  client,  and 
courts  scrutinize  such  dealings  and  interpose 
to  set  aside  such  contracts  for  the  same  rea- 
sons in  the  one  case  as  in  the  other  (1  Story, 
Eq.  Jur.  §§  307-310);  and  if  a  father  will  be 
compelled  to  restore  to  his  son  property  or 
money  which  the  former  has  received  from 
the  latter  under  and  pursuant  to  a  contract 
between  them  which  was  iUepal  and  founded 
in  fraud,  and  in  a  case  where  the  court 
would  not  interfere  were  it  not  for  the  confi- 
dential relation  between  the  parties,  as  was 
done  in  Osborne  v.  Williams,  I  see  no  reason 
why  the  same  thing  should  not  be  done  In 
a  like  case,  where  the  relation  between  the 
parties  is  that  of  attorney  and  client.  There 
is  as  great  a  degree  of  confidence  reposed 
and  an  equal  sense  of  dependence  in  the  one 
case  as  in  the  other. 

In  this  case  the  report  of  the  referee  shows 
that  the  counsel  and  advice  of  the  defendant 
was  sought  by  Conway  solely  on  the  ques- 
tion whether  his  interest  in  the  contract 
could  be  reached  by  his  creditor.  The  ad- 
vice by  the  defendant  to  assign  the  contract 
appears  to  have  been  volunteered  on  his 
part.  He  first  suggested  it,  and  if  he  had 
not  so  done  it  is  to  be  presumed  the  assign- 
ment would  not  have  been   made. 

I  think  this  is  a  case  where,  on  account  of 
the  relations  existing  between  the  parties 
and  the  circumstances  under  which  the  con- 
tract was  assigned,  the  court  was  called  up- 
on to  interfere  and  compel  the  attorney  to 
restore  what  he  tiad  acquired  under  the  as- 
signment, on  being  repaid  what  he  had  dis- 
bursed, although  the  object  of  the  assign- 
ment was  to  perpetrate  a  fraud.  T^^*^  pf""- 
ties,  although  in  delicto,  did  not  stand  in 
pari  flg^jctn  Tu  the  transaction  Conway  was 
a  rnerp  ingt^rument  in  tiie^hands  of  the  de- 
Xendant.  If  an  attorney  will  so  far  forget 
or  willfully  disregard  his  duty  to  the  courts, 
whose  license  to  practice  he  holds;  to  his 
clients,  who,  in  consequence  of  such  license, 
are  induced  to  seek  and  act  upon  his  counsel, 
and  to  the  public,  as  for  the  purpose  of  gain 
and  profit  to  himself,  to  induce  by  his  advice 
the  commission  of  fraud  by  those  who  thus 
confide  in  him,  he  at  least  should  be  com- 
pelled to  restore  to  his  victim  the  fruits  of 
his  iniquity.  It  woxild  be  a  reproach  to  our 
judicial  tribunals  should  they  allow  their 
officers,  those  appointed  by  them  as  their  as- 
sistants in  the  administering  of  justice  and 
equity,  thus  to  acquire  property  by  a  pros- 
titution of  the  trust  so  confided  to  theui.  and 
then  to  interpose  the  fraud  committed  pur- 
suant to  their  advice  as  such  officers,  as  a 


sliifld  to  protect  them  in  tlie  possession  and 
enjoyment  of  that  property. 

The  alienage  of  the  plaintiff  and  of  James 
Conway,  the  plaintiff's  ancestor,  constituted 
no  bar  to  the  plaintiff's  recovery.  An  alien 
can  hold  land  conveyed  to  him  as  against 
every  one  but  the  state,  and,  until  office 
found,  can  maintain  actions  for  its  recovery 
(Rradstreet  v.  Supen'isors  of  Oneida,  13 
Wend.  r>4€);  and  section  4  of  chapter  115  ot 
the  Laws  of  1845  (Laws  of  184.5.  p.  Qij)  pro- 
vides that  land  held  by  the  resident  alien  at 
the  time  of  his  death  shall  descend  to  the 
persons,  although  aliens,  who,  if  citizens, 
would  have  been  the  heirs  of  the  deceased 
had  he  been  a  citizen,  and  that  such  alien  to 
whom  lands  thus  descend  may  hold  the  same 
as  against  every  one  but  the  state. 

I  am  of  opinion  that  the  judgment  appealed 
from  should  be  affirmed. 

Judgment  affirmed. 

JOHNSON,  J.  (dissenting).  If  we  uphold  this 
judgment,  we  must  decide  that  the  maker  of 
an  assignment,  in  fraud  of  his  creditors,  may 
recover  back  for  his  own  use  the  transferred 
property,  provided  he  choose  his  attorney  as 
assignee,  and  executes  the  instrument  undi-r 
his  advice.  Such  a  judgment  would,  at 
least,  have  this  consequence,  that  future 
fraudulent  transfers  would  generally  be 
made  to  attorneys,  and  the  salutary  rule  that 
the  fraudulent  grantor  cannot  undo,  for  his 
own  benefit,  the  transfer  he  had  made,  would 
cease  to  have  any  practical  operation  in  n> 
straining  frauds  upon  creditors.  The  case 
of  Osborne  v.  Williams,  IS  Ves.  370.  upon 
the  analogy  of  which  this  cause  was  decided 
in  the  supreme  court,  was  put  by  the  master 
of  the  rolls  upon  the  ground  that  the  terms 
which  rendered  the  contract  illegal  were  im- 
posed by  the  father  on  his  son,  and  that  the 
consent  of  the  son  to  those  terms  was  ob- 
tained by  a  species  of  moral  constraint,  aris- 
ing out  of  the  circumstances.  "He  put  up  to 
sale  a  situation  which  the  young  man  would 
naturally  be  desirous  of  obtaining,  and  could 
obtain  only  on  the  terms  prescribed  by  his 
father."  It  was  therefore  held  that  the  par- 
ties were  not  in  pari  delicto,  and  an  account 
of  the  profits  was  decreed. 

The  grantor  In  a  fraudulent  conveyance  is 
certainly  not  less  guilty  tlian  the  grantee, 
nor  is  that  the  species  of  dealing,  between 
client  and  attorney,  as  to  which  equity  af- 
fords protection  to  the  client. 

The  judgment  should  be  reversed  and  a 
new  trial  ordered. 

DENIO,  C.  J.,  also  dissented 


520 


ILLEGALITY  OF  OBJECT. 


i.^ 


^ 


WHITE  T.  FRANKLIN  BANTI.    ^ ,  / 
(22  Pick.  ISl.)  ^  yi 

Supreme  Judicial  Court  of  Massachusetts.      Suf- 
folk and  Nantucket.     March  Term,  1839. 

By  an  agreed  statement  of  facts,  it  ap- 
peared, that  on  the  lOth  of  February,  1S37, 
the  plaintiff  deposited  with  the  defendants 
the  sum  of  $2,000,  and  received  from  them  a 
book  containing  the  following  words  and  fig- 
ures, to  wit: 

"Dr.  Franklin  Bank,  in  account  with  B.  F. 
WMte,  Cr.,  1S37,  Feb.  lOth.  To  cash  depos- 
ited, $2,000.  The  above  deposit  to  remain 
until  the  10th  day  of  August  E.  F.  Bunnell, 
Cashier." 

It  further  appeared,  that  on  the  7th  of 
July,  lSo7,  the  plaintiff  brought  this  action 
against  the  bank  to  recover  the  money  so  de- 
posited by  him,  declaring  on  the  money 
counts,  and  on  an  account  stated- 

Lf  the  court  should  be  of  opinion,  that  the 
action  could  be  maintained,  the  defendants 
were  to  be  defaulted  and  judgment  rendered 
for  the  sum  of  ?2,000  with  interest;  other- 
wise the  plaintiff  was  to  become  nonsuit. 

WILDE,  J.  The  first  ground  of  the  de- 
fence is,  that  the  action  was  prematurely 
commenced.  The  entry  in  the  book  given  to 
the  plaintiGf  by  the  cashier  of  the  bank,  is  un- 
doubtedly good  evidence  of  a  promise  to  pay 
the  amount  of  Uie  deposit  on  the  10th  day 
of  August;  and  if  this  was  a  valid  and  legal 
promise  this  action  cannot  be  maintained. 
But  it  is  very  clear,  that  this  promise  or 
agreement  that  the  deposit  should  remain  in 
the  bank  for  the  time  limited,  is  void  by  vir- 
tue of  Rev.  St  c  36,  §  57,  which  prgvidrs 
that  no  bank  shall  make  or  issiift  nny  nnt^ 
inli,  ciieck,  draft,  fjccp.pt^gnce.  certificate,  or 
contractT  in  any  form  whatever,  for  thp  pny- 
liient"  of  money^  at  any  futureZ^ny  cf^rt/iin, 
or  withTnterestT'excepting  formoney  that 

with 


may  be  borrowed  of  the  commonweaiu 
other  exceptions  not  material  in  the  pi 
case. 

The  agreement  that  the  deposit  should  re- 
main until  the  10th  day  of  August  amounts 
in  law,  by  the  obvious  construction  and 
meaning  of  it  to  a  promise  to  pay  on  that 
day.  This,_  thereforp,  was  f^rt  illegal  con- 
tract and  a  direi^t  f>^^ntrfivontinT^  of  t.iip  st.n1.- 
uEe.  _ Such  a  promise  is  void;  and  no  court 
will  lend  its  aid  to  enforce  it  This  is  a  well- 
settled  principle  of  law.  It  was  fully  dis- 
cussed and  considered  in  the  case  of  Wheeler 
V.  Russell,  17  Mass.  281,  and  the  late  chief 
justice,  in  delivering  the  opinion  of  the  court, 
remarked,  "that  no  principle  of  law  is  better 
settled,  than  that  no  action  will  lie  upon  a 
contract  made  in  violation  of  a  statute  or  of 
a  principle  of  the  common  law."  The  same 
principle  is  laid  down  in  Bank  v.  Merrick,  14 
Mass.  322,  and  in  Russell  v.  De  Grand,  15 
Mass.  39.  In  Belding  v.  Pitkin,  2  Caines,  149, 
Thompson,  i^  said,  "It  is  a  first  principle, 


and  not  to  be  touched,  that  a  contract,  In 
order  to  be  binding,  must  be  lawful."  The 
same  principle  is  fully  established  by  the 
English  authorities.  In  Shiftner  v.  Gordon, 
12  East  304,  Lord  Ellenborough  laid  it  down 
as  a  settled  rule,  "that  where  a  contract 
which  is  illegal  remains  to  be  executed,  the 
coiirt  will  not  assist  either  party,  in  an  ac- 
tion to  recover  for  the  non-execution  of  it." 

It  is  therefore  very  clear,  we  think,  that 
no  action  can  be  maintained  on  the  defend- 
ants' express  promise,  and  that,  if  the  plain- 
tiff be  entitled  to  recover  in  any  form  of  ac- 
tion, it  must  be  founded  on  an  implied  prom- 
ise. 

The  second  objection,  and  that  on  which 
the  defendants'  counsel  principally  rely,  pro- 
ceeds on  the  admission  that  the  contract  is 
illegal;  and  they_insist  that  where  money 
has  been  j3aid^y  one~M~twTr"p"arties^^a^e 
qther^  on  an  TTTeggl~rgntract,  botlTbeing  j^r- 
ticip£g_cnminis^  ^o  actlon_can  be  maintajjied 
to  recover  it  back.  The  rule  of  law  is  so 
laid  down  by  Lord  Kenyon,  in  Howson  v. 
Hancock,  8  Term  R.  577,  and  in  other  cases. 
This  rule  may  be  correctly  stated  in  respect 
to  contracts  involving  any  moral  turpitude, 
but  when  the  contract  is  merely  malum  pro- 
hibitum, the  rule  must  be  taken  with  some 
qualifications  and  exceptions,  without  which 
it  cannot  be  reconciled  \vith  many  decided 
cases.  The  rule  as  stated  by  Comyn,  in  his 
treatise  on  Contracts,  will  reconcile  most  of 
the  cases  which  are  apparently  conflicting. 
"When  money  has  been  paid  upon  an  illegal 
contract,  it  is  a  general  rule  that  if  the  con- 
tract be  executed,  and  both  parties  are  in 
pari  delicto,  neither  of  them  can  recover 
from  the  other  the  money  so  paid;  but  if 
the  contract  continues  executory,  and  the 
party  paying  the  money  be  desirous  of  re- 
scinding it,  he  may  do  so,  and  recover  back 
his  deposit  by  action  of  indebitatus  assump- 
sit for  money  had  and  received.  And  this 
distinction  is  taken  in  the  books,  namely, 
where  the  action  is  in  affirmance  of  an  ille- 
gal contract  the  object  of  which  is  to  en- 
force the  performance  of  an  engagement  pro- 
hibited by  law,  clearly  such  an  action  can 
in  no  case  be  maintained;  but  where  the 
action  proceeds  in  disaffirmance  of  such  a 
contract,  and,  instead  of  endeavoring  to  en- 
force it,  presumes  it  to  be  void  and  seeks  to 
prevent  the  defendant  from  retaining  the 
benefit  which  he  derived  from  an  unlawful 
act,  there  it  is  consonant  to  the  spirit  and 
policy  of  the  law  that  the  plaintiff  should  re- 
cover."    2  Com.  Cont.   109. 

The  rule,  with  these  qualifications  and  dis- 
tinctions, is  well  supported  by  the  cases 
collected  in  Comyn  and  by  later  decisions. 
The  question  then  is,  whether,  in  conformity 
with  these  principles,  upon  the  facts  agreed, 
this  action  can  be  maintained. 

The  first  ground  on  which  the  plaintiff's 
counsel  rely  In  answer  to  the  defendants' 
objection  Is,  that  there  was  no  illegality  In 


EFFECT  OF  ILLEGALITY. 


>21 


makmg_the  deposit,   and  thaL-tlifi,  illegality 
of "tjae  ti'ansu ( ■  u' < . i  'iifd^to^the  proinise 

of  .the  Jjauii  uuil     i  iirity  given  for  the 

repai'ment,   that  aioue  Being  _prohibitedby^ 

The  leading  case  on  this  point  is  that  of 
Robinson  v.  Bland,  2  Burrows,  1077.  Tliat 
was  an  action  an  a  bill  of  excliange  given 
for  money  lent  and  for  money  \sou  at  play. 
By  St  9  Anne,  c.  14,  It  was  enacted  that  all 
notes,  bills,  bonds,  judgments,  mortgages, 
or  other  securities  for  money  won  or  lent  at 
play,  should  be  utterly  void.  The  court 
held,  that  the  plaintiff  was  not  entitled  to 
recover  on  the  bill  of  exchange,  but  that  he 
might  recover  on  the  money  counts  for  tlie 
money  lent,  although  it  was  lent  at  the 
same  time  and  place  that  the  other  money 
for  which  the  bill  was  given  was  won.  The 
same  principle  was  laid  down  in  the  cases 
of  Insurance  Co.  v.  Scott,  19  Johns.  1;  Insur- 
ance Co.  V.  Caldwell,  3  Wend.  29G,  and  In- 
surance Co.  V.  Bloodgood,  4  Wend.  652.  In 
these  cases  the  decisions  were,  that  although 
the  nott«  were  illegal  and  void  as  securities, 
yet  that  the  money  lent,  for  which  the  notes 
were  given,  might  be  recovered  back.  The 
principle  of  law  established  by  these  deci- 
sions is  applicable  to  the  present  case.  The 
only  doubt  arises  from  the  meaning  of  the 
word  "contract,"  in  the  prohibitory  statute. 
But  taking  that  word  in  connection  with  the 
other  words  of  prohibition,  we  think  it  equiv- 
alent to  the  promise  of  the  bank,  and  that 
the  intention  of  the  legislature  was  to  pro- 
hibit the  making  or  issuing  of  any  security 
in  any  form  whatever,  for  the  payment  of 
money  at  any  future  day. 

The  next  answer  to  the  objection  of  the 
defendants  is,  that  although  the  plaintiff 
may  be  considered  as  being  partlceps  criminis 
with  the  defendants,  they  are  not  in  pari 
<iehcto.  It  is  not  universally  true,  that  a 
party,  who  pays  money  as  the  consideration 
of  an  illegal  contract,  cannot  recover  it 
back.  Where  the  parties  are  not  in  pari  delic- 
to, the  rule  "potior  est  conditio  defendentis" 
is  not  applicable.  In  Lacaussade  v.  White, 
7  Term  R.  535,  the  court  say,  "that  it  was 
more  consonant  to  the  principles  of  sound 
policy  and  justice,  that  wherever  money  has 
been  paid  upon  an  illegal  consideration  it 
may  be  recovered  back  again  by  the  party 
who  has  thus  Improperly  paid  it,  than,  by 
denying  the  remedy,  to  give  effect  to  the  il- 
legal contract" 

This  principle,  however,  Is  not  by  law  al- 
lowed to  operate  in  favor  of  either  party, 
where  the  illegality  of  the  contract  arises 
from  any  moral  turpitude.  In  such  cases 
the  court  will  not  undertake  to  ascertain  the 
relative  guilt  of  the  parties  or  afford  relief 
to  either. 

which  2s_jnerely  prohibited  '^y  gt^^^^iUie^^and 

b.fiL_pompelled   tft   rpfynd      This   is   not  only 


consonant  to  the  principles  of  sound  poUcy 
and  justice,  but  is  now  so  settled  by  author- 
ity, whatever  doubts  may  have  been  enter- 
tained respecting  it  in  former  times. 

In  the  case  of  Smith  v.  Bromley,  2  Doug. 
09G,  note,  it  was  decided,  that  the  plaintiff 
was  entitled  to  rucuver  in  an  actiuu  for 
money  had  and  received,  for  money  paid  by 
the  plaintiff  to  the  defendant  for  the  pur- 
pose of  inducing  him  to  sign  the  certificate 
of  a  bankrupt  the  plaintiff's  sister.  I^ord 
Mansfield  laid  down  the  doctrine  on  this 
point,  which  has  been  repeatedly  confirmed, 
"II  the  act  is  in  Itself  Immoral,  or  a  violation 
of  the  general  laws  of  public  policy,  there 
the  party  paying  shall  not  have  this  action; 
for  where  both  parties  are  equally  criminal 
against  such  general  laws,  the  rule  is  potior 
est  conditio  defendentis.  But  there  are  oth- 
er laws  which  are  calculated  for  the  protec- 
tion of  the  subjects  against  oppression,  ex- 
tortion, deceit  etc.  If  such  laws  are  vio- 
lated, and  the  defendant  takes  advantage  of 
the  plaintiffs  condition  or  situation,  there 
the  plaintiff  shall  recover."  And  this  doc- 
trine was  afterwards  adhered  to  and  con- 
firmed by  the  whole  court  in  the  case  of 
Jones  V.  Barkley,  2  Doug.  G84. 

On  this  distinction  it  has  ever  since  been 
held,  that  where  usurious  interest  has  been 
paid,  the  excess  above  the  legal  interest 
may  be  recovered  back  by  the  borrower  in 
an  action  for  money  had  and  received.  So 
money  paid  to  a  lottery-office  keeper  as  a 
premium  for  an  illegal  insurance,  is  recov- 
erable back,  in  an  action  for  money  had  and 
received.  Jaques  v.  GolighOy,  2  W.  BL 
1073.  But  in  Browning  v.  Morris,  Cowp. 
790,  it  was  decided,  that  where  a  lottery -of- 
fice keeper  pays  money  in  consequence  of 
having  insured  the  defendant's  tickets,  such 
contract  being  prohibited  by  St  17  Geo.  IIL 
c.  46,  he  cannot  recover  it  back,  though  the 
premium  of  insurance  paid  by  the  insured  to 
the  lottery-office  keeper  might  be.  The  dis- 
tinction on  which  this  case  was  decided  is 
very  material  in  the  present  case.  Lord 
Mansfield  referred  to  the  determination  in 
Jaques  v.  Gohghtly,  where  it  was  said, 
"that  the  statute  is  made  to  protect  the  ig- 
norant and  deluded  multitude,  who,  In  hopes 
of  gain  and  prizes,  and  not  conversant  in 
calculations,  ai'o  drawn  in  by  the  office  keep- 
ers." And  he  adds.  "It  is  very  material,  that 
the  statute  itself,  by  tlie  distinction  it  makes, 
has  marked  the  criminal;  for  the  penalties 
are  all  on  one  side, — upon  the  office  keeper. 
•The  man  who  malces  the  contract  is  liable 
to  no  penalty.  So  in  usury  there  is  no  pen- 
alty upon  the  party  who  is  imposed  upon." 
The  same  distinction  is  noticed  and  enforced 
by  Lord  Ellenborough.  in  Williams  v.  Hed- 
ley,  8  East  378.  In  that  case  it  was  decided, 
that  where  money  was  paid  to  a  plaintiff  to 
compromise  a  qui  tam  action  for  usury,  it 
might  be  recovered  back  in  an  action  for 
money  had  and  received;    because  the  pro- 


522 


ILLEGALITY  OF  OBJECT. 


hibition  and  penalties  of  SL  IS  Eliz.  c.  5,  at- 
tached only  on  "the  informer  or  plaiutifl;,  or 
other  person  suing  out  process  in  the  peual 
action,  making  composition,  etc."  It  was  ar- 
gued for  the  defendant  in  that  case,  "that  as 
the  act  of  the  defendant  co-operated  with 
that  of  the  plaintiff  in  producing  the  mis- 
chief meant  to  be  prevented  and  restrained 
by  the  statute,  it  was  so  far  illegal,  on  the 
part  of  the  defendant  himself,  as  to  preclude 
him  fi-om  any  remedy  by  suit  to  recover 
back  money  paid  by  him  in  furtherance  of  that 
object;  and  that  if  he  was  not  therefore  to 
be  considered  as  strictly  in  pari  delicto  with 
the  plaintiff  in  the  qui  tam  action,  he  was 
at  any  rate  particeps  criminis,  and  in  that 
respect  not  entitled  to  recover  from  his  co- 
delinquent,  money  which  he  had  paid  him 
in  the  course  and  prosecution  of  their  mu- 
tual crime."  This  argument  was  ^overruled, 
and  Lord  Ellenborough  fully  approved  the 
doctrine  laid  down  by  Lord  Mansfield  in 
Smith  V.  Bromley,  and  the  decisions  in  the 
several  cases  in  which  that  doctrine  had 
been  confirmed.  The  same  distinction  has 
been  recognized  in  other  cases,  and  was 
adopted  by  this  court  in  Worcester  v.  Eaton, 
11  Mass.  376,  in  which  Parker,  C.  J.,  after  re- 
ferring to  the  above  cases,  said:  "This  dis- 
tinction seems  to  have  been  ever  afterwards 
observed  in  the  English  courts;  and,  being 
founded  in  sound  principle,  is  worthy  of  adop- 
tion, as  a  principle  of  the  common  law  in 
this  country." 

The  principle  is,  in  every  respect,  applica- 
ble to  the  present  case,  and  is  decisive.  The 
prohibition  is  particularly  levelled  against 
the  bank,  and  not  against  any  person  deal- 
ing with  the  bank.  In  the  words  of  Lord 
Mansfield,  "the  statute  itself,  by  the  distinc- 
tion it  makes,  has  marked  the  criminal." 
The  plaintiff  is  subject  to  no  penalty,  but 
the  defendants  are  liable,  for  the  violation  of 
the  statute,  to  a  forfeiture  of  their  charter. 
To  decide  that  tliis  action  cannot  be  main- 
tained would  be  to  secure  to  the  defendants 
the  fruits  of  an  illegal  transaction,  and  would 
operate  as  a  temptation  to  all  banks  to  vio- 
late the  statute,  by  taking  advantage  of  the 
unwary  and  of  those  who  may  have  no  ac- 
tual knowledge  of  the  existence  of  the  pro- 
hibition of  the  statute,  and  who  may  deal 
with  a  bank  without  any  suspicion  of  the  il- 
legality of  the  transaction  on  the  part  of  the 
bank. 

There  Is  still  another  ground  on  which  the 
plaintiff's  counsel  rely.  This  action  proceeds 
in  disaffirmance^  of  an  executory  illegal  con- 
tract, and  was  commenced  before  the  money 
w^h  the_defendants  contracted  to  P&y  was 
by  the  terms  of  l3ie  "contract  payable;  the 
plaintiff  therefore  naa  a  ngnt  to  rGsrlTid  the 
contract,  or  rather  to  treat  it  as  a  void  con- 
tract, and  to  recover  back  the  consideration 
money. 

It  was  so  decided  in  Walker  v.  Chapman, 
Lofft,  342,   where   money   had   been  paid   In 


order  to  procure  a  place  in  the  customs,  but 
the  place  had  not  been  procured;    and  in  an 
action  brought  by  the  party   who  paid  the 
money,  it  was  held  that  he  should  recover, 
because   the   contract   continued    executory. 
This   case   was    cited   with   approbation   by 
Buller,  J.,  in  Lowry  v.  Bourdieu,  2  Doug.  470; 
and  the  distinction  between  contracts  exe- 
cuted and  executory,  he  said,  was  a  sound 
one.    The  same   distinction   has   been   recog- 
nized  in   actions   brought   to    recover   back 
money  paid  on  illegal  wagers,   where  both 
parties   were  in  pari   delicto.     The   case  of 
Tappenden  v.  Randall,  2  Bos.  &  P.  467,  was 
decided  on  that  distinction.     Heath,  J.,  said: 
"It  seems  to  me  that  the  distinction  adopted 
by  Mr.  Justice  Buller  between  contracts  ex- 
ecutory and  executed,  if  taken   with   those 
modifications    which    he    would    necessarily 
have  applied   to  It,   Is   a   sound   distinction. 
Undoubtedly  there  may  be  cases  where  the 
contract  may  be  of  a  nature  too  grossly  im- 
moral for  the  court  to  enter  into  any  discus- 
sion of  it;    as  where  one  man  has  paid  money 
by  way  of  hire  to  another  to  murder  a  third 
person.     But  where  nothing  of  the  kind  oc- 
curs, I  think  there  ought  to  be  locus  pceni- 
tentiae,  and  that  a  party  should  not  be  com- 
pelled against  his  will  to  adhere  to  the  con- 
tract"    The  same  distinction  is  recognized 
in  several  other  cases.     5  Term  R.  405;    1  H. 
Bl.    67;    7    Term    R.    535;    3   Taunt    277;    4 
Taunt.  290. 

In  the  case  of  Aubert  v.  Walsh,  3  Taunt 
277,  the  authorities  were  considered,  and  the 
law  was  definitely  settled  as  above  stated; 
and  it  does  not  appear  that  it  has  ever  since 
been  doubted.  In  Insurance  Co.  v.  Kip,  8 
Cow.  20,  the  same  principle  is  recognized,  al- 
though the  case  was  not  expressly  decided 
on  that  point  The  distinction  seems  to  be 
founded  in  wise  policy,  as  it  has  a  tendency 
in  some  measure  to  prevent  the  execution  of 
unlawful  contracts,  and  can  in  no  case  work 
injustice  to  either  party. 

It  is,  however,  denied  by  the  defendant'3 
counsel  that  the  contract  in  question  was 
executory,  within  the  true  intent  and  mean- 
ing of  these  decisions  and  the  doctrine  now 
laid  down.  This  question  has  not  been  much 
discussed,  and  it  is  not  necessary  to  decide 
it  in  the  present  case,  the  court  being  clearly 
of  opinion  that  the  plaintiff  is  entitled  to  re- 
cover on  the  other  grounds  mentioned.  We 
have  considered  the  question  as  to  the  dis- 
tinction between  executory  and  executed  con- 
tracts, because  it  may  be  of  some  importance 
that  the  law  in  that  respect  should  not  be 
supposed  to  be  doubtful  in  our  opinion,  which 
might  be  Inferred,  perhaps,  if  we  should 
leave  this  question  unnoticed. 

The  only  remaining  question  is,  whether 
the  plaintiff  was  bound  to  make  a  demand 
on  the  bank  before  he  commenced  his  action. 
The  general  rule  is,  that  where  money  is  due 
and  payable,  an  action  will  lie  without  any 
previous  demand.    But  where  money  is  de- 


EFFECT  OF  ILLEGALITT. 


523 


posited  In  a  bank  In  the  usual  course  of  bus  - 
ness  we  should  certainly  hold  that  a  previ- 
ous demand  would  be  requisite.  But  if  mon- 
ey should  be  obtained  by  a  bank  by  fraud,  or, 
as  in  the  present  case,  by  means  of  an  ille- 
gal contract,  the  bank  claiming  to  hold  it 
under  such  contract,  there  can  be  no  good 
reason  given  why  the  bank  should  be  exempted 
from  the  operaUon  of  the  general  rule.  In 
Clark  V.  Moody,  17  Mass.  145.  it  was  held, 
that  if  a  factor  should  render  an  untrue  ac- 


count, claiming  a  greater  credit  than  he  waa 
entitled  to,  the  principal  would  have  a  ngbt 
of  action  without  a  demand. 

If  the  defendants  had  sold  to  the  plaintiff 
a  post-note  payable  at  a  future  day,  it  could 
hardly  be  doubted  that  an  action  would  Ue 
to  recover  back  the  consideration  money, 
without  any  previous  demand;  and  there 
seems  to  bo  no  substantial  disUnction  be- 
tween such  a  case  and  the  one  in  question. 
.Judgment  on  default 


524 


OPERATION  OF  CONTRACT. 


BOSTON  ICE  CO.  ▼.  POTTER.  (4  ^ 

(123  Mass.  28.)  j^^l[rf 

Supreme  Judicial   Court  of   Massachusetts. 
Suffolk.    June  28,  1877. 

Contract  on  an  account  annexed,  for  ice  sold 
and  delivered  between  April  1,  1S74,  and 
April  1,  1875.     Answer,  a  general  denial. 

At  the  trial  in  the  superior  court,  before 
Wilkinson,  J.,  without  a  jury,  the  plaintiff 
offered  evidence  tendinj?  to  show  the  delivery 
of  the  ice  and  its  acceptance  and  use  by  the 
defendant  from  April  1,  1874,  to  April  1, 
1875,  and  that  the  price  claimed  in  the  dec- 
laration was  the  market  price.  It  appeared 
that  the  ice  was  delivered  and  used  at  the 
defendant's  residence  in  Boston,  and  the 
amount  left  daily  was  regulated  by  the  orders 
received  there  from  the  defendant's  servants; 
tljgX^the_jiefendant,— ia— 1873,  was  -supplied 
with  ice  by  theplaintlff.  but  on  account  of 
^meHTsgltlst'action  with  the  manner  of  sup- 
ply, temilnated  "his  contracFwithTtr  that  the 
deTenBant  ~  Qien^  made  a  contract  with  the 
Citizens'  Ice  Company  to  furnish  him  with 
ice;  that  some  time  before  April,  1874,  the 
Citizens'  Ice  Company  sold  its  business  to  the 
plaintiff,  with  the  privilege  of  supplying  ice 
to  its  customers.  There  was  some  evidence 
tending  to  show  that  the  plaintiff  gave  notice 
of  this  change  of  business  to  the  defendant, 
and  informed  him  of  its  intended  supply  of  ice 
to  him;  but  this  was  contradicted  on  the  part 
of  the  defendant 

The  judge  found  that  the  defendant  re- 
ceived no  notice  from  the  plaintiff  until  after 
all  the  ice  had  been  delivered  by  it  and  that 
there  was  no  contract  of  sale  between  the  par- 
ties to  this  action  except  what  was  to  be  im- 
plied from  the  delivery  of  the  ice  by  the  plain- 
tiff to  the  defendant  and  its  use  by  him;  and 
ruled  that  the  defendant  had  a  right  to  as- 
sume that  the  ice  in  question  was  delivered 
by  the  Citizens'  Ice  Company,  and  that  the 
plaintiff  could  not  maintain  this  action.  The 
plaintiff  alleged  exceptions. 

J.  P.  Farley,  Jr.,  for  plaintiff.  E.  C.  Bum- 
pus  and  E.  M.  Johnson,  for  defendant 

ENDICOTT,  J.  To  entitle  the  plaintiff  to 
recover,  it  must  show  some  contract  with  the 
defendant  There  was  no  express  contract 
and  upon  the  facts  stated  no  contract  is  to  be 
implied.  The  defendant  had  taken  ice  from 
the  plaintiff  in  1873,  but  on  account  of  some 
dissatisfaction  with  the  manner  of  supply,, 
he  terminated  his  contract  and  made  a  con- 
tract for  his  supply  with  the  Citizens'  Ice 
Company.  The  plaintiff  afterward  delivered 
Ice  to  the  defendant  for  one  year  without 
notifying  the  defendant  as  the  presiding 
judge  has  found,  that  it  had  bought  out  the 
business  of  the  Citizens'  Ice  Company,  until 
after  the  delivery  and  consumption  of  the  ice. 

The  presiding  judge  has  decided  that  the 
defendant  had  a  right  to  assume  that  the  ice 
tn  question  was  delivered  by  the  Citizens'  Ice 


Company,  and  has  thereby  necessarily  found 
that  the  defendant's  contract  with  that  com- 
pany covered  the  time  of  the  delivery  of  the 
ice. 

There  was  no  privity  of  contract  established 
between  the  plaintiff  and  defendant,  and 
without  such  privity  the  possession  and  use 
of  the  property  will  not  support  an  implied 
assumpsit.  Hills  v.  Snoll,  104  Mass.  173,  177. 
And  no  presumption  of  assent  can  be  implied 
from  the  reception  and  use  of  the  ice,  because 
the  defendant  had  no  knowledge  that  it  was 
furnished  by  the  plaintiff,  but  supposed  that 
he  received  it  under  the  contract  made  with 
the  Citizens'  Ic^  Company.  Of^  this  change 
he  was  entitled  to  be  informed" 

A  party  has  a  right  to  select  and  determine 
with  "Whom  be  ^111  CQatractTahd^annot  have 
another  person  thrust  upon  him  without  his 
consent.  ~"Tf"^ay  be  of  importance  to  him 
who  performs  the  contract,  as  when  he  con- 
tracts with  another  to  paint  a  picture,  or 
write  a  book,  or  furnish  articles  of  a  particu- 
lar kind,  or  when  he  relies  upon  the  charac- 
ter or  qualities  of  an  Individual,  or  has,  as 
in  this  case,  reasons  why  he  does  not  wish  to 
d^,l  with  a  particular  party.  In  aU  these 
cases,  as  he  may  contract  with  whom  he 
pleases,  the  sufficiency  of  his  reasons  for  so 
doing  cannot  be  inquired  into.  If  the  defend- 
ant, before  receiving  the  ice,  or  during  its 
delivery,  had  received  notice  of  the  change, 
and  that  the  Citizens'  Ice  Company  could  no 
longer  perform  its  contract  with  him,  it  would 
then  have  been  his  undoubted  right  to  have 
rescinded  the  contract  and  to  decline  to  have 
it  executed  by  the  plaintiff.  But  this  he  was 
unable  to  do,  because  the  plaintiff  failed  to 
Inform  him  of  that  which  he  had  a  right  to 
know.  Orcutt  v.  Nelson,  1  Gray,  536,  542; 
Winchester  v.  Howard,  97  Mass.  303;  Hard- 
man  V.  Booth,  1  Hurl.  &  C.  803;  Humble  v. 
Hunter,  12  Q.  B.  Div.  310;  Robson  y.  Drum- 
mond,  2  Bam.  &  Adol.  303.  If  he  had  received 
notice  and  continued  to  take  the  ice  as  deliv- 
ered, a  contract  would  be  implied.  Mudge  v. 
Oliver,  1  Allen,  74;  Orcutt  v.  Nelson,  ubi 
supra;    Mitchell  v.  Lapage,  Holt  N.  P.  2.53. 

There  are  two  English  cases  very  similar 
to  the  case  at  bar.  In  Schmaling  v.  Thomlin- 
son,  G  Taunt,  147,  a  firm  was  employed  by  the 
defendants  to  transport  goods  to  a  foreign 
market,  and  transferred  the  entire  employ- 
ment to  the  plaintiff,  who  performed  it  with- 
out the  privity  of  the  defendants,  and  It  was 
held  that  he  could  not  recover  compensation 
for  his  services  from  the  defendants. 

The  case  of  Boulton  v.  Jones,  2  Hurl.  &  N. 
564,  was  cited  by  both  parties  at  the  argu- 
ment. There  the  defendant,  who  had  been  in 
the  habit  of  dealing  with  one  Brocklehurst, 
sent  a  written  order  to  him  for  goods.  The 
plaintiff,  who  had  on  the  same  day  bought 
out  the  business  of  Brocklehurst  executed 
the  order  without  giving  the  defendant  no- 
tice that  the  goods  were  supplied  by  him  and 
not  by  Brocklehurst.  And  it  was  held  that 
the  plaintiff  could  not  maintain  an  action  for 


LIMITS  OF  CONTRACTUAL  RELATION. 


525 


the  price  of  the  goods  agaiust  the  defendant 
It  is  said  in  that  case  that  the  defendant  had 
a  right  of  set-off  against  Broclilehurst,  with 
whom  he  had  a  running  account,  and  that  is 
alluded  to  in  the  opinion  of  Baron  Brarawell, 
though  the  other  judges  do  not  mention  IL 

The  fact  that  a  defendant  in  a  particular 
case  has  a  claim  in  set-off  against  the  orig- 
inal contracting  party  shows  clearly  the  In- 
justice of  forcing  another  person  upon  him 
to  execute  the  contract  withoift  his  consent, 
against  whom  his  set-off  would  not  be  avail- 
able. But  the  actual  existence  of  the  claim 
in  set-off  cannot  be  a  test  to  determine  that 
there  is  no  Implied  assumpsit  or  privity  be- 
tween the  parties.  Nor  can  the  non-existence 
of  a  set-off  raise  an  Implied  assumpsit  If 
there  is  such  a  set-off,  it  is  sufficient  to  state 
that  as  a  reason  why  the  defendant  should 
prevail;  but  it  by  no  means  follows  that 
because  It  does  not  exist  the  plaintiff  can 
maintain  his  action.     The  right  to  maintain 


an  action  can  never  depend  upon  whether  the 
defendant  has  or  has  not  a  defence  to  it 

The  implied  assumpsit  arises  upon  the  deal- 
ings between  the  parties  to  the  action,  and 
c-annot  arise  upon  the  dealings  between  the 
defendant  and  the  original  contractor,  to 
which  the  plaintiff  was  not  a  party.  At  the 
same  time,  the  fact  that  the  right  of  set-off 
against  the  original  contractor  could  not  un- 
der any  circumstances,  be  availed  of  in  an 
action  brought  upon  the  contract  by  the  per- 
son to  whom  it  was  transferred  and  who 
executed  it  shows  that  there  is  no  privity 
between  the  parties  in  regard  to  the  subject 
matter  of  this  action. 

It  is,  therefore.  Immaterial  that  the  defend- 
ant had  no  claim  Ln  set-off  against  the  Citi- 
zens' Ice  Company. 

We  are  not  called  upon  to  determine  what 
other  remedy  the  plaintiff  has,  or  what  would 
be  the  rights  of  the  parties  if  the  ice  were 
now  Ln  existence.     Exceptions  overruled. 


OPERATION  OF  CONTRACT. 


EXCHANGE  BANK  OF  ST.  LOUIS  t. 
RICE  et  al. 

(107  Mass.  37.) 

Snpreme  Judicial   Court  of  Massachnsetss. 
Suffolk.    March,  187L 

Contract.  After  the  decision  reported  98 
Mass.  2S8-  the  parties  stated  the  case  as  fol- 
lows for  the  judgment  of  the  superior  court: 

'•On  March  8,  1SG5,  John  P.  Hill,  at  St 
Louis,  drew  on  the  defendants,  commission 
merchants  in  Boston,  a  draft  for  $3300,  paya- 
ble thirty  days  after  date  to  the  order  of  R. 
R.  Pitman  &  Company,  and  containing  on  its 
face  a  memorandum  in  the  terms  following: 
'Against  12  bales  cotton.'  On  the  same  day 
the  draft  was  indorsed  to  and  discounted  in 
the  usual  course  of  business  by  the  plaintiffs, 
and  on  March  15  was  presented  by  them  to 
the  defendants  at  Boston,  who  caused  it  to  be 
noted  for  non-acceptance.  On  March  8  Hill 
wrote  to  the  defendants  as  follows:  1  ship 
you  to-day  per  Merritt's  Express  12  bales, 
,  weighing  54S9  pounds,  on  which  I  have  drawn 
on  you  @  30  days  for  $3300.'  To  this  letter 
the  defendants  replied  on  March  14  as  fol- 
lows: "We  now  have  the  pleasure  to  acknowl- 
edge your  favor  of  the  8th.  Your  shipment  12 
bales  cotton  per  Merritt's  Express  wiU  receive 
due  attention.  Bill  of  lading  not  at  hand. 
Your  draft  for  $3300  is  excessive;  particularly 
as  we  shall  have  no  margin  on  previous  ship- 
ments, as  the  market  now  looks.  We  wiU 
honor  the  same,  but  shall  expect  you,  on  re- 
ceipt of  this,  to  make  us  shipment  of  cotton  to 
cover  the  margin.'  And  on  March  15  they 
again  wrote  to  Hill  as  follows:  'Market  for 
cotton  continues  weak.  Have  no  bill  lading 
12  bales  reported  as  shipped  yesterday,  and 
we  have  felt  obliged  therefore  to  have  your 
draft  for  $3300  noted  for  non-acceptance. 
When  bill  lading  is  received,  will  accept 
draft'  The  said  bill  of  lading  of  the  cotton 
ran  to  the  defendants  or  order,  and  was  re- 
ceived by  them  March  17,  1865. 

"The  defendants'  letter  of  March  15  was 
shown  to  the  plaintiffs  by  R.R.  Pitman  &  Com- 
pany March  22, 18G5.  The  plaintiffs  thereupon 
procured  said  letter,  and  the  duplicate  bUl  of 
lading,  of  Pitman  &  Company,  and  on  March 
27  again  presented  the  draft,  with  the  defend- 
ants' said  letter  and  the  duplicate  bill  of  lad- 
ing attached,  to  the  defendants  for  acceptance. 
But  the  defendants  declined  to  accept  the 
same,  and  afterwards  declined  to  pay,  and 
they  have  never  paid  the  same  or  any  part 
thereof,  and  the  same  was  duly  protested  for 
non-acceptance  and  non-payment  The  twelve 
bales  of  cotton  were  received  by  the  defend- 
ants on  April  17,  iand  were  sold  by  them  on 
April  21  for  $1349  net  which  sum  they  cred- 
ited in  their  current  account  with  Hill,  upon 
which  a  balance  then  was  and  still  is  due  to 
the  defendants." 

The  superior  court  ordered  judgment  for  the 
defendants;  and  the  plaintiffs  appealed-  The 
case  was  argued  at  a  former  term. 


B.  F.  Thomas  and  R.  Olney,  for  plaintiffs. 
H.  W.  Paine  and  R.  D.  Smith,  for  defendants. 

GRAY,  J.     It  has  already  been  decided  In 

this  case,  upon  proof  of  substantially  the  same 
facts  which  are  now  agreed  by  the  parties, 
that  the  plaintiffs  could  not  sue  the  defend- 
ants as  acceptors  of  the  draft;  because  their 
promise  to  the  drawer  to  accept  it,  having 
beeu  made  after  the  draft  had  been  negotiat- 
ed to  the  plaintiffs,  did  not  amount  to  an  ac- 
ceptance; and  the  memorandum  at  the  foot 
of  the  draft,  that  it  was  drawn  against  twelve 
bales  of  cotton,  could  have  no  more  effect  to 
charge  the  defendants  as  acceptors  than  the 
mere  signature  of  the  drawer,  which  of  itself 
always  imports  a  promise  that  he  will  have 
funds  in  the  hands  of  the  drawee  to  meet  the 
draft    98  Mass.  2SS. 

The  defendants'  promise  to  the  drawer  to 
accept  the  draft  was  a  mere  chose  in  action, 
not  negotiable,  and  upon  which  no  one  but  he 
to  whom  it  was  made  could  maintain  an  ac- 
tion. Worcester  Bank  v.  Wells,  8  Mete. 
(Mass.)  107;  Luff  v.  Pope,  5  Hill,  413,  and  7 
Hill,  577. 

The  general  rule  of  law  Is,  that  a  person 
who  is  not  a  party  to  a  simple  contract  and 
from  whom  no  consideration  moves,  cannot 
sue  on  the  contract,  and  consequently  that  a 
promise  made  by  one  person  to  another,  for 
the  benefit  of  a  third  person  who  is  a  stranger 
to  the  consideration,  will  not  support  an  ac- 
tion by  the  latter.  And  the  recent  decisions 
in  this  commonwealth  and  in  England  have 
tended  to  uphold  the  rule  and  to  narrow  the 
exceptions  to  it 

The  unguarded  expressions  of  Chief  Justice 
Shaw  in  Carnegie  v.  Morrison,  2  Mete.  (^lass.) 
381,  and  Mr.  Justice  Bigelow  in  Brewer  v. 
Dyer,  7  Cush.  337,  to  the  contrary,  on  which 
the  learned  counsel  for  the  plaintiffs  relied  at 
the  argument  were  afterwards,  and  while 
those  two  distinguished  judges  continued  to 
hold  seats  upon  this  bench,  qualified,  the  Hm- 
its  of  the  doctrine  defined,  and  a  disinclina- 
tion repeatedly  expressed  fo  admit  new  ex- 
ceptions to  the  general  rule,  in  unanimous 
judgments  of  the  coml,  drawn  up  by  Mr.  Jus- 
tice Metcalf,  and  marked  by  his  characteris- 
tic legal  learning  and  cautious  precision  of 
statement  Melleu  v.  Whipple,  1  Gray,  317; 
Millard  v.  Baldwin,  3  Gray,  484;  Field  v. 
Crawford,  6  Gray,  IIG;  Dow  v.  Clark,  7  Gray, 
198.  Those  judgments  have  since  been  treat- 
ed as  settling  the  law  of  Massachusetts  upon 
this  subject  Colbum  v.  Phillips,  13  Gray, 
64;  Flint  v.  Pierce,  99  Mass.  G8. 

The  first  and  principal  exception,  stated  by 
Mr.  Justice  Metcalf,  to  the  general  nile,  con- 
sists of  those  cases  in  which  the  defendant 
has  in  his  hands  money  which  in  equity  and 
good  conscience  belongs  to  the  plaintiff,  as 
where  one  person  receives  from  another  mon- 
ey or  property  as  a  fund  from  which  certain 
creditors  of  the  depositor  are  to  be  paid,  and 
promises,  either  expressly,  or  by  implication 


LIMITS  OF  CONTRACTUAL  RELATION. 


5:^7 


from  his  acceptance  of  the  money  or  property 
without  objection  to  the  terms  on  which  it  is 
delivered  to  him,  to  pay  such  creditors.  That 
class  of  cases,  as  was  pointed  out  in  1  Gray, 
322,  includes  CanieKie  v.  Moriison  and  most 
of  the  earlier  cases  in  this  commonwealth;  as 
well  as  the  later  cases  of  Frost  v.  Gage,  1 
Allen,  2G2,  and  Putnam  v.  Field,  103  Mass. 
556. 

The  only  illustration,  which  the  decisions  of 
this  com-t  afford,  of  Mr.  Justice  MetcaLTs  sec- 
ond class  of  exceptions,  is  Folton  v.  Dickin- 
son, 10  Mass.  287,  in  which  it  was  held,  in 
accordance  with  a  number  of  early  English 
authorities,  and  hardly  argued  against,  that  a 
son  might  sue  upon  a  promise  made  for  his 
benefit  to  his  father.  Those  cases,  with  the 
proposition  on  which  they  have  sometimes 
been  supposed  to  rest,  that,  by  reason  of  the 
near  relation  between  parent  and  child,  the 
latter  might  be  thought  to  have  an  interest  in 
the  consideration  and  the  contract  and  the 
former  to  have  entered  into  the  contract  as 
his  agent,  are  not  now  law  In  England. 
Tweddle  v.  Atkinson,  1  Best  &  S.  393;  Add. 
Cont.  (Gth  Ed.)  1040.  Dicey,  Parties,  84.  And 
this  case  does  not  require  us  to  consider 
whether  they  ought  still  to  bo  followed  hero. 

The  third  exception,  admitted  by  Mr.  Jus- 
tice Metcalf,  is  the  case  of  Brewer  v.  Dyer, 
7  Gush.  337,  in  which  the  defendant  made  a 
written  promise  to  the  lessee  of  a  shop  to 
take  his  lease  (which  was  under  seal)  and 
pay  the  rent  tu  the  lessor  according  to  its 
terms,  entered  inti,  posses.sion  of  the  shop 
with  the  lessor's  knowledge,  paid  him  the  rent 
quarterly  for  a  year,  and  then  before  the  ex- 
piration of  the  lease  left  the  shop,  and  was 
held  liable  to  an  action  by  the  lessor  for  the 
rent  subsequently  accruing.  That  case  may 
perhaps  be  supported  on  the  ground  that  such 
payment  and  receipt  of  the  rent  after  the 
agreement  between  the  defendant  and  the  les- 
see warranted  the  inference  of  a  direct  prom- 
ise by  the  defendant  to  the  lessor  to  pay  the 
rent  to  him  for  the  residue  of  the  term.  Set 
McFarlan  v.  Watson.  3  N.  Y.  286  It  certain- 
ly cannot  be  reconciled  with  the  later  authori- 
ties, without  limiting  it  to  its  own  special 
circumstances  and  affords  no  safe  guide  in 
the  decision  01  the  present  cape. 

The  plaintiffs  are  then  obliged  to  fall  back 
upon  the  first  exception  to  the  general  rule. 
But  they  fail  to  bring  their  case  within  th:it 
exception,  or  within  any  of  the  authorities  to 
which  they  have  referred  us. 

In  Carnegie  v.  Morrison.  2  Mete.  (Mass.) 
381,  the  defendants,  having  funds  in  cash  or 
credit  of  the  plaintiffs'  debtor,  gave  him  a 
letter  of  credit,  which  was  shown  to  the  plain- 
tiffs, and  on  the  faith  of  which  they  drew  the 
bill,  for  the  amount  of  which  they  sued  the 
defendants;  and  the  drawing  of  that  bill, 
whereby  they  made  themselves  liable  to  the 
drawee  thereof,  was  a  consideration  moving 
from  them.  In  Lilly  v.  Hays.  5  Adol.  &  E. 
548.  1   Nev.  &   P.  26,  the  defendant,   as  the 


jury  found,  had  authorized  the  plaintiff  to  be 
told  that  the  defendant  had  received  the  mon- 
ey to  his  use,  and  thus  promised  the  plain- 
tiff to  pay  it  to  him  So  in  Walker  v.  Ros- 
tron,  9  Mees.  &  W.  411,  the  defendant  had 
promi.sed  the  plaintiff  to  pay  the  sum  in  ques- 
tion. And  the  rule  established  by  the  modern 
cases  in  England,  as  laid  down  in  the  text 
books  cited  for  the  plaintiffs,  does  not  permit 
the  person  for  whose  benefit  a  promise  is 
made  to  anotlier  person,  from  whom  the  only 
consideration  moves,  to  maintain  an  action 
against  the  promisor,  unless  either  the  latter 
has  also  made  an  express  promise  to  the  plain- 
tiff, or  the  promisee  acted  as  the  plaintiff's 
agent  merely.  Mete.  Cont.  209;  Add.  Cont. 
(6th  Ed.)  030,  1041.  Chit  Cont.  (8th  Ed. I 
53.  Where  the  promisee  is  in  fact  acting  as 
the  agent  of  a  third  person,  although  that  is 
unknown  to  the  promisor,  the  principal  is  the 
real  party  to  the  contract  and  may  therefore 
sue  in  his  own  name  on  the  promise  made  to 
his  agent.  Sims  v.  Bonds,  5  Barn.  &  Adol. 
389,  2  Ne/.  &  M.  COS;  Huntmgton  v.  Knox. 
7  Gush.  371;  Barry  v.  Page,  10  Gray,  398; 
Hunter  v.  Giddings.  97  Muss.  41;  Ford  v. 
Williams,  21  How.  28'. 

In  the  case  at  bar,  the  plaintiffs  had  ac- 
quired no  title  in  the  cotton  against  whloL 
the  draft  was  drawn.  The  bill  of  lading  was 
not  attached  to  the  dralc.  or  made  payabl> 
to  the  holder  ther^jf,  or  delivered  to  th(- 
plaintiffs.  The  case  is  thus  distinguished 
from  Allen  v.  Williams,  12  Pick.  297,  and 
Bank  v.  Gardner,  15  Gray.  362,  cited  at  the 
argument.  The  cotton  was  not  of  sufl5cient 
value  to  pay  the  draft  and  the  balance  of  ac- 
count between  the  defendants  and  the  draw- 
er, at  the  time  of  their  receipt  and  sale  of 
the  cotton,  and  ever  since,  was  in  favor  of  the 
defendants.  There  is  no  ground  therefore  for 
implying  a  promise  from  the  defendants  to 
the  plaintiffs  to  pay  to  them  either  the  amount 
of  the  draft  or  the  proceeds  of  the  cotton. 
Tieman  v.  Jackson,  5  Pet  580;  C^owporth- 
waite  V.  Sheffield,  1  Sandf.  416.  3  N.  Y.  243; 
Winter  v.  Drury,  5  N.  Y.  525;  Yates  v.  Bell, 
3  Bam.  &  Aid.  643.  The  plaintiffs  did  not 
take  the  draft,  or  make  advances,  upon  the 
faith  of  any  promise  of  the  defendants,  or  of 
any  actual  receipt  by  them  of  the  cotton  or 
the  bill  of  lading,  but  solely  upon  the  faith 
of  the  drawer's  signature  and  implied  prom- 
ise that  the  defendants  should  have  funds  to 
meet  the  draft  The  whole  consideration  of 
the  defendants'  promise  moved  from  the 
drawer  and  not  from  the  plaintiffs.  And  the 
defendants  made  no  promise  to  the  plaintiffs. 
Their  only  promise  to  accept  the  draft  was 
made  to  Hill,  the  drawer,  after  the  draft  had 
been  negotiated  to  the  plaintiffs;  and  there 
is  no  proof  that  the  defendants  authorized 
that  promise  to  be  shown  to  the  plaintiffs,  or 
that  Hill,  to  whom  that  promise  was  made, 
was  an  agent  of  the  plaintiffs.  His  relation 
to  them  was  that  of  drawer  and  payee,  not  of 
agent  and  principaL     To  infer,  as  suggested 


528 


OPERATION  OF  CONTRACT. 


In  belialf  of  the  plaintiffs,  that  he  was  their 
agent  In  recelTlng  the  defendants'  promise, 
so  that  they  might  sue  thereon  in  their  own 
name,  wouid  be  unsupported  by  any  facts  in 
the  case,   and   would  be  an  invasion  of  the 


rules  of  law,  which  will  not  allow  any  person, 
who  took  the  draft  before  that  promise  was 
made,  to  maintain  an  action  upon  that  prom- 
ise, either  as  an  acceptance  or  a  promise  to 
accept     Judgment  for  the  defendants. 


LIMITS  OF  CONTRACTUAL  RELATION. 


529 


LAWRENCE  v.  FOX. 

(20  N.  Y.  2GS.) 

Court  of  Appeals  of  New  York.    1859. 

I.  S.  Torrance,  for  apijelhiut.    E.  P.  Cbapin, 
for  appellee. 

H.  GRAY,  J.  The  fust  objection  raised  on 
the  trial  amounts  to  this:  That  tlie  evidence 
of  the  person  present,  who  heard  the  decLi- 
i-atious  of  Holly  giving  directions  as  to  the 
paj-uient  of  the  money  he  was  then  advan- 
cing to  the  defendant,  was  mere  hearsjiy  and, 
therefore,  not  competent.  Had  the  plaintiff 
sued  Holly  for  this  sum  of  money  no  ob- 
jection to  the  competency  of  this  evidence 
would  have  been  thought  of;  and  if  the  de- 
fendant hao  performed  his  promise  by  pay- 
ing the  sum  loaned  to  him  to  the  plaintiff, 
and  Holly  had  afterward  sued  him  for  its 
recovery,  and  this  evidence  had  been  offered 
by  the  defendant,  it  would  doubtless  have 
been  receive<.l  without  an  objection  from 
any  source.  All  the  defendant  had  the 
right  to  demand  in  this  case  was  evidence 
which,  as  between  Holly  and  the  plaintiff, 
was  competent  to  establish  the  relation  be- 
tween them  of  debtor  and  creditor.  For  that 
pui-pose  the  evidence  was  clearly  competent; 
it  covered  the  whole  ground  and  warranted 
the  verdict  of  the  jury.  But  it  is  claimed 
that  notwithstanding  this  promise  was  estab- 
lished by  competent  evidence,  it  was  void 
for  the  want  of  consideration.  It  is  now 
more  than  a  quarter  of  a  century  since  it 
was  settled  by  the  supreme  court  of  thia 
state — in  an  able  and  painstaking  opinion 
by  the  late  Chief  Justice  Savage,  In  which 
the  authorities  were  fully  examined  and 
carefully  analyzed — that  a  promise  in  all 
material  respects  like  the  one  under  consid- 
ei-ation  was  valid;  and  the  judgment  of  that 
court  was  unanimously  affirmed  by  the 
court  for  the  correction  of  errors.  Farley 
v.  Cleaveland,  4  Cow.  432;  s.  c.  in  error, 
9  Cow.  G39.  In  that  case  one  Moon  owed 
Farley  and  sold  to  Cleaveland  a  quantity  of 
hay,  in  consideration  of  which  CleaveLond 
promised  to  pay  Moon's  debt  to  Farley;  and 
the  decision  in  favor  of  Farley's  right  to  re- 
cover was  placed  upon  the  ground  that  the 
hay  received  by  Cleaveland  from  Moon  was  a 
valid  considei-ation  for  Cleaveland's  promise 
to  pay  Farley,  and  that  the  subsisting  liabil- 
ity of  Moon  to  pay  Farlej'  was  no  objection 
to  the  recovery.  The  fact  that  the  money 
advanced  by  Holly  to  the  defendant  was  a 
loan  to  him  for  a  day,  and  that  it  thereby 
became  the  property  of  the  defendant, 
seemed  to  Impress  the  defendant's  counsel 
with  the  idea  that  because  the  defendant's 
promise  was  not  a  trust  fund  placed  by  the 
plaintiff  in  the  defendant's  hands,  out  of 
which  he  was  to  realize  money  as  from  tlie 
sale  of  a  chattel  or  the  collection  of  a  debt, 
the  promise  although  made  for  the  benefit 
of  the  plaintiff  could  not  inure  to  his  bene- 
fit    The  hay  which  Cleaveland  delivered  to  , 

UOPK.SEL.  CAS.  CONT. — 34 


Moon  was  not  to  be  paid  to  Farley,  but  the 
debt    incurred    by    Cleaveland    for    the    pui-- 
chase  of  the  hay,  like  the  debt  incurred  by 
the    defendant     for     money     borrowed,    was 
what   was  to  be  paid.    That  c-ase  has   '>een 
often  referred  to  by  the  courts  of  this  state, 
and   has   never   been   doubted   as  sound  au- 
thority for  the  principle  upheld  by  It.     Bar- 
ker V.  Bucklin,  2   Denio,   45;    Canal   Co.   v, 
Westchester  County   Bank,   4  Denio,   97.    It 
puts   to   rest   the  objection   tliat  the  defend- 
ant's promise  was  void  for  want  of  considera- 
tion.    The   report   of   that   case  shows   tliat 
the   promise   was   not   only   made    to    Mooq 
but    to   the   plaintiff    r"^rley.     In    this    case 
the  promise  was  made  to  Holly  and  not  ex- 
pressly to  the  plaintiff;    and   this  difference 
between  the  two  cases  presents  the  question, 
raised  by  the  defendant's  objection,  as  to  the 
want   of  privity   between   the   plaintiff   and 
defendant     As  early    as    ISOO    it    was    an- 
nounced by  the  supreme  court  of  this  state, 
upon  what  was  then  regarded  as  the  settled 
law   of   England,    "That   where    one   person 
makes  a  promise  to  another  for  the  benefit 
of   a   third   person,   that    third   person    maj- 
maintain  an  action  upon  it"     Schermerhora 
V.   Vanderheyden,   1   Johns.   140,     has    often, 
been  reasserted  by  our  coui-ts  and  never  de- 
parted from.    The  case  of  Seaman  v.  White 
has  occasionally  been  referred  to  (but  not  by 
the  courts)  not  only  as  having  some  bearing 
upon   the  question  now   under  consideration, 
but  as  involving  in  doubt  the  soundness  of 
the    proposition    stated    in    Schermerhorn    y. 
Vanderheyden.     In  that  case  one  Hill,  on  the 
17th  of  August,  ISoo,  made  his  note  and  pro- 
cured it  to  be  indorsed  by  Seaman  and  dis- 
counted  by   the   Phoenix  Bank.     Before   the 
note  matured  and  while  it  was  owned  by  the 
Phoenix   Bank,   Hill   placed  in  the  hands  of 
the  defendant,   Whitney,  his  draft  accepted 
by   a   third  party,   which  the  defendant   in- 
dorsed, and  on  the  7th  of  October,  lS3o,  got 
discounted    and    placed    the    avaUs   in   the 
hands  of  an  agent  with   which   to   take  up 
Hill's  note;    the  note  became  due,  Whitney 
withdrew  the  avails  of  the  draft  from   the 
hands  of  his  agent  and  appropriated  it  to  a 
debt  due  him   from   Hill,  and  Seaman   paid 
the  note   indorsed   by   him  and   brought  his 
suit   against    \Miitney.     Upon   this   state    of 
facts   appearing,    it   was   held    that    Seaman 
could  not  recover:    first  for  the  reason  that 
no  promise  had  been   made  by   Whitney   to 
pay,  and  second,  if  a  promise  could  be  im- 
plied   from    the    facts    that  Hill's  accepted 
draft  with  which  to  raise  the  moons  to  pay 
the  note,  had  been  placed  by  HiU  in  the  hands 
of  Whitney,   the   promise   would    not   be  to 
Seaman,  but  to  the  Phcenix  Bank  who  then 
owned  the  note;    although  in  the  course  of 
the  opinion  of  the  court.  It  was  stated  that, 
in  all  cases  the  principle  of  which  was  sought 
to  be    applied    to    that    case,    the    fund    hadi 
been  appropriated  by  an  express  undertaJc- 
ing  of  the  defendant  with  the  creditor.    But 
before  concludLug  the  opinion  of  the  court 


530 


OPERATION  OF  CONTRACT. 


In  this  case,  the  learned  judj^e  who  deliver- 
ed it  conceded  that  an  undertaking  to  pay  the 
creditor  may  be  implied  from  an  arrange- 
ment to  that  effect  between  the  defendant 
and  the  debtor.  This  question  was  subse- 
quently, and  in  a  case  quite  recent,  again 
the  subject  of  consideration  by  the  supreme 
court,  when  it  was  held,  that  in  declaring  up- 
on a  promise,  made  to  the  debtor  by  a  third 
party  to  pay  the  creditor  of  the  debtor,  found- 
ed upon  a  consideration  advanced  by  the 
debtor,  it  was  unnecessary  to  aver  a  promise 
to  the  creditor;  for  the  reason  that  upon 
proof  of  a  promise  made  to  the  debtor  to  pay 
the  creditor,  a  promise  to  the  creditor  would 
be  implied.  And  in  support  of  this  proposi- 
tion, in  no  respect  distinguishable  from  the 
one  now  under  consideration,  the  case  ot 
Schermerhorn  v.  Vanderheyden,  with  many 
intermediate  cases  in  our  courts,  were  cited, 
in  which  the  doctrine  of  that  case  was  not 
only  approved  but  aflBrmed.  Canal  Co.  v. 
Westchester  County  Bank,  4  Denio,  97.  The 
same  principle  is  adjudged  in  several  cases 
in  Massachusetts.  I  will  refer  to  but  few  of 
them.  Ai-nold  v.  Lyman,  17  Mass.  400;  Hall 
V.  Mai-ston,  Id.  575;  Brewer  v.  Dyer,  7  Cash. 
337,  340.  In  Hall  v.  Marston  the  court  say: 
•'It  seems  to  have  been  well  settled  that  if 
A  promises  B.  for  a  valuable  consideration 
to  pay  C,  the  latter  may  maintain  assump- 
sit for  the  money;"  and  in  Brewer  v.  Dyer, 
the  recovery  was  upheld,  as  the  court  said, 
"upon  the  principle  of  law  long  recognized 
and  clearly  established,  that  when  one  per- 
son, for  a  valuable  consideration,  engages 
with  another,  by  a  simple  contract,  to  do 
some  act  for  the  benefit  of  a  third,  the  lat- 
ter, who  would  enjoy  the  benefit  of  the  act, 
may  maintain  an  action  for  the  breach  of 
such  engagement;  that  it  does  not  rest  upon 
the  ground  of  any  actual  or  supposed  rela- 
tionship between  the  parties  as  some  of  the 
earlier  cases  would  seem  to  indicate,  but 
upon  the  broader  and  more  satisfactory  basis, 
that  the  law  operating  on  the  act  of  the  par- 
ties creates  the  duty,  establishes  a  privity, 
and  implies  the  promise  and  obligation  on 
which  the  action  is  founded."  There  is  a 
more  recent  case  decided  by  the  same  court, 
to  which  the  defendant  has  referred  and 
claims  that  it  at  least  impairs  the  force  of  the 
former  cases  as  authority.  It  is  the  case  of 
Mellen  v.  Whipple,  1  Gmy,  317.  In  that  case 
one  Rollins  made  his  note  for  $500,  payable 
to  Ellis  and  Mayo,  or  order,  and  to  secure 
its  payment  mortgaged  to  the  payees  a  cer- 
tain lot  of  ground,  and  then  sold  and  convey- 
ed the  mortgaged  premises  to  the  defendant, 
by  deed  in  which  it  was  stated  that  the 
"granted  premises  were  subject  to  a  mort- 
gage for  ?500,  which  mortgage,  with  the 
note  for  which  it  was  given,  the  said  Whip- 
ple is  to  assume  and  cancel."  The  deed  thus 
made  was  accepted  by  Whipple,  the  mort- 
gage was  afterward  duly  assigned,  and  the 
note  indorsed  by  Ellis  and  Mayo  to  tlie  plain- 
tiff's intestate.     After  Whipple  received  the 


deed  he  paid  to  the  mortgagees  and  their 
assigns  the  interest  upon  the  mortgage  and 
note  for  a  time,  and  upon  refiising  to  con- 
tinue his  payments  was  sued  by  the  plaintiff 
as  administratrix  of  the  assignee  of  the  mort- 
gage and  note.  The  court  held  that  the 
stipulation  in  the  deed  that  Whipple  should 
pay  the  mortgage  and  note  was  a  matter 
exclusively  between  the  two  parties  to  the 
deed;  that  the  sale  by  Rollins  of  the  equity 
of  redemption  did  not  lessen  the  plaintiff's 
security,  and  that  as  nothing  had  been  put 
into  the  defendant's  hands  for  the  purpose 
of  meeting  the  plaintiff's  claim  on  Rollins, 
there  was  no  consideration  to  support  an 
express  promise,  much  less  an  implied  one, 
that  Whipple  should  pay  Mellen  the  amount 
of  the  note.  That  is  all  that  was  decided 
in  that  ease,  and  the  substance  of  the  rea- 
sons assigned  for  the  decision;  and  whether 
the  case  was  rightly  disposed  of  or  not,  it 
has  not  in  its  facts  any  analogy  to  the  case 
before  us,  nor  do  the  reasons  assigned  for 
the  decision  bear  in  any  degree  upon  the 
question  we  are  now  considering.  But  it  is 
urged  that  becau;e  the  defendant  was  not  in 
any  sense  a  trustee  of  the  property  of  Holly 
for  the  benefit  of  the  plaintiff,  the  law  will 
not  imply  a  promise.  I  agree  that  many  ot 
the  cases  whei-e  a  promise  was  implied  were 
cases  of  trusts,  created  for  the  benefit  of  the 
promisor.  The  case  of  Pelton  v.  Dickinson, 
10  Mass.  287,  and  others  that  might  be  cit- 
ed are  of  that  class;  but  concede  them  all 
to  have  been  cases  of  trusts,  and  it  proves 
nothing  against  the  application  of  the  rule 
to  this  case.  The  duty  of  the  trustee  to  pay 
the  cestui  que  trust,  accoi-ding  to  the  terms 
of  the  trust,  implies  his  promise  to  the  latter 
to  do  so.  In  this  case  the  defendant,  upon 
ample  consideration  received  from  Holly, 
promised  Holly  to  pay  his  debt  to  the  plain- 
tiff; the  consideration  received  and  the 
promise  to  Holly  made  it  as  plainly  his  duty 
to  pay  the  plaintiff  as  if  the  money  had  been 
remitted  to  him  for  that  purpose,  and  as 
well  implied  a  promise  to  do  so  as  if  he  had 
been  made  a  trustee  of  property  to  be  con- 
verted into  cash  with  which  to  pay.  The 
fact  that  a  breach  of  the  duty  imposed  in 
the  one  case  may  be  visited,  and  justly,  with 
more  serious  consequences  titan  in  the  other, 
by  no  means  disproves  the  payment  to  be  a 
duty  in  both.  The  principle  illustrated  by 
the  example  so  frequently  quoted  (which 
concisely  states  the  case  in  hand)  "that  a 
promise  made  to  one  for  the  benefit  of  an- 
other, he  for  whose  benefit  it  is  made  may 
bring  an  action  for  its  breach,"  has  been  ap- 
plied to  trust  cases,  not  because  it  was  ex- 
clusively applicable  to  those  cases,  but  be- 
cause it  was  a  principle  of  law,  and  as  such 
applicable  to  those  cases.  It  was  also  in- 
sisted that  Holly  could  have  discharged  the 
defendant  from  his  promise,  though  it  was 
intended  by  both  parties  for  the  benefit  of 
the  plaintiff,  and,  therefore,  the  plaintiff  was 
not    entitled    to    maintain    this   suit    for    the 


LIMITS  OF  COXTRACTUAL  KELATION. 


551 


recovery  of  a  demand  over  which  he  had 
no  control.  It  is  enough  that  the  plaintiff 
did  not  release  the  defendant  from  his 
promise,  and  whetlier  ho  could  or  not  Is  a 
question  not  now  necessarily  involved;  but 
if  It  was,  I  think  it  would  be  found  difficult 
to  maintain  the  right  of  Holly  to  discliarge 
a  judgment  recovered  by  the  plaintiff  upon 
confession  or  otherwise,  for  the  breach  of 
the  defendant's  promise;  and  if  he  could 
not,  how  could  he  discharge  the  suit  before 
judgment,  or  tne  promise  before  suit,  made 
as  it  was  for  the  plaintiff's  benefit  and  In 
accordance  with  legal  presumption  accept- 
ed by  him  (Beriy  v.  Taylor,  5  Hill,  577-r)S4 
et  seq.),  until  his  dissent  was  shown?  The 
cases  cited  and  especially  that  of  Farley 
V.  Cl6aveland,  established  the  validity  of  a 
parol  promise;  it  stands  then  upon  the  foot- 
ing of  a  written  one.  Suppose  the  defend- 
ant had  given  his  note  in  which  for  value 
received  of  Holly,  he  had  promised  to  pay 
the  plaintiff  and  the  plaintiff  had  accept- 
ed the  promise,  retaining  Holly's  liability. 
Very  clearly  Holly  could  not  have  discharged 
that  promise,  be  the  right  to  release  the 
defendant  as  it  may.  No  one  can  doubt  that 
he  owes  the  sum  of  money  demanded  of  him, 
or  that  in  accordance  with  his  promise  it 
was  his  duty  to  have  paid  it  to  the  plaintiff; 
nor  can  it  be  doubtetl  that  whatever  may  be 
the  diversity  of  opinion  elsewhere,  the  ad- 
judications in  this  state,  from  a  very  early 
period,  approved  by  experience,  have  estab- 
lished the  defendant's  liability;  if,  therefore, 
it  could  be  shown  that  a  more  strict  and 
teclmically  accui-ate  application  of  the  rules 
api)lied,  would  lead  to  a  different  result 
(wliich  I  by  no  means  concede),  the  effort 
should  not  be  made  in  the  face  of  manifest 
justice. 
The  judgment  should  be  affirmed. 

JOHNSON,  C.  J.,  and  DENIO,  J.,  based  their 
judgment  upon  the  ground  that  the  promise 
was  to  be  regarded  as  made  to  the  plaintiff 
through  the  medium  of  his  agent,  whose 
action  he  could  ratify  when  it  came  to  his 
knowledge,  though  taken  without  his  being 
privy  thereto. 

COMSTOCK,  J.  (dissenting).  The  plaintiff 
had  nothing  to  do  with  the  promise  on  which 
he  brought  this  action.  It  was  not  made 
to  him,  nor  did  the  consideration  proceed 
from  him.  If  he  can  maintain  the  suit, 
it  is  because  an  anomaly  has  foimd  its  way 
Into  the  law  on  this  subject.  In  general, 
there  must  be  privity  of  contract.  The  party 
who  sues  upon  a  promise  must  be  the  prom- 
isee, or  he  must  have  some  legal  interest 
in  the  undertaking.  In  this  case,  it  is  plain 
that  Holly,  who  loaned  the  money  to  the 
defendant,  and  to  whom  the  promise  in  ques- 
tion was  made,  could  at  any  time  have 
claimed  that  it  should  be  performed  to  him- 
self personally.  He  had  lent  the  money  to 
the  defendant,  and  at  the  same  time  directed 


the  latter  to  pay  the  sum  to  the  plaintiff, 
lliis  direction  he  could  countermand,  and 
if  he  liad  done  so,  manifestly  the  defendant's 
promise  to  pay  according  to  the  direction 
would  have  ceased  to  exist.  The  plaintiff 
would  receive  a  benefit  by  a  complete  exe- 
cution of  the  arrangement,  but  the  arrange- 
ment itself  was  between  other  parties,  and 
was  under  their  exclusive  control.  If  the 
defendant  had  paid  the  money  to  Holly,  his 
debt  would  liave  been  disdiarged  thereby. 
So  Holly  might  have  relea.sed  the  demand  or 
assigned  it  to  another  person,  or  the  parties 
might  have  annulled  the  promise  now  in 
question,  and  designated  some  other  creditor 
of  Holly  as  the  party  to  whom  the  money 
should  be  paid.  It  has  never  been  claimed 
that  in  a  case  thus  situated  the  right  of  a 
third  person  to  sue  upon  the  promise  rested 
on  any  sound  principle  of  law.  We  are  to 
iucjuire  whether  the  rule  has  been  so  estab- 
lished by  positive  authority. 

The  cases  which  have  sometimes  been  sup- 
posed to  have  a  bearing  on  this  question  are 
quite  numerous.  In  some  of  them,  the  dicta 
of  judges,  delivered  upon  very  slight  con- 
sideration, have  been  referred  to  as  the  de- 
cisions of  the  courts.  Thus,  in  Schermer- 
hom  V.  Vanderheyden,  1  Johns.  1-40,  the  court 
is  reported  as  saying:  "We  are  of  opinion 
that  where  one  person  makes  a  promise  to 
another,  for  the  benefit  of  a  third  person,  that 
third  person  may  maintain  an  action  on 
such  promise."  This  remark  was  made  on 
the  authority  of  Button  v.  Foole,  'Vent  31S, 
332,  decided  in  England  nearly  two  himdred 
years  ago.  It  was,  however,  but  a  mere  re- 
mark, as  the  ease  was  determined  against 
the  plaintiff  on  another  groimd.  Yet  this 
decision  has  often  been  referred  to  as  au- 
thority for  similar  observations  in  later  cases. 

In  another  class  of  cases,  which  have  been 
sometimes  supposed  to  favor  the  doctrine, 
the  promise  was  made  to  the  person  who 
brought  the  suit,  while  the  consideration 
proceeded  from  another;  the  question  con- 
sidered being,  whether  the  promise  was  void 
by  the  statute  of  frauds.  Thus,  in  Gold  v. 
I'hillips,  10  Johns.  412,  one  Wood  was  in- 
debted to  the  plaintiffs  for  services  as  at- 
torneys and  counsel,  and  he  conveyed  a 
farm  to  the  defendants,  who.  as  part  of  the 
consideration,  were  to  pay  tliat  debt.  Ac- 
cordingly, the  defendants  wrote  to  the  plain- 
tiffs, informing  them  that  an  arrangement 
had  been  made  by  which  they  were  to  pay 
the  demand.  The  defense  was,  that  the 
promise  was  void  within  the  statute,  be- 
cause, although  in  writing,  it  did  not  ex- 
press the  consideration.  But  the  action  was 
sustained,  on  the  ground  that  the  undertak- 
ing was  original  and  not  collateral.  So  in 
the  case  of  Farley  v.  Cleaveland,  4  Cow.  432, 
9  Cow.  G30.  the  facts  proved  or  offered  to 
be  proved  were,  that  the  plaintiff  held  a 
note  against  one  Moon;  that  Moon  sold  hay 
to  the  defendant,  who  in  consideration  of 
that  sale  promised  the  plaintiff  by  parol  to 


OrERATION   OF  CONTRACT. 


pay  the  note.  The  only  question  was, 
whether  the  statute  of  frauds  applied  to  the 
case.  It  was  held  by  the  supreme  court, 
and  afterward  by  the  court  of  errors,  that 
it  did  not  Such  is  also  precisely  the  doc- 
trine of  Ellwood  V.  Monk,  5  Wend.  23o, 
where  it  was  held  that  a  plea  of  the  statute 
of  frauds  to  a  count  upon  a  promise  of  the 
defendant  to  the  plaintiff,  to  pay  the  latter 
a  debt  owing  to  him  by  another  person,  the 
promise  being  founded  on  a  sale  of  prop- 
erty to  the  defendant  by  the  other  person, 
was  bad. 

The  cases  mentioned  and  others  of  a  like 
character  were  referred  to  by  Mr.  Justice 
Jewett,  in  Barker  v.  Bucklin,  2  Denio,  45. 
In  that  case  the  learned  justice  considered 
at  some  length  the  question  now  before  us. 
The  authorities  referred  to  were  mainly 
those  which  I  have  cited,  and  others  upon 
the  statute  of  frauds.  The  case  decided 
nothing  on  the  present  subject,  because  it 
was  determined  against  the  plaintiff  on  a 
gi-ound  not  involved  in  this  discussion.  The 
doctrine  was  certainly  advanced  which  the 
plaintiff  now  contends  for,  but  among  all 
the  decisions  which  were  cited,  I  do  not 
think  there  is  one  standing  directly  upon  It. 
The  case  of  Arnold  v.  Lyman,  17  Mass.  400, 
might  perhaps  be  regarded  as  an  exception 
to  this  remark,  if  a  different  interpretation 
had  not  been  given  to  that  decision  in  the 
supreme  court  of  the  same  state  where  it 
was  pronounced.  In  the  recent  case  of 
Mfllen  V.  Whipple,  1  Gray,  317,  that  deci- 
sion is  understood  as  belonging  to  p  class 
where  the  defendant  has  in  his  ^ands  a 
trust  fund,  which  was  the  foundation  of  the 
duty  or  promise  on  which  the  suit  is  brought 

The  cases  in  which  some  trust  was  in- 
volved are  also  frequently  referred  to  as  au- 
thority for  the  doctrine  now  in  question, 
but  they  do  not  sustain  It  If  A.  delivers 
mpney  or  property  to  B.,  which  the  latter 
accepts  upon  a  trust  for  the  benefit  of  C, 
the  latter  can  enforce  the  trust  by  an  ap- 
propriate action  for  that  purpose.  Berly  v. 
Taylor,  5  Hill,  577.  If  the  trust  be  of  mon- 
ey, I  think  the  beneficiary  may  assent  to  it 
and  bring  the  action  for  money  had  and  re- 
ceived to  his  use.  If  It  be  of  something 
else  than  money,  the  trustee  must  account 
for  It  according  to  the  terms  of  the  trust, 
and  upon  principles  of  equity.  There  Is 
some  authority  even  for  saying  that  an  ex- 
press promise  founded  on  the  possession  of 
a  trust  fund  may  be  enforced  by  an  action 
at  law  in  the  name  of  the  beneficiary,  al- 
though it  was  made  to  the  creator  of  the 
trust.  Thus,  in  Comyn,  Dig.  "Action  on  the 
Case  upon  Assumpsit,"  B,  15,  it  is  laid  down 
that  If  a  man  promise  a  pig  of  lead  to  A., 
and  his  executor  give  lead  to  make  a  pig  to 
B.,  who  assumes  to  deliver  It  to  A.,  an  as- 
sumpsit lies  by  A.  against  him.  The  case 
of  Delaware  &  H.  Canal  Co.  v.  Westchester 
County  Bank,  4  Denio.  97,  involved  a  trust 
because   the   defendants   had    received    from 


a  third  party  a  bill  of  exchange  under  an 
agreement  that  they  would  endeavor  to  col- 
lect it,  and  would  pay  over  the  proceeds 
when  collected  to  the  plaintiffs.  A  fund 
received  under  such  an  agreement  does  not 
belong  to  the  person  who  receives  It.  He 
must  account  for  it  specifically;  and  per- 
haps there  is  no  gross  violation  of  principle 
In  permitting  the  equitable  owner  of  it  to 
sue  upon  an  express  promise  to  pay  it  over. 
Having  a  specific  interest  in  the  thing,  the 
undertaking  to  account  for  it  may  be  regard- 
ed as  in  some  sense  made  with  him  through 
the  author  of  the  trust.  But  further  than 
this  we  cannot  go  without  violating  plain 
rules  of  law.  In  the  case  before  us  there 
was  nothing  in  the  nature  of  a  trust  or 
agency.  The  defendant  borrowed  the  mon- 
ey of  Holly  and  received  it  as  his  own. 
The  plaintiff  had  no  right  In  the  fund,  legal 
or  equitable.  The  promise  to  repay  the 
money  created  an  obligation  in  favor  of  the 
lender  to  whom  it  was  made  and  not  in 
favor  of  any  one  else. 

I  have  referred  to  the  dictum  In  Scher- 
merhorn  v.  Vanderheyden,  1  Johns.  140,  as 
favoring  the  doctrine  contended  for.  It 
was  the  earliest  in  this  state,  and  was 
founded,  as  already  observed,  on  the  old 
English  case  of  Dutton  v.  Poole,  Vent  318. 
That  case  has  always  been  referred  to  as 
the  ultimate  authority  whenever  the  rule  in 
question  has  been  mentioned,  and  it  de- 
serves, therefore,  some  further  notice.  The 
father  of  the  plaintiff's  wife  being  seized  of 
certain  lands,  which  afterward  on  his  death 
descended  to  the  defendant,  and  being  about 
to  cut  £1,000  worth  of  timber  to  raise  a  por- 
tion for  his  daughter,  the  defendant  prom- 
ised the  father  in  consideration  of  his  for- 
bearing to  cut  the  timber,  that  he  would  pay 
the  said  daughter  the  £1,000.  After  verdict 
for  the  plaintiff,  upon  the  issue  of  non-as- 
sumpsit, it  was  urged  in  arrest  of  judgment 
that  the  father  ought  to  have  brought  the 
action,  and  not  the  husimnd  and  wife.  It 
was  held,  after  much  discussion,  that  the 
action  would  lie.  The  court  said:  "It 
might  be  another  case  if  the  money  had 
been  to  have  been  paid  to  a  stranger;  but 
there  is  such  a  manner  of  relation  between 
the  father  and  the  child,  and  it  is  a  kind  of 
debt  to  the  child  to  be  provided  for,  that  the 
plaintiff  is  plainly  concerned."  We  need  not 
criticise  the  reason  given  for  this  decision. 
It  Is  enough  for  the  present  purpose,  that 
the  case  is  no  authority  for  the  general  doc- 
trine, to  sustain  which  it  has  been  so  fre- 
quently cited.  It  belongs  to  a  class  of 
cases  somewhat  peculiar  and  anomalous,  in 
which  promises  have  been  made  to  a  parent, 
or  person  standing  in  a  near  relationship  to 
the  person  for  whose  benefit  it  was  made, 
and  in  which,  on  account  of  that  relationship, 
the  beneficiary  has  Ik'CU  allowed  to  main- 
tain the  action.  Ilegarded  as  standing  on 
any  other  ground,  they  have  long  since 
ceased   to   be   the   law    in    England.     Thus.. 


LIMITS  OF  CONTRACTUAL  RELATION. 


>ii3 


In  Crow  V.  Rogers,  1  Strange,  502,  one  Hardy 
was  indebted  to  the  plaiutiO:  in  the  sum  of 
£70,  and  upon  a  discourse  between  Hardy 
and  the  defendant,  it  was  agreed  that  the 
defendant  should  pay  that  debt  in  consid- 
eration of  a  house,  to  be  conveyed  by  Hardy 
to  him.  The  plaintiff  brought  the  action  on 
that  promise,  and  Button  v.  Poole  was  cit- 
ed In  support  of  it.  But  It  was  held  that 
the  action  would  not  lie,  because  the  plain- 
tiff was  a  stranger  to  the  transaction. 
Again,  In  Price  v.  Easton,  4  Barn.  &  Adol. 
433,  one  William  Price  was  indebted  to  the 
plaintiff  in  £13.  The  declaration  averred  a 
promise  of  the  defendant  to  pay  the  debt, 
in  consideration  that  "William  Price  would 
work  for  him,  and  leave  the  wages  in  his 
hands;  and  that  Price  did  work  according- 
ly, and  earned  a  large  sum  of  money,  which 
he  left  in  the  defendant's  hands.  After  ver- 
dict for  the  plaintiff,  a  motion  was  made  in 
arrest  of  judgment,  on  the  ground  that  the 
plaintiff  was  a  stranger  to  the  consideration. 
Dutton  V.  Poole,  and  other  cases  of  that 
class,  were  cited  in  opposition  to  the  mo- 
tion, but  the  judgment  was  arrested.  Lord 
Demnan  said:  "I  think  the  declaration  can- 
not be  supported,  as  it  does  not  show  any 
consideration  for  the  promise  moving  from 
the  plaintiff  to  the  defendant."  Littlodale, 
J.,  said:  "No  privity  Is  shown  between  the 
plaintiff  and  the  defendant.  The  case  is 
precisely  like  Crow  v.  Rogers,  and  must  be 
governed  by  It."  Taunton,  J.,  said:  "It  Is 
consistent  with  all  the  matter  alleged  in  the 
declaration,  that  the  plaintiff  may  have  been 
entirely  Ignorant  of  the  arrangement  be- 
tween William  Price  and  the  defendant." 
Patterson.  J.,  observed:  "It  Is  clear  that  the 
allegations  do  not  show  a  right  of  action  in 
the  plaintiff.  There  Is  no  promise  to  the 
plaintiff  alleged."  The  same  doctrine  is 
recognized  in  Lilly  v.  Hays,  5  Adol.  &  E. 
548,   and    such    Is   now    the   settled   rule    in 


England,  although  at  an  early  day  there 
was  some  obscurity  arising  out  of  the  case 
of  Dutton  V.  Poole,  and  others  of  that  pe- 
culiar class. 

The  question  was  also  Involved  in  some 
confusion  by  the  earlier  cafics  in  Massa- 
chusetts. Indeed,'  the  supreme  court  of 
that  state  seem  at  one  time  to  have  made  a 
nearer  approach  to  the  doctrine  on  which 
this  action  must  rest  than  the  courts  of  this 
state  have  ever  done.  10  Ma.ss.  287;  17 
Mass.  400.  But  In  the  recent  case  of  Mel- 
lon v.  Whipple,  1  Gray,  317,  the  subject  was 
carefully  reviewed  and  the  doctrine  utterly 
overthrown.  One  RoUin  was  Indebted  to 
the  plaintiff's  testator,  and  had  secured  the 
debt  by  a  mortgage  on  his  land.  He  then 
conveyed  the  equitj'  of  redemption  to  the  de- 
fendant, by  a  deed  which  contained  a  clause 
declaring  that  the  defendant  was  to  assume 
and  pay  the  mortgage.  It  was  conceded 
that  the  acceptance  of  the  deed  with  such 
a  clause  in  It  was  equivalent  to  an  express 
promise  to  pay  the  mortgage  debt;  and  the 
question  was,  whetlier  the  mortgagee  or  his 
representative  could  sue  on  that  undertak- 
ing. It  was  held  that  the  suit  could  not  be 
maintained;  and  in  the  course  of  a  very 
careful  and  discriminating  opinion  by  Judge 
Metcalf,  It  was  shown  that  the  cases  which 
had  been  supposed  to  favor  the  action  be- 
longed to  exceptional  classes,  none  of  which 
embraced  the  pure  and  simple  case  of  an 
attempt  by  one  person  to  enforce  a  promise 
made  to  another,  from  whom  the  considera- 
tion whoUy  proceeded-  I  am  of  that  opin- 
ion. 

The  judgment  of  the  court  below  should, 
therefore,  be  reversed,  and  a  new  trial 
granted. 

GROVER,  J^  also  dissented. 

Judgment  affirmed- 


'53^. 


OPERATION  OF  CONTRACT. 


,  ^       R^  PPLYE 


V.   RACIXE   SEEDER   CO. 


(44  N.  W.  363,  79  Iowa,  220.) 
Supreme  Court  of  Iowa.     Jan,  31,  1S90. 

Appeal  from  district  court,  Polk  county: 
Josiah  Given,  Judge. 

Action  for  breach  of  contract  in  the  sale 
of  certain  seeders,  in  which  the  court,  with- 
out the  intervention  of  a  jury,  found  the 
following'  facts : 

"First.  That  prior  to  Octolier  14,  1SS4, 
the  firm  of  Young-  Bros.,  the  plaintiff's  as- 
signors, were  a  copartnership  engaged 
principally  as  manufacturers' agents  in  sale 
of  agricultural  implements  throughout  the 
state  of  Iowa,  having. their  place  of  busi- 
ness at  the  city  of  Des  Moines,  in  said 
state.  (Second.  That  on  the  IDth  day  of 
August,  1SS4,  the  Racine  Seeder  Company, 
of  Racine,  "Wis.,  the  defendant  herein,  made 
with  said  Young  Bros,  the  contract  intro- 
duced in  evidence,  and  marked  'Exhibit  A,' 
as  alleged  in  plaintiff's  petition.  Third, 
That  by  said  contract  the  defendant  sold 
to  Young  Bros,  nine  hundred  Strowbridge 
Broadcast  sowers,  for  which  payment  was 
to  be  made  by  the  promissory  notes  of 
Young  Bros,  as  imi)lements  were  delivered, 
and  in  consideration  for  such  purchase  the 
defendant  granted  to  said  firm  the  exclusive 
privilege  of  selling  said  implements  in  the 
western  half  of  the  state  of  Iowa.  Young 
Bros,  were  to  canvass  said  territory,  and 
solicit  written  orders  for  said  Strowbridge 
sower,  in  the  name  of  defendant,  using 
blank  orders  prescribed  by  it;  and  the  or- 
ders thus  taken  were  to  be  turned  over  to 
the  defendant,  and  thereupon  the  imple- 
ments were  to  be  shipped  by  the  defend- 
ant to  the  various  purchasers,  at  the 
times  stated  in  such  orders.  Young  Bros, 
were  further  required  to  take  promissory 
notes  in  settlement  for  implements  thus 
sold,  when  sales  were  not  for  cash ;  and 
such  notes  were  to  be  turned  over  to  the 
defendant,  in  addition  to  the  contracts  be- 
fore  mentioned,  as  collateral  security  for 
the  notes  of  Young  Bros.  If  implements 
were  sold  for  cash,  the  same  was  to  be  im- 
mediately applied  by  Young  Bros,  on  the 
purchase  price  of  the  implements  contract- 
ed for.  Fourth.  That,  upon  the  faith  of 
the  above  contract,  Young  Bros,  proceeded 
to  canvass  the  territory  assigned  them, 
taking  orders  forthe  said  implements,  and 
•turning  them  over  to  defendant,  and  oth- 
erwise performing  their  part  of  said  con- 
tract, and  up  to  the  14th  of  October,  1SS4, 
had  sold  about  three  hundred  of  said  im- 
plements, at  prices  varying  from  $16.50  to 
$18,75.  Said  contracts  were  identical  in 
form  with  Exhibit  A,  hereto  attached. 
Fifth.  That  on  the  14th  day  of  October, 
1884,  the  said  Young  Bros,  made  a  general 
assignment  for  the  benefit  of  creditors  to 
one  Isaac  Henshie,  who  continued  to  per- 
form the  duties  of  said  assignee  until  his 
death,  on  December  8,  18S4;  that  the  rec- 
ord of  the  instrument  found  on  pages  Nos, 
10,  11,  12,  and  13  of  book  No.  154  of  Chattel 
Mortgage  Records,  in  recorder's  office  of 
Polk  county, Iowa, introduced  in  evidence, 
is  a  true  copy  of  said  general  assignment; 
that  by  said  assignment  all  rights  under 
said  contract  of  Young  Bros,  with  defend- 


ant passed  to  said  assignee;  that  the  plain- 
tiff in  this  cause  is  the  successor  in  ofiice  to 
said  Isaac  Henshie  as  assignee  of  said 
Y^oung  Bros.,  duly  appointed  by  the  ciiTuit 
court  of  Polk  county,  Iowa,  on  or  about 
the  13th  day  of  December,  1884.  Sixth. 
That  on  the  5th  day  of  November,  1884, 
the  defendant  sent  to  Young  Bros.'  recent 
place  of  business,  by  messenger,  the  letter 
of  that  date  set  out  In  defendant's  answer 
herein,  giving  notice  of  its  refusal  to  go  on 
with  the  contract  before  mentioned;  that 
the  defendant  intended  by  the  notice  given 
in  said  letter  to  put  an  end  to  the  contract 
entirely,  and  the  same  was  understood  and 
treated  by  the  assignee  of  Y'oung  Bros,  as 
BO  intended  ;  that  soon  after  the  service  of 
the  above  notice  the  defendants  entered 
this  same  territory  which  had  been  grant- 
ed by  said  contract  to  Young  Bros.,  made 
new  contracts,  in  its  own  name,  with  some 
of  the  persons  with  whom  Y^oujig  Bros, 
had  contracted  for  the  sale  of  said  imple- 
ments, and  sold  large  numbers  of  the  same 
to  divers  other  persons  in  said  territory. 
Seventh.  That,  as  soon  as  practicable  after 
entering  upon  his  duties  as  assignee  of  said 
Young  Bros. 'estate,  the  said  Isaac  Henshie 
sought  legal  advice  with  reference  to  his 
rights  as  such  assignee  under  said  con- 
tract, and  was  advised  that  he  had  a  right 
under  the  law  to  go  on  with  the  same,  and 
require  performance  thereof  on  the  part  of 
defendant;  and  there  was  evidence  tend- 
ing to  show  that  he  thereupon  procured 
an  agent  to  further  canvass  the  territory 
named  in  saidcontract,  and  was  otherwise 
arranging  to  go  on  with  the  same,  when 
he  received  said  defendant's  letter  of  No- 
vember 5,  1884,  giving  notice  of  its  refusal 
to  perform  said  contract.  Such  evidence 
was,  in  substance,  that  said  assignee  called 
in  from  the  road  one  William  Gracey,  who 
had  previously  been  employed  by  Young 
Bros,  to  sell  said  Strowbridge  sower,  the 
goods  handled  by  Young  Bros.,  in  said  ter- 
ritory; that  said  Gracey  was  subsequent- 
ly in  the  city;  and  that  the  account-book 
kept  by  the  assignee  showed  an  account 
with  William  Gi*acey,  in  which  appeared 
the  following  entry:  "October  20,  1884, 
Commenced  work  at  sixty  dollars  per 
month  and  expenses;"  that  said  Gracey 
received  money  from  said  assignee,  and 
subsequently  took  the  two  orders  for  thir- 
ty-five of  said  Strowbridge  sowers,  which 
were  introduced  in  evidence,  and  marked 
'Exhibit  B,'  (22  and  23,)  but  this  was  no 
evidence  that  the  defendant  had  knowledge 
of  these  matters;  that  at  the  time  said  let- 
ter of  November  5,  1884,  was  received  from 
the  defendant  said  assignee  had  not  had  a 
reasonable  time  in  which  to  perfect  ar- 
rangements for  going  on  with  said  con- 
tract. Eighth.  That  said  Strowbridge 
I3roadcast  sower  is  a  patented  article,  of 
which  defendant  was  the  sole  manufactur- 
er. About  the  month  of  February  or  March, 
1885,  however,  a  similar  sower  was  put  up- 
on the  market  by  the  Joliet  Wire  Com- 
pany, of  Joliet,  111.,  at  less  than  this  con- 
tract price;  but  this  was  considered  by  the 
defendant  to  be  an  infringement  on  the 
Strowbridge  patent.  Ninth.  That  at  no 
time  has  defendant  either  made  or  ten- 
dered to  plaintiff,  or  to  his  predecessor  in 
office,  the  said  Isaac  Henshie,  or  to   said 


ASSIGNMENT. 


53^ 


Young  Bros.,  any  compensation  whatever 
for  the  labor  or  nionoyw  expendod  by  them, 
or  for  any  portion  of  their  performance  of 
said  contract,  or  made  or  offered  in  any 
manner  to  place  the  said  persons, or  either 
of  tliern.j/i  statu  quo.  Tenth.  Thatdeiend- 
ant  never  delivered,  nor  tendered  a  deliv- 
ery of,  any  portion  of  said  nine  hundred 
iStrowbridjie  sowers  sold  to  said  Young 
Bros.,  although  such  delivery  was  demand- 
ed, to  the  number  of  said  implements 
named  in  said  orders  turned  over  to  said 
defendant,  if  such  orders  constituted  a  de- 
mand ;  and  said  defendant  refused  to  deliv- 
er any  portion  of  said  implements,  or  to 
perform  its  part  of  said  contract  in  any  re- 
spect whatever.  Butno  demand  was  made 
upon  defendant  for  i)erformance  of  said 
contract,  unless  the  delivery  of  said  orders 
constituted  such  demand.  Eleventh.  Tiiat 
neither  the  plaintiff  nor  his  predecessor  in 
ofliee,  the  said  Isaac  Henshie,ever  tendered 
the  defendant  any  security  in  lieu  of  the 
promissory  notes  of  Young  Bros,  agx'eed 
to  be  made,  or  made  application  to  the 
court  for  authority  to  carry  out  said  con- 
tract, or  to  require  said  defendant  to  ac- 
cept any  security  in  lieu  of  said  notes,  or 
gavedcfendant  any  notice  that  he  intended 
to  carrj^  out  said  contract.  " 

As  a  conclusion  of  law,  the  district  court 
found  with  the  defendant,  and  the  plain- 
tiff appeals. 

Cummins  &  Wrischt  and  N.  B.  Raymond, 
for  appellant.  Lehman  &  Park,  for  appel- 
lee. 

GRANGER,  J.  I.  The  point  receivingthe 
principal  attention  in  argument  Is  as  to 
the  effect  on  the  contract  of  the  insolvency 
of  Young  Bros.,  and  the  assignment  for 
the  benelit  of  their  creditors.  Perhaps  it 
may  be  better  stated  as  a  query,  thus: 
Was  the  insolvency  and  assignment  a  jus- 
tification for  the  defendant  company  in  re- 
scinding the  contract?  The  answer  to  this 
question  is  a  practical  determination  of 
the  case,  as  to  the  plaintiffs  cause  of  ac- 
tion. Its  consideration  has  led  counsel  for 
appellant  to  consider  at  some  length  the 
law  as  to  the  assignment  of  contracts,  and 
It  is  urged  that  the  assignment  in  ques- 
tion is  within  itscontemyjlation.  A  salient 
feature  of  thecase  isthe  manner  or  method 
of  payment  by  Young  Bros,  for  the  seed- 
ers. The  contract  was  for  t)00  seeders,  to 
be  delivered  on  the  orders  of  Young  Bros., 
for  which  the  firm  was  to  give  its  notes. 
Y'oung  Bros,  were  to  deliver  the  seeders  to 
purchasers  from  them,  and  settle  for  the 
same  either  by  receiving  cash  or  notes.  If 
cash,  it  was  to  be  turned  over  to  defend- 
ant, to  apply  on  the  notes  of  Y'oiing  Bros. 
If  notes,  they  were  to  be  turned  over  to 
defendant  as  collateral  security  for  the 
notes  already  given  by  Young  Bros.  It  is 
said  in  argument  that  the  district  court 
held  the  rescission  sealed  because,  after  the 
assignment,  Young  Bros,  were  not  in  a 
position  to  give  their  notes  in  pursuance 
of  the  terms  of  the  contract;  from  which 
we  infer  this  view  of  the  court :  That  the 
defendant  was  entitled,  under  the  con- 
tract, to  the  notes  of  Young  Bros.,  aided 
collaterally  by  the  notes  taken  by  them  in 
the  sales  of  the  seeders.  As  between  de- 
fendant  and   Young    Bros.,   nothing    less 


could  be  regarded  as  a  compliance  with 
the  c(jntract.  It  could  hardly-  be  claimed 
that  Young  Bros.,  in  a  settlement  for  the 
maehines,  could  substitute  in  lieu  of  their 
note  that  of  another  person  or  firm,  re- 
gaidless  of  the  question  of  solvency  or 
value,  even  though  aided  by  the  collateral 
notes  as  agreed  upon,  for  the  sole  and  con- 
clusive reason  that  their  engagements  are 
for  notes  signed  by  them.  Such  a  rule 
needs  no  elaboration. 

The  argument,  then,  leads  us  to  the 
query,  without  reference  to  the  statutory 
assigriinent  for  the  benelit  of  credilor.s, 
could  Young  Bros,  have  so  assigned  the 
contract,  without  the  consent  of  defend- 
ant, as  tosubstituteanotherin  their  stead 
for  pei-formance,  and  whose  note  must  be 
accepted  in  lieu  of  theirs  by  the  defendant? 
This  leads  us  to  consider  the  autliorities 
cited.  Counsel  for  appellant  quotes  from 
Code,  §  2084,  as  follows:  "Insti-uments  in 
writing,  by  which  the  maker  promises 
*  *  *  to  pay  or  deliver  any  property  or 
labor,  or  acknowledges  any  monc}'  or 
labor  or  property  to  be  due,  are  assignable 
by  indorsement  thereon,  or  by  other  writ- 
ing; and  the  a.ssignee  shall  have  a  right  of 
action  in  his  own  name."  Counsel  then 
say:  "Under  the  very  broad  language 
of  this  provision,  this  court  has  held  that 
all  contracts  are  assignable,  even  in  cases 
where,  by  the  terms  of  the  instrument,  its 
assignment  is  prohibited."  And  reference 
is  made  to  Moorman  v.  Collier.  32  Iowa,  138, 
and  Bank  v.  Carpenter, 41  Iowa,  518.  Sec- 
tion 20*>4  is  a  part  of  thechar)teron  "Notes 
and  Bills;"  and  the  section  deals  only  with 
instruments  in  wi-iting,  and  tells  how 
they  may  be  transferred,  and  who  may  sue 
thereon.  In  both  of  the  cases  to  which  refer- 
ence is  made  the  court  had  under  consider- 
ation the  validitj-  of  the  transfer  of  an  in- 
strument in  writing  for  the  payment  of 
money;  and  the  language  used  in  e.ich  case 
is  not  too  broad,  if  properly  limited  by  the 
subject  of  its  application.  In  Moorman  v. 
Collier,  the  language  relied  on  is  that  "all 
instruments,  under  our  statute,  are  assign- 
able;" and  the  statement  ttikes  as  author- 
ity Revision,  §  179G,  which  corresponds  with 
section  20^4  of  the  Code,  and  the  language 
of  the  case  is  only  as  to  "  instruments."  It 
does  not  say,  "all  coTitracts."  The  case 
evidently  means  all  instruments  for  the 
payment  or  deli  very  of  money,  property,  or 
labor,  as  specified  in  the  si^ction  and  cliap 
ter.  The  case  of  Bank  v.  Carpenter  was  an 
action  on  a  written  guarantj-,  which  was 
held  assignable;  aad  in  its  disrussion  this 
language  is  used  :  "  Generally,  by  the  com- 
mon law,  a  guaranty  is  not  negt)tiable.  or 
in  any  maTinertransiorable,  so  as  to  enable 
the  a-ssiguee  to  maintain  an  action  there- 
on. *  *  •  But  under  our  statutes  this 
and  every  other  kind  of  contract  is  assign- 
able." It  cites  for  support  Code,  §;;  2os2- 
20>7,  inclusive;  and  it  is  said  in  the  opinion 
that  "even  in  a  case  where,  by  the  terms 
of  the  instrument,  its  assignment  is  pro- 
hibited, it  may  be  assigned.  "  The  sections 
referred  to  are  the  six  first  sections  in  the 
chapter  on"  Notes  and  Bills,"  which  chap- 
ter, of  course,  has  reference  to  other  instru- 
ments than  notes  and  bills,  and  the  pro- 
visions, in  brief,  as  to  assignments  are 
that  a  party  entitled  to  recover  on  an  in- 


5o6 


OPERATION  or  CONTRACT. 


strument  or  an  open  account  may  transfer 
his  ripht  of  recovery  to  another:  but  there 
Is  nothing  in  the  language  of  the  chapter 
to  indicate  a  legislative  intent  to  authorize 
a  party  to  a  contract  by  assignment  to 
transfer  his  obligations  to  perform  to  a 
third  party,  and  thus  effect  liis  release, 
■without  the  consent  of  his  obligee.  Let  us 
suppose  that  A.  contracts  in  writing  to 
render  service,  as  a  traveling  salesman,  to 
B.,  for  a  si^ecilied  compensation.  Under 
the  laM',  if  B.  shall  be  indebted  to  A.  on  the 
contract,  A.  may  assign  his  claim.  But 
suppose  A.  should  assign  his  contract  to 
C,  whereby  C.  was  to  receive  the  pay  and 
render  the  service.  Must  B.  accept  that? 
B.  has  contracted  for  the  services  of  A.  He 
is  entitled  to  that;  and,  before  B.  can  be 
required  to  pay  either  to  A.  or  his  assigns, 
he  must  have  what  hecontracted  for.  The 
law  will  permit  a  person  to  assign  what 
is  his,  either  in  possession  or  by  right  of 
action, butnot  his  obligations  to  another; 
and  such  is  the  substiance  of  the  provis- 
ions of  the  statutes  on  the  subject  of  as- 
signments referred  to.  Thus  we  think 
that  Young  Bros,  could  not,  without  ref- 
erence to  the  assignment  for  the  benefit  of 
creditors,  have  so  assigned  the  contract  in 
question,  without  the  consent  of  the  de- 
fendant, as  to  have  required  defeu<lant  to 
have  accepted  in  lieu  of  theirs  the  notes  of 
their  a-ssignee. 

"We  may  then  inquire  if  there  is  anything 
in  the  statutory  assignment  for  the  bent  fit 
of  creditors  to  change  the  rule?  It  is  urged 
that  the  statutory  pro  visions  as  to  assign- 
ments for  the  benefit  of  creditors  is  broad 
enough  to  enable  the  assignee  to  eseciite 
any  contract  that  might  come  into  his 
hands.  The  difficulties  of  the  case  are  not 
with  the  provisions  of  the  statute  as  to 
the  authority  of  the  a.ssiguee.  They  are 
more  with  his  incapacrity  or  indisposition 
to  execute  the  contract.  We  should  not 
lose  sight  of  the  real  question  under  con- 
sideration by  a  contemplation  of  what  t>he 
assignee  could  have  done  if  defendant,  after 
insolvency,  had  been  willing  to  deliver  the 
seeders.  It  may  be  conceded  that  the  con- 
tract could  thus  have  been  executed  by  the 
a.ssignee  on  behalf  of  Young  Bros.  But 
the  query  is,  had  the  defendant  the  right 
to  refuse  delivery  of  the  seeders  after  in- 
solvency and  assignment?  In  other  words, 
had  it  the  right  to  terminate  the  contract? 
If  it  were  a  case  of  insolvency  without  the 
assignment,  we  think  it  would  be  conceded 
on  authority  that  the  obligation  to  deliver 
could  only  be  on  a  tenderofacash  payment 
in  lieu  of  notes  agreed  upon.  Pardee  v.  Kan- 
ady,  100  N.  Y.  121,  12  N.  E.  Rep.  885.  Does 
the  fact  of  the  assignment  affect  the  rights 
of  the  defendant?  The  reason  of  the  rule 
in  cases  of  insolvency  is  too  manifest  to 
need  explanation,  A  person  who  contracts 
to  deliver  property  on  a  credit,  in  antici- 
pation of  a  solvent  purchaser,  ought  not 
to  be  required  to  deliver  it  after  insolv- 
ency, which  is  a  practical  confession  by  the 
purchaser  of  his  inability  to  comply  with 
the  terms  of  the  contract.  If  to  the  fact  of 
insolvency  is  added  that  of  an  assignment 
for  the  benefit  of  creditors,  why  should  the 
rule  be  changed?  If  the  delivery  is  excused 
in  case  of  insolvencj'  because  the  property 
will  not  be  paid  for.thesame  reasons  exist 


for  excusing  the  delivery  after  assignment. 
If  the  insolvent  did  not  possess  a  right  to 
enforce  the  contract  except  by  cash  pay- 
ment, he  could  convey  no  greater  right  to 
his  assignee.  The  argument  deals  with  the 
question  of  the  right  of  appellant  to  a  de- 
livery of  the  seeders  upon  cash  payment 
therefor.  To  our  minds,  the  record  does 
not  present  the  question  for  consideration. 
The  contract  was  not  to  pay  cash,  but  to 
settle  by  note.  After  insolvency  defendant 
was  not  required  to  anticipate  a  readiness 
for  cash  payment;  and,  if  either  Young 
Bros,  or  plaintiff  desired  to  make  such  pay- 
ment, a  tender  to  that  effect  should  have 
been  made.  Soon  after  the  assignment,  de- 
fendant, as  it  should,  gave  notice  that  be- 
cause of  the  insolvency'  and  dissolution  pf 
the  partnership  the  contract  was  rescinded. 
This  notice  was  to  Young  Bros.  If  the  as- 
signee then  desired  to  pay  in  cash,  and  have 
the  seeders  delivered,  the  proposition  or 
tendershould  have  been  made.  Butneither 
the  pleadings  in  the  case,  nor  the  findings  of 
the  court,  deal  Avith  this  question.  The 
case  in  the  district  court  seems  to  have 
been  tried  upon  an  issue  as  to  the  right  of 
the  assignee  to  carry  out  the  contract  by 
giving  his  note  in  lieu  of  that  of  Young 
Bros.  The  pleadings  and  findings  have  to 
do  with  a  willingness  on  the  part  of  the 
assignee  to  carry  out  the  contract;  but  it 
appears  only  to  have  been  a  carrying  out 
of  the  contract  as  Young  Bros,  were  au- 
thorized to  do,  and  not  by  payrnents  in 
cash.  A  reference  to  the  elcA^enth  finding 
shows  that  the  assignee  has  never  in  any 
manner  indicated  to  defendant  a  purpose 
or  desire  to  secure  or  perform  the  contract. 
Insolvency,  in  such  cases,  implies  an  ina- 
bility to  perform,  on  which  the  defendant 
might  rely  until  otherwise  assured. 

Appellant  contends,  with  much  zeal,  that 
the  mere  fact  of  insolvency  does  not  put  an 
end  to  the  contract  of  sale;  and  several 
authorities  ai-e  cited  in  support  of  the  rule. 
It  is  not  necessary  for  us  to  state  an 
opinion  on  a  state  of  facts  so  broad.  The 
case  In  re  Steel  Co.,  4  Ch.  Div,  108,  cited  by 
appellant,  bears  upon  the  question  of 
when  the  facts  will  justify  a  seller  on  credit 
in  refusing  to  deliver  because  of  the  subse- 
quent insolvency  of  the  purchaser.  The 
facts  in  that  case  are  that  the  Carnforth 
Iron  Company,  in  October,  1874,  contracted 
to  supply  iron  to  be  delivered  monthly, 
and  to  be  paid  for  in  installments,  but  on 
credit.  The  installments  were  delivered 
till  in  February,  1875,  when  the  purchasing 
company  called  a  meeting  of  its  creditors, 
and  said  it  was  carrying  on  business  at  a 
loss,  and  was  short  of  capital,  and  asked 
for  an  extension  of  time,  which  the  credit- 
ors refused.  The  selling  company  then  re- 
fused to  deliver  the  iron  except  upon  cash 
payments,  and  the  purchasing  company 
then  rescinded  the  contract.  The  selling 
company  then  asked  for  damage,  whicli 
the  court  held  could  not  be  recovered; 
holding  that  there  was  no  such  declaration 
of  insolvency  as  to  justify  the  selling  com- 
pany in  refu.sing  to  deliver.  The  syllabus 
of  the  case,  which  appears  to  be  supported 
by  the  opiuion,  deduces  a  rule  as  follows: 
"In  order  to  justify  the  vendors,  in  such  a 
case,  in  exercising  their  right  of  refusal  to 
deliver,  there  must  be  such  proof  or  admis- 


ASSIGNMENT. 


537 


eion  of  the  Insolvency  of  the  purchasers  at 
the  time  as  amounts  to  a  declaration  of 
intention  not  to  pay  for  the  goods.  "  The 
case  does  not  appear  to  be  an  authority 
against  the  right  of  refusal  to  deliver 
where  the  fact  of  insolvency  exists,  and  is 
so  evidenced  as  to  amount  to  a  dec-laied 
purpose  not  to  pay.  It  is  the  fact  of  the 
insolvency  that  Beema  to  be  the  turning 
point  in  the  case,  and  that  would  surely 
seem  to  be  the  reasonable  rule.  The  case 
of  Morgan  v.  Bain,  L.  R.  10  C.  P.  15,  also 
cited  by  appellants,  was  one  for  the  deliv- 
ery of  iron  on  credit;  and  the  purchasers 
became  insolvent.  Lord  Colkridge,  C.  J., 
in  his  opinion,  said:  "It  is  not  disputed 
tliat  upon  the  occurrence  of  insolvency  the 
vendor  would  not  be  bound  to  deliver  to 
the  insolvent  purchaser  an  installment  of 
the  iron  becoming  due,  without  a  tender 
of  the  price. "  Brett,  J.,  in  the  same  case, 
said,  without  commitang  himself  to  the 
tlieory  that  the  mere  fact  of  insolvency 
would  pci  se  p'jt  an  end  to  the  contract, 
that  such  fact,  with  that  of  notice  to  the 
seller  of  the  insolvency,  would  justify  an  as- 
sumption by  the  seller  that  the  purchaser 
intended  to  abandon  the  contract.  The 
notice  upon  which  he  relied,  and  gave  his 
adherence  to  the  holding  in  that  case,  waa 
the  commencement  of  insolvent  proceed- 
ings under  the  bankrupt  act.  In  this  case 
the  fact  of  the  insolvency  is  unquestioned, 
and  a  like  notice  is  given  by  an  insolvent 
proceeding  for  the  benefit  of  creditors. 
Hence  it  seems  the  defendant,  in  this  case, 
is  within  any  of  the  rules  cited.  Other  au- 
thorities cited  by  appellant  are  not  more 
favorable  to  his  position. 

2.  Defendant  presented  a  counter-claim, 
based  on  an  open  account  alleging  a  bal- 
ance due  of  $27.98,  as  to  which  the  court 
established  a  claim  against  the  estate  of 
Young  Bros,  for  $27,  based  on  the  follow- 
ing finding  of  facts:  "  Twelfth.  On  defend- 
ant's counter-claim,  the  court  finds  that 
defendant  received  orders  from  Young 
Bros,  for  the  goods  mentioned  in  the  ac- 


count under  dates  September  5,  6,  8,  15, 
and  17,  18S4;  that  these  orders  were  treat- 
ed in  the  usual  way,  the  usual  directions 
given  for  shipping,  and  the  goods  charged 
on  the  books  to  Young  Bros. ;  that  both 
of  Young  Bros,  were  on  the  witness  stand, 
and  neither  of  tliein  denied  having  received 
the  goods;  that,  the  balance  of  defendant's 
counter-claim  not  beiug  denied,  the  de- 
fendant should  recover  the  sum  of  three 
hundred  and  twenty-seven  and  ninety-eight 
one-hundredths  dollars,  less  the  sum  of 
three  hundred  dollars  due  the  plaintiff  for 
commission  earned  by  Young  Bros,  under 
thecontractof  LS'vj,  declared  on  in  plaintiff's 
petition."  It  is  urgi-d  that  tlie  proofs  are 
not  sufficient  to  sustiun  the  finding.  The 
argument  concedes  a  practical  disjjute  in 
the  testimony,  and  the  finding  has  the 
force  of  a  verdict  by  the  jury.  The  evi- 
dence is  such  that  we  cannot  interfere, 

3.  It  is  next  said  that  it  was  error  to  en- 
ter a  personal  judgment  against  ttie  as- 
signee. The  assignment  is  in  these  words: 
"The  court  erred  iu  rendering  a  personal 
judgment  against  the  plaintiff  herein  for 
the  balance  due  upon  defendant's  counter- 
claim, for  the  reason  that  such  judgment 
is  contrary  to  law  and  the  evidence.  Said 
defendant  was  entitled  only  to  the  estab- 
lishment of  his  claim  as  a  creditor  of  said 
estate."  The  assignment  is  not  sustained 
by  the  record.  The  judgment  of  the  court 
is  merely  the  establishment  of  a  claim 
against  the  estate.  It  is  not  a  personal 
judgment.  It  would  only  be  su  bject  to  pro 
rata  payment,  like  other  claims.  The 
wording  of  the  judgment  is  "that  such  be 
andis  hereby  established  asa  claim  against 
the  estate  of  Young  Bros.,  and  against  the 
eaid  Eapplye  as  their  assignee. "  These 
words  have  no  other  meaning  than  the  es- 
tablishment of  the  claim.  It  would  ap- 
pear that  appellant  has  based  this  assign- 
ment rather  upon  statements  in  the  ab- 
stract with  reference  to  the  judgment  than 
upon  record  of  the  judgment  as  copied  in 
the  abstract.    Affirmed. 


0PERATI0:5(  OF  CONTRACT. 


COOLIDGE  V.  RUGGLES. 

(15  Mass.  3S7.) 

Supreme   Judicial   Court   of   Massachusetts. 
Suffolk  and  Nantucket.    1819. 

Assumpsit  on  the  following  writing,  viz.;— 

"Boston,  October  1,  1S12. 
"For  value  received,  I  promise  to  pay  the 
bearer  hereof,  six  months  after  date,  nine 
hundred  and  eighty  dollars,  provided  the 
ship  Mary  arrives  at  a  European  port  of  dis- 
charge, free  from  capture  and  condemna- 
tion by  the  British. 

"Samuel  Ruggles." 

At  the  trial  before  Jackson,  J.,  at  the 
sittings  here,  after  the  last  March  term,  it 
appeared  that  the  said  promise  was  made  to 
one  W.  S.  Skinner,  the  consideration  where- 
of was  a  certain  document,  known  by  the 
name  of  "a  Sawyer  license,"  which  was  in- 
tended for  the  protection  of  merchant  ves- 
sels of  the  United  States  from  capture  by 
British  cruisers,  war  then  existing  between 
the  United  States  and  Great  Britain;  and 
that,  about  two  years  after  receiving  the 
said  note,  the  said  Skinner  transferred  and 
delivered  the  same,  with  other  effects,  to  the 
plaintiff,  to  be  by  him  collected  and  passed 
to  the  credit  of  Skinner,  in  an  account  then 
open  between  him  and  the  plaintiff,  and 
upon  which  Skinner  was  indebted  to  the 
plaintiff.  The  signature  of  the  defendant 
was  admitted,  and  the  plaintiff  proved  that 
the  said  ship  Mary,  mentioned  In  the  said 
note,  arrived  at  a  Eiiropean  port  of  dis- 
charge, and  there  delivered  her  cargo  in 
safety,  without  any  capture  or  condemna- 
tion whatsoever. 

A  verdict  was  returned  for  the  plaintiff, 
under  the  direction  of  the  judge;  and  the 
defendant  tendered  a  bill  of  exceptions  as 
at  common  law,  which  was  sealed  by  the 
judge.  The  questiou  chiefly  insisted  on  at 
the  argument,  and  which  alone  was  consid- 
ered by  the  court,  was,  whether  the  plaintiff 
could  maintain  the  action,  as  assignee  of 
the  note  sued. 


Mr.  Hubbard,  for  plaintiff.     The  Solicitor 
General  and  Mr.  Cooke,  for  defendant. 

PARKER,  C.  J.,  delivered  the  opinion  of 
the  court.  The  only  question  to  which  we 
have  turned  our  attention  in  this  case,  is, 
whether  the  written  promise  declared  on  is 
negotiable  in  its  nature,  so  that  an  action 
may  be  maintained  upon  it  in  the  name  of 
the  plaintiff,  who  is  assignee.  And  we  are 
all  of  opinion  that  it  is  not  so  negotiable,  on 
account  of  the  contingency  on  which  the 
payment  of  the  money  is  made  to  depend- 
All  promises  to  pay  money,  being  at  com- 
mon law  choses  in  action,  were  unassign- 
able. It  is  only  by  virtue  of  the  statute  of 
3  &  4  Anne,  c.  9,  that  certain  descriptions 
of  them  are  assignable,  so  as  that  the  prop- 
erty and  the  right  of  action  vest  in  the  as- 
signee. 

The  paper  declared  on  does  not  come  with- 
in the  description  of  notes  made  assignable 
by  that  statute.  For  it  has  been  declared 
by  frequent  judicial  decisions,  that  a  note  or 
bill,  to  attain  that  character,  must  be  pay- 
able in  money  absolutely.  A  note  or  bill 
payable  to  bearer  stands  upon  the  same 
ground  as  a  note  payable  to  order.  The 
only  difference  is  in  the  mode  of  transfer. 
The  latter  must  be  by  endorsement;  the 
former  may  be  by  delivery;  but  both  must 
contain  a  promise  to  pay  money  uncondition- 
ally. 

The  cases  which  show  that  an  action  may 
be  maintained  by  an  assignee,  in  his  own 
name,  are  all  where  there  has  been,  after 
the  assignment,  a  promise  to  pay  to  the  as- 
signee; and  to  this  effect  the  case  of  Fen- 
ner  v.  Mears,  2  W.  Bl.  1269,  is  unquestion- 
ably good  law;  and  several  cases  have  been 
decided  by  this  court  upon  the  same  princi- 
ple. In  this  case,  no  promise  is  shown  to 
pay  to  the  assignee. 

Cases  were  cited  to  show  that  the  promise 
in  this  case  is  assignable  in  equity.  But 
the  difference  between  that,  and  an  assign- 
ment under  the  statute  of  Anne,  Is  too  well 
known  to  need  explanation.  The  verdict  is 
set  aside  and  a  new  trial  granted- 


/v 


V 


.X 


i 


ASSIGNMENT. 


i39 


WALKER  et  al.  v.  BROOKS  ct  aL 

(125  Mass.  241.) 

Supreme   Judicial    Court   of   Massachusetts. 
Worcester.    Aug.  31,  1878. 

G.  F.  Hoar  aud  F.  T.  Blackiuer,  for  plain- 
tiffs.    J.  J.  Storrow,  for  defendants. 

GRAY,  C.  J.  This  bill  was  filed  May  21, 
1877,  by  Joseph  H.  Walker  and  Georf^e  M. 
Walker,  copartners,  against  James  W.  Brooks 
and  Horace  H.  Bigelow.  The  material  alle- 
gations of  the  bill  are  as  follows: 

1st.  That  on  March  21,  1872,  the  defend- 
ant Bigelow  executed  to  the  two  plaintiffs  a 
lease  of  and  license  to  use  a  certain  patented 
machine  for  compressing  heels  for  boots  }>nd 
shoes,  for  which  the  plaintiffs  were  to  oav 
him  a  royalty  of  ten  cents,  or,  in  case  of  their 
rendering  true  accounts  to  him  monthly,  the 
sum  of  one-half  cent,  for  each  pair  of  heels 
thereby  compressed. 

2d.  That,  at  the  same  date,  Bigelow  enter- 
ed into  an  agreement  with  Joseph  H.  Walker, 
one  of  the  plaintiffs,  to  pay  him  monthly  for 
certain  services  in  introducing  the  machine  to 
the  public  (which  he  afterwards  performed) 
sums  equal  to  those  to  be  paid  by  the  plain- 
tiffs to  Bigelow  under  the  lease  and  license 
from  him. 

3d.  That  Bigelow  has  assigned  each  of  these 
contracts  to  the  other  defendant  Brooks,  who 
has  become  in  equity  entitled  to  all  the  ad- 
vantages thereof  and  to  receive  all  sums  of 
money  due  or  to  become  due  from  the  plain- 
tiffs under  the  same,  and  has  become  in  eq- 
uity bound  to  perform  all  the  obligations  ex- 
pressed or  implied  therein  to  be  performed 
by  Bigelow. 

4th.  That  all  the  rights  and  obligations  of 
Joseph  H.  Walker,  under  his  agreement  with 
Bigelow,  have  been  assigned  to  and  vested 
in  the  plaintiffs,  and  they  are  in  equity  enti- 
tled to  receive  all  sums  which  are  or  may  be- 
come due  under  the  same. 

5th.  That  the  plamtlffs,  under  the  lease  and 
license  to  them,  have  used  the  patented  ma- 
chine, and  have  duly  kept  and  rendered  ac- 
counts to  the  defendants,  and  have  paid  to 
them  in  full  for  such  lease  and  use  to  Febru- 
ary 1,  1877,  the  sum  of  .$3000,  and  now  owe 
and  are  ready  to  pay  to  the  defendant  Brooks 
a  further  sum  of  $164  75  for  such  use  since 
that  time.  . 

Gth.  That  there  is  due  a  like  sum  from 
Brooks  to  the  plaintiffs,  and  that  they  have 
demanded  of  him  that  he  should  pay  to  them 
the  sum  so  paid  by  them,  and  should  set  off 
the  sum  so  due  from  them  as  rent  as  afore- 
said against  the  sum  so  in  equity  due  to 
them  from  him;  and  that  he  has  wholly  re- 
fused to  do  so.  and  threatens  to  sue  thorn  for 
this  sum,  and  to  set  aside  and  avoid  the 
lease  and  license,  and  to  seize  uix)n  and  take 
possession  of  the  leased  machines,  alleging 
that  the  plaintiffs  have  not  performed  the 
stipulations  and  conditions  thereof  on  their 
part. 

7th.  That  the  plaintiffs  have  fully  perform- 


ed the  same,  and  are  nady  and  offer  to  do  so 
hereafter,  except  that  they  Insist  and  aver 
tliat  in  equity  they  are  entitled  to  have  the 
sums  due  as  aforesaid,  from  either  of  the 
parties  to  the  othei.  set  off,  and  that  such 
right  to  a  set-off  operates  as  an  extinguish- 
ment and  payment  of  tho.se  sums. 

The  prayer  of  the  bill  is  for  a  discovery  un- 
der oath;  for  an  account  of  all  sums  due  from 
the  plaintiffs  to  the  defendants  or  either  of 
them,  and  from  the  defendants  or  either  of 
them  to  the  plaintiffs;  for  a  set-off  of  such 
sums  against  each  other;  for  an  injunction 
against  bringing  any  suit  against  the  plain- 
tiffs on  account  of  any  claim  against  them  as 
above  stated;    and  for  further  relief. 

To  this  bill  the  defendants  have  demurred, 
because  the  plaintiffs  have  a  plain,  adequate 
and  complete  remedy  at  law,  and  because 
they  have  not  stated  such  a  case  as  entitles 
them  to  any  discovery  or  relief  In  equity. 
We  are  of  opinion  that  the  demurrer  Is  well 
taken,  and  that  the  bill  cannot  be  sustained 
on  any  of  the  grounds  assigned  by  the  learn- 
ed counsel  for  the  plaintiffs. 

It  is  attempted,  in  the  first  place,  to  bring 
the  case  within  the  rule,  that  where  there 
are  cross  demands  between  the  parties  of  sucli 
a  nature  that  if  both  were  recoverable  at  law 
they  would  be  the  subject  of  a  set-off,  then, 
if  eitlier  of  them  is  a  matter  of  equitable  ju- 
risdiction, the  set-off  may  be  enforced  in  eq- 
uity. It  Is  said  that  the  defendant  Brooks, 
as  the  assignee  of  the  claim  of  the  other  de- 
fendant Bigelow  against  the  plaintiffs,  has 
an  equitable  right  of  action  against  the  plain- 
tiffs, which,  though  at  law  it  could  only  be 
sued  in  the  name  of  Bigelow,  might  in  eq- 
uity be  sued  by  Brooks;  and  that  such  nght 
of  Brooks  to  sue  the  plaintiffs  in  equitv  af- 
fords a  foundation  for  jurisdiction  In  equity 
to  order  a  set-off  of  that  equitable  right 
against  the  plaintiffs'  claim. 

But  a  court  of  equity  will  not  entertain  a 
bill  by  the  assignee  of  a  strictly  legal  right, 
merely  upon  the  ground  that  he  cannot  bring 
an  action  at  law  in  his  own  name,  nor  unless 
It  appears  that  the  assignor  prohibits  and 
prevents  such  an  action  from  being  brought 
in  his  name,  or  that  an  action  .so  brought 
would  not  afford  the  assignee  an  adequate 
remedy. 

In  Hammond  v.  Mos.senger,  9  Sim.  327,  3.32, 
Vice  Chancellor  Shad  well  so  held,  and  said, 
"If  this  case  were  stripped  of  all  special  cir- 
cumstiinces,  it  would  be  simply  a  bill  filed  by 
a  plaintiff  who  had  obtained,  from  certain 
persons  to  whom  a  debt  was  due,  a  right  to 
sue  in  their  names  for  the  debt.  It  is  quite 
new  to  me  that,  in  such  a  simple  case  as  that, 
this  court  allows,  in  the  first  instance,  a  bill 
to  be  filed  against  the  debtor  by  the  person 
who  has  become  the  assignee  of  the  debt.  I 
admit  that,  if  special  circumstances  are  stat- 
ed, and  it  is  represented  that,  notwithstand- 
ing the  right  which  the  party  has  obtained  to 
sue  in  the  name  of  the  creditor,  the  creditor 
will  interfere  and  prevent  the  exercise  of  that 


540 


OPERATION  or  CONTRACT. 


right,  this  court  will  interpose  for  the  pur- 
pose of  preventing  that  species  of  wrong  being 
done;  and,  if  the  creditor  will  not  allow  the 
matter  to  be  tried  at  law  in  his  name,  this 
court  has  a  jurisdiction,  in  the  first  instance, 
to  compel  the  debtor  to  pay  the  debt  to  the 
plaintiff;  especially  in  a  case  where  the  act 
doue  by  the  creditor  is  done  in  collusion  with 
the  debtor.  If  bills  of  this  kind  were  allow- 
able, it  is  obvious  that  they  would  be  pretty 
frequent;  but  I  never  remember  any  instance 
of  such  a  biU  as  this  being  filed,  unaccompa- 
nied by  special  circumstances." 

It  is  true  that  Mr.  Justice  Story,  in  his  Com- 
mentaries, observed  upon  that  opinion,  "Tliis 
doctrine  is  apparently  new,  at  least  in  the 
broad  extent  in  which  it  is  laid  down;  and 
does  not  seem  to  have  been  generally  adopted 
in  America.  On  the  contrary,  the  more  gen- 
eral principle  established  in  this  country 
seems  to  be,  that  wherever  an  assignee  has 
an  equitable  right  or  interest  in  a  debt  or 
other  property  (as  the  assignee  of  a  debt  cer- 
tainly has)  there  a  court  of  equity  is  the  prop- 
er forum  to  enforce  it;  and  he  is  not  to  be 
driven  to  any  circuity  by  instituting  a  suit  at 
law  in  the  name  of  the  person  who  is  possess- 
ed of  the  legal  title.  A  cestui  que  trust  may 
ordinarily  sue  third  persons  in  a  court  of  eq- 
uity, upon  his  equitable  title,  without  any 
reference  to  the  existence  of  a  legal  title  in 
his  trustee,  which  may  be  enforced  at  law." 
Story,  Eq.  Jur.  §  lOoTa.  To  the  same  effect 
is  the  statement  in  Story,  Eq.  PI.  §  153. 

But  the  adjudged  cases,  including  those  cit- 
ed by  the  learned  commentator,  upon  being 
examined,  fail  to  support  his  position,  and 
show  that  the  doctrine  of  Hammond  v.  Mes- 
senger is  amply  sustained  by  earlier  authori- 
ties in  England  and  in  this  country. 

A  century  and  a  half  ago,  parties  for  whose 
benefit  their  agent  had  obtained  policies  of 
insurance  in  his  own  name,  brought  bills  in 
equity  against  the  underwriters.  But  Lord 
Chancellor  King  refused  to  sustain  them,  say- 
ing, "At  this  rate,  all  policies  of  insurance 
would  be  tried  in  this  court,  for  they  are  gen- 
erally taken  in  the  name  of  a  trustee;"  and 
again,  "If  I  should  give  way  to  this  attempt, 
no  action  would  ever  be  brought  on  a  poli- 
cy." And  his  decision  was  aflirmed  in  the 
house  of  lords.  Dhegetoft  v.  Assurance  Co., 
Mos.  83.  and  4  Brown,  Pari.  Cas.  (2d  Ed.) 
4:]t;;  Fall  v.  Chambers,  Mos.  193;  Lord  Hard- 
wicke  afterwards  expressed  a  like  opinion. 
Motteux  V.  Assurance  Co.,  1  Atk.  545,  547. 

In  Cator  v.  Burke,  1  Brown,  Ch.  434,  Cator, 
with  whom  Hargrave  had  deposited,  as  secu- 
rity for  a  debt  of  his  own  to  Cator,  a  bond 
made  by  Burke  to  Hargrave,  filed  a  bill  in 
equity  against  Burke  and  Hargrave,  to  com- 
pel Burke  to  pay  the  debt  to  the  plaintiff, 
out  of  a  counter  bond  for  a  larger  amount, 
which  Hargrave  had  made  to  Burke;  and  to 
prevent  Burke  from  setting  up  the  counter 
bond  as  a  defense  to  any  action  at  law  which 
might  be  brought  against  him  in  the  name  of 
Hargrave.      The    bill    was    dismissed;     Lord 


Loughborough  saying,  "The  bond  can  never 
be  considered  in  any  other  light  than  as  an 
unassignable  security;  to  consider  it  other- 
wise would  bring  all  the  causes  on  bonds  in 
Westminster  Hall  into  this  court.  The  plain- 
tiff has  mistaken  both  the  law  and  equity; 
for  first,  he  has  supposed  that  the  holder  of 
a  bond  might,  where  there  was  no  discovery 
to  be  made,  come  bither,  and  have  a  differ- 
ent relief  from  what  he  could  have  at  law; 
and  secondly,  that  if  there  was  fraud  in  giv- 
ing the  counter  bond,  it  could  not  be  made  use 
of  at  law.  When  this  bill  is  dismissed  with 
costs,  you  may  bring  your  action  in  the  name 
of  Hargrave.  If  this  bill  would  lie  by  the 
simple  act  of  assigning  the  bond,  a  suit  in  eq- 
uity might  be  brought  on  eveiy  bond  that  is 
given."  So  m  Rose  v.  Clarke,  1  Younge  & 
C.  534,  548,  Vice  Chancellor  Knight-Bruce 
said,  "As  I  apprehend,  an  equitable  title  to 
money  secured  by  a  bond  is  not  of  itself  suf- 
ficient to  entitle  the  party  so  interested  to 
sue  the  obligor  in  equity  for  payment  of  the 
money.  There  must,  I  conceive,  be  some- 
thing more." 

The    decision    in    Riddle    v.    Mandeville,    5 
Cranch,  322,  allowing  an  indorsee  of  a  prom- 
issory note  to  sustain  a  bill  in  equity  against 
a  remote  indorsei,  proceeded  upon  the  ground 
that  in  Virginia  no  remedy  at  law  could  be 
had   agamst   him,    except   by    the    circuitous 
course  of  successive  actions  by  each  indorsee 
against  his  immediate  indorser,   and  that   in 
that   particular   case   the    intermediate   party 
was  insolvent     See  Mandeville  v.  Riddle,   1 
Cranch,  290;    Harris  v.  Johnston,  3  Cranch, 
311.     That  Chief  Justice  Marshall,  who  de- 
livered the  opinions  in  these  cases,   did  not 
consider    them    as    establishing    the    general 
proposition  that  the  assignee  of  a  chose  m 
action,  who  could  not  sue  thereon  in  his  own 
name  at  law,   might  therefore  do  so   in  eq- 
uity,   is    manifest    from    his    opinion    in    the 
later   case    of    Lenox    v.    Roberts,    2    Wheat 
373,  in  which  the  assignee  of  all  the  property 
of  a  banking  corporation  was  allowed  to  main- 
tain a  bill  in  equity  in  his  own  name  upon  a 
promissory  note  which  had  not  been  formally 
indorsed  to  him,  for  the  reason  that,  "as  the 
act  of   incorporation   had   expired,   no   action 
could  be  maintained  at  law  by  the  bank  itself." 
In  Carter   v.   Insurance   Co.,   1  Johns.    Ch. 
4G3,  Chancellor  Kent  dismissed  a  bill  in  equi- 
ty brought  against  an  insurance  company  by 
the  assignees  of  a  policy  of  msurance;    and 
briefly  stated  his  reasons  to  be,  that  the  de- 
mand  was   properly   cognizable  at  law,   and 
there  was  no  good  reason  for  coming  into  the 
court  of  chancery  to  recover  on  the  contract  of 
insurance;   that  the  plaintiffs  were  entitled  to- 
make  use  of  the   names  of  the  original  as- 
sured  in   the   suit  at  law,   and  the  nominal 
plaintiffs   would    not  be  permitted  to  defeat 
or  prejudice  the  right  of  action;  that  it  might 
be  said  here,  as  was  said  by  the  chancellor  in 
the  analogous  case  of  Dhegetoft  v.  Assurance 
Co.,  supra,  that  at  this  rate  all  policies  of  in- 
surance  would   be   tried   in   this  court;    and 


ASSIGNMENT. 


541 


that  the  bill  stated  no  special  ground  for  eq- 
uitable relief. 

It  was  hold  by  the  courts  of  appeals  of 
Maryland  and  Virginia,  and  by  the  supremo 
court  of  Tennessee  in  an  opinion  delivered 
by  Judge  Catron,  (afterwards  a  justice  of  the 
supreme  court  of  the  United  States.)  that  the 
mere  fact  of  the  assignment  of  a  legal  chose 
in  action  gave  the  assignee  no  right  to  involve 
the  jurisdiction  of  a  court  of  equity.  Adair 
V.  Winchester,  7  dill  &  J.  114;  Moseley  v. 
Boush.  4  Rand.  302;  Smiley  v.  Bell,  Mart.  & 
Y.  378.  The  opposing  decision  in  Townsond 
V.  Carpenter,  11  Ohio,  21,  is  unsupported  by 
.my  reference  to  authorities. 

The  cases  before  Chancellor  Walworth  of 
Field  V.  Maghee,  5  Paige,  .539,  and  Rogers  v. 
Insurance  Co.,  6  Paige,  583,  contain  no  de- 
cision upon  this  point;  and  in  the  later  case 
of  Ontario  Banlj  v.  Mumford,  2  Barb.  Ch. 
596,  615,  he  said,  "As  a  general  nile,  this 
court  will  not  entertain  a  suit  brought  by 
the  assignee  of  a  debt  or  of  a  chose  in  ac- 
tion, which  is  a  mere  legal  demand,  but  will 
leave  him  to  his  remedy  at  law  by  a  suit  in 
the  name  of  the  assignor;"  and  referred  to 
the  cases  before  Chancellor  Kent  and  Vice 
Chancellor  Shadwell,  and  in  the  courts  of  Ma- 
ryland, Virginia  and  Tennessee,  already  cited. 

The  statement  in  Story,  Eq..  Jur.  §  143r.a, 
that  "if  a  legal  debt  is  due  to  the  plaintiff  by 
the  defendant,  and  the  defendant  is  the  as- 
signee of  a  legal  debt  due  to  a  third  person 
from  the  plaintiff,  which  has  been  duly  as- 
signed to  himself,  a  court  of  equity  will  set 
off  the  one  against  the  other,  if  both  debts 
could  properly  be  the  subject  of  a  set-off  at 
law,"  is  pervaded  by  the  same  error  that  we 
have  considered. 

The  decision  of  the  vice  chancellor  in  Wil- 
liams V.  Davies,  2  Sim.  461,  by  which  a  cred- 
itor appears  to  have  been  restrained  in  eq- 
uity from  taking  judgment  and  execution  at 
law  on  a  debt  of  one  to  whom  he  owed  a 
larger  sum,  is  obscurely  reported,  and  was  dis- 
approved by  Lord  Chancellor  Cottenham. 
Clarlc  V.  Oort,  Craig  &  P.  154,  159;  Rawson  v. 
Samuel,  Craig  &  P.  161,  178.  In  Clark  v. 
Cort,  the  bill  upon  which  the  set-off  was  or- 
dered was  by  tlie  assignees  of  a  claim  which 
required  the  investigation  of  accounts  and  the 
application  of  a  security,  of  which  the  court 
would  have  had  jurisdiction  if  the  suit  had 
been  by  the  assignor;  and  the  chancellor 
said,  "The  case,  then,  is  not  that  of  a  mere 
assignee  of  a  legal  debt,  coming  into  equity  to 
have  the  benefit  of  a  set-off  which  he  could 
not  have  at  law."    In  Rawson  v.  Samuel,  he 


observed,  "We  speak  familiarly  of  equitable 
set-off,  as  distingui.shed  from  the  set-off  at 
law;  but  It  will  be  found  that  this  equitable 
set-off  exists  in  cases  where  the  party  seek- 
ing the  benefit  of  it  can  sliow  some  equitable 
ground  for  being  protected  agaiu.st  his  ad- 
versary's demand.  The  mere  existence  of 
cro.ss  demands  is  not  suflicient."  And  see 
Watson  V.  Railway  Co.,  L.  R.  2  C.  P.  593; 
Spaulding  v.  Backus,  122  Mass.  553. 

In  this  commonwealth,  the  assignee  of  a 
chose  in  action  has  an  adequate  and  complete 
remetly  at  lav/,  w  the  right  to  maintain  an  ac- 
tion thereon  in  the  name  of  his  assignor,  or  of 
his  executor  or  administrator,  without  his  con- 
sent, and  even  against  his  protest,  at  least  upH 
on  giving  him,  if  sea.sonably  demanded,  a 
bond  of  indemnity  ag-ainst  costs.  Dennis  v. 
Twitchell.  10  Mete.  (Mass.)  ISO,  184;  Rock- 
wood  V.  Brown.  1  Gray,  261;  Bates  v.  Kemp- 
ton,  7  Gray,  382;  Foss  v.  Bank,  111  ila.ss. 
285.  In  any  action  at  law,  brought  by  Brooks 
in  the  name  of  Bigolow,  to  recover  the  sums 
due  him  from  these  two  plaintiffs  under  the 
license,  they  could  set  off  the  demand,  under 
the  other  contract  assigned  to  them,  of  Jo- 
seph H.  Walker  against  Bigelow,  if  Bigelow 
liad  notice  of  such  assignment  before  bringing 
his  action.  Gen.  St  c.  130,  §  5;  Cook  v.  Mills, 
5  Allen,  36,  38.  Their  neglect  to  give  such 
notice  cannot  entitle  them  to  demand  the  In- 
terposition of  a  court  of  equity.  Wolcott  v. 
Jones,  4  Allen,  367. 

The  bill  shows  no  case  for  an  account  that 
cannot  be  taken  at  law.  Badger  v.  McNa- 
mara,  123  Mass.  117.  It  cannot  be  main- 
tained to  restrain  a  forfeiture;  because  it 
does  not  show  that  there  is  any  danger  of  ir- 
reparable injury,  therein  differing  from  Flor- 
ence Sewing- Mach.  Co.  v.  Grover  &  B.  Sew- 
ing-Mach.  Co.,  110  Mass.  1.  It  cannot  be 
maintained  under  Gen.  St  c  113,  §  2.  to  reach 
and  apply,  in  payment  of  a  debt,  property  or 
rights  of  a  debtor  which  cannot  be  come  at  to 
be  attached  or  taken  on  execution  in  a  suit  at 
law  against  him;  because  it  is  not  framed  in 
that  aspect  and  because  the  statute  relates  to 
rights  of  property,  or  claims  of  the  debtor 
against  third  persons,  and  does  not  extend  to 
claims  of  the  debtor  against  the  plaintiff  him- 
self. Crompton  v.  Antliony,  13  AUen.  33,  37. 
It  cannot  be  maintained  for  discovery;  be- 
cause it  cannot  be  maintained  for  relief,  and 
does  not  show  that  any  discovery  is  required 
in  aid  of  proceedings  at  law.  Pool  v.  Lloyd. 
5  Mete.  (Mass.)  525;  Ahrend  v.  Odiome.  118 
Mass.   261. 

Demurrer  sustained,  and  bill  dismissed. 


542 


OPERATION  OF  CONTRACT. 


'^ 


-  ARKANSAS   VALLEY   SMELTING   CO.   v. 

'V  BELDEN  MIN.  CO.  'K^^  ^ 

^  (8  Snp.   Ct.   130S.  127   U.  S.  379.)    3^'' 

Sapremp  Court  of  the  United  States.     May  14, 
ISSS. 

In  error  to  the  circuit  court  of  the  United 
States  for  the  district  of  Colorado. 

This  was  an  action  brought  by  a  smelting 
company,  incorporated  by  the  laws  of  Mis- 
souri, against  a  mining  company,  incorpo- 
rated by  the  laws  of  Maine,  and  both  doing 
business  in  Colorado  by  virtue  of  a  compli- 
ance with  its  laws,  to  recover  damages  for 
the  breach  of  a  contract  to  deliver  ore,  made 
by~tl3e~trerenaant  witlf  Billing  &  Eilers,  and 
assigned  to  the  plaintiff.  The  material  alle- 
gations of  the  complaint  were  as  follows: 
On  July  12,  ISSl,  a.  contract  in  writing  was 
made  between  the  defendant  of  the  first 
part  and  Billing  &  Eilers  of  the  second  part, 
by  which  it  was  agreed  that  the  defendant 
should  sell  and  deliver  to  Billing_&  Eilers, 
at  their  ^meltmg^worfe  iiTTieadville,  10,000 
tons  of  carbonateTead  ore  Jrgm  its  mines  at 
Red  Cliff^at_the,,nrtp-x)£-ai  Jeaat-aO_tQfls_a 
day,  beginning  upon  the  completion  of  a  rail- 
i-oaH"  fv(fm.  Leadville  to  Red  Cliff,  and  continu- 
ing until  the  whole  should  have  been  deliv- 
ered, and  that  "aU. ^re  jo  jjellvered  shall  at 
once,  upon  the  delivery  thereof,  become  the 
property  of  the  second  party;"  and  it  was 
further  agreed  as  follows:  "The  value  of 
said  ore  and  the  price  to  be  paid  therefor  shall 
be  fixed  in  lots  of  about  one  hundred  tons 
each;  that  is  to  say,  as  soon  as  such  a  lot 
of  ore  shall  have  been  delivered  to  said  sec- 
ond party,  it  shall  be  sampled  at  the  works 
of  said  second  party,  and  the  sample  assayed 
by  either  or  both  of  the  parties  hereto,  and 
the  value  of  such  lots  of  ore  shall  be  fixed  by 
such  assay;  in  case  the  parties  hereto  cannot 
agree  as  to  such  assay,  they  shall  agree  upon 
some  third  disinterested  and  competent  par- 
ty, whose  assay  shall  be  final.  The  price  to 
be  paid  by  said  second  party  for  such  lot  of 
ore  shall  be  fixed  on  the  basis  hereinafter 
agreed  upon  by  the  closing  New  York  quota- 
tions for  silver  and  common  lead,  on  the  day 
of  the  delivery  of  sample  bottle,  and  so  on 
until  all  of  said  ore  shall  have  been  delivered. 
Said  second  party  shall  pay  said  first  party 
at  said  Leadville  for  each  such  lot  of  ore  at 
once,  upon  the  detennination  of  its  assay 
value,  at  the  following  prices;"  specifying, 
by  reference  to  the  New  York  quotations,  the 
price  to  be  paid  per  pound  for  the  lead  con- 
tained in  the  ore,  and  the  price  to  be  paid  for 
the  silver  contained  in  each  ton  of  ore,  vary- 
ing according  to  the  proportions  of  silica  and 
of  iron  in  the  ore.  The  complaint  further 
alleged  that  the  railroad  was  completed  on 
November  30,  1881,  and  thereupon  the  defend- 
ant, under  and  in  compliance  with  the  con- 
tract, began  to  deliver  ore  to  Billing  &  Eilers 
at  their  smelting  works,  and  delivered  167 
tons  between  that  date  and  .January  1,  1882, 
when  "the  said  firm  of  Billing  and  Eilers  was 


dissolved,  and  the  said  contract  and  th£_b]ial- 
ness  ctTaid  firm,  and  the  smelting  works  a.t 
which  said  urcs  wlto  to  be  delivered,  were 
sold,  assigUL'd,  aud  iraust'crred  to  Gj,_BUli^, 
whereof  the  defendaBt  had  due  notice;"  that 
after  such  transfer  and  assignment  the  de- 
fendant continued  to  deliver  ore  under  the 
contract,  and  between  January  1  and  April 
21,  1882,  delivered  to  Billing  at  said  smelting 
works  894  tons;  that  on  May  1,  1882,  the  con- 
tract, together  with  the  smelting  works,  was 
sold  and  ^onveyed  by  Billing^  to_th£  plaintiff, 
whereof  the  defendant  had  due  notice;  that 
the  defendant  then  ceased  to  deliver  ore  un- 
der the  contract,  and  afterwards  refused  to 
perform  the  contract,  and  gave  notice  to  the 
plaintiff  that  it  considered  the  contract  can- 
celed and  annulled;  that  all  the  ore  so  deliv- 
ered under  the  contract  was  paid  for  accord- 
ing to  its  terms;  that  "the  plaintiff  and  its 
said  assignors  were  at  all  times  during  their 
respective  ownerships  ready,  able,  and  willing 
to  pay  on  the  Uke  terms  for  each  lot  as  deliv- 
ered, when  and  as  the  defendant  should  de- 
liver the  same,  according  to  the  terms  of  said 
contract,  and  the  time  of  payment  was  fixed 
on  the  day  of  delivery  of  the  'sample  bottle,' 
by  which  expression  was,  by  the  custom  of 
the  trade,  intended  the  completion  of  the  as- 
say or  test  by  which  the  value  of  the  ore  was 
definitely  fixed;"  and  that  "the  said  Billing 
and  Eilers,  and  the  said  G.  BilUng,  their  suc- 
cessor and  assignee,  at  all  times  since  the 
delivery  of  said  contract,  and  during  the  re- 
spective periods  when  it  was  held  by  them 
respectively,  were  able,  ready,  and  willing  to 
and  did  comply  with  and  perform  all  the 
terms  of  the  same,  so  far  as  they  were  by 
said  contract  required;  and  the  said  plain- 
tiff has  been  at  all  times  able,  ready,  and  will- 
ing to  perform  and  comply  with  the  terms 
thereof,  and  has  from  time  to  time,  since  the 
said  contract  was  assigned  to  it,  so  notified 
the  defendant."  The  defendant  demm'red 
to  the  complaint  for  various  reasons,  one  of 
which  was  that  the  contract  therein  set  forth 
could  not  be  assigned,  but  was  personal  in 
its  nature,  and  could  not,  by  the  pretended  as- 
signment thereof  to  the  plaintiff,  vest  the 
plaintiff  with  any  power  to  sue  the  defendant 
for  the  alleged  breach  of  contract.  The  cir- 
cuit court  sustained  the  demurrer,  and  gave 
judgment  for  the  defendant;  and  the  plain- 
tiff sued  out  this  writ  of  error. 

R.  S.  Morrison,  T.  M.  Patterson,  and  C.  S. 
Thomas,  for  plaintiff  in  error. 

Mr.  Justice  GRAY,  after  stating  the  facts 
as  above,  delivered  the  opinion  of  the  court. 

If  the  assignment  to  the  plaintiff  of  the  con- 
tract sued  on  was  valid,  the  plaintiff  is  the 
real  party  in  interest,  and  as  such  entitled, 
under  the  practice  in  Colorado,  to  maintain 
this  action  in  its  own  name.  Rev.  St.  §  914; 
Code  Civ.  Proc.  Colo.  §  3;  Steel  Co.  v.  Lund- 
berg,  121  U,  S.  451,  7  Sup.  Ct.  958.  The  vital 
question  in  the  case,  therefore,  is  whether 
the  conti-act  between  the  defendant  and  Bil- 


ASSlGis^MENT. 


543 


ling  &  Eilers  was  assit^able  by  the  latter^ 
cmder  tje_circumstauces  stated  1b  the  com- 
plaiuj.  "At  the  present  day,  no  doubt,  an 
agreemeat  to  pay  money,  or  to  deliver  goods, 
may  be  assiguod  by  the  person  to  whom  the 
money  is  to  be  paid  or  the  goods  are  to  be 
delivered,  if  there  is  nothing  in  the  terms  of 
the  contract,  whether  by  requiring  something 
to  be  afterwards  done  by  him,  or  by  some 
other  stipulation,  which  manifests  the  Inten- 
tion of  the  parties  that  It  shall  not  be  assign- 
able. But  every  one  has  a  right  to  select  and 
^ermine  with  whom  he  will  contracjt,  and 
cajunot  have  anothejujerson  thrust  upon  ^im 
without  his  consent  In  the  familiar  phrase 
of  Lord'Deuman,  "You  have  the  right  to  the 
benefit  you  anticipate  from  the  character, 
credit,  and  substance  of  the  party  with  whom 
you  contract."  Humble  v.  Hunter,  12  Q.  B. 
310,  317;  Winchester  v.  Howard,  97  Mass. 
303,  305;  Ice  Co.  v.  Potter,  123  Mass.  2S; 
King  V.  Batterson,  13  R.  I.  117,  120;  Lansden 
V.  McCarthy,  45  Mo.  lOG.  The  rule  upon  this 
subject,  as  applicable  to  the  case  at  bar. 
Is  well  expressed  in  a  recent  English  trea- 
tise: " Rights  -irisini?  nnt_  of  contract  can- 
not be  transferred  if  they^are  coupled  with 
liabilities,  of_Jf  they  involve  a  relation  of 
personal  confidence_such  that  tBi;  party 
wIiose_  agreement  conferred  thotJt^  rlgtrts 
must  haye  intendad-^them  to  be~excrciscd 
onlj  hj  Jiim  Jn  whom  he  actually^  ciuj fi ded . " 
Pol.  Cont.  (4th  Ed.)  425.  The  contract  here 
sued  on  was  one  by  which  the  defendant 
agreed  to  deliver  10,000  tons  of  lead  ore 
from  its  mines  to  Billing  &  Eilers  at  their 
smelting  works.  The  ore  was  to  be  delivered 
at  the  rate  of  50  tons  a  day,  and  it  was 
expressly  agreed  that  It  should  become  the 
property  of  Billing  &  Eilers  as  soon  as  de- 
livered. The  price  was  not  fixed  by  the 
contract,  or  payable  upon  the  delivery  of  the 
ore.  But,  as  often  as  a  hundred  tons  of  ore 
had  been  delivered,  the  ore  was  to  be  as- 
sayed by  the  parties  or  one  of  them,  and, 
if  they  could  not  agree,  by  an  umpire;  and 
it  was  only  after  aU  this  had  been  done, 
and  according  to  the  result  of  the  assay, 
and  the  proportions  of  lead,  silver,  silica, 
and  Iron  thereby  proved  to  be  In  the  ore, 
that  the  price  was  to  be  ascertained  and 
paid.  During  the  time  that  must  elapse 
between  the  delivery  of  the  ore  and  the  as- 
certainment and  payment  of  the  price  the 
defendant  had  no  security  for  its  uavmcpt 
excepts  jn  _the^_chara£ter_jnid__aalteiiey — ef 
Hilling  &  JlilerSi,  The  defendant,  therefore, 
could  not  be  compelled  to  accept  the  liabil- 
ity of  any  other  person  or  corporation  as  a 
substitute  for  the  liability  of  those  with 
whom  it  had  contracted.  The  fact  that  upon 
the  dissolution  of  the  firm  of  Billing  &  Ei- 
lers, and  the  transfer  by  Eilers  to  Billing 
of  this  contract,  together  with  the  smelting 
works  and  business  of  the  partnership,  the 
defendant  continued  to  deliver  ore  to  Bil- 
ling according  to  the  contract,  did  not  oblige 
the  defendant  to  deliver  ore  to  a  stranger. 


to  whom  Billing  hn,tl  midtjrtiken,  without 
tlie  defendants  consentj__toassigntbe_con- 
Jxaiit^  The  change  in  a!~'parlnership  "by  the 
coming  in  or  the  withdrawal  of  a  partner 
might  perhaps  be  held  to  be  within  the  con- 
templation of  the  parties  originally  con- 
tracting; but,  however  that  may  be,  an  as- 
sent to  such  a  change  in  the  one  party  can- 
not estop  the  other  to  deny  the  validity  of 
a  subsequent  assignment  of  the  whole  con- 
tract to  a  stranger.  The  technical  rule  of 
law,  recognized  in  Murray  v.  Ilarway,  50 
N.  Y.  337,  cited  for  the  plaintiff,  by  which 
a  lessee's  express  covenant  not  to  assign  has 
been  held  to  be  wholly  determined  by  one 
assignment  with  the  lessor's  consent,  has  do 
application  to  this  case.  The  cause  of  ac- 
tion set  forth  In  the  complaint  is  not  for  any 
failure  to  deliver  ore  to  Billing  before  hts 
assignment  to  the  plaintiff,  (which  might 
perhaps  be  an  assignable  cnose  in  action,) 
but  it  is  for  a  refusal  to  deliver  ore  to  the 
plaintiff  since  this  assignment  Perform- 
ance and  readiness  to  perform  by  the  plain- 
tiff and  its  assignors,  during  the  periods 
for  which  they  respectively  held  the  con- 
tract is  all  that  is  alleged;  there  is  no  al- 
legation that  Billing  Is  ready  to  pay  for  any 
ore  delivered  to  the  plaintiff.  In  short,  the 
plaintiff  undertakes  to  step  intn  .the  shoes 
on^uiing,  and  to  substitute  its  liability  for 
The  aefendant  had  a  perfect  right  to 


liis. 

"necITne  to  assent  to  this,  ajid  to  refuse  to 
recognize  a  party,  with  whom  it  had  never 
contracted,  as  entitled  to  demand  further 
deliveries  of  ore.  The  cases  cited  in  the 
careful  brief  of  the  plaintiff's  counsel,  as 
tending  to  support  this  action,  are  distin- 
guishable from  the  case  at  bar,  and  the 
principal  ones  may  be  classified  as  follows: 
First.  Casog_  of^  j.greements  to  sell  apd  dij- 
liver  goodsfor  a  fixed  price,  payable  ^n 
cash  on'SFliverY.  in  whTgfi  the  owneT  would 
receive  the  price  at  the  time  of  parting 
with  his  property,  nothing  further  would 
remain  to  be  done  by  the  purchaser,  and 
the  rights  of  the  seller  could  not  be  affected 
by  the  question  whether  the  price  was  paid 
by  the  person  with  whom  he  originally 
contracted  or  by  an  assignee.  Sears  v, 
Conover,  *42  N.  Y.  113,  4  Abb.  Dec.  170; 
Tyler  v.  Barrows,  6  Rob.  104.  Second. 
Cases  upon  the  question  how  far  executors 
succeed  to  rights  and  liabilities  under  a  con- 
tract of  their  testator.  Ilambly  v.  Trott, 
Cowp.  371,  375;  ^Yent worth  v.  Cock.  10 
Adol.  &  E.  42.  2  Perry  &  D.  251;  3  Wil- 
liams, Ex'rs  (7th  Ed.)  1723-1725.  Assign- 
ment by  operation  of  law,  as  in  the  case 
of  an  executor,  is  quite  different  from  as- 
signment by  act  of  the  party;  and  the  one 
might  be  held  to  have  been  in  the  contem- 
plation of  the  parties  to  this  contract,  al- 
though the  other  was  not.  A  lease,  for 
instance,  even  If  containing  an  express 
covenant  against  assignment  by  the  lessee, 
passes  to  his  executor.  And  It  is  by  no 
means    clear    that    an    executor    would    be 


544 


OPERATION  OF  CONTRACT. 


bound  to  perform,  or  would  be  entitled  to 
tbe  benefit  of,  sucb  a  contract  as  that  now 
in  question.  Dickinson  v.  Calahan,  19  Pa. 
St  227.  Third.  Cases  of  assignments  by 
contractors  for  public  works,  In  which  the 
contracts,  and  the  statutes  under  which 
they  were  made,  were  held  to  permit  all 
persons  to  bid  for  the  contracts,  and  to  ex- 
ecute them  through  third  persons.  Taylor 
V.  ralmer.  31  Cal.  LMO,  247;  St.  I.ouis  v. 
Clemens.  42  Mo.  69;  Philadelphia  v.  Lock- 
hardt,  73  Pa.  St  211;  Devlin  v.  New  York, 
(]3   N.    Y.   8,    Fourth.  Other  cases   of   con- 


tracts assigned  by  the  party  who  was  to  do 
certain  work,  not  by  the  party  who  was  to 
pay  for  it  and  in  which  the  question  was 
whether  the  work  was  of  such  a  nature 
that  it  was  intended  to  be  performed  by  the 
original  contractor  only.  Robson  v.  Drum- 
mond,  2  Barn.  &  Adol.  303;  Waggon  Co. 
V.  Lea,  5  Q.  B.  Div.  149;  Parsons  v.  Wood- 
ward. 22  N.  J,  Law.  19r..  Without  consid- 
ering whether  all  tho  cases  cited  were  well 
decided,  it  is  suffi(i<'ut  to  say  that  none  of 
them  can  control  the  decision  of  the  pres- 
ent  case.    Judgment   affirmed. 


ASSIGNMENT. 


345 


rANBUSKIRK  et  al.  v.  HARTFORD  FIRE 

INS.   CO. 

(14  Cona.  141.) 

Supreme  Court  of  Errors  of  Connecticut.    June, 
lf>41. 

W.  W.  Ellsworth,  for  plaintiCCa.  Hunger- 
ford  &  Cone,  for  assignee. 

WAITE,  J.  The  plainUffs  brought  their 
suit,  by  foreign  attachment,  against  Joseph 
Mortimer,  and  attached  a  debt  claimed  to  be 
due  to  him  from  the  defendants  upon  a  pol- 
icy of  insurance.  Having  recovered  judg- 
ment in  that  suit  they  brought  their  scire 
facias  agaiust  the  defendants  to  recover 
their  demand.  Payment  was  resisted,  by 
the  defendants,  upon  the  ground  of  an  as- 
signment of  the  debt  made  to  John  Morti- 
mer, previous  to  the  attachment  It  is  found, 
by  the  court  below,  that  no  notice  of  that 
assignment  was  given  to  the  defendants  until 
long  after  the  attachment. 

The  question  arising  in  this  case,  is,  wheth- 
er the  plaintiffs  are  entitled  to  recover. 

If  the  case  is  to  be  governed  by  the  laws 
of  this  sta,te,  it  is  clear,  that  the  defence 
cannot  prevail:  for  the  rule  here,  is  well 
settled,  that,  in  order  to  perfect  an  assign- 
ment of  a  chose  In  action,  as  against  bona 
flde  creditors  and  purchasers  without  notice, 
notice  of  such  assignment  must  be  given  to 
the  debtor  within  a  reasonable  time;  and 
unless  such  notice  is  given,  creditors  may  at- 
tach and  acquire  a  valid  lien;  and  others 
may  purchase  the  debt,  and  gain  a  title  su- 
perior to  that  of  the  first  assignee.  Bishop 
V.  Holcomb,  10  Conn.  444;  Judah  v,  Judd,  5 
Day,  534;  Woodbridge  v.  Perkins,  3  Day, 
364.  And  so  far  as  regards  subsequent  pur- 
chasers, the  same  law  is  fully  recognized 
and  established  in  England.  Williams  v. 
Thorp,  2  Simons,  257;  Dearie  v.  Hall,  3 
Russ.  1;  Loveridge  v.  Cooper,  3  Russ.  30; 
Foster  v.  Cockerell,  9  Bligh,  322;  2  Story, 
Eq.  301.  Here,  ho  notice  of  the  assignment 
of  the  debt  to  John  Mortimer  was  given  to 
the  defendants  until  after  the  attachment; 
and  it  is  not  claimed,  that  the  plaintiffs  had 
any  knowledge  of  that  assignment.  They, 
therefore,  by  the  law  of  this  state,  acquired 
a  lien  paramount  to  the  title  of  the  a.s- 
signee.  In  this  respect,  an  attaching  cred- 
itor stands  In  a  situation,  very  similar  to 
that  of  a  subsequent  purchaser.  He  obtains 
a  lien  upon  the  debt,  as  valid  as  the  title 
acquired  by  a  purchaser. 

UOPK.  SEL.  CAS.  CONT.  — 85 


But  although  it  is  not  denied  by  the  de- 
fendants, that  such  is  the  law  of  Connect- 
icut, yet  it  is  claimed  by  them,  that  the 
assignment  was  made  in  the  state  of  New 
York,  where  a  different  rule  of  law  applies 
in  relation  to  assignments  of  cljoses  in  ac- 
tion; and  that  upon  the  principles  of  comity, 
the  same  effect  ought  to  be  given  to  the  as- 
signment here  as  would  be  given  to  it,  in 
that  state. 

But  does  it  appear,  that  the  law  of  the 
state  of  New  York  differs  from  ours?  It  is 
found  by  the  court,  (and  as  we  are  informed 
in  the  language  of  the  witness,)  that  "an 
assignment  of  a  chose  in  action  is  effectual 
to  convey  the  title  to  the  assignee,  upon  de-- 
livery  of  the  instrument;  and  no  notice  need 
be  given,  by  the  debtor,  that  such  claim 
agaiust  him  had  been  assigned."  That  un- 
doubtedly is  the  law  here,  so  far  as  regards 
the  parties  to  the  assignment.  It  is  even 
good  as  against  aU  persons  who  have  notice 
of  the  assignment.  But  would  it  be  effectual 
as  against  attacliing  creditors,  and  subse- 
quent purchasers  without  such  notice?  That 
fact  is  not  found  by  the  court;  nor,  in  our 
opinion,  is  It  a  necessary  inference  from 
what  is  found. 

To  justify  the  conclusion  that  the  laws  of 
the  state  of  New  York  so  widely-  differ  from 
ours  and  those  of  England,  upon  a  prin- 
ciple, which,  we  believe  so  correct  and  sal- 
utary, as  that  requiring  notice  to  be  given 
of  the  assignment  of  a  chose  in  action,  to 
protect  It  against  the  subsequently  acquired 
rights  of  other  persons,  It  ought  to  be  made 
distinctly  to  appear,  and  not  left  to  any 
forced  construction. 

What  would  be  the  effect  of  such  a  con- 
flict of  laws  upon  the  present  case,  were  it 
proved  to  exist,  we  do  not  deem  it  necessary 
to  determine.  Upon  that  question  there  are 
various  and  conflicting  decisions.  Manufac- 
turing Co.  V.  Prall,  9  Conn.  4S7;  Oliver  v. 
Townes,  14  Mart.  97;  Pomeroy  v.  Rice,  10 
Pick.  22;  Daniels  v.  WiUard,"l6  Pick.  36; 
Burlock  V.  Taylor,  16  Pick.  335. 

But  as  we  are  not  satisfied  from  the  find- 
ing of  the  court  below,  that  any  material 
difference  exists  between  the  law  of  this 
state  and  that  of  New  York,  we  are  of  opin- 
ion, that  the  plaintiffs  are  entitled  to  judg- 
ment for  the  amount  due  by  the  defendants 
on  the  policy,  at  the  time  the  original  writ 
was  served  upon  them. 

In  this  opiiiioD  the  other  Judges  conctured. 


546 


-I 


OPERATION  OF   CONTRACT. 


MOTT  V.  CLARK. 

(9  Pa.  St.  399.) 

Supreme   Court   of   Pennsylvania.      Dec  Term, 
1S4S. 

Dec.  IS.  This  was  an  ejectment  to  recover 
a  moiety  of  two  pieces  of  land,  one  moiety  of 
which  plaintiff  was  in  possession  of. 

The  main  question  arose  out  of  the  follow- 
ing facts:  In  1S20  John  Clark  obtained  the 
title  by  a  sheriff's  deed  to  the  whole  property; 
but  in  fact  he  was  trustee  for  his  father,  Vin- 
son Clark,  for  a  moiety.  In  1S21  John  convey- 
ed this  moiety  to  Vinson  Clark,  the  defendant, 
but  the  deed  was  not  registered  until  1836. 

In  1S31,  John  Clark  mortgaged  the  whole 
property  to  Broadhead,  the  mortgage  being 
registered  in  November.  But  according  to  the 
verdict  Broadhead  had  notice  at  and  before 
the  date  of  this  mortgage,  of  the  real  extent 
of  John  Clark's  title,  and  of  the  deed  to  V. 
Clark. 

In  1S32,  Broadhead,  by  deed  which  was 
never  registered,  assigned  the  bond  and  mort- 
gage to  Johnson,  who  had  no  notice  of  V. 
Clark's  title. 

In  1835,  there  was  a  judgment  recovered  by 
Johnson  on  another  cause  of  action  against 
John  Clark,  under  which  the  whole  of  the 
property  in  question  was,  in  1837,  sold  and 
conveyed  by  the  sheriff  to  Johnson.  But  at 
this  sale  notice  was  given  of  Vinson  Clark's 
title  to  the  moiety. 

In  184i,  Johnson  conveyed  to  the  plaintiff, 
who,  it  was  assumed,  had  notice  of  V.  Clark's 
title,  and  in  1845,  he  assigned  him  the  mort- 
gage. On  the  accompanying  bond  judgment 
had  been  entered  in  1832.  Whether  this  was 
assigned  or  not,  could  not  be  gathered  from 
the  bill  of  exceptions. 

Under  these  circumstances  the  defendant 
contended  that  the  sheriff's  sale  having  pass- 
ed but  a  moiety,  on  account  of  the  notice 
given  by  V.  Clark,  the  plaintiffs  right  under 
the  mortgage  was  postponed:  1.  Because  of 
the  notice  to  the  mortgagee  of  the  state  of  the 
title.  2.  Because  the  assignment  was  not  reg- 
istered before  Vinson  Clark's  deed  was.  3. 
Because  the  mortgage  merged  in  plaintiff's 
title  under  the  sheriffs  deed. 

On  this  point  the  court  (Jessup,  P.  J.)  in- 
structed the  jury,  that  if  Broadhead  had  no- 
tice of  V.  Clark's  deed,  plaintiff  was  bound 
by  it 

The  other  exceptions  were  as  follows:  L 
The  court  permitted  defendant  to  read  the 
proceedings  under  the  judgment  on  the  bond 
whereby  other  property  had  been  sold  to 
Johnson  subsequently  to  his  purchase  of  the 
property  in  question.  2.  They  permitted  de- 
fendant to  examine  John  Clark  to  prove  no- 
tice to  Broadhead  of  the  title  and  deed  to  V. 
Clark,  and  that  this  moiety  of  the  land  was 
included  by  mistake.  3.  They  also  permitted 
defendant  to  prove  that  Johnson  at  the  sher- 
iff's sale  gave  but  the  value  of  a  moiety  of  the 
premises.  4.  The  defendants  had  shown  sev- 
eral judgments  against  J.  Clark,  prior  to  that 


under  which  plaintiff  purcha .sod  — which  were 
liens — and  that  no  purchase-moin\v  was  paid 
by  him  to  the  sheriff.  The  court  told  the 
jury  that  if  plaintiff  held  under  the  mortgage 
only,  then  the  amount  of  his  bid,  which  was 
applicable  to  other  creditors  on  their  liens 
who  had  acquiesced,  should  be  applied  to  the 
payment  of  the  mortgage  debt. 

Mr.  Reeder,  for  plaintiff  in  error.  J.  M. 
Porter,  contra. 

ROGERS,  J.  (after  stating  the  two  titles  un- 
der the  mortgage  and  the  sheriff's  sale.) 
Either  of  the  titles  as  above  stated  would  en- 
title the  plaintiff  to  a  verdict.  But  the  de- 
fendants contend  the  plaintiff  cannot  recover 
because  Thomas  Clark,  on  the  5th  of  Jan- 
uary, 1841  conveyed  an  undivided  half  of  the 
premises  (being  the  property  in  dispute)  to  his 
father  Vinson  Clark.  That  this  deed  was  ac- 
knowledged on  the  day  of  its  date,  and  was 
recorded  May  1st,  1821.  The  deed  being  re- 
corded before  the  sheriff's  sale,  and  moreover 
V.  Clark  having  given  notice  at  the  sale,  the 
court  properly  instructed  the  jury  that  the 
purchaser  at  the  sheriff's  sale  obtained  no 
title  unless  the  deed  from  John  Clark  to  V. 
Clark  was  fraudulent.  The  jury  decided  that 
it  was  a  bona  fide  conveyance.  There  is 
therefore  an  end  to  the  title  grounded  on  the 
sheriff's  deed. 

Has  then  the  plaintiff,  the  assignee  of 
Broadhead,  a  title  under  the  mortgage?— 
and  this  is  a  principal  point  in  this  case. 
The  mortgage  to  Broadhead  was  recorded 
2Sth  November,  1831,  but  the  deed  from  J. 
Clark  to  V.  Clark,  although  prior  in  date, 
was  not  recorded  until  May  1st,  1836.  And 
this  would  be  decisive  of  the  case;  but  the 
defendant  replies,  that  although  his  deed  is 
recorded  upwards  of  five  years  after  the  en- 
try of  the  mortgage,  he  is  not  to  be  post- 
poned because  the  mortgagee  had  actual  no- 
tice of  the  conveyance  of  a  moiety  of  the 
property  by  John  Clark  to  his  father,  V. 
Clark.  The  fact  of  notice  was  properly  left 
by  the  court  to  the  jury,  who  found  that  the 
mortgagee  had  notice.  But  in  answer  the 
plaintiff  contends  that  admitting  this  to  be 
so,  he  is  an  assignee  without  notice,  and. 
however  it  may  be  as  between  the  moi-t- 
gagee  and  third  persons,  he  takes  the  prop- 
erty discharged  of  all  equities  of  which  he 
had  DO  knowledge.  The  question,  therefore, 
is  (granting  he  had  no  notice,  which  is  un- 
doubted), does  the  assignee  stand  in  the 
same  or  a  better  position  than  the  mort- 
gagee? On  this  point  the  court  instructed 
the  jury,  that  the  assignment  of  a  mortgage 
is  not  so  within  the  recording  acts,  as  to 
give  the  assignee  protection  against  an  un- 
recorded deed,  of  which  the  mortgagee  had 
full  notice.  That  a  mortgagee  is  a  purchaser 
within  the  statute  of  frauds  is  ruled  in  Lan- 
caster V.  Dolan,  1  Rawle,  245,  on  the  au- 
thority of  Chapman  v.  Emery,  Cowp.  278. 
Now  it  has  been  repeatedly   ruled,   that  al- 


ASSIGNMENT. 


547 


though  a  purchaser  has  notice  of  an  equi- 
table claim,  by  which  bis  conscience  Is  af- 
fect (cl,  yet  a  person  purchasing  from  him 
bona  Ode,  and  without  notice  of  the  right, 
will  not  be  bound  by  it.  So  a  person  hav- 
ing notice  of  an  equitable  claim  may  safely 
purchase  of  a  person  who  bought  bona  fide, 
and  without  notice.  These  positions  are 
elementary,  and  are  fully  sustained  by  the 
authonties  cited.  If,  therefore,  a  mortgagee 
is  to  be  considered  on  the  footing  of  a  pur- 
chaser, it  would  seem  to  follow  that  an  as- 
signee without  notice  takes  the  property  dis- 
charged of  a  latent  equity.  If  any  existed. 
These  cases,  although  analogous,  are  not  ex- 
pressly in  point,  but  the  case  of  an  assignee  of  a 
bond  and  mortgage  is  expressly  ruled  in  Liv- 
ingston V.  Dean,  2  Johns.  Ch.  479.  He  takes 
it  subject  to  all  the  equity  of  the  mortgagor, 
but  not  to  the  latent  equity  of  a  third  per- 
son. To  subject  him  to  such  an  equity  he 
must  have  express  or  constructive  notice  at 
the  time  of  the  assignment.  It  is  a  general 
and  well-settled  principle,  says  the  chan- 
cellor in  Murray  v.  Lylburn,  2  Johns,  Ch. 
443,  that  the  assignee  of  a  chose  in  action 
takes  it  subject  to  the  same  equity  it  was 
subject  to  in  the  hands  of  the  assignee.  2 
Vern.  691-7G5;  1  P.  Wms.  497;  1  Ves.  122; 
4  Ves.  118.  But  this  rule  is  generally  under- 
stood to  mean  the  equity  residing  in  the 
original  obligor  or  debtor,  and  not  an  equity 
residing  in  some  third  person  against  the  as- 
signor. He  takes  it  subject  to  all  the  equity 
of  the  obligor,  say  the  judges  in  the  very 
elaborately  argued  case  of  Norton  v.  Rose, 
2  Wash.  (Ya.)  233,  on  this  very  point,  touch- 
ing the  rights  of  the  assignee  of  a  bond. 
The  assignee  can  always  go  to  the  debtor 
and  ascertain  what  claims  he  may  have 
against  the  bond  or  other  chose  in  action, 
wliich  he  Is  about  purchasing  from  the 
obligor;  but  he  may  not  be  able  with  the 
utmost  diligence,  to  ascertain  the  latent  equi- 
ty of  some  third  person  against  the  obligee. 
He  has  not  any  object  to  which  he  can 
direct  his  inquiries,  and  for  this  reason  the 
claim  of  the  assignee,  without  notice  of  a 
chose  in  action,  in  the  late  case  of  Redfearn 
V.  Ferrier,  1  Dow,  50,  was  preferred  to  that 
of  a  party  setting  up  a  secret  equity  against 
the  assignor.  Lord  Eldon  observed  in  that 
case,  that  if  it  were  not  to  be  so,  no  as- 
signment could  ever  be  taken  with  safety. 
It  would  be  utterly  impossible  to  guard 
against  combination  by  the  mortgagor  and 
mortgagee,  particularly  with  the  aid  of  the 
owner  of  the  latent  equity.  If  V.  Clark  the 
owner  as  he  alleges  of  the  moiety,  loses  his 
property,  it  is  his  own  laches  for  it  was  his 
duty  to  put  his  deed  on  record  as  notice  of 
his  title.  Having  neglected  his  duty,  he  is 
postponed  to  the  mortgagee,  who  Is  a  pur- 
chaser within  the  statute  of  frauds.  At  law 
his  title  Is  available  against  the  owner,  who 
neglected  to  put  his  deed  on  record.  The 
assignee  stands  in  the  position  of  the  mort- 
gagee so  far  as  regards  the  legal  title,  but 


stands,  as  the  authorities  evidently  show, 
unaffected  with  an  equity  of  which  he  had 
no  knowledge  or  possibility  of  knowledge, 
and  against  which  it  would  be  irapossible 
for  him,  with  the  most  careful  dihgeuce,  to 
guard  himself.  If  be  had  notice  of  the  out- 
standing e<iuity,  he  would  be  in  the  same 
position  as  the  mortgagee  and  equity  in  such 
case  would  relieve  the  owner  of  the  estate, 
notwithstanding  his  neglect.  The  principle 
on  which  courts  of  equity  act,  is  that  actual 
notice  is  equivalent  to  constructive  notice 
derived  from  the  registry  of  the  deed.  The 
intention  of  the  acts  requiring  deeds  to  be 
recorded  was  to  secm-e  subsequent  pur- 
chasers and  mortgagees  against  prior  secret 
conveyances  and  fraudulent  encumbrances; 
and  therefore  when  a  person  has  notice  of 
a  prior  conveyance,  it  is  not  a  secret  con- 
veyance by  which  he  can  be  prejudiced;  for 
he  can  be  in  no  danger  where  he  knows  of 
another  encumbrance  because  then  he  might 
have  stopped  his  hand  from  proceeding,  and 
therefore  is  not  the  person  whom  the  stat- 
ute meant  to  relieve.  The  court  of  chancery 
affords  relief,  because  it  is  against  equity 
for  him  to  protect  himself  by  his  legal  title 
when  he  had  express  notice  of  a  prior  con- 
veyance or  encumbrance.  But  it  is  evident 
this  must  be  personal  to  the  mortgagee,  and 
cannot  affect  his  innocent  assignee.  Why 
should  an  innocent  assignee  be  deprived  of 
the  benefit  of  the  legal  title,  in  favour  of  a 
person  who,  by  his  neglect  to  put  his  deed 
on  record,  has  put  it  in  the  power  of  the 
mortgagee  to  perpetrate  a  fraud?  It  is  an 
invariable  principle  of  equity,  that  where 
one  of  two  innocent  persons  must  suffer,  he 
who  is  the  cause  of  the  loss  must  bear  it. 
But  it  is  contended  Jeromus  Johnson  is  post- 
poned because  he  did  not  put  his  deed  or 
assignment  on  record  until  after  V.  Clark's 
deed  was  recorded.  In  Lightner  v.  Mooney, 
10  Watts,  407;  Ebner  v.  Goundie,  5  Watts 
&  S.  49;  Goundie  v.  Water  Co.,  7  Pa.  St, 
233,— it  is  ruled,  under  our  statute,  that 
where  there  are  two  deeds  of  conveyance  of 
difTorent  dates,  neither  of  which  is  recorded 
within  six  months,  that  which  is  first  re- 
corded will  take  priority.  And  this  would  be 
conclusive,  but  for  the  answer  that  the  as- 
signee is  not  bound  to  register  his  assign- 
ment, and  is  in  no  default,  as  is  conclusively 
shown  by  Mr.  Justice  Kennedy  in  Craft  v. 
Webster,  4  Rawle,  254.  The  learned  judge, 
after  an  able  review  of  the  point,  conies  to 
the  following  conclusion:  "Having  shown 
that  an  assignment  of  a  mortgage  is  not  a 
conveyance  of  and  concerning  land,  where- 
by the  same  may  be  in  any  way  affected  in 
law  or  equity  (which  are  the  words  of  the 
recording  act),  it  is  not  necessary  that  it 
should  be  recorded,  as  required  by  that  act, 
to  give  it  validity  against  a  subsequent  as- 
signment made  by  the  mortgagee  to  a  third 
person  for  valuable  consideration,  without 
notice  of  the  first.  If  the  first  assignment 
were  in  writing,  proved  and  recorded,   the 


548 


OPERATION  OF  CONTRACT. 


recording  would  afford  the  assignee  no  ad- 
ditional protection  against  a  claim  under  a 
subsequent  assignment." 

This  is  the  principal  point  in  the  case; 
but,  as  it  goes  down  for  another  trial,  it  be- 
comes necessary  briefly  to  notice  the  other 
exceptions.  We  cannot  see  the  relevancy  of 
testimony  as  admitted  in  the  first  bill,  be- 
cause it  was  the  sale  of  other  property  with 
no  connexion  that  we  can  perceive  with  this 
case  unless  it  should  appear  to  be  for  the 
same  debt;  in  which  case,  the  proceeds  of 
sale  would  be  applicable  to  the  payment  of 
the  mortgage.  2d.  We  cannot  see  what  in- 
terest J.  Clarli  has  in  the  controversy.  He 
is  not  directly  interested  in  the  event,  nor 
would  a  verdict  and  judgment  in  this  case 
be  evidence  in  any  suit  to  which  he  may  be 
a  party.  There  has  been  nothing  exhibited 
to  us  to  show  that  he  has  an  interest  to  have 
the  mortgage  extinguished  by  the  rents.  So 
far  as  appears,  if  he  has  any  interest,  it  is 
to  prove  that  the  mortgagor  has  been  paid, 
as  perhaps.  In  that  event,  it  might  render 
him  liable  to  an  action  at  the  suit  of  the  as- 
signee. The  evidence  contained  in  the  third 
bill  was  improperly  admitted,  for  the  value 
of  the  property  in  dispute  has  nothing  to  do 
with  the  issue,  and  is  only  calculated  to  per- 
plex the  minds  of  the  jury,  by  exciting  an 
impression  that  Johnson  had  made  an  ad- 
vantageous bargain.  That  Johnson  paid  only 
the  one-half  of  the  value  of  the  property, 
after  the  notice  of  V.  Clark  at  the  sherifTs 
sale  cannot  affect  his  title  to  the  property, 
and  ought  not  to  have  the  slightest  weight 
in  the  determination  of  this  case. 

There  is  no  error  in  proving  that  Johnson 
received  the  benefit  of  the  whole  proceeds 


of  the  sheriff's  sale,  by  retaining  it  on  ac- 
count of  his  mortgage.  The  effect  of  the 
evidence  will  depend  on  other  circumstances. 
For,  if  there  was  a  surplus  over  and  above 
the  liens  against  the  estate,  the  mortgagor 
would  have  the  right  to  apply  that  surplus 
to  the  extinguishment  of  the  mortgage.  But 
if  there  was  no  surplus  but  money  appli- 
cable to  judgment  creditors,  which  has  been 
misapplied,  they  are  the  persons  who,  hav- 
ing been  injured,  have  alone  the  right  to 
complain.  The  sheriff  would  be  answerable 
to  the  creditors,  and  Johnson  would  be  an- 
swerable to  the  sheriff,  and  nothing  but  an 
express  contract  or  agreement  would  pro- 
tect them.  The  court,  therefore,  did  injus- 
tice to  the  plaintiff  in  charging  the  jury  that 
this  money  having  been  received  by  Johnson 
for  Clark's  property,  and  not  accounted  for 
by  him  to  other  creditors,  and  they  having 
acquiesced  therein,  should  now  be  applied 
by  the  jury  to  cancel,  so  far  as  it  goes,  the 
indebtedness  of  John  Clark  to  Johnson.  Ad- 
mitting the  fact  that  Johnson  received 
money  which  he  has  not  accounted  for  to 
the  other  creditors,  yet  there  is  no  evidence 
of  any  agreement  by  the  creditors  that  the 
money  should  be  misapplied.  If  so,  they 
have  their  remedy  against  Johnson,  and  not 
the  mortgagor;  and  the  court  had  no  right 
to  expose  Johnson  to  the  risk  of  paying  the 
money  not  only  to  the  mortgagor,  but  to  the 
creditors  also. 

I  refrain  from  noticing  the  question  of 
merger,  because  it  fonns  no  part  of  the  case 
now  before  the  court.  It  will  be  time  enough 
to  decide  when  it  properly  arises. 

Judgment  reversed,  and  a  venire  de  novo, 
awarded. 


^ 


If 


JOINT  AND  SEVERAL  CONTRACTS, 


649 


BLLER  ot  al. 
E. 


T.  LACY. 


^■^O 


^  3/(36  N.  E.  1088.  137  Ind.  436.) 


J 


Supreme  Conrt  of  Indiana.     April  7.  18&4. 

Appeal  from  circiilt  conrt  Hamilton  coun- 
ty;   R.  R.  Stophonson,  Judpe.  ■' 

Action  by  John  Lacy  against  Joseph  W. 
Eller  and  others.  From  a  judfrment  overrnl- 
InfT  a  demurrer  to  the  complaint,  defendants 
appeal.     Reversed. 

Roberts  &  Vestal,  for  appellants.  Shirts 
&  Kilboiu-ne,  for  appellee. 

HACKNEY,  J.  The  appellee  sued  to  set 
aside  as  fraudulent  the  couveyance  of  cer- 
tain real  estate  from  the  appellant  Joseph 
W.  Eller.  The  complaint  allopes  that  in  the 
year  1878  the  appellee  hold  a  judj^nent 
aj^ainst  Joseph  W.  Eller  and  Jackson,  Albert, 
and  William  Lacy  for  $G,750,  and  proceed- 
ings were  pending  to  review  said  judgment; 
whereupou  the  parties  to  said  judgment  en- 
tered into  the  following  agreement  as  to  said 
judgment  and  said  proceedings  to  review: 
"This  cause  settled  and  compromised  on  the 
following  terms,  to  wit:  The  judgment  ren- 
dered in  tlais  court  on  the  15th  day  of  Sep- 
tember, 1877,  in  favor  of  the  said  John  Lacy, 
and  against  the  plaintiffs  in  this  suit,  for  the 
sum  of  $G,750,  is  fully  paid  and  satisfied,  the 
receipt  whereof  Is  hereby  acknowledged  by 
the  said  John  Lacy,  and  he  is  to  enter  satis- 
faction in  full  of  said  judgment  on  the  judg- 
ment docket  of  said  court.  The  plaintiffs  are 
to  pay  all  costs  in  this  cause,  and  to  pay  to 
said  John  Lacy  the  sum  of  $50  each  and  ev- 
ery year  as  long  as  he,  the  said  John  Lacy, 
may  live;  and,  in  case  the  above  sum  should 
prove  insufficient  for  the  reasonable  support 
of  defendant  in  consequence  of  his  long-pro- 
tracted sickness,  then  and  in  that  case  the 
plaintiffs  are  to  pay,  in  addition  to  that  sum, 
a  sufficient  sum  to  furnish  said  defendant  a 
reasonable  support.  [Signed]  John  Lacy. 
William  Lacy.  J.  W.  Eller.  Jackson  Lacy." 
The  entry  of  the  satisfaction  of  said  judg- 
ment is  then  alleged,  and  the  complaint  ixa- 
ther  alleges  that  "the  defendants,  except  the 
said  Eller  herein,  have  paid  plaintiff  each 
year  the  fifty  dollars  due  from  them  and 
from  each  of  them;  they  also  paid  such  sum 
in  addition  as  has  been  necessary  In  case  of 
sickness  of  plaintiff,  as  in  said  agreement 
provided.  But  the  plaintiff  avers  that  about 
five  years  ago  the  defendant  Eller  failed  and 
refused,  and  has  ever  since  faUed  and  re- 
fused, to  pay  his  portion  of  said  money,  or 
any  part  thereof;  that  judgments  have  been 
rendered  in  favor  of  plaintiff  in  this  court  for 
those  installments  due  from  him;  that  exe- 
cutions have  been  returned,  *No  property 
fo\md  whereon  to  levy;'  *  •  •  that  said 
judgment,  interest,  and  costs  amounted  at 
the  time  to  about  three  himdred  dollars." 
Then  follow  allegations  of  the  ownership  by 
said  Eller  of  certain  real  estate,  and  that  the 
same  was  fraudulently  conveyed  by  him  to 


his  two  daughters,  a  conveyance  by  one 
daughter  to  the  other,  who  is  an  appellant 
herein,  the  insolvency  of  said  Joseph  W.  Eller, 
and  the  fact  that  he  had  not  at  the  time  of 
said  conveyance,  nor  since,  property  BuflS- 
cient  to  pay  said  debt  due  and  to  become 
due.  A  judgment  against  said  Joseph  W. 
Eller  for  $2(j(j  is  sought  under  said  agree- 
ment, and  it  is  prayed  that  said  conveyances 
be  set  aside  "to  satisfy  the  judgment  hereto- 
fore taken  by  plaintiff  against  the  defendant 
J.  W.  Eller,  as  well  as  the  judgment  taken 
in  this  action,"  etc 

The  circuit  court  overruled  the  demurrer  of 
the  appellants  to  the  complaint,  and  the  cor- 
rectness of  that  ruling  is  attacked  here  for 
several  reasons.  The  first  objection  to  the 
complaint  is  that  it  seeks  to  recover  against 
one  of  several  joint  obligors,  and  to  set  aside 
the  conveyance  of  one  of  several  joint  obli- 
gors, without  an  allegation  that  the  others  of 
such  obligors  have  not  suflScient  means  and 
property  from  which  the  plaintiCTs  claim 
could  be  made  in  whole  or  in  part.  The  ap- 
pellee concedes  expressly  that  "it  Is  not  clear 
from  the  face  of  the  contract  whether  it  was 
Intended  to  be  $50  from  each  of  the  promis- 
ors." We  need  not  determine  whether  the 
agreement  gave  the  appellee  $150  "each  and 
every  year,"  but  to  our  minds  it  is  perfectly 
clear  that,  whatever  snm  was  sccm'ed  by  the 
agreement,  it  was,  by  the  terms  of  the  agree- 
ment, payable  by  the  obligors  jointly.  The 
language  of  the  agreement  is  that  "the  plain- 
tiffs are  to  pay  •  •  •  to  said  John  Lacy." 
and  "the  plaintiffs  are  to  pay  in  addition." 
There  is  not  one  word  in  the  agreement  cast- 
ing the  slightest  doubt  upon  the  character  of 
the  instrument  in  this  respect.  But  it  is  said 
that  the  parties  construed  the  agreement  as 
several,  "because  the  complaint  shows  that 
eacli  of  the  other  parties  bad  paid  $50  per 
annum,  and  that  the  appellant  Joseph  W.  El 
ler  had  paid  a  similar  sum  per  annum  until 
foiu-  or  five  years  prior  to  the  bringing  of  the 
suit."  The  complaint  alleges,  as  will  be  seen, 
that  "the  defendants,"  excepting  Eller.  "have 
paid  plaintiff  each  year  the  fifty  dollars  due 
from  them  and  from  each  of  them;  they  al- 
so paid  such  sum  in  addition"  as  necessary 
in  sickness.  Omitting  the  words  "due  from 
them  and  each  of  them,"  which  are  but  a 
conclusion  of  the  pleader,  and  confining  the 
inquiry  to  the  fact,  or  the  acts  of  the  parties 
so  paying,  it  does  not  appear  that  there  was 
any  severance  in  any  payments,  either  as  to 
persons  or  amoimts.  The  failure  of  Eller  to 
contribute  to  such  payments  neitier  changed 
the  character  of  the  contract  nor  created  » 
construction  of  it,  nor  did  that  fact  release 
the  other  obligors  from  the  payment  of  the 
whole  sum  due  from  time  to  time  by  the 
terms  of  the  contract.  It  is  unnecessary  that 
we  should  intimate  an  opinion  as  to  wheth'M- 
a  construction  by  the  parties  of  a  plain  and 
unambiguous  contract  may  prevail  as  against 
the  only  possible  construction  or  legal  Inter- 
pretation its  terms  will  permit,     K  the  obli- 


550 


OPERATION  OF  CONTRACT. 


gatlon  Is  joint,  there  Is  not  only  no  action 
stated  for  the  claim  to  a  personal  judgment 
for  the  $'200  against  Eller  upon  the  obliga- 
tion, but  there  could  be  no  cause  for  setting 
aside  a  conveyance  of  his  property  without 
exhausting  those  who  were,  as  to  such  sum, 
liable  jointly  with  him.  As  long  as  the  legal 
remedy  existed  against  part  of  the  joint  debt- 
ors, equity  would  not  extend  its  relief  as  to 
another  of  such  debtors.  This  is  elemental, 
but  our  attention  has  fallen  upon  two  cases- 
involving  the  exact  question  before  us. 
Wales  V.  Lawrence,  36  N.  J.  Eq.  207;  Ran- 
dolph V.  Daly,  16  N.  J.  Eq.  313.  Against  this 
conclusion,  appellee's  learned  counsel  do  not 
contend  fvirther  than  we  have  suggested,— 
that  the  parties  had  construed  the  contract 
as  several. 

It  remains  to  Inquire  as  to  the  sufficiency 
of  the  complaint  upon  the  allegations  of  the 
recovery  of  judgments  against  EUer  alone 
upon  said  contract  It  will  be  observed  that 
a  personal  judgment  Is  not  sought  upon  the 
judcrmeuts  so  alleged  against  Eller,  and 
therefore  the  complaint  as  to  them  could  be 


sufficient  only  to  reach  the  property  so  al- 
leged to  have  been  fraudulently  conveyed. 
While  a  copy  of  the  judgment  was  not  a  nec- 
essary exhibit  with  the  complaint,  yet  it  will 
be  observed  that  some  fact  was  necessary  to 
have  been  alleged  to  show  the  character  and 
validity  of  the  judgment.  Here  it  does  not 
appear  that  the  alleged  judgment  debtor  was 
brought  into  court  by  any  process,  nor  are 
the  dates,  amounts,  or  character  of  the  judg- 
ments given.  It  does  not  appear  that  no  oth- 
er than  Eller  was  a  defendant  in  the  cases 
wherein  the  alleged  judgments  were  ren- 
dered. If  the  element  of  the  complaint  seek- 
ing to  set  aside  the  conveyances  were  elimi- 
nated, the  complaint  would  probably  be  defi- 
cient In  stating  a  cause  of  action  for  a  per- 
sonal judgment  upon  said  judgments.  How- 
ever, since  a  personal  judgment  upon  this 
branch  of  the  appellee's  claims  is  not  sought, 
it  Is  unnecessary  to  consider  and  determine 
the  sufficiency  of  the  complaint  for  that  pur- 
pose. The  court  erred  in  overruling  the  de- 
mmrer  to  the  complaint,  and  for  this  eiTor 
the  judgment  is  reversed. 


JOINT  AND  SEVERAL  CONTRACTS. 


551 


^^^ 


ANGUS  T.  ROBINSON  et  aL 


3^ 


(8  Atl,  497,  59  Vt.  585.) 
Bnpreme  Court  of  Vermont.      March  25,  1887. 

Exct'ptious  from  Orleans  eouuty  court,  Feb- 
ruary term,  ISSu;    Ross,  J.,  presiding. 

Action  of  assumpsit.  Heard  on  demurrer 
to  the  fourth  count  of  the  declaration.  De- 
murrer sustained-  Tlie  facts  appear  Ln  the 
opinion. 

Crane  &  Alfred,  for  plaintiff.  Edwards, 
Dickerman  &  Young,  for  defendants. 

POWERS,  J.  The  fourth  count  demurred 
to  sots  out  a  contract  made  by  the  plaintiff 
and  Goff  jointly,  of  the  one  part,  and  the  de- 
fendant's intestate,  of  the  other  part,  where- 
by certain  stock  and  bonds  of  the  Montreal, 
Boston  &  Portland  Railway  were  sold  to  such 
intestate,  and  certain  labor  was  to  be  done 
upon  said  railway  as  part  consideration  for 
such  sale.  It  also  avers  the  delivery  of  cer- 
tain other  bonds  by  said  Angus  and  Goff  to 
the  intestate  to  insure  the  performance  of 
their  contract  It  further  avers  full  perform- 
ance of  the  contract  by  Angus  and  Goff.  In 
this  posture  of  things  the  plaintiff  discloses 
a  perfected  right  of  action  in  Angus  and  GofiC 
to  recover  the  unpaid  purchase  money  of  the 
stock  and  bonds  sold,  and  also  the  bonds  put 
up  as  collateral,  or  their  proceeds  if  convert- 
ed by  the  intestate  to  his  own  use.  The  count 
further  avers  that,  after  performance  by  An- 
gus and  Goff  of  the  contract  on  their  part, 
the  intestate  settled  with  Goff  for  his  inter- 
est in  the  contract  and  his  interest  in  the  col- 
lateral bonds;  and  the  plaintiff's  contention 
is  that  he  may  now  maintain  an  action  in  his 
own  name  to  recover  one-half  the  unpaid  pur- 
chase money  and  half  the  proceeds  of  the 
collateral  bonds.  We  think  such  action  can- 
not bo  maintained.  The  sale  of  the  stock  and 
bonds  with  the  collateral  undertaking  to  put 
the  railway  in  running  condition  was  the  con- 
sideration of  the  Intestate's  promise.  The 
delivery  of  the  collateral  bonds  was  a  mere 
Incident  of  such  sale,  -a  mere  security  for  the 
performance  of  the  principal  contract  by  An- 
gus and  Goff. 

If  Robinson  had  contracted  with  Angus  and 
Goff  severally  for  the  share  of  each  in  the 
stock  and  bonds,  and  promised  them  several- 
ly to  pay  for  such  shares,  it  would  be  quite 
another  thing.  But,  however,  as  between 
themselves,  the  owuership  of  the  stock  and 
bonds  in  truth  was,  the  declaration  states 
their  interest  to  bt  "joint  and  equal,"  and 
sets  them  out  as  joint  contractors;  and  the 
principle  that  joint  contractors  must  all  sue 
upon  their  joint  contract  is  too  elementary  to 
retpiire  the  citation  of  authorities.  Robin- 
son's settlement,  then,  with  Goff  for  his  in- 
terest was  in  substance  a  satisfaction  of  the 
Joint  indebtedness  pro  tanto.  What  Goff  re- 
ceived belonged  to  Anjjns  and  Goff,  and  the 


balance  due  from  Robinson  belongs  to  them 
jointly.  It  is  not  the  case  of  the  novation  of 
a  c<jntract.  If  Angus,  Goff,  and  Robinson 
had  mutually  agreed  upon  a  disintegration  of 
the  demand,  and  Robinson  had  promised  to 
pay  Angus  his  share,  the  case  would  be  differ- 
ent. But  here  Angus  was  no  party  to  the 
severance  made  by  Goff  and  Roltinson,  and 
was  not  bound  by  It;  and,  if  It  did  not  bind 
him,  it  did  not  bind  them  in  respect  to  him. 

The  cases  cited  by  the  learned  counsel  for 
the  plaintiff  are  not  in  conflict  with  this  hold- 
ing. In  Hall  V.  Leigh,  8  Cranch,  50,  a  con- 
signee sold  merchandise  for  two  owners.  But 
each  owned  one-half  severally,  which  fact 
was  disclosed  in  the  consignment,  and  sep- 
arate instructions  for  the  sale  were  made. 
In  Beach  v.  Hotchkiss,  2  Conn.  f/Jl,  defend- 
ant had  paid  one  of  seve'ral  joint  contractors 
his  share  of  the  common  debt,  but  had  not 
liquidated  the  account  with  the  others.  A.s- 
sumpsit  cannot  be  maintained  by  the  others 
severally  for  their  share.  Some  language  i.s 
used  by  the  court  giving  support  to  the  plain- 
tiff's contention  in  the  case  at  bar,  but  the 
result  of  the  case  is  inconsistent  with  it  Ln 
Austin  V.  Walsh,  2  Mass.  401,  A.  and  B.  joint- 
ly ship  goods  consigned  to  C.  to  sell.  After 
shipment,  A.  and  B  sever  their  interest  in 
the  adventure,  and  A.  gives  B.  written  in- 
structions to  C.  to  pa:>  B.  nis  moiety.  B. 
shows  this  direction  to  C,  who  refuses  to  ac- 
count to  B.,  but  says  he  will  pay  B.  if  pro- 
ceeds belong  to  him.  It  was  held  that  the 
agreement  between  A.  and  B.  to  sever  their 
interest  would  not  entitle  them  to  sue  C.  sev- 
erally, unless,  after  notice,  C.  had  consented 
to  it,  and  to  account  to  each  for  his  share. 
But  as  the  action  was  not  on  the  original  con- 
tract but  on  C.'s  promise  to  pay  B.  if  he 
was  entitled,  and  he  had  shown  he  was  enti- 
tled, he  might  recover. 

Without  further  review,  the  true  rule  ap- 
pears to  be  that  where  all  the  parties  in  in- 
terest in  the  joint  contract  agree  to  a  sever- 
ance of  the  joint  interest,  and  the  obligor 
promises  to  pay  each  his  several  share,  each 
may  sue  therefor;  the  suit  being  based  upon 
the  promise  to  pay  each  severally,  and  not  on 
the  original  joint  promise.  Here  the  count 
is  clearly  in  assumpsit,  and  the  right  of  re- 
covery is  based  upon  the  original  undertak- 
ing. The  act  of  bringing  the  suit  cannot  in 
law  be  effectual  to  work  a  severance  of  the 
joint  interest  of  Angus  and  Goff,  and  thus,  by 
way  of  a  ratification  of  the  unwarranted  sev- 
erance made  by  Goff  and  Robinson,  give  An- 
gus a  several  action.  The  severance  must 
first  be  made,  and  a  new  promise  must  ap- 
pear as  the  basis  of  the  new  right  of  action 
springing  from  the  severance. 

The  judgment  of  the  county  court  sustain- 
ing the  demurrer,  and  adjudging  the  plaintifTs 
new  fourth  count  insufficient  is  affirmed,  and 
the  case  remanded. 


652 

4 


INTERPRET ATIOX  OF  CONTRACT. 
SMITH  T.  WILLIAMS. 


(1  Murph.  426.) 

Supreme  Court  of  North  Carolina.    July,  1810. 

This  was  an  action  on  the  case  for  a  breach 
of  warranty  in  the  sale  of  a  negro.  The  dec- 
laration stated,  "that  the  defendant  war- 
ranted the  negro  to  be  sound  and  healthy 
as  far  as  he  knew;  that  the  negro  was  un- 
sound and  unhealtliy,  being  afflicted  with  a 
rupture,  and  that  the  defendant  well  knew 
he  was  so  afflicted  at  the  time  of  the  war- 
ranty and  sale."  The  jury  found  a  verdict 
for  the  plaintiff,  subject  to  the  opinion  of 
the  court  on  a  point  of  law  reserved  in  the 
course  of  the  ti-ial,  viz.:  Whether  the  plain- 
tiff could  be  permitted  to  prove  such  a  war- 
ranty, when  at  the  delivery  of  the  negro,  up- 
on the  sale,  he  received  from  the  defendant  a 
written  instrument,  but  not  under  seal,  in  the 
following  words: 

"Know  all  men  by  these  presents,  that  I, 
Obed  Williams,  of  the  county  of  Onslow,  and 
state  of  North  Carolina,  have  bargained  and 
sold  unto  David  Smith,  of  the  aforesaid  cotm- 
ty  and  state,  one  negro  fellow,  named  George, 
about  thirty  years  of  age,  for  and  in  consider- 
ation of  three  hundred  dollars.  I  do  warrant 
and  defend  the  said  negro  against  the  lawful 
claim  or  claims  of  any  person  or  persons 
w'homsoever,  unto  him  the  said  Smith,  his 
heirs  and  assigns  forever.  Given  under  my 
hand  this  29th  January,  1802. 

"Obed  Williams. 

"Teste,  George  Roan." 

This  instrument  had  been  proved  in  Onslow 
county  court,  and  registered.  The  point  re- 
served was  sent  to  this  court. 

TAYLOB,  J.  The  contract  between  the  par- 
ties is  stated  at  length  in  the  special  case, 
and  appears  to  be  both  formally  and  substan- 
tially a  bill  of  sale  in  aU  respects,  except  as 
to  the  want  of  a  seal  This  omission,  how- 
ever, is  so  important  in  the  legal  estimation 
of  the  paper,  that  it  cannot  be  classed 
amongst  specialties,  but  must  remain  a  sim- 
ple contract,  on  which  no  additional  validity 
can  be  conferred  by  the  subsequent  registra- 
tion. For  I  do  not  apprehend  that  any  legal 
effect  can  be  given  to  a  paper  by  recording  it, 
if  that  ceremony  were  not  required  by  law. 

It  might  not,  however,  be  an  useless  enquiry 
to  consider,  whether  a  paper  containing  near- 
ly all  the  component  parts  of  a  specialty  or 
deed,  does  not  advance  some  greater  claims 
to  be  respected  in  the  scale  of  evidence,  than 
such  proofs  of  a  contract  as  rest  upon  the 
memory  of  witnesses. 

The  solemnity  of  sealed  instruments  has 
been,  from  the  earliest  periods  of  the  law, 
highly  regarded;  because  the  forms  and  cere- 
monies which  accompany  them,  bespeak  de- 
liberation in  the  parties,  and  afford  a  safe 
ground  for  courts  and  juries  to  ascertain  and 
settle  contested  rights.     This  deliberation  is 


inferred,  not  from  any  one  circumstance  at- 
tending the  transaction,  but  as  the  general 
effect  of  the  whole.  Thus  in  Plowd.  308,  B: 
"It  is  said  that  deeds  are  received  as  a  lien 
final  to  the  party  making  them,  although  he 
received  no  consideration,  in  respect  of  the 
deliberate  mode  in  which  they  are  supposed 
to  be  made  and  executed;  for,  first,  the  deed 
is  i)repared  and  drawn;  then,  the  seal  is  af- 
fixed; and  lastly,  the  contracting  party  de- 
livers it,  which  is  the  consummation  of  his 
resolution."  Hence  it  appears,  that  the  law 
gives  to  deeds  a  respect  and  importance 
which  it  denies  to  any  other  contracts;  not  an 
empty  and  unmeaning  respect,  but  such  as 
properly  arises  from  the  existence  of  all  those 
circumstances  which  are  calculated  to  fix  and 
make  authentic  the  contracts  of  men. 

A  contract  cannot  be  a  deed,  if  either  it  is 
not  prepared  and  drawn;  if  the  seal  be  not 
affixed,  or  if  it  be  not  delivered;  but  still  if 
the  deliberation  is  inferred  from  all  these  cir- 
cumstances, it  is  fair  reasoning  to  presume 
some  degree  of  dehberation  from  any  one  or 
two  of  them,  and  to  give  to  the  paper,  when 
it  is  introduced  as  evidence  of  the  parties' 
transaction,  precisely  such  credence  as  be- 
longs to  it,  from  its  partaking  more  or  less  of 
the  nature  of  a  deed. 

To  give  this  rule  a  practical  application  to 
the  case  before  us,  the  conclusion  would  be, 
that  as  the  paper  is  without  a  seal,  it  cannot 
be  a  deed,  and  is  therefore  not  decisive  evi- 
dence as  that  instrument  is;  it  is  not  a  final 
lien;  but  as  it  possesses  some  of  the  essen- 
tials of  a  deed,  viz.  a  formal  draught  and  de- 
livery, so  far  it  shall  be  regarded  as  evidence 
of  no  slight  nature  of  the  fact  it  is  introduced 
to  establish. 

The  writers  on  the  law  of  evidence  have 
accordingly,  in  arranging  the  degrees  of  proof, 
placed  written  evidence  of  every  kind  higher 
in  the  scale  of  probability  than  unwritten;  and 
notwithstanding  the  splendid  eloquence  of 
Cicero,  to  the  contrary,  in  his  declamation  for 
the  poet  Archias,  the  sages  of  our  law  hav^ 
said  that  the  fallibility  of  human  memory 
weakens  the  effect  of  that  testimony  which 
the  most  upright  mind,  awfully  impressed 
with  the  solemnity  of  an  oath,  may  be  dis- 
posed to  give.  Time  wears  away  the  distinct 
image  and  clear  impression  of  the  fact,  and 
leaves  in  the  mind,  uncertain  opinions,  imper- 
fect notions  and  vague  surmises. 

It  is,  however,  contended  by  the  plaintiff, 
that  contracts  by  our  law  are  distinguished 
by  specialty  and  by  parol;  that  there  is  no 
third  kind,  and  that  whatever  is  not  a  spe- 
cialty, though  it  be  in  writing,  is  by  parol. 
To  establish  this  position,  a  case  is  cited  from 
7  Term  R.  350,  by  which  it  is  certainly 
proved.  But  the  position  being  established, 
whether  it  will  authorize  the  inference  that 
parol  evidence  is  admissible  to  vary  and  e.x- 
tend  written  evidence,  will  best  appear  from 
an  examination  of  the  case,  and  from  some  at- 
tention to  the  question  which  caUed  for  the 
solution  of  the  court. 


KULES  RELATING  TO  EVIDENCE. 


In  the  case  cited,  the  declaration  states, 
that  the  defendant,  beinj,'  indebted  as  admin- 
istratrix, promised  to  pay  when  requested, 
and  the  judgment  Is  against  her  generally. 
From  this  statement  It  is  manifest,  tliat  the 
promise  could  not  be  extended  beyond  the 
consideration  which  was  Ln  another  right  as 
administratrix,  and  made  to  bind  the  defend- 
ant personally.  But  in  order  to  avoid  Uiis 
objection,  it  was  contended,  that  the  promise 
being  reduced  to  writing,  the  necessity  of  a 
consideration  was  dispensed  with;  and  that 
the  fact  of  its  having  been  made  in  writing, 
might  well  be  presumed  after  verdict,  if  nec- 
essary to  support  the  verdict,  which  latter  po- 
sition was  conceded  by  the  court. 

It  is,  then,  perfectly  evident:,  that  the  only 
question  In  the  case  was,  whether  nudum 
pactum  could  be  alleged  against  a  contract 
in  writing,  but  witliout  seal?  That  it  could 
not,  had  been  a  notion  entertained  by  sev- 
eral eminent  men,  and  amongst  the  i-est  by 
the  learned  commentator,  who  observes,  that 
"every  bond,  from  the  solemnity  of  the  in- 
strument, and  every  note,  from  the  sub- 
scription of  the  drawer,  carries  with  it  in- 
ternal evidence  of  a  good  consideration." 
Tliis  doctrine,  however,  is  inaccurate  as  ap- 
plied to  notes,  when  a  suit  is  brought  by  the 
payee,  and  is  only  correct  as  between  the 
indorsee  and  drawer.  To  demonstrate  the 
propriety  of  the  objection,  it  became  neces- 
sary for  the  court,  in  Ram  v.  Hughes,  to 
enter  into  a  definition  and  classification  of 
contracts,  into  those  by  specialty  and  those 
by  parol;  to  which  latter  division  every  con- 
tract belongs  that  is  not  sealed,  though  It 
may  be  written.  Everj^  written  unsealed  con- 
tract is,  therefore,  in  the  strict  language  of 
legal  precision,  a  parol  contract,  and  like  all 
others,  must  be  supported  l)y  a  consideration. 

But  let  it  be  considered,  what  the  court  would 
have  said,  if  the  case,  instead  of  requiring 
them  to  give  a  precise  and  comprehensive 
definition  of  contracts,  had  called  upon  them 
for  a  description  of  the  evidence  by  which 
contracts  may  be  supported.  They  would,  I 
apprehend,  liave  said,  (because  the  law  says 
so,)  the  evidence  which  may  be  adduced  in 
proof  of  a  contract  is  threefold:  1st,  matter 
of  record;  2d,  specialtj*;  3d,  unsealed  writ- 
ten evidence,  or  oral  testimony.  It  is  there- 
fore necessary  to  distinguish  between  a  con- 
tract, and  the  evidence  of  a  contract,  for 
though  they  may  be,  and  are,  in  many  cases, 
idoutifiod;  yet,  in  legal  language,  a  parol 
contract  may  be  proved  by  written  evidence. 
This  Is  the  case  now  before  us,  and  this 
brings  me  to  the  question  it  presents,  which 
I  understand  to  be,  whether  oral  evidence  is 
proper  to  ejxtend  and  enlarge  a  contract 
which  the  parties  have  committed  to  writ- 
ing? The  first  reflection  that  occurs  to  the 
mind  upon  the  statement  of  the  question.  In- 
dependent of  any  technical  rules,  is,  that  the 
parties,  by  making  a  written  memorial  of 
their  transaction,  have  implicitly  agreed,  that 
in  the  event  of  any  future   misunderstand- 


I 


553 


ing,  that  writing  shall  be  referred  to,  as  the 
proof  of  their  act  and  intention;  that  such 
obligations  as  arose  from  the  paper,  by  just 
construction  or  legal  intendment,  sliould  be 
valid  and  compulsory  on  them;  but  that  they 
would  not  subject  themselves  to  any  stipula- 
tions beyond  their  contract;  because,  if  they 
meant  to  be  bound  by  any  such,  they  might 
have  added  them  to  the  writing;  and  thus 
have  given  them  a  clearness,  a  force,  and  a 
direction,  which  they  could  not  have  by 
being  trusted  to  the  memory  of  a  witness. 
For  this  end,  the  paper  is  signed,  is  wit- 
nessed, and  is  mistakenly  recorded.  But  the 
plaintiff  says,  "Besides  the  warranty  of  title 
contained  in  the  writing,  the  defendant  made 
me  another  warranty  as  to  the  quality,  which 
I  can  prove  by  a  witness  present  at  the 
time;  and  though  he  has  complied  with  the 
warranty  which  was  committed  to  writing, 
j'et  he  has  broken  the  one  which  was  orally 
made,  whence  I  am  injured  and  seek  com- 
pensation." 

We  are  then  to  decide,  whether  the  law 
deems   such    proof  admissible. 

By  the  common  law  of  England,  there 
were  but  few  contracts  necessary  to  be  made 
in  writing.  Property  lying  in  grant,  as  rights 
and  future  interests,  and  that  sort  of  real 
property,  to  which  the  term  incorporeal  here- 
ditament applies,  must  have  been  authenti- 
cated by  deed.  So  the  law  remained  until 
St.  32  Hen.  VIII.,  which,  permitting  a  par- 
tial disposition  of  land  by  will,  required  the 
will  to  be  in  writing;  but  estates  In  land 
might  still  be  conveyed  by  a  symlwlical  de- 
livery in  presence  of  the  neighbors,  without 
any  written  instrument;  though  it  was 
thought  prudent  to  add  security  to  the  trans- 
action by  the  charter  of  feoffment.  The 
statute  of  29  Car.  II.,  commonly  called  the 
statute  of  frauds,  has  made  writing  and 
signing  essential  in  a  great  variety  of  cases 
wherein  they  were  not  so  before,  and  has 
certainly  increased  the  necessity  of  caution 
In  the  English  courts,  with  respect  to  the 
admission  of  verbal  testimony,  to  add  to  or 
alter  written  instruments,  in  cases  coming 
within  the  provisions  of  that  statute.  That 
law,  being  posterior  to  the  date  of  the  char- 
ter under  which  this  state  was  settled,  has 
never  had  operation  here;  so  that  the  com- 
mon law  remained  unaltered  until  the  year 
1715,  when  a  pailial  enactment  was  made  of 
the  provisions  of  the  English  statute. 

The  law  must  therefore  bo  sought  for  in 
cases  arising  before  the  statute  of  frauds, 
and  expositions  upon  that  statute  are  no  oth- 
erwise authoritative  than  as  they  afllrm  or 
recognize  the  ancient  law.  But  I  believe 
there  can  be  no  doubt  that  the  rule  is  as  an- 
cient as  any  in  the  law  of  evidence,  and  that 
It  existed  before  the  necessity  of  reducing 
any  act  into  writing  was  introduced. 

In  riowd.  345,  Lord  Dyer  remarks,  "Men's 
deeds  and  wills,  by  which  they  settle  their 
estates,  are  the  laws  which  private  men  are 
allowed  to  make,  and  they  are  not  to  be  al- 


554 


INTERPRETATION  OF  CONTRACT. 


V, 


tered  even  by  the  king,  in  bis  courts  of  law 
or  conscience." 

In  Rutland's  Case,  5  Coke,  the  court  re- 
solved that  it  was  very  inconvenient  that 
matters  in  writing  should  be  controlled  by 
averment  of  parties,  to  be  proved  by  uncer- 
tain testimony  of  slippeiy  memory,  and 
should  be  perilous  to  purchasers,  farmers, 
&c. 

The  case  of  Meres  v.  Ansel,  3  Wilson,  275, 
is  directly  in  point  upon  the  genei-al  princi- 
ple, to  shew  that  parol  evidence  shall  not 
be  admitted  to  contradict,  disannul  or  sub- 
stantially vaiy  a  written  agreement. 

In  2  Atk.  3S4,  Lord  Hardwicke  says:  "It 
is  not  only  contrary  to  the  statute,  but  to 
common  law,  to  add  anything  to  a  written 
agreement  by  parol  evidence," 

All  written  contracts,  says  Justice  Asliurst, 
whether  by  deed  or  not,  are  intended  to  be 
standing  evidence  against  the  parties  enter- 
ing into  them.     4  Term  R.  331. 

1  Ves.  Jr.  241,  parol  evidence  to  prove  an 
agreement  made  upon  the  purchase  of  an 
annuity  that  it  was  redeemable,  was  rejected. 

In  a  very  recent  case,  in  7  Ves.  211,  we  are 
furnished  with  the  opinion  of  the  present 
master  of  rolls.  Sir  William  Grant,  than 
whom  no  judge  ever  ranked  higher  in  the 
estimation  of  his  contemporaries,  for  pro- 
found and  accurate  knowledge  in  legal  sci- 
ence, and  a  proper  and  discriminating  appli- 
cation of  well  grounded  principles  to  the 
cases  which  arise  in  judgment  before  him. 
His  observations  are,  "By  the  rule  of'  law, 
independent  of  the  statute,  parol  evidence 
cannot  be  received  to  contradict  a  written 
agreement.  To  admit  it  for  the  purpose  of 
proving  that  the  written  instrument  does 
Qot  contain  the  real  agreement,  would  be 
the  same  as  receiving  it  for  every  purpose, 
[t  was  for  the  purpose  of  shutting  out  that 
enquiry  that  the  rule  was  adopted.  Though 
the  written  instrument  does  not  contain  the 
terms,  it  must,  in  contemplation  of  law,  be 
taken  to  contain  the  agreement,  as  furnish- 
ing better  evidence  than  any  parol  can  sup- 
ply." 

To  these  authorities,  I  will  add  a  decision 
of  the  circuit  court  of  Pennsylvania,  because 
it  appears  to  be  in  principle  the  very  case 
under  consideration. 

An  action  on  the  case  was  brought  by  the 
assignee  of  a  bond  against  the  assignor,  up- 
on a  written  assignment  In  general  terms. 
The  plaintiffs  offered  oral  evidence  to  shew 
that  the  defendant  had  expressly  guarantied 
the  payment  of  the  bond.  "Chase,  Justice. 
You  may  explain,  but  you  cannot  alter  a 
written  contract  by  parol  testimony.  A  case 
of  explanation  implies  uncertainty,  ambigui- 
ty and  doubt  upon  the  face  of  the  instru- 
ment. But  the  proposition  now  is  a  plain 
case  of  alteration;  that  is,  an  offer  to  prove 
by    witnesses,    that    the    assignor    promised 


something  beyond  the  plain  words  and  mean- 
ing of  his  written  contract.  Such  evidence 
is  inadmissible,  and  has  been  so  adjudged  in  ' 
the  supreme  court,  in  Clark  v.  Russell,  3  Dal. 
415.  I  grant  that  chancery  will  not  con- 
fine itself  to  the  strict  rule,  in  cases  of  fraud, 
and  of  trust;  but  we  are  sitting  as  judges 
at  common  law,  and  I  can  perceive  no  reason 
to  depart  from  it." 

I  suppose  the  above  authorities  are  amply 
sufficient  to  establish  the  proposition  Lor 
which  they  are  cited,  and  therefore  I  forbear 
to  make  any  other  references  for  that  pur- 
pose. The  exceptions  to  the  general  rule 
may  be  comprised  under  the  heads  of  fraud, 
surprise,  mistake,  in  cases  of  resulting  trust, 
to  rebut  an  equity,  or  to  explain  latent  am- 
biguities; and  there  may  also  be  some  other 
cases  which  cannot  be  properly  ranged  un- 
der the  titles  specified.  But  as  the  case 
stated  is,  in  my  opinion,  directly  opposed  by 
the  general  rule,  so  far  as  it  seeks  to  estab- 
lish the  proof  of  wan-anty  as  to  quality,  by 
parol,  and  presents  no  fact  to  bring  it  with- 
in any  of  the  exceptions,  it  would  be  need- 
less to  multiply  authorities  with  respect  to 
them. 

As  to  the  exception  on  the  ground  of  fraud, 
I  conceive  that  only  occurs,  where  some- 
thing intended  to  have  been  inserted  in  the 
contract,  is  omitted  through  the  misrepre- 
sentation or  unfair  practice  of  one  of  the 
parties.  In  such  case,  the  omission  may  be 
supplied  by  parol  evidence.  But  there  is  no 
allegation  here  that  the  additional  warranty 
was  intended  or  understood  by  either  party 
to  have  been  inserted  in  the  agreement. 

It  is  also  necessai-y  to  attend  to  the  nature 
of  the  remedy  adopted  by  the  plaintiff  in 
this  case,  which  is  founded  on  the  warranty, 
and  is  in  assumpsit  The  questions  arising 
upon  the  general  issue  are,  whether  the  war- 
ranty was  made,  and  whether  it  was  true 
at  the  time  of  making.  For  if  the  warranty 
were  made,  and  not  complied  with,  it  is 
wholly  immaterial  whether  the  defect  was 
known  to  the  seller  or  not,— a  principle  that 
seems  to  extend  to  every  case  where  the 
plaintiff  proceeds  on  the  wan-anty.  But  in 
an  action  of  deceit,  the  scienter  or  fraud  is 
a  material  part  of  the  declaration,  and  must 
be  brought  home  to  the  defendant  to  author- 
ize a  recovery  against  him,  and  in  such  case 
it  seems,  from  the  authorities,  that  proofs  of 
the  fraudulent  conduct  of  the  defendant  may 
be  drawn  from  sources  dehors  the  written 
contract.  It  cannot  be  contended  that  in- 
serting the  scienter  in  a  declaration  on  the 
warranty,  will  convert  It  into  an  action  of 
deceit  founded  on  tort  In  the  latter  ac- 
tion, the  knowledge  of  the  defendant,  or 
something  equivalent  to  it  by  whicli  the 
fraud  is  charged,  is  a  substantive  allegation, 
and  must  be  proved;  In  the  former,  it  is^ 
merely  surplusage,  and  may  be  rejected. 


RULES  DELATING  TO  EYIDEXCE— PllOOF  OF  CUSTOM  AND  USAGE.     555 


COOPER  V.  KANE. 

(19  Wend.  3SG.) 

Supreme  Court  of  New  York.    1838. 

This  was  an  action  of  replevin,  trif^d  at  the 
Albany  circuit  in  October,  ISS.'i,  before  the 
Hon.  Hiram  Denio,  then  one  of  the  circuit 
jud^'cs. 

The  action  was  in  the  dotinot  for  detaining 
a  quantity  of  sand  taken  from  a  lot  in  the 
city  of  Albany  belonging  to  tlie  plaintiff,  which 
the  defendant  had  excavated  under  a  contract 
with  the  plaintiff,  so  as  to  make  the  lot  con- 
form to  a  profile  or  plan  of  the  streets  es- 
tablished by  the  corporation.  The  contract 
was  in  writing;  the  defendant  was  to  exca- 
vate the  lot  and  malco  the  necessary  embank- 
ments within  a  limited  time,  for  which  he 
was  to  be  paid  by  the  plaintiff  i^lSO,  when 
the  work  was  done.  The  defendant  com- 
pleted tiio  job  and  Was  paid  the  stipulated 
price.  Whilst  engaged  in  the  work,  the  defend- 
ant placed  a  large  quantity  of  sand,  which 
was  taken  off  of  the  lot  in  order  to  make  it 
conform  to  the  required  plan,  on  an  adjoining 
lot  not  belonging  to  the  plaintiff,  and  when  re- 
quested by  the  plaintiff  to  permit  her  to  take 
it  away,  he  refused  such  permission;  for  this 
detention  the  action  was  brought.  There  was 
no  stipulation  In  the  contract  as  to  whom  the 
sand,  taken  from  the  lot  in  mailing  the  ex- 
cavation, should  belong  after  it  was  taken  off 
the  lot.  The  defendant  then  offered  to  prove 
a  custom  of  the  city  of  Albany  which  had  ex- 
isted for  a  great  number  of  years  and  was 
well  known  and  understood,  that  in  the  ex- 
cavation of  lots,  the  material  excavated  be- 
longed to  the  excavator  and  not  to  the  own- 
er of  the  lot,  unless  there  was  an  express  res- 
ervation in  the  contract  to  the  contrary.  The 
judge  rejected  the  testimony,  and  instructed 
the  jury,  that  on  the  evidence  adduced  the 
plaintiff  was  entitled  to  their  verdict,  who  ac- 
cordingly found  a  verdict  for  the  plaintiff 
with  six  cents  damages,  and  six  cents  costs, 
and  assessed  the  value  of  the  propert}'  at 
$157.  The  defendant  moves  for  a  new  trial. 
The  cause  was  submitted  on  written  argu- 
ments. 

J.  Holmes,  for  plaintiff.  C.  M.  Jenkins,  for 
defendant. 

NELSON,  O.  J.  I  am  inclined  to  the  opin- 
ion that  the  evidence  of  the  custom  in  re- 
spect to  contracts  like  the  one  out  of  which 
this  action  has  arisen,  by  wny  of  explaining 
It,  and  which  was  offered  by  the  defendant 
for  that  purpose,  was  admissible.  It  did  not 
go  to  vary  any  express  or  necessarily  im- 
plied stipulations  between  the  parties  therein 
contained,  but  rather  to  establish  what 
amoimted  to  a  complete  performance  agree- 
ably to  the  presumed  understanding  of  the 
parties. 

Mr.  Starkle  says  (2  Starkie.  Ev.  258,  259), 
"where  parties  have  not  entered  Into  any  ex- 
press and  specific  contract,  a  presumption 
nevertheless  arises,  that  they  meant  to  con- 
tract and   to  deal   according  to   the  general 


usage,  practice  and  understanding,  if  any  such 
exist.  In  relation  to  the  subject  matter."  The 
same  rule  of  evidence  is  also  recognized  by 
Phillipps  (volume  1,  pp.  420,  421).  and  Lord 
Kenyon  remarked  in  Whitnel  v.  Gratham,  ti 
Term  R.  398.  that  evidence  of  usage  was  ad- 
missible to  expound  a  private  deed,  as  well 
as  tho  king's  charter.  The  right  of  carriers, 
dyers,  wliarfiugers,  &;c.  to  a  lien  on  the  goods 
entrusted  to  them  for  their  compensation,  is 
frequently  established  by  usage,  independent- 
ly of  the  contract.  In  Rushforth  v.  Hadfleld, 
6  East,  519,  Lord  Ellenborough  pennitted  the 
defendants  (common  carriers)  to  go  into  proof 
of  common  usage  to  detain  the  goods  for  a 
general  balance,  on  the  ground  of  an  implied 
agreement  arising  out  of  it  between  the  par- 
ties. He  observed  that  if  there  be  a  general 
usage  of  trade  to  deal  with  common  carriers 
in  this  way,  aU  persons  dealing  in  the  trade- 
are  supposed  to  contract  with  them  upon  tho 
footing  of  the  general  practice,  adopting  the 
general  lien  into  their  contract.  Lawrence,  J., 
admitted  that  the  lien  must  be  by  contract  be- 
tween the  parties,  but  observed  that  usage  of 
trade  was  evidence  of  the  contract,  and  if  sc 
long  established  as  to  afford  a  presumption  it 
was  commonly  known,  it  was  fair  to  concludi^ 
the  particular  parties  contracted  with  refer- 
ence to  It.  In  Kirkman  v.  Shawcross,  6  Term 
R.  14,  the  dyers,  dressers,  whisters,  printers, 
&c.,  of  a  neighborhood,  held  a  public  meeting 
and  entered  into  an  agreement  ttiat  Lhey  would 
receive  no  more  goods  in  the  way  of  their 
trade,  except  on  the  condition  that  they 
should  have  a  lien  on  them  for  a  general  bal- 
ance, which  was  extensively  published.  The 
court  held  that  any  person  who  delivered 
goods  to  them  after  notice  must  be  deemed  to 
have  assented  to  the  terms  prescribed:  and, 
as  we  have  seen,  notice  might  be  inferred 
from  the  general  notoriety  of  the  terms  thus 
published. 

Now,  in  this  case,  there  is  simply  an  agree- 
ment to  excavate  the  earth  in  a  certain  street 
and  to  make  the  necessary  embankment,  ac- 
cording 'to  a  map  of  the  corporation,  for  a 
given  compensation.  Nothing  is  said  about 
the  surplus  earth,  where  it  Is  to  be  laid,  or 
what  is  to  be  done  with  it  Would  It  be  a 
workmanlike  execution  of  the  contnict  to  pile 
it  upon  the  adjacent  bank?  or  may  the  con- 
tractor dispose  of  it  as  he  sees  fit,  and  as  most 
convenient  and  profitable  to  himself?  It  ap- 
pears to  me,  the  solution  of  these  questions 
may  very  well  be  referred  to  common  us;ige 
in  such  cases,  if  any  exist;  and  that  if  it 
should  he  proved  as  said  by  Lawrence,  J.,  "It 
is  fair  to  conclude  the  particular  parties  con- 
tracted with  reference  to  it"  This  usage 
may  often  have  a  very  important  influence  up- 
on the  minds  of  the  parties  as  exemplified  in 
this  case:  for  the  value  of  the  materials,  which 
the  plaintiff  lias  recovered,  nearly  equals  the 
price  of  the  job.  If  in  fact  the  usage  exists, 
and  the  contract  was  made  In  reference  to  it, 
serious  Injustice  must  be  the  result  of  up- 
holding  the   verdicu 

New  trial  granted. 


INTERPRETATION  OF  CONTRACT, 


GRAY  V.  CLARK  et  aL 

(11  Vt.  6S3.) 

Supreme  Cotirt  of  Vermont.     Washington. 
July,  1S39. 

Ejectment  for  a  third  of  an  acre  of  land  in 
Marshtield.  Plea,  not  guilty,  and  trial  by  jury. 
Upon  the  trial  in  the  court  below,  it  appeared 
in  evidence,  that  on  the  26th  day  of  July.  1836, 
Luther  Hunt  deeded  the  land  in  controversy, 
■with  some  sixty  seven  acres  more,  to  Eli  Whee- 
lock.  and  the  lands  so  deeded  are  described  as 
follows: 

"All  that  part  of  lot  No.  three  in  the  fifth 
range  of  lots  in  said  town,  meaning  to  convey 
all  that  part  of  said  lot  that  was  deeded  to  me 
bv  Daniel  AVilson  on  the  20th  day  of  August, 
1823,  bounds  the  same,  being  more  or  less; 
also,  about  one  third  of  an  acre  of  land  of  lot 
No.  three,  in  the  fifth  range,  lying  south  of  the 
road,  bounded  westerly  by  the  land  conveyed 
to  the  school  district,  "north  by  the  road,  east- 
erly by  the  western  line  of  Mr.  Carleton,  mean- 
ing the  same  land  that  Luther  Hunt's  buildings 
stand  on,  having  recourse  to  the  deed  from 
English  to  said  Wilson  for  more  particular 
bounds." 

The  consideration  of  this  deed  was  eight 
hundred  and  fifty  dollars.  On  the  same  2»jth 
of  July,  1826,  Wheelock  executed  to  said  Hunt, 
for  the  consideration  of  eight  hundred  dollars, 
a  mortga^-e  deed  of  lands  described  as  follows: 
"all  that  part  of  lot  No.  three  in  the  fifth  range 
of  lots  in  said  town,  m&aning  to  convey  all  that 
part  of  said  lot  that  Luther  Hunt  deeded  to  me 
this  day.  excepting  seventeen  acres  lying  in 
the  southeast  corner  of  said  lot,  also  including 
one  quarter  of  an  acre  which  James  En- 
glish deeded  to  Daniel  Wilson,  and  *Wil-  *584 
son  to  Hunt,  to  Wheelock, "  to  secure  the 
payment  of  eight  hundred  and  fifty  dollars, 
specified  in  four  promissory  notes,  in  the  con- 
dition of  said  mortgage  deed  mentioned.  Tho 
land  in  controversy  is  the  piece  described  in 
the  last  mentioned  deed  as  one  quarter  acre 
which  James  English  deeded  to  Daniel  Wilson. 
Wheelock  continued  in  possession  of  the  prem 
ises  until  the  29th  of  January,  1830,  when  he 
executed  to  the  plaintiff's  intestate  a  mortgage 
deed  to  secure  her  maintenance  during  her  life, 
and  soon  after  absconded,  and  wholly  failed  to 
perform  the  condition  of  this  last  mortgage. 
Afterwards,  in  March,  1832.  Hunt  brought  a 
bill  of  foreclosure  against  Wheelocl^  and  the 
plaintiffs  intestate,  obtained  a  final  decree, 
took  possession  of  the  premises,  and  conveyed 
them  to  one  Damon,  who  deeded  them  to  the 
defendant.  It  was  admitted  that  Hunt  had  a 
good  title  to  the  land  when  he  conveyed  to 
Wheelock,  and  that  the  plaintiff  was  entitled 
to  recover,  unless  the  land  in  question  was  con- 
veyed to  Hunt  by  Wheelock's  mortgage  deed 
to  him,  but  if  the  land  was  not  conveyed  to 
Hunt  by  that  deed,  then  the  defendants  were 
entitled  to  a  verdict.  The  county  court  direct- 
ed the  jury  to  return  a  verdict  for  the  defend- 
ants, and  the  plaintiff  excepted. 

A.  Spalding  and  L.  B.  Peck,  for  plaintiff. 
Wm.   Upham.  and  0.  H,  Smith,  for  defend- 
ants. 

The  opinion  of  the  court  was  delivered  by 

REDFIELD,  J.  The  only  question  to  be  deter- 
mined in  this  case  is,  whether  the  land  in  ques- 
tion was  included  in  the  exception  in  Whee- 
lock's mortgage  deed  to  Hunt,  or  in  the  grant. 
All  the  land  referred  to  in  this  deed  origi- 
nally belonged  to  Hunt,  and  had  all,  that  day, 
been  deeded  to  Wheelock. — The  notes  secured 


by  the  mortgage  were  a  portion  of  the  consid- 
eration of  the  purchase,  and,  from  the  amount, 
?S.50,  being  the  same  as  the  consideration  ex- 
pressed in  Hunt's  deed  to  Wheelock,  it  is  pre- 
sumed were  for  the  principal  part  of  the  con- 
sideration. The  land  in  dispute,  instead  of 
being  deeded,  as  recited  in  Wheelock's  deed  to 
Hunt,  by  English  to  Wilson,  and  by  him  to 
Hunt,  was  deeded  by  English  directly  to 
Hunt.  *In  Hunt's  deed  to  Wheelock,  *58o 
the  land  is  described  in  different  parcels, 
by  reference  to  the  deeds  by  which  he  derived 
his  title.  The  mortgage  deed,  executed  by 
Wheelock  to  Hunt  to  secure  the  consideration, 
from  the  precise  correspondence  in  the  terms 
of  description  of  the  estate,  was  manifestly 
copied  from  the  deed,  and,  after  the  entire  es- 
tate had  been  described  by  general  terms,  and 
the  exceptions  also,  the  dubious  clause  is  super- 
added. 

If  we  adopt  the  rule,  ut  res  magi$  vaUat  quam 
pereat,  we  must  consider  this  as  forming  a  part 
of  the  exception,  for  as  the  whole  estate  had 
already  been  described,  it  would  not  enlarge, 
nor  in  any  way  render  more  certain,  the  grant, 
but  would  enlarge  the  exception.  But  this 
maxim  in  regard  to  the  construction  of  deeds 
is  but  one  among  the  very  great  number  which 
the  sages  of  the  law  have  left  us.  The  great 
object,  and,  indeed,  the  only  foundation  of  all 
rules  of  construction  of  contracts,  is,  to  come 
at  the  intention  of  the  parties.  And  any  rule, 
which  leads  us  aside  of  this  grand  object,  is  to 
be  disregarded.  In  the  present  case,  from  the 
general  nature  and  object  of  the  transaction 
and  the  common  course  of  business,  there  can 
be  little  doubt  of  the  intention  of  the  parties 
to  include  the  buildings,  which  constituted  the 
principal  value  of  the  purchase,  in  the  mort- 
gage, which  was  executed  to  secure  the  pur- 
chase money.  This  view  is  favored,  too,  we 
think,  by  the  manner  in  which  the  mortgage 
was  drawn,  being  copied  from  the  deed,  and, 
in  that,  the  different  parcels  being  described 
separately,  it  did  not  probably  occur  to  the 
parlies,  that  a  general  reference  to  that  deed 
would  include  all  its  particulars,  therefore,  ex 
maxima  cautela,  these  particulars  are  again  re- 
peated. We  ought  not,  therefore,  to  adopt  a 
construction  which  will  defeat  the  obvious  in- 
tention of  the  parties,  and  produce  a  result 
which  it  is  highly  improbable,  perhaps  absurd, 
to  suppose  they  contemplated.  This  view  is  in 
accordance  with  established  rules  of  construc- 
tion. Cholmondeley  v.  Clinton,  2  B.  &  Aid. 
Rep.  625.     Hassell  v.  Long,  2  M.  &  S.  363. 

It  has  been  repeatedly  said  that,  in  the  inter- 
pretation of  contracts,  a  nice  grammatical  con- 
struction is  not  always  to  be  regarded.  Crom- 
well V.  Grurasden,  1  Ld.  Raym.  335. — 2  Salk. 
462.  Fountain  v.  Guavers.  2  Show.  R.  333.  7 
Peterds.  Ab.  13'J.  Hence  we  are  under 
•586  no  necessity  of  re*ferripg  the  word  "in- 
cluding" to  the  next  immediate  antece- 
dent "excepting."  The  term  "including"  may 
have  reference  to  the  deed,  as  well  as  the  ex- 
ception. And,  it  is  evident,  the  most  natural 
and  obvious  import  of  the  word  is,  "including" 
in  the  deed,  and  not  in  the  exception. 

But,  at  most,  the  term  "including"  in  its  con- 
nection, is  equivocal.  In  such  cases,  resort 
may  always  be  had  to  the  circumstances  under 
which  the  contract  was  executed,  and  the  con- 
temporaneous construction  given  to  it  by  the 
parties,  as  evidenced  by  possession  or  other 
similar  acts.  Attorney  General  v.  Parker,  3 
Atk.  R.  576.  King  v.  Varlo.  Cowoer,  248; 
Bainbridge  v.  Statham,  7  Dowl.  &  Ryl.  141,  (16 
Eng.  C.  L.  279.)  Wadlev  v.  Bayliss,  5  Taunt. 
R.  752.    (1  Eng.  C.  L.  385.)    Jackson  v.  Wood. 


RULES  or  CONSTRUCTION. 


13  Johns  340.  In  this  view,  it  is  evident  that 
the  construction  contender!  for  by  the  defend- 
ant must  prevail.  For  the  land  ^as  alwaya 
been  claimed  and  held  under  the  deed  by  de- 
fendant, and  that  claim  fully  acquiesced  in  by 
plaintiff  for  many  years,  without  any  pretence 


of  claim  on  his  part,  so  far  as  appears  in  tiia^ 

Inevery  view  of  the  case.  then,  we  think  the 
construction  ?iven  to  the  deed  by  the  county 
court  must  prevail. 

Judzmeat  aiUrined- 


INTEEPRETATION  OF  CONTRACT. 


beck:  &  FAULT  LITnOCxRAPHING  CO.  t. 
COLORADO  MILLING  &  ELE- 
VATOR CO. 

(3  C.  C.  A.  248,  52  Fed.  700.) 

Circuit  Court  of  Appeals,  Eighth  Circuit.    Octo- 
ber 31.  1S92. 

No.  141. 
In  error  to  the  circuit  court  of  the  United 
States  for  the  district  of  Colorado.  Reversed. 
Statement  by  SANBORN,  Circuit  Judge: 
This  was  an  action  by  the  plaintiff  in  error 
to  recover  the  contract  price  of  certain  sta- 
tionery and  advertising  matter  furnished  the 
defendant.  It  was  tried  on  the  merits,  .and 
at  the  close  of  the  evidence  the  comrt  instruct- 
ed the  jury  to  return  a  verdict  for  the  defend- 
ant, and  this  instruction  is  assigned  as  error. 
The  plaintiff  was  a  corporation  of  Wisconsin, 
engaged  in  lithographing  and  printing,  and  its 
principal  place  of  business  was  at  Milwaukee, 
in  that  state.  The  defendant  was  a  corpora- 
tion of  Colorado,  engaged  in  the  business  of 
milling,  and  its  principal  place  of  business 
was  at  Denver,  in  that  state.  In  June,  1SS9, 
the  plaintiff  agreed  to  make  new  designs  of 
certain  buildings  of  defendant,  with  sketches 
of  its  trade-marks;  to  execute  engravings 
thereof  in  a  strictly  first-class  style;  to  em- 
body these  on  the  stationery  described  below; 
to  submit  to  defendant  for  approval  proofs 
thereof;  to  submit  designs  and  proofs  of 
hangers,  on  fine  chromo  plate,  for  advertis- 
ing defendant's  business,  by  the  following 
fall;  to  engrave  a  strictly  first-class  vignette 
of  one  of  defendant's  plants;  to  submit  a 
sketch  and  proof  thereof  to  defendant;  to  fur- 
nish defendant  with  10,000  basiness  cards  and 
5,000  checks  in  Augiist,  1889;  to  furnish.  In 
the  course  of  the  year,  letter  heads,  note- 
heads,  bill  heads,  statements,  bills,  envelopes, 
and  cards  to  the  defendant  to  the  number  of 
331,100,  and  5,000  hangers;  and  to  furnish  the 
vignette  and  5,000  hangers  more  after  the  ap- 
proval of  the  proofs  thereof  by  the  defendant. 
The  defendant  agreed  to  take  and  pay  for 
this  stationery,  this  vignette,  and  those  hang- 
ers at  certain  agreed  prices,  which  amounted 
in  the  aggregate  to  about  $6,000.  The  plainr 
tiff  furnished  the  10,^)00  cards  and  5,(XX) 
checks  required  under  the  contract  in  August, 
1889,  and  the  defendant  received  and  paid  for 
them.  The  plaintiff;  introduced  testimony  to 
the  effect  that  it  strictly  complied  with  and 
fully  performed  these  contracts  In  every  re- 
spect, except  that  it  shipped  the  articles  con- 
tracted for  (which  were  not  delivered  in  Au- 
gust) by  rail  from  Milwaukee  to  the  defend- 
ant, at  Denver,  in  December,  1889,  In  five 
boxes,  four  of  which  did  not  arrive  at  Denver 
until  9:42  a.  m.,  January  1,  1890,  and  the  fifth 
did  not  arrive  there  until  January  4,  1890; 
that  before  January  8,  1890,  all  of  these  arti- 
cles were  tendered  to  the  defendant,  and  it 
refased  to  examine  or  receive  them;  that  the 
sketches  and  proofs  of  the  designs,  trade- 
marks, and  hangers  had  been  submitted  to 
and  approved   by  the  defendant  during   the 


summer  and  fall  of  1SS9,  before  these  articles 
were  niauufacturod,  and  that  the  last  proof 
was  approved  November  16,  1&S9;  that  on 
December  16,  1889,  the  defendant  wrote  the 
plaintiff  to  forward  by  express  2,000  state- 
ments and  3,000  envelopes  "as  per  proofs  sub- 
mitted;" that  the  state  of  the  art  and  process 
of  lithographing  is  such  that,  after  the  gen- 
oral  idea  of  a  piece  of  work  is  conceived,  it  is 
customary  to  make  first  a  pencil  design,  and, 
when  this  is  found  satisfactory,  to  prepare  a 
colored  sketch  where  colored  work  is  requir- 
ed; that  after  the  sketch  is  colored  it  is  litho- 
graphed, that  is,  transferred  to  a  stone;  that 
each  color  requires  a  separate  stone;  and  in 
these  hangers  there  were  nine  colors;  that  it 
requires  from  two  to  three  months  to  repro- 
duce on  stone  a  colored  sketch  like  that  used 
for  the  hangers;  that  the  artists'  work  and 
the  reproduction  on  stone  were  the  most  ex- 
pensive parts  of  this  work  contracted  for; 
and  that  the  expense  of  the  materials  and 
printing  was  but  a  small  part  of  the  entire  ex- 
pense of  the  work. 

F.  W.  V.  Cotzhausen,  for  plaintiff  in  error. 
V.  D.  Markham,  for  defendant  in  error. 

Before  CALDWELL  and  SANBORN,  Cir- 
cuit Judges,  and  SHIRAS,  District  Judge. 

SANBORN,  Circuit  Judge  (after  stating  the 
facts).  The  ground  on  which  it  is  sought  to 
sustain  the  instruction  of  the  court  below  to 
return  a  verdict  for  the  defendant  in  this  case 
is  that  the  plaintiff  failed  to  tender  or  deliver 
the  articles  contracted  for  to  the  defendant, 
at  Denver,  until  six  or  eight  days  after  the  ex- 
piration of  the  year,  that  the  plaintiff  did  not 
therefore  furnish  them  "in  the  course  of  the 
year,"  and  that  this  faUure  justified  the  de- 
fendant in  repudiating  the  contract,  and  refus- 
ing to  pay  any  part  of  the  contract  price. 

It  is  a  general  principle  governing  the  con- 
struction of  contracts  that  stipulations  as  to 
the  time  of  their  performance  are  not  neces- 
sarily of  their  essence,  unless  it  clearly  ap- 
pears in  the  given  case  from  the  express  stip- 
ulations of  the  contract  or  the  nature  of  its 
subject-matter  that  the  parties  Intended  per- 
formance within  the  time  fixed  in  the  con- 
tract to  be  a  condition  precedent  to  its  en- 
forcement, and,  where  the  intention  of  the 
parties  does  not  so  appear,  performance  short- 
ly after  the  time  limited  on  the  part  of  either 
party  will  not  justify  a  refusal  to  perform  by 
the  party  aggrieved,  but  his  only  remedy  will 
be  an  action  or  counterclaim  for  the  damages 
he  has  sustained  from  the  breach  of  the  stip- 
ulations. In  the  application  of  this  principle 
to  the  cases  as  they  have  arisen,  in  the  pro- 
mulgation of  the  rales  naturally  deduced  from 
it,  and  in  the  assignment  of  the  various  cases 
to  the  respective  classes  in  which  the  stipu- 
lation as  to  time  of  performance  is,  or  is  not, 
deemed  of  the  essence  of  the  contract,  the 
controlling  consideration  has  been,  and  ought 
to  be,  to  so  decide  and  classify  the  cases  that 
unjust  penalties  may  not  be  inflicted,  nor  un- 


KULES  OF  CONSTRUCTION— RULES  AS  TO  TIME 


559 


Tcasonable  damages  recovered.  Thus,  in  the 
ordinary  contract  of  merchants  for  the  sale 
and  delivery,  or  the  manufacture  and  sale,  of 
marketable  commodities  within  a  time  cer- 
tain, it  has  been  held  that  performance  with- 
in the  tim.e  is  a  condition  precedent  to  the  en- 
forcement of  the  contract,  and  that  a  failure 
In  this  rej?ard  would  justify  the  ajisrieved 
party  in  refusing  performance  at  a  later  day. 
Norrlngton  v.  Wright,  115  U.  S.  18^203,  6 
Sup.  Ct.  12.  This  application  of  the  general 
principle  commends  itself  as  just  and  reason- 
able, on  account  of  the  frequent  and  rapid  in- 
terchange and  use  of  such  commodities  made 
necessary  by  the  demands  of  commerce,  and 
because  such  goods,  if  not  received  in  time  by 
the  vendee,  may  usually  be  sold  to  others  by 
the  vendor  at  small  loss,  and  thus  he  may 
himself  measure  the  damages  he  ought  to  suf- 
fer from  his  delay  by  the  difference  in  the 
market  value  of  his  goods.  On  the  other 
hand,  it  has  been  held  that  an  express  stipu- 
lation in  a  contract  for  the  construction  of  a 
house,  that  it  should  be  completed  on  a  day 
certain,  and  that,  in  case  of  failure  to  com- 
plete it  within  the  time  limited,  the  builder 
would  forfeit  $1,000,  would  not  justify  the 
owner  of  the  land  on  which  the  house  was 
constructed  in  refusing  to  accept  it  for  a 
breach  of  this  stipulation  when  the  house  was 
completed  shortly  after  the  time  fixed,  nor 
even  in  retaining  the  penalty  stipulated  in  the 
contract  but  that  he  must  perform  his  part 
of  the  contract,  and  that  he  could  retain  from 
or  recover  oi'  the  builder  the  damages  he  sus- 
tained by  the  delay  and  those  only.  Tayloe 
T.  Sandiford,  7  Wheat.  13,  17.  This  applica- 
tion of  the  general  rule  is  equally  just  and 
reasonable.  The  lumber  and  material  be- 
stowed on  .a  house  by  a  builder  become  of  lit- 
tle comparative  value  to  him,  while  they  are 
ordinar'Jy  of  much  greater  value  +o  the  own- 
er of  the  land  on  which  it  stands,  and  to  per- 
mit the  latter  to  escap-e  payment  because  his 
house  iJ  ccmpleted  a  few  days  later  than  the 
contract  requires  would  result  in  great  injus- 
tice to  the  contract£>r,  while  the  rule  adopted 
fuUr  protects  the  owner,  and  does  no  injus- 
tice to  any  )C2.  The  cases  just  referred  to 
illustrate  ♦:wo  well-settled  rules  of  law  which 
have  been  deduced  from  this  general  princi- 
ple, and  In  «ccordaiK:e  with  which  this  case 
must  be  determined.     They  are: 

In  contracts  of  merchants  for  the  sale  and 
delivery  or  for  the  manufacture  and  sale  of 
marketable  commodities  a  statement  descrip- 
tive of  the  subject-matter,  or  some  material 
Incident,  such  as  the  time  of  shipment,  is  a 
condition  precedent,  upon  the  failure  or  non- 
performance of  which  the  party  aggrieved 
may  repudiate  the  whole  contract.  Norrlng- 
ton V.  Wright  115  U.  S.  ISS.  203.  6  Sup.  Ct 
12;  Rolling  Mill  v.  Rhodes.  121  U.  S.  255, 
261,  7  Sup.  Ct.  SS2.  But  in  contracts  for 
work  or  skill,  and  the  materials  upon  which 
it  is  to  be  bestowed,  a  statement  fixing  the 
time  of  performance  of  the  contract  is  not 
ordinarily   of   its   essence,    and  a    failure   to 


perform  within  the  time  stipulated,  followed 
by  substantial  performance  after  a  short  de- 
lay, will  not  justify  the  aggrieved  party  in 
repudiating  the  en'^ire  contract,  but  will  sim-' 
ply  give  him  his  action  for  damages  for  the 
breach  of  tlie  stipulation.  Tayloe  v.  Sandi- 
ford, 7  Wheat.  13,  17;  Ilambiy  v.  Railroad 
Co.,  21  Fed.  541,  544,  554,  557. 

It  only  remains  to  determine  whether  the 
contracts  in  the  case  at  bar  are  the  ordinary 
contracts  of  merchants  for  the  manufacture 
and  sale  of  marketable  commodities  or  con- 
tracts for  labor,  skill,  and  materials,  and 
this  is  not  a  difficult  task.  A  contract  to 
manufacture  and  funiish  articles  for  the 
especial,  exclusive,  and  peculiar  use  of  an- 
other, with  special  features  which  he  re- 
quires, and  which  render  them  of  value  to 
him,  but  useless  and  unsalable  to  others.— 
articles  whose  chief  cost  and  value  are  de- 
rived from  the  labor  and  skill  bestowed  upon 
them,  and  not  from  the  materials  of  which 
they  are  made,— is  a  contract  for  work  and 
labor,  and  not  a  contract  of  sale.  Engraving 
Co.  V.  .Moore,  75  Wis.  170.  172,  43  N.  W. 
1124;  Goddard  v.  Rinney,  115  Mass.  450; 
Hinds  V.  Kellogg  (Com.  PI.)  13  N.  Y.  Supp. 
922;  Turner  v.  Mason  (INIich.)  32  N.  W.  840. 
Thus  in  Engraving  Co.  v.  Moore,  supra,  where 
the  lithographing  company  had  contracted 
to  manufacture  a  large  quantity  of  engrav- 
ings and  lithographs  for  a  theatrical  man- 
ager, with  special  features,  useful  to  him 
only  during  a  certain  season,  and  they  were 
completed  and  set  aside  in  the  rooms  of  the 
lithographer,  and  there  burned  before  de- 
livery to  the  manager,  the  court  held  that  the 
contract  was  not  one  for  the  sale  of  persomil 
property,  but  one  for  work,  skill,  and  ma- 
terials, because  it  was  not  the  materials,  but 
the  lithographer's  work  of  skill,  that  gave 
the  value  to  the  finished  advertisements,  and 
was  the  actual  subject-matter  of  the  contract, 
and  because  that  work  and  skill,  while  It 
added  the  chief  value  to  the  finished  articles 
for  the  especial  use  of  the  defendant,  made 
both  the  articles  and  the  materials  worthle-^s 
for  all  other  purposes. 

The  contracts  in  the  case  we  are  consider- 
ing were  not  for  the  blank  paper  on  which 
they  were  finally  impressed;  that  was  of 
small  value  in  proportion  to  the  value  of  the 
finished  articles;  they  were  not  for  the  sale 
of  anything  then  in  existence;  they  were  for 
the  artistic  skill  and  labor  of  the  employes 
of  the  defendant  in  preparing  the  sketches 
and  designs,  transferring  them  upon  stone, 
and  finally  impressing  them  upon  the  paper 
the  defendant  was  to  furnish;  and  they  au- 
thorized the  plaintiff,  without  other  orders 
than  the  contracts  themselves,  and  the  ap- 
provals of  the  designs  and  proofs  there  call- 
ed for,  to  prepare  and  furnish  all  the  articles 
named  In  the  contracts  and  to  collect  the 
contract  price  therefor.  These  contracts  re- 
quired the  names  of  defendant's  mills  and  its 
trade-marks  to  be  so  impressed  upon  all  these 
articles  that  when  they  were  completed  they 


560 


USTTERPRETATIOX  OF  CONTRACT. 


\    . 


were  not  only  unsalable  to  all  others,  but 
worthless  to  plaintiff  for  all  purposes  but 
waste  paper.  The  contracts  are  evidence 
that  on  December  31,  1SS9,  the  articles  con- 
tracted for  would  have  been  worth  about 
$6,000  to  the  defendant,  and  if  a  few  days 
later,  when  they  were  tendered,  they  were 
not  worth  so  much,  the  defendant  may  re- 
cover the  damages  it  suffered  from  the  delay 
from  December  31,  1SS9,'  to  the  date  of  the 
tender,  in  a  proper  action  therefor,  or  may 
have  the  same  allowed  in  this  action  under 
proper  pleadings  and  proofs,  and  no  injustice 
will  result;  while,  if  the  defendant  was  per- 
mitted on  account  of  this  delay  to  utterly 
repudiate  the  contract,  the  plaintiff  must 
practically  lose  the  entire  $6,000.  The  con- 
tracts contain  no  stipulation  from  which  it 
can  be  fairly  inferred  that  the  parties  in- 
tended the  time  of  performance  to  be  even 
material;  indeed,  they  strongly  indicate  the 
conti'ary.  They  provide  that  a  certain  por- 
tion of  the  articles  shall  be  furnished  in  two 
months,  that  the  remainder  of  the  stationery 
and  5,000  hangers  shall  be  furnished  in  the 
course  of  the  year,  and  that  5,000  hangers 
more  and  the  vignette  shall  be  furnished 
within  a  reasonable  time  after  the  proofs  are 
approved  by  the  defendant;  there  is  no  stipu- 
lation for  the  payment  of  any  damages  or 
the  avoidance  of  the  contracts  on  account 
of  a  failure  to  perform  within  any  of  the 
times  stipulated  in  tie  contracts,  and  the 
parties  themselves  proceeded  so  leisurely 
theix'under  that  the  first  and  only  admitted 
request  by  the  defendant  for  the  delivery  of 
any  of  the  articles  not  delivered  In  August 


was   on    December    10,    1S89.    In    Tayloe    v.  \ 
Sandiford,  supra,  the  court  refused  to  permit  \ 
the    owner   to    retain    the   $1,000    which   the    '|  i 
house  builder  had  expressly  agreed  to  pay  if      -^ 
he  failed  to  complete  the  house  within  the 
time  fi^xed  in  the  contract.    In  the  absence 
of  any  such  stipulation,   or  any   clearly-ex« 
pressed  intent  that  time  should  be  material 
even,  it  would  be  clearly  unjustified  by  the 
law  and  inequitable  to  hold  that  the  plaintiff 
is   compelled  to   forfeit   his    entire   contract 
price  on  account  of  this  trifling  delay  that 
may  have  been  immaterial  to  the  defendant, 
and,   if   not,   may   be   fully   compensated   In 
damages. 

The  result  is  that  these  conti*acts  were  not 
for  the  sale  and  delivery,  or  the  manufacture 
and  delivery,  of  marketable  commodities. 
They  were  contracts  for  artistic  skill  and 
labor,  and  the  materials  on  which  they  were 
to  be  bestowed  in  the  manufacture  of  articles 
which  were  not  salable  to  any  one  but  tiie 
defendant  when  completed  because  impress- 
ed with  special  features  useful  only  to  it 
There  was  nothing  in  the  contracts  or  their 
subject-matter  indicating  any  intention  of  the 
parties  that  the  stipulations  as  to  time  shouiu 
be  deemed  of  their  essence;  and  the  defend- 
ant was  not  justified  on  account  of  the  slight 
delay  disclosed  by  the  record  in  refusing  to 
accept  the  goods,  or  in  repudiating  the  entire 
contract  This  conclusion  disposes  of  the 
case,  and  it  Is  unnecessary  to  notice  other  er- 
rors assigned.  The  judgment  below  is  re- 
versed, and  the  cause  remanded  for  further 
proceedings  not  inconsistent  with  this  opin- 
ion. 


5  OF  CONSTRUCTION— PENALTIES  AND  LIQUIDATED  DAMAGES.     5G1 


•JAQUITH  V.  HUDSON.i 

(5  Mich.  123.) 

Supreme  Court  of  Micliigan.    May  Term, 
1858. 

Error  to  circuit  court,  Wayne  county. 

The  action  was  by  Jaquitli  against  Hudson, 
upon  a  pronii.ssory  note  for  one  tliousand  dol- 
lars, given  by  the  latter  to  the  former,  April 
15th,  1855,  and  payable  twelve  months  after 
date.  Defendant  pleaded  the  general  issue, 
and  gave  notice  that  on  the  trial  he  would 
prove  that,  previous  to  said  15th  day  of  April, 
1855,  plaintiff  and  defendant  had  been  and 
were  partners  in  trade,  at  Trenton,  in  said 
county  of  Wayne,  under  the  name  of  Hudson 
&  Jaquith;  that,  on  that  day  the  copartner- 
ship was  dissolved,  and  the  parties  then  en- 
tered into  an  agreement,  of  which  the  follow- 
ing is  a  copy: 

"This  article  of  agreement,  made  and  en- 
tered into  between  Austin  E.  Jaqnlth.  of  Tren- 
ton, Wayne  county,  and  state  of  Michigan,  or 
the  first  part,  and  Jonathan  Hudson,  of  Tren- 
ton, county  of  Wayne,  and  state  of  Michigan, 
of  "the  second  part,  witnesseth,  that  the  said 
Austin  E.  Jaquith  agrees  to  sell,  and  by  these 
presents  does  sell  and  convey  unto  the  said 
Jonathan  Hudson,  his  heirs  and  assigns,  all 
his  right,  title,  and  interest  in  the  stock  of 
goods  now  owned  by  the  firm  of  Hudson  and 
Jaquith,  together  with  all  the  notes,  books, 
book  accounts,  moneys,  deposits,  debts,  dues, 
and  demands,  as  well  as  all  assets  that  in  any- 
wise belong  to  the  said  firm  of  Hudson  & 
Jaquith;  and  that  the  copartnership  that  has 
existed  between  the  said  firm  of  Hudson  & 
.Jaquith  is  hereby  dissolved;  and  that  the 
said  Austin  E.  Jaquith,  by  these  presents, 
agrees  that  he  will  not  engage  in  the  mercan- 
tile business,  in  Trenton,  for  himself,  or  in 
connection  with  any  other  one,  for  the  space 
of  three  years  from  this  date,  upon  the  for- 
feiture of  the  sum  of  one  thousand  dollars,  to 
be  collected  by  the  said  Hudson  as  his  dam- 
ages. In  consideration  whereof,  the  said  Jon- 
athan Hudson,  of  the  second  part,  agrees  for 
himself,  his  heirs  and  administrators,  to  pay 
unto  the  said  Austin  E.  Jaquith  the  sum  of 
nine  hundred  dollars,  for  his  services  in  the 
firm  of  Hudson  &  Jaquith,  together  with  all 
the  money  that  he  (the  said  Austin  E.  Jaq- 
uith) paid  into  said  firm,  deducting  there- 
from the  amount  which  he  (the  said  Austin 
E.  Jaquith)  has  drawn  from  said  firm;  the 
remainder  the  said  Hudson  agrees  to  pay  to 
the  said  Jaquith,  his  heirs  or  assigns,  at  a 
time  and  in  a  manner  as  shall  be  specified  in 
a  note  bearing  even  date  with  these  presents. 
And  the  said  Hudson,  for  himself,  his  heirs 
and  assigns,  agrees  to  pay  all  the  debts,  notes 
and  liabilities  of  the  firm  of  Hudson  & 
Jaquith,  and  to  execute  imto  the  said  Jaquith 
a  good  and  sufficient  bond  of  indemnification 

1  Irrelevant  parts  omitted. 

HOPK.SEL.CAS.CONT. — 36 


against  all  claims,  debts,  or  liabilities  of  the 
firm  of  Hudson  &  Jaquith. 

"Trenton,  April.  1S55. 

"Austiu   E.  .Jaquith.     [L.    S.] 
"Jonathan  Hudson.       [L.  S.] 

"Witnr'ss:  Arthur  Edwards.  Arthur  Ed- 
wards, Jr." 

And  defendant  further  gave  notice,  among 
other  tilings,  that  he  would  show,  on  the  trial, 
that,  after  the  execution  of  said  agreement  in 
writing,  and  the  giving  of  said  note  in  pur- 
suance thereof,  on  or  about  the  15th  day  of 
July,  1855,  plaintiff,  in  violation  of  said  agree- 
ment, entered  into  the  mercantile  business  at 
Trenton,  and  had  continued  to  carry  on  the 
same  ever  since;  by  means  whereof  the  con- 
sideration of  said  note  had  failed.  And  he 
further  gave  notice,  that  he  (the  defendant) 
continued  to  cairy  on  the  mercantile  business 
at  Trenton,  aftor  the  dissolution  of  said  co- 
partnership; and  by  means  of  the  breach  of 
said  articles  by  plaintiff,  defendant  had  sus- 
tained damages  to  the  sum  of  one  thousand 
dollars,  liquidated  by  said  articles  for  a  breach 
thereof,  which  sum  he  would  claim  to  have 
di'ducted  from-  the  amount  of  said  note,  on 
the  trial. 

*  *  *  •  *  •      ' 

The  court  was  then  asked  by  plaintiflf'g 
counsel  to  charge  the  jury,  as  follows: 

"2.  That,  even  if  the  agreement  set  up  was. 
In  the  opinion  of  the  jury,  properly  delivered, 
as  between  the  parties,  the  defendant  can 
not  recoup  any  damages  against  the  plaintiff, 
except  upon  evidence  showing  that  some  dam- 
age was  actually  sustained  by  him;  that  the 
clause  in  the  agreement  as  to  damages,  can 
not,  of  itself,  and  In  the  absence  of  evidence, 
operate  to  the  reduction  of  the  claim  of  the 
plaintiff,  as  the  sum  fixed  in  the  agreement 
is  in  tlie  nature  of  a  penalty,  and  not  liquidat- 
ed damages;  and  no  damages  can  be  recov- 
ered under  it  except  such  as  are  proven." 
The  court  refused  so  to  charge;  and  plaintiflP 
excepted. 

The  court  charged  the  jury,  that  it  was  not 
necessary  for  the  defendant  to  prove  any  ac- 
tual damage  under  the  plaintiff's  breach  of 
the  said  agreement,  as  the  damages  therein 
fixed  were  liquidated  damages,  and  not  a  pen- 
alty. 

The  issue  was  then  submitted  to  the  jury 
on  the  evidence,  who  found  a  verdict  for  the 
plaintiff,  in  the  sum  of  eighteen  dollars  and 
eight  cents,  allowing  the  defendant  the  sum 
of  one  thousand  dollars  mentioned  in  the 
agreement 

Plaintiff  brought  the  case  to  this  court  by 
writ  of  error,  accompanied  by  bill  of  excep- 
tions. 

D.  Bethune  Duffield.  for  plaintiff  in  error. 
G.  V.  N.  Lothrop,  for  defendant  In  error. 

CHRISTIANCY,  J.  •  •  •  The  second 
exception  raises  the  single  question,  whether 


562 


mXERPKETATIO]^   OF  CONTRACT. 


the  sum  of  Sl.OOO.  mentioned  in  tlie  covenant 
of  Jaquitla  not  to  go  into  business  in  Trenton, 
is  to  be  construed  as  a  penalty,  or  as  stipu- 
lated damages— the  phiintiff  in  error  insisting 
it  should  be  construed  as  the  former,  the  de- 
fendant as  the  latter. 

We  shall  not  attempt  here  to  analyze  all  the 
decided  cases  upon  the  subject,  which  were 
read  and  cited  upon  the  argument,  and  which, 
with  others,  have  been  examined.  It  is  not 
to  be  denied  that  there  is  some  conflict,  and 
more  confusion,  in  the  cases;  judges  have 
been  long  and  constantly  complaining  of  the 
confusion  and  want  of  harmony  in  the  deci- 
sions upon  this  subject  But,  while  no  one 
can  fail  to  discover  a  very  great  amount  of 
apparent  conflict,  still  it  will  be  found,  on  ex- 
amination, that  most  of  the  cases,  however 
conflicting  in  appearance,  have  yet  been  de- 
cided according  to  the  justice  and  equity  of 
the  particular  case.  And  while  there  are 
some  isolated  cases  (and  they  are  but  few), 
which  seem  to  rest  upon  no  very  intelligible 
principle,  it  will  be  found,  we  think,  that  the 
following  general  principles  may  be  confident- 
ly said  to  resmt  from,  and  to  reconcile,  the 
great  majority  of  the  cases,  both  in  England 
and  in  this  country: 

First.  The  law,  following  the  dictates  of 
equity  and  natural  justice,  in  cases  of  this 
kind,  adopts  the  principle  of  just  compensa- 
tion for  the  loss  of  injury  actually  sustained; 
considering  it  no  greater  violation  of  this 
principle  to  confine  the  injured  party  to  the 
recovery  of  less,  than  to  enable  him,  by  the 
aid  of  the  court  to  extort  more.  It  is  the  ap- 
plication, in  a  court  of  law,  of  that  principle 
long  recognized  in  courts  of  equity,  which, 
disregarding  the  penalty  of  the  bond,  gives 
only  the  damages  actiially  sustained.  This 
principle  may  be  stated,  in  other  words,  to  be, 
that  courts  of  justice  will  not  recognize  or  en- 
force a  contract,  or  any  stipulation  of  a  con- 
tract, clearly  unjust  and  unconscionable;  a 
principle  of  common  sense  and  common  hon- 
esty so  obviously  in  accordance  with  the  dic- 
tates of  justice  and  sound  policy  as  to  make 
it  rather  matter  of  surprise  that  courts  of 
law  had  not  always,  and  in  all  cases,  adopted 
it  to  the  same  extent  as  courts  of  equity. 
And,  happily  for  the  puiposes  of  justice,  the 
tendency  of  courts  of  law  seems  now  to  be 
towards  the  full  recognition  of  the  principle, 
in  all  cases. 

This  principle  of  natural  justice,  the  courts 
of  law,  following  courts  of  equity,  have,  in 
this  class  of  cases,  adopted  as  the  law  of  the 
contract;  and  they  will  not  permit  the  par- 
ties by  express  stipulation,  or  any  form  of 
language,  however  clear  the  intent,  to  set  it 
aside;  on  the  familiar  ground,  "conventus  pri- 
vatomm  non  potest  publico  juri  derogare." 

But  the  court  will  apply  this  principle,  and 
disregard  the  express  stipulation  of  parties, 
only  in  those  c-ases  where  it  is  obvious  from 
the  contract  before  them,  and  the  whole  sub- 
ject-matter, that  the  principle  of  compensa- 


tion has  been  disregarded,  and  that  to  carry 
out  the  express  stipulation  of  the  parties, 
would  violate  this  principle,  which  alone  the 
court  recognizes  as  the  law  of  the  contract 

The  violation,  or  disregard,  of  this  prin- 
ciple of  compensation,  may  appear  to  the 
court  in  various  ways — from  the  contract,  the 
sum  mentioned,  and  the  subject-matter.  Thus, 
where  a  large  sum  (say  one  thousand  dollars) 
is  made  payable  solely  in  consequence  of  the 
non-payment  of  a  much  smaller  sum  (say  one 
hundred  dollars),  at  a  certain  day;  or  where 
the  contract  is  for  the  performance  of  several 
stipulations  of  very  different  degrees  of  im- 
portance, and  one  large  sum  is  payable  on 
the  breach  of  any  one  of  them,  even  the  most 
trivial,  the  damages  for  which  can,  in  no  rea- 
sonable probability,  amount  to  that  sum;  in 
the  first  case,  the  court  must  see  that  the  real 
damage  is  readily  computed,  and  that  the 
principle  of  compensation  has  been  overlook- 
ed, or  purposely  disregarded;  in  the  second 
case,  though  there  may  be  more  difficulty  in 
ascertaining  the  precise  amount  of  damage, 
yet  as  the  contract  exacts  the  same  large  sum 
for  the  breach  of  a  trivial  or  comparatively 
unimportant  stipulation,  as  for  that  of  the 
most  important  or  of  all  of  them  together,  it 
is  equally  clear  that  the  parties  have  wholly 
departed  from  the  idea  of  just  compensation, 
and  attempted  to  fix  a  rule  of  damages  which 
the  law  wiU  not  recognize  or  enforce. 

We  do  not  mean  to  say  that  the  principle 
above  stated  as  deducible  from  the  cases,  is 
to  be  found  generally  announced  in  express 
terms,  in  the  language  of  the  courts;  but  it 
wiU  be  found,  we  think,  to  be  necessarily  im- 
plied in,  and  to  form  the  only  rational  founda- 
tion for,  all  that  large  class  of  cases  which 
have  held  the  sum  to  be  in  the  nature  of  a 
penalty,  notwithstanding  the  strongest  and 
most  explicit  declarations  of  the  parties  that 
it  was  intended  as  stipulated  and  ascertained 
damages. 

It  is  true,  the  courts  in  nearly  all  these  cases 
profess  to  be  construing  the  contract  with 
reference  to  the  intention  of  the  parties,  as  if 
for  the  purpose  of  ascertaining  and  giving 
effect  to  that  intention;  yet  it  is  obvious,  from 
these  cases,  that  wherever  it  has  appeared  to 
the  court,  from  the  face  of  the  contract  and 
the  subject-matter,  that  the  sum  was  clearly 
too  large  for  just  compensation,  here,  while 
they  will  allow  any  form  of  words,  even  those 
expressing  the  direct  contrary,  to  indicate  the 
intent  to  make  it  a  penalty,  yet  no  form  of 
words,  no  force  of  language,  is  competent  to 
the  expression  of  the  opposite  intent.  Here, 
then,  is  an  intention  incapable  of  expression 
in  words;  and  as  all  written  contracts  must 
be  expressed  in  words,  it  would  seem  to  be  a 
mere  waste  of  time  and  effort  to  look  for  such 
an  intention  in  such  a  contract.  And  as  the 
question  is  between  two  opposite  intents  only, 
and  the  negation  of  the  one  necessarily  Im- 
plies the  existence  of  the  other,  there  would 
seem  to  be  no  room  left  for  construction  with 


liULES  OP  CONSTRUCTION— PENALTIES  AND  LIQUIDATED  DAMAGES.     5G3 


reference  to  the  Intent.  It  must,  then,  be 
manifest  that  the  intention  of  the  parties  In 
such  cases  is  not  governing  consideration. 

But  some  of  the  cases  attempt  to  justify 
this  mode  of  construing  the  contract  with  ref- 
erence to  the  intent,  by  declaring,  in  sub- 
stance, that  though  the  language  is  the  strong- 
est which  could  be  used  to  evince  tlie  iul.eiitiun 
In  favor  of  stipulated  damages,  still,  if  it  ap- 
pear clearly,  by  reference  to  the  subject-mat- 
tor,  that  the  parties  have  made  the  stipulation 
without  reference  to  the  principle  of  just 
compensation,  and  so  excessive  as  to  be  out  of 
all  proportion  to  the  actual  damage,  the  court 
must  hold  that  they  could  not  have  intended 
it  as  stipulated  damages,  though  they  have  so 
expressly  declared.  See,  as  an  example  of 
this  class  of  cases,  Kemble  v.  Parren,  6  Bing. 
141. 

Nove  this.  It  is  true,  may  lead  to  the  same 
result  in  the  particular  case,  as  to  have 
placed  the  decision  upon  the  true  ground,  viz., 
that  though  the  parties  actually  intended  the 
sum  to  be  paid,  us  the  damages  agreed  upon 
between  them,  yet  it  being  clearly  uncon- 
scionable, the  court  would  disregard  the  in- 
tention, and  refuse  to  enforce  the  stipulation. 
But,  as  a  rule  of  construction,  or  interpreta- 
tion of  contracts,  it  is  radically  vicious,  and 
tends  to  a  confusion  of  ideas  in  the  construc- 
tion of  contracts  generally.  It  is  this,  more 
thaji  anything  else,  which  has  produced  so 
mucti  apparent  conflict  in  the  decisions  upon 
this  whole  subject  of  penalty  and  stipulated 
damages.  It  sets  at  defiance  all  rules  of  in- 
terpretation, by  denying  the  intention  of  the 
parties  to  be  what  they,  in  the  most  imam- 
biguous  terms,  have  declared  it  to  be,  and 
finds  an  intention  directly  opposite  to  that 
which  ii?  clearly  expressed — "divinatio,  non 
Interpretatio  est,  qua?  omnino  recedit  a  litera." 

Again,  the  attempt  to  place  this  question  up- 
on the  intention  of  the  parties,  and  to  make 
this  tho  governing  consideration,  necessarily 
implies  that,  if  the  intention  to  make  the 
sum  stipulated  damages  should  clearly  ap- 
pear, the  court  would  enforce  the  contract  ac- 
cording to  that  Intention.  To  test  this,  let  It 
be  asked,  whether,  in  such  a  case,  if  it  were 
admitted  that  the  parties  actually  intended 
the  sum  to  be  considered  as  stipulated  dam- 
ages, and  not  as  a  penalty,  would  a  court  of 
law  enforce  It  for  the  amount  stipulated? 
Clearly,  they  could  not,  without  going  back 
to  the  technical  and  long  exploded  doctrine 
which  gave  the  whole  penalty  of  the  bond, 
without  reference  to  the  damages  actually 
sustained.  They  would  thus  be  simply  chan- 
ging the  names  of  things,  and  enforcing,  un- 
der the  name  of  stipulated  damages,  what  In 
its  own  nature  is  but  a  penalty. 

The  real  question  in  tliis  class  of  cases  will 
be  found  to  be,  not  what  the  parties  intended, 
but  whether  the  siun  is,  in  fact,  in  the  na- 
ture of  a  penalty;  and  this  is  to  be  determin- 
ed by  the  magnitude  of  the  sum,  in  connec- 
tion with  the  subject-matter,  and  not  at  all 


by  the  words  or  the  understanding  of  the 
parties.  The  intention  of  the  parties  can  not 
alter  it.  While  courts  of  law  gave  the  penalty 
of  the  bond,  the  parties  intended  the  pay- 
ment of  the  penalty  as  much  as  they  now 
intend  the  payment  of  stipulated  damages; 
it  must,  therefore,  we  think,  be  very  obvious 
that  the  actual  intention  of  the  parties,  in 
this  class  of  cases,  and  relating  to  this  point, 
is  wholly  immaterial;  and  though  the  courts 
have  very  generally  professed  to  base  their 
decisions  upon  the  intention  of  the  parties, 
that  intention  is  not.  and  can  not  be  made, 
the  real  basis  of  these  decisions.  In  en- 
deavoring to  reconcile  their  decisions  with 
the  actual  intention  of  the  parties,  the  courts 
have  sometimes  been  compelled  to  use  lan- 
guage wliolly  at  war  with  any  idea  of  inter- 
pretation, and  to  say  "that  the  parties  must 
be  considered  as  not  meaning  exactly  what 
they  say."  Homer  v.  Flintoff,  9  Mees.  & 
W.,  per  Park,  B.  May  It  not  be  said,  with  at 
least  equal  propriety,  that  the  courts  have 
sometimes  said  what  they  did  not  exactly 
mean? 

The  foregoing  remarks  are  all  to  be  confin- 
ed to  that  class  of  cases  where  it  was  clear, 
from  the  sum  mentioned  and  the  subject-mat- 
ter, that  the  principle  of  compensation  had 
been  disregarded. 

But,  secondly,  there  are  great  numbers  of 
eases,  where,  from  the  nature  of  the  contract 
and  the  subject-matter  of  the  stipulation,  for 
the  breach  of  which  the  sum  is  provided,  it 
is  apparent  to  the  court  that  the  actual  dam- 
ages for  a  breach  are  uncertain  In  their  na- 
ture, difficult  to  be  ascertained,  or  impossible 
to  be  estimated  with  certainty,  by  reference 
to  any  pecuniary  standard,  and  where  the 
parties  themselves  are  more  intimately  ac- 
quainted with  all  the  peculiar  circumstances, 
and  therefore  better  able  to  compute  the  ac- 
tual or  probable  damages,  than  courts  or  ju- 
ries, from  any  evidence  which  can  be  brought 
before  them.  In  all  such  cases,  the  law  per- 
mits the  parties  to  ascertain  for  themselves, 
and  to  provide  in  the  contract  itself,  the 
amount  of  the  damages  which  shall  be  paid 
for  the  breach.  In  permitting  this,  the  Liw 
does  not  lose  sight  of  the  principle  of  compen- 
sation, which  is  the  law  of  the  contract,  but 
merely  adopts  the  computation  or  estimate 
of  the  damages  made  by  the  parties,  as  being 
the  best  and  most  certain  mode  of  ascertain- 
ing the  actual  damage,  or  what  sum  wiU 
amount  to  a  just  compensation.  The  reason, 
therefore,  for  allowing  the  parties  to  ascer- 
tain for  themselves  the  damages  in  this  class 
of  cases,  is  the  same  which  denies  the  right 
in  the  former  class  of  cases;  viz..  the  courts 
adopt  the  best  and  most  practicable  mode  of 
ascertaining  the  sum  which  will  produce  just 
compensation. 

In  this  class  of  cases  where  the  law  per- 
mits the  parties  to  ascertain  and  fix  the 
amount  of  diimages  in  the  contract,  the  first 
inquiry  obviously  is,  whether  they  have  done 


564 


INTERPEETATION  OF  CONTRACT. 


so  In  fact?  And  here,  the  intention  of  the 
parties  is  the  governing  consideration;  and 
in  ascertaining  this  intention,  no  merely 
technical  effect  will  be  given  to  the  particu- 
lar vrords  relating  to  the  sum,  but  the  en- 
tire contract,  the  subject-matter,  and  often 
the  situation  of  the  parties  with  respect  to 
each  other  and  to  the  subject-matter,  will  be 
considered.  Thus  though  the  word  "penal- 
ty" be  used  (Sainter  v.  Pergason,  7  Man,,  G. 
&  S.  71G;  Jones  v.  Green,  3  Younge  &  J. 
299;  Pierce  v.  Fuller,  S  Mass.  223),  or  "for- 
feit" (Noble  v  Noble,  7  Cow.  307),  or  "for- 
feit and  pay"  (Fletcher,  v.  Dycke,  2  Term  R. 
32),  it  will  still  be  held  to  be  stipulated 
damages,  if,  from  the  whole  contract,  the 
subject-matter,  and  situation  of  the  parties, 
it  can  be  gathered  that  such  was  their  in- 
tention. And  in  proportion  as  the  difficulty 
of  ascertaining  the  actual  damage  by  proof 
is  greater  or  less,  where  this  difficulty  grows 
out  of  the  nature  of  such  damages,  in  the 
like  proportion  is  the  presumption  more  or 
less  strong  that  the  parties  intended  to  fix 
the  amount. 

It  remains  only  to  apply  these  principles  to 
the  case  before  us.  It  is  contended  by  the 
plaintiff  in  error,  that  the  payment  of  the 
one  thousand  dollars  mentioned  in  the  cove- 
nant of  Jaquith  is  not  made  dependent  sole- 
ly upon  the  breach  of  the  stipulation  not  to 
go  into  business  in  Trenton,  but  that  it  ap- 
plies equally— First,  to  the  agreement  to  sell 
to  Hudson  his  interest  in  the  goods;  sec- 
ond, to  sell  his  interest  in  the  books,  notes, 
accounts,  etc.;  and,  third,  to  the  agreement 
to  dissolve  the  partnership.  But  we  can  per- 
ceive no  ground  for  such  a  construction. 
The  language  in  reference  to  the  sale  of  the 
interest  in  the  goods,  books,  notes,  accounts, 
etc.,  and  that  in  reference  to  the  dissolution, 
is  not  that  ot  a  sale  in  futuro,  nor  for  the 
dissolution  of  the  partnership  at  a  future 
period,  but  it  is  that  of  a  present  sale  and  a 
present  dissolution— "does  hereby  sell,"  and 
"the  copartnership  is  hereby  dissolved,"  is 
the  language  of  the  Instrument  It  is  plain, 
from  this  language,  from  the  subject-matter, 
and  from  all  the  acts  of  the  parties,  that 
these  provisions  were  to  take,  and  did  take, 
Immediate  effect.  There  could  be  no  pos- 
sible occasion  to  provide  any  penalty  or 
stipulated  damages  for  the  non-performance 
of  these  stipulations,  because  this  sale  and 
dissolution  would  already  have  been  accom- 
plished the  moment  the  contract  took  effect 
for  any  purpose;  and,  until  it  took  effect, 
the  stipulation  for  the  one  thousand  dollars 
could  not  take  effect  or  afford  any  security, 
nor  would  Hudson  be  bound  or  need  the  se- 
curity. But  it  remained  to  provide  for  the 
future.  If  Jaquith  were  to  be  at  liberty  to 
set  up  a  rival  store  in  the  same  village,  it 
might  seriously  affect  the  success  of  Hud- 
son's business;  and  we  are  bound  to  infer, 
from  the  whole  scope  of  this  contract,  that 
Hudson  would  never  have  agreed  to  pay  the 


consideration  mentioned  in  It,  nor  to  have 
entered  into  the  contract  at  all,  but  for  the 
stipulation  of  Jaquith  "that  he  will  not  en- 
gage in  the  mercantile  business  in  Trenton, 
for  himself  or  in  connection  with  any  other 
one,  for  the  space  of  three  years  from  this 
date,  upon  the  forfeiture  of  the  sum  of  one 
thousand  dollars,  to  be  collected  by  said 
Hudson  as  his  damages."  This  stipulation 
of  Jaquith  not  to  go  into  business,  is  the  only 
one  on  his  part  which  looks  to  the  future; 
and  it  is  to  this,  alone,  that  the  language 
in  reference  to  the  one  thousand  dollars  ap- 
plies. Any  other  construction  would  do  vio- 
lence to  the  language,  and  be  at  war  with 
the  whole  subject  matter. 

The  damages  to  arise  from  the  breach  of 
this  covenant,  from  the  nature  of  the  case, 
must  be  not  only  uncertain  in  their  nature, 
but  impossible  to  be  exhibited  in  proof, 
with  any  reasonable  degree  of  accuracy,  by 
any  evidence  which  could  possibly  be  ad- 
duced. It  is  easy  to  see  that  while  the 
damages  might  be  very  heavy,  it  would  be 
very  difficult  clearly  to  prove  any.  Their 
nature  and  amount  could  be  better  esti- 
mated by  the  parties  themselves,  than  by 
witnesses,  courts,  or  juries.  It  is,  then,  pre- 
cisely one  of  that  class  of  cases  in  which  it 
has  always  been  recognized  as  peculiarly 
appropriate  for  the  parties  to  fix  and  agree 
upon  the  damages  for  themselves.  In  such 
a  case,  the  language  must  be  very  clear  to 
the  contrary,  to  overcome  the  inference  of 
intent  (so  to  fix  them),  to  be  drawn  from 
the  subject-matter  and  the  situation  of  the 
parties;  because,  it  is  difficult  to  suppose, 
in  such  a  case,  that  the  party  taking  the 
stipulation  intended  it  only  to  cover  the 
amount  of  damages  actually  to  be  proved,  as 
he  would  be  entitled  to  the  latter  without 
the  mention  of  any  sum  in  the  contract,  and 
he  must  also  be  supposed  to  know  that  his 
actual  damages,  from  the  nature  of  the  case, 
are  not  susceptible  of  legal  proof  to  anything 
approaching  their  actual  extent.  That  the 
parties  actually  intended,  in  this  case,  to 
fix  the  amount  to  be  recovered,  is  clear  from 
the  language  itself,  without  the  aid  of  a  ref- 
erence to  the  subject-matter,  "upon  the  for- 
feiture of  the  sum  of  one  thousand  dollars, 
to  be  collected  by  the  said  Hudson  as  his 
damages."  It  is  manifest  from  this  lan- 
guage that  it  was  intended  Hudson  should 
"collect,"  or,  in  other  words,  receive  this 
amount,  and  that  it  should  be  for  his  dam- 
ages for  the  breach  of  the  stipulation.  .  This 
language  is  stronger  than  "forfeit  and  pay," 
or  "under  the  penalty  of,"  as  these  might  be 
supposed  to  have  reference  to  the  form  of 
the  penal  part  of  a  bond,  or  to  the  form  of 
action  upon  it,  and  not  to  the  actual  "col- 
lection"  of  the  money. 

It  is,  therefore,  very  clear,  from  every  view 
we  have  been  able  to  take  of  this  case,  that 
it  was  competent  and  proper  for  the  parties 
to    ascertain    and    fix    for    themselves    the 


RULES  OF  CONSTRUCTION— PENALTIES  AND  LIQUIDATED  DAMAGES.     5C5 


amount  of  damages  for  the  breach  complain- 
ed of,  and  equally  clear  that  they  have  done 
so  In  fact.  From  the  uncertain  nature  of 
the  damages,  we  cannot  say  that  the  sum  in 
this  case  exceeds  the  actual  damages,  or  that 
the  principle  of  compensation  has  been  vio- 
lated. Indeed,  it  would  have  been  perhaps 
difficult  to  discover  a  violation  of  this  prin- 
ciple had  the  sum  in  this  case  been  more 
than  it  now  is,  though,  doubtless,  even  in 
such  cases  as  the  present,  if  the  sum  stated 
were  so  exces.sive  as  clearly  to  exceed  all 
reasonable  apprehension  of  actual  loss  or  in- 


Jury  for  the  breach,  we  should  be  compelled 
to  disregard  the  intention  of  the  parties,  and 
treat  the  sum  only  as  a  penalty  to  cover  the 
actual  damages  to  be  exhibited  In  proof. 
In  this  case  the  party  must  be  held  to  the 
amount  stipulated  in  his  contract 

The  second  exception,  therefore.  Is  not 
well  talien;  the  court  properly  refused  to 
charge  as  requested,  and  no  error  appearing 
in  the  record,  the  judgment  of  the  circuit 
court  for  the  county  of  Wayne  must  be  af- 
firmed. 

The  other  justices  concurred. 


DISCHARGE  OF  CONTRACT. 


\^1 


HOBBS  et  al.  v.   COLUMBIA  PALLS 
BRICK  CO. 


(31  N   E.  756.  157  Mass.  109 


F 


Supreme  Judicial   Court  of   Massachusetts. 
Suffolk.    Sept.  7,  1892. 


Exceptions  from  superior  court,  Suffolk 
county. 

Action  by  John  S.  Hobbs  and  others 
against  the  Columbia  Falls  Brick  Company 
on  a  contract  foi  the  sale  and  delivery  of 
brick.  Judgment  for  plaintiffs,  and  defend- 
ant excepts.     Exceptions  sustained. 

S.  L.  Whipple,  for  plaintiffs.  P.  T.  Benner, 
for  defendant. 

MORTON,  J.  We  think  that  upon  the 
facts  which  were  agreed,  and  upon  those 
which  appeared  in  evidence  from  the  testi- 
mony of  its  president  and  treasurer,  the  de-. 
fendant  was  entitled  to  go  to  the  jury  on  the 
'question  whether  there  had  been  "an  abandon- 
men^__ofthe  contract  bj^hej  la  intiff^^^  and 
their  assignees  which  was  assented  to  by^e 
defendant.  The  court  ruled  generally  upon 
the  evidence  thus  disclosed  that  it  would  not 
constitute  a  defense.  If,  therefore,  the  de- 
fendant can  avail  of  it  In  any  aspect  as  a  de- 
fense, it  is  entitled  to  a  new  trial.  As  the 
case  was  left  it  appeared  that  after  the  con- 
tract was  entered  into  the  plaintiffs  Jjgcame 
insolvent,  and  made  a_  voluntary  assignment 
for  the  benefit  _^  Jiheir  creditors,  of  which 
they  ^ave  notice  to  the  defendant  They  aft- 
erwards took  the  benefit  of  the  Insolvent  act, 
and  compounded  with  their  creditors  by  com- 
position proceedings.  No  reference  to  the 
contract  was  contained  in  the  schedule  of  as- 
sets which  they  filed  In  the  insolvency  court, 
and  there  was  no  allusion  to  it  in  the  state- 
ment of  their  assets  which  was  made  by  them 
at  a  meeting  of  their  creditors.  The  contract 
was  an  executory  one,  and  the  plaintiffs!  knt^w 
^>^f^t  the  tjrifk  ■^ere  to  be  made  at  the  plain- 
tiffs' Place.,  In  Maine.  They  gave  no  notice, 
directly  or  inrHrPctly,  tn  tTiP  dgfgJljj'^t,  till 
May  12th,— more  than  four  months  afterThe 
notice  of  their  assignment,— that  they  would 
claim  performance,  and  did  not  till  then  offer 
to  pay  or  secure  the  defendant  under  the 
contract  The  defendant  sold  the  brick  some 
time  in  ApriL  We  tbiBkJt_would_haveJieen 
competent  for  the.  Jury  to  And,  tmder  these 


circumstances.  that_the_-Plaiiitiffs  had  aban- 
^^£3^_the ^contractTand  that  thg  defendant 
had_a5sented_tp^  and  acted  upon  such  aban- 
donmejit.  The  jury  could_properly_  have  re- 
garded the  ^lyTng  of  tbe_noticg^_oL  the  assign- 
ment  as  equivalent  to  the  plaintiffs  saying 
that  they'  could  ^61  go~on"with  the  contract, 
especially  wheDTtaken  in~cqnnect|on  with  all 
tb^e~blheF circumstances.  Morgan  v.  Bain^  L. 
R.  10  C.  P.  15^  in  re  Steel  Co.,  4  Ch.  Div. 
lOS;  Ex  parte  Stapleton,  10  Ch.  Div.  586;  Ex 
parte  Chalmers,  L.  R.  8  Ch.  App.  289. 

While  the  fact  that  the  plaintiffs  became 
insolvent  after  entering  into  the  contract 
would  of  itself  not  have  terminated  the  con- 
tract, it  was  competent  for  the  jury  to  find 
that  the  notice  which  they  gave  to  the  de- 
fendant of  the  assignment,  and  their  subse- 
quent conduct,  justified  the  defendant  in  the 
assumption  that  they  had  abandoned  the  con- 
tract The  conduct  of  the  assjgnees,_assum- 
ing  that  the~contract  pasied  to  them,  does 
not  put  the  matter  in  any  better  shape  for  the 
plaintiffs.  It  was  their  duty  within  a  rea- 
sonable time  after  the  assignment  to  elect 
whether  to  proceed  or  not  with  the  contract, 
and  to  notify  the  defendant  accordingly.  Ex 
parte  Chalmers,  supra;  Ex  parte  Stapleton, 
supi'a.  They  did  not  do  this.  On  the  con- 
trary, when  the  defendant's  treasurer  in- 
quired whether  they  were  going  to  claim  the 
contract,  the  reply  which  he  got  left  on  his 
mind  the  impression  that  they  were  not. 
They  did  nothing  to  Indicate  that  they  were 
going  to  claim  it,  and  did  not  offer  to  pay  or 
in  any  way  secure  the  defendant  for  the  per- 
formance of  the  contract.  They  continued  to 
hold  the  pr»perty  assigned  to  them  till  April 
17th,  without  taking  any  action  In  reference 
to  the  contract  when  they  reconveyed  it  to 
the  plaintiffs,  who  could  derive  no  higher 
right  from  the  assignees  than  they  themselves 
possessed.  Inasmuch  as  there  must  be  a  new 
trial,  and  the  case  may  then  go  off  on  the 
ground  which  we  have  indicated  above,  or 
the  facts  relating  to  it  may  not  then  be  as 
now  stated,  we  have  not  considered  the  ef- 
fect of  the  testimony  offered  by  the  defendant, 
tending  to  show  that  the  plaintiffs  were  hope- 
lessly insolvent  at  the  time  when  they  made 
the  contract,  and  knew  themselves  to  be  so, 
and  concealed  the  fact  from  the  defendant, 
who  was  thereby  Induced  to  enter  Into  the 
contract.     Exceptions  sustained. 


(^3^ 


SUBSTITUTED  AGREEMENT. 
CUTTER  V.  COCHRANE 


567 


(116  Mass.  408.) 


Supreme   Judicial   Court   of   Massaclrosetts. 
Suffolk.    Dec.  28,  1874. 

Contract  for  money  had  and  received,  with 
counts  on  an  atireement  to  repay  money  paid 
by  the  plaintiff  to  the  defendant  on  a  con- 
tract, alleged  to  have  been  rescinded. 

At  the  trial  in  the  superior  court,  before 
Rockwell,  J.,  the  plaintiff  offered  evidence 
tending  to  prove  the  following  facts:  In 
November,  1870,  the  plaintiff  and  the  defend- 
ant, acting  through  his  agent,  Hugh  Coch- 
rane, entered  into  a  verbal  agreement  for  pur- 
chase  Ey  the  DiaiTitTff~7>?  tjig^defendnnt.^  as 
guardiai.  of  certaiiLJPl""r  bpirs,.-Qf,-n  ^imell- 
IngHIouse  and  land  connected, Iheressith,^ Stri- 
ated In  Maiden.  On  November  11,  the  plain- 
'tirt  made  rhe  first  payment,  and  took  a  re- 
ceipt and  memorandum,  as  follows:  "Re- 
ceived of  Mrs.  E.  J.  Cutter  one  hundred  dol- 
lars, on  account  of  purchase  of  estate  known 
as  CcK:hrajne  estate,  situated  op  court  leading 
from  Main  street;  price,  forty-seven  hun- 
dred dollars;  to  be  paid  in  instalments  of 
sev°aty-fiv^  dollars  per  month,  until  June  1, 
1871.  ;iL  whk.i  time  amounts  of  payments  to 
equal  one  thousand  dollars,  and  one  thou- 
sanr  doilars  to  be  paid  in  quarterly  payments 
from  that  date.  Balance  on  mortgage  for 
thite  year-  from  chat  date.  Bond  for  deed 
to  be  siren  on  that  date,  and  deed  when  the 
balanr^-  >if  the  second  thousand  is  paid.  Hugh 
Cochraic,  f  r  Guardian." 

The  authority  of  Hugh  Cochrane  to  act  as 
agent  for  the  defendant  vnis  not  denied.  Va- 
rious payment.:  were  rm-de  by  the  plaintiff, 
from  November  11,  ^870,  to  Octo'oe/  17,  1871, 
amounting  to  $950  In  all.  for  which  receipts 
wen;  given,  sometimes  signed  by  the  defend- 
ant and  sometimes  by  Hugh  Cocar"jie  In  his 
behalf. 

In  Noveniber,  1870,  the  plaintiff  entered  into 
possession  of  the  house  and  premises  under 
the  agreement  of  sale,  and  continued  to  oc- 
cupy the  same  until  July,  1872.  About  April 
1,^  1872,  no  further  payments  having  been 
made,  Hugh  Cochrane  wont  to  the  house  of 
the  plaintiff,  and  said  the  defendant  was  dis- 
satisfied, on  account  of  the  delay  in  making 
the  payments;  and  it  wna  thpn  j^gT-P^d  that 
the_a£:reement  ^jjsale  sbould_be  rescinded ; 
that  the  plaintiff  should  give  up  possession  of 
the^prein ises  _to~tbe  defendant,^ but  should 
hold~possession  and  keep  tlie  house  furnished 
for  a  while,  to  enable  the  defendant  to  make 
a  more  advantageous  sale  of  the  same,  and 
pay  the  defendant  interest  at  eight  per  cent. 
per  annum  on  the  purchase  money  for  the 
time  she  should  have  occupied;  and  that  the 
defendant,  in  consideration  thereof,  should 
pay   back  to  the  plaintiff  the   several    sums 


she  had  paid  towards  the  purchase,  with  eight 
per  cent,  per  annum  on  the  several  payments 
from  the  date  of  such  payments,  and  al.s:o  re- 
fund to  her  $00.03,  being  the  amount  of  taxes 
on  the  estate  paid  by  her.  The  plaintiff  re- 
mained, and  kept  the  house  furnished  until 
the  defendant  sold  the  same  on  May  24,  1872, 
and,  as  soon  as  requested  thereafter,  gave  up 
the  possession  to  the  purchaser  on  July  18, 
1872.  In  September,  1872,  she  went  to  the 
store  of  the  defendant  in  Boston  for  a  settle- 
ment, where  she  found  Hugh  Cochrane  and 
the  defendant  together,  and  where  Hugh,  in 
the  defendant's  presence,  made  out  a  state- 
ment of  the  balance  due  the  plaintiff,  placing 
it  at  $207.75;  that  it  differed  from  the  above 
agreement  only  in  that  it  did  not  embrace 
the  item  of  taxes,  nor  did  It  allow  her  inter- 
est on  the  payments  made  by  her;  while  on 
his  side  was  claimed  an  item  of  .$24.25,  al- 
leged to  have  t)een  paid  by  him  for  insurance, 
and  which  he  contended  ought  to  be  paid  by 
the  plaintiff.  The  plaintiff  declined  to  set- 
tle on  these  terms,  and  subsequently,  and  be- 
fore suit  brought,  made  formal  demand  for 
aU  the  money  paid  by  her  as  above,  which 
was  refused  by  the  defendant 

After  the  evidence  was  closed,  the  defend- 
ant's counsel  asked  the  Judge  to  rule  that  the 
plaintiff  was  not  entitled  to  recover,  on  the 
ground  that  there  was  no  consideration  for 
the  alleged  promise  on  the  part  of  the  de- 
fendant. The  judge  so  mled  and  ordered  a 
verdic*:  for  the  defendant,  and  the  plaintiff 
alleged  exceptions. 

N.  B.  Bryant,  for  plaintiff.  J.  P.  Convvjrsj 
aiid  E.  A.  Kelly,  far  defendant 

AMES,  J.  Whether  by  her  failux-e  to  make 
the  stipulated  payments  the  plaintiff  had  lost 
all  her  rights  under  the  original  contract,  and 
forfeited  the  money  which  she  had  paid,  is 
a  question  which  the  defendant  is  not  enti- 
tled to  raise  in  this  case.  The  settlement 
which  was  had  between  the  parties  proceed- 
ed upon  a  very  different  ground.  An  agree- 
ment to  rescind  a  previous  contract  imports 
that,  until  It  Is  rt^sclnded.  It  Is  recognized  by 
botli  parties  as  subsisting  and  binding.  J^ 
regciiidlng^  of  a  previotis_contract  containing; 
miltuarstlpulaSong  is  a  relensp  by  p-TclTpailjj 
tqliiejitlier^^  The  release  by  one  Is  the  con- 
sideration for  the  release  by  the  other,  and 
the  mutual  releases  form  the  consideration 
for  the  new  promise,  and  are  sufficient  to 
give  it  full  legal  effect.  I  The  defendant  is 
bound  to  account  for  the  money  that  has  been 
paid  to  him,  not  because  the  purchase  did  not 
go  into  effect,  but  because,  in  consideration 
of  mutual  releases,  he  has  excused  the  plain-  . 
tiff  from  its  fulfilment,  has  consented  to  a  / 
new  agreement,  and  has  expressly  promised 
to  accoimt  for  the  money. 

Exceptions  sustained. 


668 


DISCHARGE  OF  CONTKACT. 


3I 


BUTTERFIELD  v.  HABTSHORN.       ^ 

(7  N.  H.  345.)  ^J^ 

Superior  Court  of   New   Hampshire.      Hillsbor- 
ough,   Dec.  Term,  1S34. 

Assumpsit  for  money  bad  and  received. 
On  trial,  it  appeai-ed  that  prior  to  the  29th 
of  September,  1826,  one  John  Hartshorn  was 
duly  appointed  executor  of  the  last  will  of 
Benjamin  Hartshorn,  whose  estate  was  de- 
creed to  be  administered  in  the  insolvent 
court. 

The  plaintiff  presented  a  claim  against 
said  estate,  of  $45.06,  which  was  allowed  by 
the  commissioner,  and  a  decree  of  the  pro- 
bate court  was  passed  on  the  29th  of  Sep- 
tember, 1826,  for  the  payment  of  the  claim 
allowed  the  plaintiff  and  other  creditors  of 
the  estate. 

It  further  appeared,  that  on  the  17th  of 
November,  1826,  the  said  John  Hartshorn, 
executor,  sold  and  conveyed  to  the  defend- 
ant a  farm  which  had  belonged  to  the  tes- 
tator, for  the  sum  of  $1900,  and  that  upon 
that  occasion,  by  agreement  between  him 
and  the  defendant,  the  defendant  retained  a 
sufficient  amount  of  the  purchase  money  to 
pay  the  claims  against  said  estate  which  re- 
mained unpaid,  among  which  was  that  of 
the  plaintiff;  and  the  defendant  agreed  with 
the  executor  to  pay  to  the  plaintiff  the 
amount  of  his  claim,  to  recover  which  this 
action  is  brought. 

Upon  this  evidence,  verdict  was  taken  for 
the  plaintiff  by  consent;  and  it  was  agreed 
that  judgment  should  be  rendered  upon  the 
verdict,  or  that  the  verdict  should  be  set 
aside,  and  judgment  entered  for  the  defend- 
ant^  as  the  court  should  direct. 

J.  U.  Parker,  for  plaintifL  E.  Parker,  for 
defendant. 

UPHAM,  J.  In  this  case,  the  plaintiff  hav- 
ing a  claim  against  the  estate  of  Benjamin 
Hartshorn,  which  had  been  allowed,  it  be- 
came the  duty  of  the  executor  to  provide  for 
its  payment,  if  he  had  assets.  If  the  execu- 
tor might  have  compelled  the  plaintiff  to  a 
suit  upon  the  bond,  in  order  to  recover  the 
amount  of  his  claim,  it  was  no  part  of  his 
duty  as  executor  to  adopt  that  course;  and 
it  is  evident  that  he  intended  to  provide  for 
the  payment  of  the  plaintiff's  claim  without 
compelling  him  to  resort  to  legal  proceed- 
ings. For  this  purpose  he  directed  the 
amount  due  the  plaintiff  to  be  paid  out  o£ 
funds_  left  by  him  with  the  defendant,  aris- 
ing from  the  sale^_of__landa  hp"inngnn^  j-n 
the  est^e:  and  "the  defendant  cannot  pre- 
vail in  the  exception  which  has  been  taken 
by  him  in  this  case,— that  it  was  in  the  power 
of  the  executor  to  have  done  differently,  and 
to  have  withstood  payment  until  compelled 
by  a  suit  upon  his  bond.  Besid,cs,  the  exec- 
utor is  a  stranger  to  this  suit;  and,  if  this 
defence  should  be  considered  as  open  to  him 
(see,  contra,  Adams  v.  Dakin,  2  N.  H.  374), 


it  is  open  only  to  him,  and  cannot  avail  to 
this  defendant. 

The  second  exception  which  has  been  tak- 
en is  equally  untenable.  The  defendant  pur- 
chased the  land,  and  thereby  became  in- 
debted to  the  executor.  By  agreement  be- 
tween the  executor  and.  the  defendant,  the 
defendant  retained,  not  the  land,  as  that  Jiad 
passed  to  him  by  the  sale,  but  a  portion  of 
the  purchase  money,  for  the  purpose  of  pay- 
ing the  debts  of  certain  creditors  of  the  es- 
tate, among  which  was  the  debt  due  the 
plaintiff;  and  if  there  is  a  sufficient  privity 
betwixt  the  defendant  and  the  plaintiff,  the 
purchase  money  so  retained  is  the  plaintiff's 
money,  for  which  the  defendant  is  liable  to 
him  in  an  action  for  money  had  and  re- 
ceived to  his  use.  As  between  the  plaintiff 
and  defendant,  it  is  the  .same  as  if  the  land 
bad  been  paid  for,  and  the  executor  had  then 
deposited  a  portion  of  the  purchase  money 
with  the  defendant,  directing  him  to  pay. 
certain  debts  due  from  the  executor,  and! 
Hvhich  the  defendant  promised  to  pay. 

But  the  principal  question  in  this  case  is, 
whether .  the  plaintiff  can  avail  himself  of 
the^^j)romise^  made  j2J__theJdefendant  to  t_he 
executor, — he"^ever  having  agreed  to  accept 
thedefendant^s  his  dibtor,  nor  having  made 
any  -demand  of  him  for  the  rnpney  ^rior^  to 
th^  prTirnpencement  of  this_suit. 

Can  the  plaintiff  avail  himself  of  the  de- 
posit of  the  money  by  the  executor  with  the 
defendant,  and  the  defendant's  promise  to 
Hartshorn,  the  executor,  to  pay  it,  without 
some  evidence  of  assent  on  the  part  of  the 
plaintiff  before  the  institution  of  a  suit? 

It  is  apparent,  that  in  cases  of  this  kind,  a 
contract,  in  order  to  be  binding,  must  be 
mutual  to  all  concerned,  and  that  until  It  is 
completed  by  the  assent  of  all  interested,  it 
is  liable  to  be  defeated,  and  the  money  de- 
posited countermanded. 

It  seems,  also,  to  be  clear,  that  no  contract 
of  the  kind  here  attempted  to  be  entered 
into  can  be  made,  without  an  entire  change 
of  the  original  rights  and  liabilities  of  the 
parties  to  it.  There  is  to  be  a  deposit  of 
money  for  the  payment  of  a  prior  debt, — an 
agreement  to  hold  the  money  for  this  pur- 
pose, and  an  agreement  on  the  part  of  a  third 
person  to  accept  it  in  compliance  with  this^ 
arrangement.  It  is  made  through  the  agen- 
cy of  three  individuals,  for  the  purpose  of 
payment;  and  it  can  have  no  other  effect 
than  to  extinguish  the  original  debt,  and  cre- 
\ate  a  new  liability  of  debtor  and  creditor  be- 
'twixt  the  person  holding  the  money  and  the 
individual  who  is  to  receive  it  On  any  oth- 
er supposition  there  would  be  a  duplicate 
liability  for  the  same  debt;  and  the  depos- 
ite,  instead  of  being  a  payment,  would  be 
a  mere  collateral  security, — which  is  totally 
different  from  the  avowed  object  of  the  par- 
ties. 

What  proceedings  will  constitute  an  assent 
to  this  contract  and  discharge  the  original 
debtor?   Will  a  demand  of  the  money  have  this 


SUBSTITUTED  AGREEMENT. 


5G9 


•  effect?  An  Individual  who  should  receive  ad- 
vices from  his  debtor  of  a  deposite  of  money 
for  hia  beuelit,  would  hardly  deum  a  demand 
of  the  money,  accompanied  by  a  refusal  of 
payment,  a  discharge  of  the  prior  debt.  A 
suit  to  recover  money  is  no  more  decisive 
evidence  of  an  election  to  receive  it,  than  a 
demand;  and  the  l)ringing  of  a  suit  cannot 
be  considered  evidence  of  an  assent  to  a  con- 
tract, and  tliereby  support  the  action  which 
had  no  foundation  until  It  was  brought. 

To  entitle  the  plaintiff  to  recovgr,  there 
must  be  nn  PYtingnishment  of  the  original 
4obt;  and  it  is  quesUonablewhether,  in  cas- 
es oflrois^kind,  anylElSg  can  "operate  aa  an 
~exti  nguishment  of  the  origlnaldebtbnt  pay- 
mem,  or  an  express  agreementof  the  credit- 
or~to_takfi.  another"~persQP.-aa-bi3  debtor^in 
discharge  of  the  original  claim.  A  contract 
of  this  description  is  an  extinguishment  of 
the  original  debt.  Coxon  v.  Cbadley,  3  Bam. 
&  C.  591. 

The  bailee  is  either  a  stakeholder— holding 
the  money  to  abide  a  contingency,  and  bound 
either  to  deliver  it  to  the  depositor,  if  he  re- 
mands it,  or  to  the  creditor  if  he  claims  it,— 
1^  the  first  claimant  thereby  making  it  his  mon-*^ 
ey;  and  of  course,  If  the  creditor's  money 
then  a  payment  of  the  original  debt, — or  the 
bailee  is  liable  solely  to  the  depositor,  there 
being  no  privity  of  contract  betwixt  himself 
^and  any  other  person. 

If  this  be  true,  the  money  being  holden  npy- 
on  a  contingency  neither  party  can  sue  with- 
out a  prior  demand.  It  is  unnecessary  to  de- 
termine, in  this  case,  whether  suit  may  be 
made  with  demand.  If  so,  it  must  be  solely 
on  the  ground  that  by  such  demand  the  prior 
debt  is  extinguished. 

It  is  important  in  this  case  to  refer  to  such 
authorities  as  bear  upon  It.  The  case  of 
Hall  V.  Marston,  17  Mass.  575,  directly  con- 
flicts with  the  principles  laid  down  as  above. 
But  one  authority  is  cited  to  sustain  it, 
which  Is  from  Com.  Dig.,  "Action  upon  the 
Case  upon  Assumpsit,"  E:  "If  money  be 
given  to  A  to  deliver  to  B,  B  may  have  an 
action."  The  reference  In  Comyn  Is  to 
RoIIe,  Abr.,  and  Haidres,  321.  The  case  In 
H^rdres  is  Bell  vs.  Cliaplaln,  where  A  deliver- 
ed goods,  the  property  of  B,  to  C,  who  prom- 
ised, for  a  consideration  given  by  A,  to  de- 
liver them  to  B;  and  It  was  holden  that  either 
A  or  B  might  sue  C  for  not  delivering  them. 
In  that  case  the  goods  delivered  were  the 
property  of  B,  and  no  question  arose  as  to 
the  extinguishment  of  a  prior  debt.  The  case 
In  Massachusetts  proceeds  upon  the  same 
principle.  The  court  remark,  that  "wher- 
ever one  has  In  his  hands  the  money  of  an- 
other which  he  ought  to  pay  over,  he  is 
liable  to  this  action."  The  question  of  title 
to  the  money,  which  settles  the  question  of  a 
right  of  action.  Is  assumed  to  be  in  the  plain- 
tiff. 

The  case  of  Weston  v.  Barker,  12  Johns. 
276.  is  similar  to  that  in  17  Mass.,  except 
that  there  was  an  express  agreement  to  hold 


the  balance  of  the  money  subject  to  the  or- 
der of  the  depositors;  and  an  order  was 
afterward.s  drawn  by  them  for  the  money  in 
favor  of  the  plaintiff,  of  which  the  defend- 
ant had  notice.  In  this  case  Spencer,  J.,  dis- 
sented. Neilson  v.  Blight,  1  Johns.  Cas.  205, 
Is  a  similar  authority. 

The  cases,  Wilson  v.  Coupland,  5  Barn.  & 
Aid.  228;  Meerh  v.  Moes.sard,  1  Moore  & 
P.  8;  Israel  v.  Douglas,  1  H.  Bl.  239;  Tat- 
lock  V.  Harris,  3  Term  R.  180,— differ  from 
this  case.  In  those  cases  there  was  an  agree- 
ment of  all  tlie  parties  operating  to  the  ex- 
tinguishment of  the  original  debt,  and  a  new 
promise  was  made  by  the  person  holding 
the  money  directly  to  the  creditor.  These 
cases  are  similar  to  Cuxon  v.  Chadley  and 
Heaton  v.  Angler,  above  cited.  On  such  a 
promise  there  is  no  doubt  a  suit  would  lie, 
Surtees  v.  Hubbard,  4  Esp.  203;  Gill  v. 
Brown,  12  Johns.  385;  Beecker  v.  Beecker,  7 
Johns.  103;  HoUey  v.  Rathbone,  8  Johns.  149. 
It  would  be  Irrevocable  on  the  part  of  the 
promissor.  A  person  cannot  revoke  an  au- 
thority to  his  debtor  to  pay  a  debt  to  a  tliird 
party,  the  creditor  of  the  former,  after  the 
debtor  has  given  a  pledge  to  such  third  party 
that  he  will  pay  the  money  according  to  the 
authority.    Chit  Cont.  185. 

These  cases  are  distinct  from  the  case  now 
under  consideration.  Up  to  the  time  when 
this  action  was  brought,  the  plaintiff  had 
never  consented  to  receive  the  money  of  this 
defendant,  and  there  never  had  been  any 
contract  made  betwixt  them  relative  to  it. 

The  case,  Wharton  v.  Walker,  4  Barn.  & 
C.  1G3,  conflicts  with  the  Massachusetts  and 
New  York  authorities,  and  is  directly  in  point 
in  favor  of  the  defendant  One  Lythgoe  was 
Indebted  to  the  plaintiff  in  the  sum  of  £4.  Ss. 
and  gave  the  plaintiff  an  order  for  that  sum 
upon  the  defendant,  who  was  his  tenant  to 
be  paid  out  of  the  next  rent  that  became 
due.  When  the  next  rent  became  due,  Lyth- 
goe left  in  the  hands  of  the  defendant  the 
amount  due  to  the  plaintiff,  and  gave  a  re- 
ceipt for  the  whole  rent;  and  the  defendant 
promised  to  pay  the  plaintiff,  who  after- 
wards brought  an  action  for  money  had  and 
received.  It  was  held  that  the  action  could 
not  be  maintained,  because  the  plaintiff's 
debt  against  Ljthgoe  was  not  discharged. 

Bayley,  J.,  says,  that  if,  by  an  agreement 
betwixt  the  three  parties,  the  plaintiff  had 
undeiiaien  to  look  to  the  defendant  and 
not  to  his  original  debtor,  that  would  have 
been  binding,  and  the  plaintiff  might  have 
maintained  an  action,  on  the  agreement;  but 
In  order  to  give  that  right  of  action  there 
must  be  an  extinguishment  of  tlie  original 
debt  But  no  such  bargain  was  made  in  this 
case.  Upon  the  defendant's  refusing  to  pay 
the  plaintiff,  the  latter  might  still  sue  Lyth- 
goe, as  In  Coxon  v.  Chadwell,  3  Bam.  &  C. 
591. 

The  other  judges  severally  expressed  a  con- 
curring opinion. 

See,  also,  Bourne  v.  Mason,  1  Vent  6;  Crow 


570 


DISCHARGE  OF  CONTRACT. 


T.  Rogers,  1  Strange,  192;  Williams  v.  Ever- 
ett, 14  East,  532;  Johnson  v.  Collins,  1  East, 
104;  Stewart  v.. Fry,  7  Taunt.  339;  Lowther 
V.  Berry,  S  Mod.  116;  Crifford  v.  Berry,  11 
Mod.  241;  3  East,  171. 

The  general  rule  applicable  to  cases  of  this 
kind  is,  that  the  legal  interest  In  the  con- 
tract resides  with  the  party  from  whom  the 
consideration  moves,  notwithstanding  it  may 
inure  to  another's  benefit,  or  even  is  to  be 
performed  to  another  in  person.  So  that 
"were  A  to  promise  B,  for  some  considera- 
tion he  has  given  him,  to  pay  C  a  sum  of 
money,  B,  and  not  C,  would  be  legally  con- 


cerned in  this  agreement-"  Tliis  rule  Is 
laid  down  by  Hamm.  Part  Act.  p,  6,  after 
adverting  to  the  authorities  referred  to  in 
Comyn,  and  cited  in  17  Mass.,  which  he  says 
militate  against  the  general  rule,  and  are 
unsustained  by  subsequent  decisions. 

There  is  some  conflict  in  the  authorities  on 
this  subject,  but  we  consider  the  general  rule 
as  laid  down,  and  which  is  recognized  as 
settled  law  in  England,  to  be  the  better  opin- 
ion, and  established  on  sound  legal  principles. 
The  verdict,  therefore,  for  the  plaintiff,  must 
be  set  aside,  and  judgment  entered  for  thfr 
defendant- 


PERFORMANCE— PAYMENT. 


571 


nATFIELD.  ,    o  -4 


L^(^         MARKLE  V. 

(2  Johns.  455.) 
Sapreme  Court  of  New  York.    1807. 

This  case  came  before  the  court  on  a  writ 
Of  error,  from  the  court  of  common  pleas,  of 
Dutchess  county,  founded  upon  a  bill  of  ex- 
ceptions. 

The  suit  below  was  an  action  of  assumpsit. 
The  declaration  contained  a  count  for  divers 
cattle,  sold  and  delivered  to  the  defendant; 
and  counts  for  money  paid,  &c.  lent,  &c.  and 
for  money  had  and  received,  to  the  use  of  the 
plaintiff,  and  an  insimul  computassent.  Plea, 
non-assumpsit. 

Upon  the  trial,  the  plaintiff  below  proved, 
that  in  October,  1805,  he  sold  to  the  defendant, 
who  was  a  butcher,  a  number  of  cattle,  for 
120  dollars,  and  that  the  defendant  paid  him 
the  said  sum  in  bank  bills,  which  the  plain- 
tiff. recei.vciL  jn  .  lull  payment.  Among  the 
bilTs  so  received,  there  was  one  for  fifty  dol- 
lars, of  the  Boston  Branch  Bank  of  the  Unit- 
ed States.  The  plaintiff,  on  the  same  day  on 
which  he  sold  the  cattle  and  received  the  bills 
in  payment,  paid  the  same  note  of  50  dollars 
to  a  third  person;  and  soon  afterwards,  it 
was  discovered  to  be  counterfeit,  and  was  re- 
turned to  the  plaintiff.  The  same  bill  was 
produced,  and  provedjo  becouaterfelt,  upon 
the  trial.  No  evidence  was  given  that  the 
"deJendant  below  knew  the  bill  to  be  counter- 
feit, and  he  was  proved  to  be  an  illiterate 
man.  The  counsel  for  the  defendant,  at  the 
trial,  Insisted,  that  the  plaintiff  was  not  en- 
titled to  recover  upon  the  proof;  but  the  court 
charged  the  jury  that  the  evidence  was  sulli- 
cient,  and  that  the  plaintiff  was  entitled  to 
recover  the  fifty  dollars,  with  interest,  though 
there  was  no  evidence  of  any  fraud  in  the 
defendant,  and  the  jury  found  accordingly. 
The  blU  of  exceptions  was  taken  to  this  opin- 
ion, and  V.  >  charge  of  the  court  below. 

Mr.  Ruggles,  for  plaintiff  in  error.  J.  Tall- 
madge,  contra. 

KENT,  C.  J.  The  justice  of  this  ease  is 
clearly  with  the  defendant  in  error.  He  part- 
ed with  his  goods  to  the  plaintiff,  without  re- 
ceiving the  compensation  which  was  intend- 
ed. It  would  be  matter  of  regret,  if  the  law 
obliged  us  to  regard  a  payment  in  counter- 
feit, instead  of  genuine  bank  bills,  as  a  valid 
payment  of  a  debt,  merely  because  the  cred- 
itor did  not  perceive  and  detect  the  false 
bills,  at  the  time  of  payment.  The  rexisonablo 
doctrine,  and  one  which  undoubtedly  agrees 
with  the  common  sense  of  mankind,  is  laid 
down  by  Paulus  in  the  Digest;  and  has  been 
incorporated  into  the  French  law.  He  says, 
that  if  a  creditor  receive  by  mistake  any 
thing  in  pnyTnt>nt.  different  from  what  was 
due,  and  upnn  the  supposition  that  it  was  the 
thing  actually  due,  as  if  he  receive  brass  In- 
stead of  gold,  the  .debtor  is  not  discharged, 
and  the  creditor,  upon  offering  to  return  that 
which  lie  received,  may  demand  that  which 
Is  due  by  the  contract.    Si  quum  aurum  tibi 


promisissem,  tibi  Ignoranti  quasi  anrura  aes 
solverim,  non  liberabor.  Dig.  46.  3.  50;  Poth. 
Tr.  Obi.  No.  4l>5. 

But  there  are  some  ancient  dicta  in  the  Eng- 
lish law,  which  advance  a  contrary  doctrine, 
in  respect  to  gold  and  silver  coin.  It  is  said, 
that  the  crcnlitor  must  at  his  peril  count  and 
examine  the  money  at  the  time  he  receives  It. 
Bank  biUs  are  not  money,  in  the  strictly  legal 
and  technical  sense  of  the  term,  but  as  they 
circulate,  and  are  received  as  money,  in  the 
ordinary  transactions  of  business,  it  becomes 
material  to  examine  into  the  authority  and 
solidity  of  these  positions  In  the  books.  In 
Shep.  Touch,  p.  140,  It  is  laid  down,  and  with 
a  reference  to  the  Terms  de  Ley,  that  if  pay- 
ment be  made  paiUy  with  counterfeit  coin, 
and  the  party  accept  it,  and  put  it  up,  it  is  a 
good  payment  Shepherd's  Touchstone  i.s 
supposed  to  be  the  work  of  Mr.  Justice  Dod- 
eridge,  and  as  such,  it  has  always  been  con- 
sidered as  a  book  of  authority;  but  it  loses 
some  of  its  character  for  accuracy,  when  we 
consider  it  as  a  posthumous  and  surreptitious 
publication.  The  book  to  which  it  refers, 
gives  no  increased  weight  to  the  dictum.  The 
same  doctrine  is  contained  in  Wade's  Case. 
5  Coke,  114,  but  it  is  supported  only  on  the  au- 
thority of  the  case  of  Vane  v.  Studley,  which 
is  there  cited,  in  which  it  is  said  to  have  been 
adjudged,  that  where  the  lessor  demanded 
rent  of  his  lessee,  according  to  the  condition 
of  re-entry,  and  the  lessee  paid  the  rent  to 
the  lessor,  who  received  it  and  put  it  into  his 
purse,  and  afterwards  discovering  a  counter- 
feit piece  among  the  money,  he  refused  to 
carry  it  away,  and  re-entered  for  the  condi- 
tion broken,  the  re-entry  was  held  not  to  be 
lawful,  because  he  accepted  the  money  at  his 
peril.  This  case  of  Vane  v.  Studley  is  cited 
cautiously,  and  stated,  as  said  to  have  been 
so  adjudged.  With  regard  to  Wade's  Case 
itself,  it  did  not  require  the  aid  of  any  such 
decision,  because  no  such  question  arose  in 
that  case,  and  it  was  adopted  by  Lord  Coke 
merely  In  illustration  of  his  opinion.  Per- 
haps, the  question  arising  upon  the  forfeiture 
of  a  condition,  might  have  induced  the  judges 
the  more  readily  to  adopt  the  rule,  though  in 
Shepherd  the  rule  is  laid  down  as  general, 
and  without  any  special  application.  These 
loose  dicta,  and  this  doubtful  case  of  Vane  v. 
Studley,  are  then,  as  far  as  I  have  been  able 
to  discover,  all  the  authority  which  we  have 
for  this  ancient  doctrine;  and  it  is  to  be  re- 
marked, that  we  find  no  subsequent  sanction 
of  it,  through  aU  the  accumulated  decisions 
in  the  English  law.  On  the  contrary,  the 
modern  decisions  are  founded  on  different 
principles.  They  apply  another  and  juster 
rule  to  cases  of  payment  in  negotiable  paper. 
These  cases  are  so  very  analogous  to  the  one 
before  us,  that  it  would  be  very  difficult  to 
raise  a  distinction. 

In  Stedman  v.  Gooch,  1  Esp.  3,  the  plaintiff 
took  in  payment,  for  goods  sold  to  the  defend- 
ant, three  promissory  notes  of  one  Finlay, 
payable  at  the  house  of  one  Brown,  and  gave 


572 


DISCHARGE  OF  CONTRACT. 


the  defendant  a  receipt  to  that  effect.  It  ap- 
peared that  Finlay  had  no  effects  in  the  hands 
of  Brown,  and  the  plaintiff  sued  upon  the 
original  demand,  before  the  notes  were  pay- 
able. Lord  Kenyon  held,  and  his  opinion  was 
afterwards  concurred  in,  by  the  other  judges 
of  the  king's  bench,  that  if  such  a  bill  or 
note  was  of  no  value,  the  creditor  might  con- 
sider it  as  waste  paper,  and  re^oiTto  his  orfg- 
iual  demand.  If  the  plaintiff  in  that  case 
was  not  boimd  by  the  acceptauce  of  the  prom- 
issory note  of  Finlay,  because  it  proved  after- 
wards to  be  of  no  value,  why  should  the  de- 
fendant in  the  present  case,  be  bound  by  the 
acceptance  of  a  pretended  promissory  note 
from  the  Boston  Branch  Bank,  when  the  note 
proves,  afterwards,  to  be  coimterfeit?  Wheth- 
er it  be  the  promissory  note  of  an  individual, 
or  of  a  corporation,  can  make  no  difference. 
The  creditor,  in  both  cases,  is  presumed  to 
have  been  ignorant  of  the  want  of  value  in 
the  note.  He  cannot  be  chargeable  with  neg- 
ligence. In  not  detecting,  in  the  iirst  instance, 
the  want  of  value,  because,  the  means  of  as- 
certaining whether  the  note  was  or  was  not 
of  value,  may  be,  and  probably  were,  equal- 
ly in  both  cases,  absent  from  the  party.  The 
like  doctrine  was  advanced  in  the  case  of 
Owenson  v.  Morse,  7  Term  R.  64,  and  it  has 
been  adopted  and  applied  to  a  similar  trans- 
action of  payment,  in  a  negotiable  note,  in 
the  case  of  Roget  v.  Merritt  (decided  in  this 
court)  2  Gaines,  117. 

The  negotiable  note  of  a  third  person,  and  a 
bank  note,  are  equally  promissory  notes,  for 
the  payment  of  money;  and  if  the  receiver 
may  be  presumed  in  the  one  case,  and  not  in 
the  other,  to  have  taken  upon  him  the  risk 
of  the  solvency  of  the  drawer,  there  is  no  pre- 


sumption in  either  case,  that  he  assumes  up- 
on himself  the  risk  of  forgery.  In  the  case 
of  goldsmiths'  notes,  which  were  formerly  ac-  ^  > 
counted  as  ready  cash,  Lord  Ch.  J.  Holt  did, 
indeed,  once  say  (Tassel  v.  Lewis,  1  Ld. 
Raym.  743)  that  the  receiver  gave  credit  to 
the  goldsmith,  and  took  them  at  his  peril; 
but  this  doctrine  has  since  been  exploded  by 
repeated  decisions  (Strange.  415,  SOS,  1248). 
Even  were  we  to  admit,  (which  I  do  not)  that 
there  might  be  some  difficulty  in  surmounting 
the  opinion  of  Lord  Coke,  as  to  gold  and  silver 
coins,  yet,  as  to  bank  bills  and  other  promis- 
sory notes,  we  must  conclude,  upon  the 
strength  of  authority,  as  well  as  upon  the  rea- 
son and  justice  of  the  case,  that  the  charge  of 
the  court  below  was  correct,  and  that  the 
judgment  ought  to  be  affirmed. 

I  have  not  thought  it  requisite  to  pay  much 
attention  to  the  case  of  Price  v.  Neal,  3  Bur- 
rows, 1354,  which  was  cited  in  the  argument, 
because,  I  consider  that  case  as  decided  upon 
principles,  which  have  no  application  to  the 
case  before  us.  It  was  there  held,  to  be  in- 
cumbent upon  the  acceptor  of  a  forged  bill  of 
exchange,  to  satisfy  himself  of  the  genuine- 
ness of  the  drawer's  hand,  before  he  accepts 
and  pays  it,  as  he  must  be  presumed  to  know 
his  correspondent's  hand;  and  that  it  was  not 
incumbent  upon  the  defendant  to  inquire  into 
that  fact-  That  decision,  therefore,  turned 
upon  the  negligence  imputable  to  the  one 
party  and  not  to  the  other.  No  such  imputa- 
tion arises  in  the  present  case.  The  accept- 
ance of  a  bill,  and  the  indorsement  of  a  note 
give  a  credit  to  the  pap«r,  which,  ui>on  com- 
mercial principles,  the  party  is  not  afterwards 
at  liberty  to  recaU. 

Judgment  affirmed. 


PERFORMANCE— PAYMENT. 


573 


(^ 


CHELTENHAM  STONE  &  GRAVEL  CO.  y. 
/  GATES  IRON  WORKS. 

^  (16  N.  E.  923,  124  111.  623.) 


r-3' 


Supreme  Court  of  Illinois.    May  9,  1SS8. 

Appeal  from  appellate  court.  First  district, 

Frederic  Ullmann,  for  appellant.  Henry  H. 
Anderson,  for  appellee. 

SHELDON,  C.  J.  This  Is  an  appeal  frijm  a 
judgment  of  the  appellate  court  for  the  First 
district,  affirming  a  judgment  of  the  supe- 
rior court  of  Cook  county.  The  case  made  by 
the  evidence  was  this:  Between  March_19 
and  October  15,  1885,  appelleeTTtie  Gates 
Ttqp  \Vnri>s;^  snifr~hpppiTivriT  the  Ciicltenham 
Stone    &    Qravei    (jompduy.    machinery    and 

counts  were  rendered  monthly,  and  payments 
were  made  on  account  from  time  to  time. 
During  August,  1885,  appellee  received  from 
appeUant  Iron  to  the  amount  of  $!?7j0^,  and  a 
note  dated  August  10,  1885,  for  $1,000,  due 
90  days  from  said  date,  signed  by  the  Chelten- 
ham Improvement  Company,  payable  to_ap- 
pellee.  Both  these  items,  the  iron  and  the 
note,  were  credited  appellant  on  appellee's 
books,  and  the  statement  of  account  rendered 
appellant  on  September  1st  showed  a  credit 
of  the  two  amounts,  and  the  statement  of 
account  thereafter  rendered  started  off  with 
the  balance  after  deducting  these  amounts. 
When  the  transactions  for  the  season  were 
closed,  appellee's  books  showed  an  Indebt- 
edness against-  appellant  of  $145.97.  This 
amount  is  conceded  to  be  still  due.  Prior  tn^ 
the  maturity_ji£_Jt§_iiote,  the  improvement 
(jmnnny  hadbecome  insolvinT7~a"nd  the  note 
was  not  paid.  Annellee  sued  the  improve- 
ment company  on  the  note,  and  obtained  judg- 
ment, but  was  unable  to  collect  it.  Then  It 
brought  this  suit  against  appellant  on'  the  ac- 
T^'iimt','  ipiiormi:  tlu>  credit  it  li.id  given  for  the, 
amount  of  the  ni,t.c',  ;md  on  the  trial  tendered 
appellant  an  a^si-iimont  of "  its  iudirment 
against  the  irniirM\ 'inont  company.  Appel- 
lant recovered  a  ver°Jict  and  judgment  for 
$1,145.97,  the  full  amount  of  its  claim. 

It  is  Insisted  that  the  presumption  of  law 
from  these  facts  was  that  the  note  was  taken 
in  absolute  payment;  and,  as  there  was  no 
eridence  offered  tending  to  rebut  that  pre- 
sumption, appellee  was,  on  the  case  made  by 
it,  only  entiUod  to  a  verdict  for  $145.97;  and 
that  the  court  erred  in  not  granting  appel- 
lant's motion,  made  when  the  appellee  rested 
its  case,  to  direct  the  jury  to  find  a  verdict 
for  appellee  for  $145.97,  and  also  in  not  giv- 
ing the  following  Instruction  asked  by  appel- 
lant, but  refused,  viz.:  'Tf  the  jury  believe, 
from  the  evidence,  that  the  note  referred  to 
was  credited  by  the  plaintiff  to  the  defend- 
ant on  the  books  of  the  plaintiff,  and  included 
as  a  credit  in  statement  of  account  after- 
wards rendered  by  the  plaintiff  to  defendant, 
then  the  presumption  of  law  is  that  said  note 
was  received  in  payment,  and  the  burden  of 


proof  is  upon  the  plaintiff  to  show  that  such 
was  not  the  intention  of  the  parties  at  the 
time  said  note  was  given;  and  if  the  plaintiff 
has  failed  to  show  such  Intention,  that  the 
.same  .should  not  be  received  as  payment,  by 
a  fair  preponderance  of  testimony,  the  jury 
will  find  for  the  defendant  on  that  issue." 
Story,  in  his  work  on  Promissory  Notes  (sec- 
tion 104),  lays  down  the  rule  in  this  respect  as 
follows:  "In  general,  by  our  law,  unless 
otherwise  specially  agreed,  the  taking  of  a 
promissory  note  for  a  pre-existing  debt  or  a 
^contemporaneous  consideration  is  tn  atcd  pri- 
ma facie  as  a  conditional  payment  only;  that 
Is,  as  payment  only,  if  it  is  duly  paid  at  matu- 
rity. But  in  some  of  the  American  states  a 
different  rule  is  applied,  and,  unless  it  is  other- 
wise agreed,  the  taking  of  a  promLssorj-  note 
Is  deemed  prima  facie  an  absolute  payment 
of  the  pre-existing  debt  or  other  considera- 
tion. But,  In  each  case,  the  rule  Is  founded 
upon  a  mere  presumption  of  the  supposed  in- 
tention of  the  parties,  and  is  open  to  explana- 
tion and  rebutter,  by  establishing,  by  proper 
proofs,  what  the  real  Intention  of  the  parties 
was;  and  this  may  be  established,  not  only 
by  express  words,  but  by  reasonable  impli- 
cation from  the  attendant  circumstances."  In 
Tobey  v.  Barber,  5  Johns.  G8,  a  note  of  a 
third  person  was  given  for  rent  due,  and  a 
receipt  given  for  the  rent  The  note  was  not 
paid,  the  maker  having  become  insolvent  be- 
fore the  note  became  due.  The  court  ^ay: 
"The  taking  of  the  note  was  no  extinguish- 

(ment  of  the  debt  due  for  the  rent  It  is  a 
rule,  well  settled  and  repeatedly  recognized 
in  this  court,  that  taking  a  note,  either  of 
the  debtor  or  of  a  third  person,  for  a  pre-ex- 
isting debt  ib  no  payment  imless  it  be  ex- 
pressly agreed  to  take  the  note  as  payment  , 
and  to  run  the  risk  of  its  being  paid,  or  lia-  / 
less  the  creditor  parts  with  the  note,  or  is  I 
[guilty  of  laches  in  not  presenting  it  for  pay- 
ment  in  due  time;  and  it  was  held  that  the 
inference  arising  from  the  reeceipt  was  not 
enough  to  establish  such  a  positive  agree- 
ment." Johnson  v.  Weed,  9  Johns.  310.  is  to 
the  same  effect, — a  case  where  the  note  of  a 
third  person  had  been  given  in  payment  of  a 
debt,  and  a  receipt  in  full  given.  Melntyre  v. 
Kennedy,  29  Pa.  St.  448;  Himter  v.  Moul, 
98  Pa.  St.  13;  Brown  v.  Olmsted,  50  Cal.  IGJ, 
—are  authorities  in  support  of  the  rule  that 
taking  the  note  of  a  third  person  for  a  pre- 
existing debt  is  no  payment  unless  it  be  ex- 
pressly agreed  to  take  the  note  as  payment 
The  decisions  In  this  state  are  essentially  to 
the  same  effect  Walsh  v.  Lenaon,  98  IlL 
27;    Wilhelm  v.  Schmidt  &i  111.  185. 

It  is  insisted  that  although  the  acceptance 
of  the  note  merely  might  not  be  payment 
yet,  treating  the  note  as  payment,  as  was 
done  here,  by  crediting  it  as  payment  on  ap- 
pellee's books,  and  in  statements  of  account 
rendered,  shows  that  the  note  was  taken  in 
payment.  We  do  not  consider  this  any  strong- 
er evidence.  In  that  regard,  than  were  the 
receipts  in  full  which  were  given  in  the  cases 


574 


DISCHARGE  OF  CONTRACT. 


cited  from  Johnson.  In  regard  to  the  receipt 
in  Johnson  v.  Weed,  the  court  remarked: 
"It  might  still  have  been  understood,  consist- 
ently with  the  words  of  it,  [receipt,]  that  the 
note  was  received  in  fiill,  under  the  usual 
condition  of  its  being  a  good  note."  And  so 
in  Brigham  v.  Lally,  130  Mass.  4S5,  a  case 
where  such  a  note  of  a  third  person  had  been 
taken  on  an  open  account,  and  the  debtor 
credited  therewith,  it  was  held  that  the  trial 
com-t  properly  refused  to  rule  that  placing  the 
cote  to  the  credit  of  the  defendant  upon  the 
plaintiff's  journal  and  ledger,  and  making  no 
other  appropriation  of  the  money,  was  in 
law  a  payment.  We  think  the  ruling  of  the 
court  here  complamed  of  is  entirely  well  sus- 
tained by  authority. 
Counsel  for  appellee,  in  his  address  to  the 


jury,  was  allowed  by  the  court,  against  ap- 
pellant's objection,  to  argue  that  a*  sch«me 
had  existed  whereby  one  of  the  defendant's 
officers  had  foisted  the  note  upon  the  plain- 
tiff, knowing  the  maker  to  be  or  about  to 
become  insolvent,  so  that  the  loss  might  fall 
upon  the  plaintiff;  and  an  instruction  asked 
by  the  defendant  that  there  was  no  evidence 
in  such  regard,  and  that  the  jury  should  dis- 
regard the  remarks  of  counsel  with  refer- 
ence thereto,  was  refused;  and  this  action  of 
the  'court  is  assigned  for  error.  While  these 
remarks  of  counsel  may  have  been  improper, 
and  the  court  might  well  have  interposed  as 
requested,  we  cannot  say  that  the  refusal 
to  do  so  v,-as  such  error  as  should  cause  a  re- 
versal of  the  judgment  The  judgment  of 
the  appellate  court  must  be  aflaxmed. 


6 


PERFORMANCE— TENDER. 


575 


/  <2    LAMB  V.  LATHROP  et  aL 

^^  ^  (13  Wend.  95.) 

Supreme  Court  of  New  York.    Oct,  1834 

Demurrer.     The  plaintiff  declared  on  a  note 
made    by    the    defendants,    bearing    date   8th 
March,   1831,   whereby  the  defendants  prom- 
ised, one  year  after  date,  fCLimy  ^"  ^^^^  plain,- 
tifC  $50  in  a  horse,  heat  Bto,cJj,lor  iirst  rale 
pine  lumber,  to  be  'delivered  in  Cortland  vil- 
lage, at  the  markeFprice^at  the  ajppraisal  qjC. 
I  WO   [jt^'l'Si'iLs  Of    (]i.     uaiues  _  of  _  BarUett   and 
Rowley,   uiili  use,    ;md  alleged  non-perform- 
ance.     The    defendants    pleaded,    that    when 
the  note  became  due,  to  wit,  on  the  Sth  March, 
1832,  they  tendered   to  the  plaintiff  the  siiid 
sum  of  $50  and  the  interest  tliereof  for  onejf- 
year,  in  a  horse,  appraised  by  Bartlett  at  $70,v 
averring  that  Rowley  was  not  on  that  day  in| 
the  state,  but  was  in  the  state  of  Pennsyl\a- 1 
nia,  wholly  beyond  the  reach,  power  and  con- /I 
Itrol  of  the  defendants,  so  that  they  could  not/ 
procure  his  attendance  to  unite  with  Bartlett || 
in  the  appraisal  of  the  horse,  and  concluding 
Ijy  alleging  that  the  plaintiff  refused  to   re- 
ceive the  horse  so  tendered  by  them;    where- 
fore they   prayed  •Judgment,   &c     This  plea 
did  not  contiiin  the  averment  of  tout  temps 
prist.     The   plaintiff   replied,   that  after   the 
tender  of  the  horse,  to  wit,  on  the  10th  day  of 
March,   &c.   at,   &c.    he   demanded   the  same 
horee   of   the   defendants,    which   horse   then 
was  in  their  possession,  and  that  the  defend- 
ants refused  to  deliver  the  horse  to  him,  un- 
less he  would  pay  to  thejn  $16.50,_the  diff e^ 
ence  between 


ie_appraised  value  of  the  horse 

and  the  snm  of  $50,  witli  the  interest  there 
of  for  one  year;  concluding  with  a  veriflca- 
fiou  and  prayer  of  judgment.  To  which  rep- 
lication the  defendants  demurred. 

M.  7.  Reynolds,  for  plaintiff.  J.  A.  Spen- 
cer, for  defendant:. 

SA'v'AGE,  C.  J.  The  principal  qnestlon 
arises  up.on  the  plea  of  the  defendants,  the 
validity  ci  which  is  denied  by  the  plaintiff, 
and  the  Iirst  ground  urged  on  his  part  is,  that 
it  L"^  not  averred  that  the  defendant  is  still 
read>  to  deliver  the  horse.  It  is  contended, 
on  the  authority  of  Chipman's  Essay  on  Con- 
tracts, p.  96,  that  such  an  averment  is  nec- 
essary; and  that.  In  a  case  like  this,  the  rep- 
lication of  a  subsequent  demand  and  refusal 
authorizes  a  recovery  upon  tlie  original  cause 
of  action.  The  learned  author  of.  this  essay 
argues  that  as  there  is  at  this  day  no  case 
where  property  is  lost  to  the  creditor  by  a 
tender  and  refusal,  it  follows  that  every  plea 
of  tender  must  contain  an  averment  that  the 
property  is  still  ready.  It  is  true  tliat  prop- 
erty tendered  is  not  lost  to  the  creditor  by  his 
neglect  or  refusal  to  receive  it;  but  it  is  also 
time  that,  in  the  case  of  a  tender  of  specj^c 
articles,  the  courts  in  thl"s  state  consider  the 
contract  to  deliver  or  pay  such  articles"  dis- 
cEarged.  The  tender,  properly  made,  is  a 
Batistaction  ol:  tne  denl'and;   the  debt  is  paid, 


and  the  articles  tendered  become  the  proper- 
ty of  the  creditor,  and  afterwards  are  kept 
at  his  risk  and  expense.  In  the  case  of 
Slingerland  v.  Morse,  8  Johns.  478,  the  com-l 
say,  "We  consider  it  a  complete  bar  to  the 
suit  upon  the  contract"  In  Slielden  v.  Skin- 
ner, 4  Wend.  528.  529,  this  subject  was  again 
considered  by  this  court,  and  such  a  tender 
held  analogous,  as  it  was  in  the  List  case 
cited,  to  the  French  consignation,  whereby 
the  debtor  is  dLscharged.  The  creditor  must 
resort  to  the  specilic  articles,  and  to  the  per- 
.«;on  who  tendered  them  as  the  bailee  thereof. 
The  relation  of  debtor  and  creditor  no  longer 
subsists  between  those  parties,  but  that  of 
trustee  and  cestui  que  trust,  or  lyailor  and 
bailee.  See  2  Kent,  Comm.  508,  509.  Itl 
'such  be  the  law,  the  defendant  in  this  case) 
'  was  not  bound  to  aver  that  the  horse  was  still ' 
iready;  and  the  plea  is  not  faulty  for  want] 
•of  such  averment.  ' 

The  remaining  obje-^tions  to  this  plea  are, 
that  it  is  not  averred  that  the  appraisal  was 
by  the  persons  agreed  upon,  nor  at  the  mar- 
ket price,  nor  that  the  tender  was  made  Ln 
satisfaction  of  the  debt  No  authority  la  cit- 
ed to  show  that  it  should  be  averred  that  the 
offer  was  made  in  satisfaction  of  the  debt; 
the  precedents  are  not  so,  nor  do  I  see  any  ne- 
cessity for  such  an  averment.  The  plaintiff 
complains  that  the  defendant  did  not  pay  him 
$50  and  interest  in  a  horse,  according  to  his 
contract.  The^ef^ndnnt  an^n,  j;hat_on  the 
day,  ^Tid^nj^ti^f^i^nfL  ftppnintxiil^hrtrnrlrrrrl 
tcPSim  the  said  sum  in  a  horseTaccoriTrngto 
his  contract";  that  is  enou^E  Nor  can  it  be 
necessary,  iB  such  cese,  to  aver  that  the  ap- 
praisement was  at  the  market  price.  Th.^ 
market  price  is  the  price  of  every  article,  un- 
less some  other  is  mentioned  The  market 
price,  I  apprehend,  was  inserted  as  directory 
to  the  appraisers  and  the  averment  that  tlio 
horse  was  appraised  by  the  appraisers  is  suf- 
ficiently minute  and  certain;  to  appraise  at 
any  other  price  would  be  a  violation  of  duty, 
even  if  the  words  market  price  were  omitted. 
The  presumption,  in  such  cases  is,  tliat  the 
persons  designated  have  done  their  duty;  not 
that  they  have  violated  It 

But  the  objection  that  there  is  no  averment 
that  the  property  in  question  was  appraised 
by  the  persons  agreed  upon  is  not  so  easily 
obviated.  The  defendants,  by  their  contract, 
agreed  to  pay  $50  and  Interest  for  one  year, 
in  a  horse,  at  the  appraisal  of  Bartlett  and 
Rowley.  They  aver  that  they  tendered  the 
horse  at  the  appraisal  of  Bartlett;  that  is  n<>t 
a  compliance  with  the  contract  The  ap- 
praisement by  two  persons  is  a  condition  pre- 
cedent t"o~~tne  Tender;  the  plaintiff  has  not 
agreed  to  accept  a  horse  at  the  appraisement 
0?  iJartlett  in6he,  noFof  Bartlett  and  any  ctn- 
£r  except  Kowieyi  It  is  not  sufficient  that 
the  act  done  may  be  equivalent  The  plain- 
tiff relied  upon  the  judgment  of  those  particu- 
lar persons;  the  defendants  undertook  to  pro- 
cure It:  if  they  failed,  they  must  pay  the 
money.     There   is  a   debt  due   the   plaintiff; 


676 


DISCHARGE  OF  CONTRACT. 


he  agrees  to  receive  a  horse,  provided  it  is 
appraised  by  Bartlett  and  Rowley.  The  de- 
fendants agree  to  pay  the  money,  if  they  do 
not  deUver  a  horse  at  the  appraisal  of  Bart- 
lett and  Rowley.  This  is  the  legal  effect  of 
the  contract.  It  is  majiifest  that  the  defend- 
ants have  not  procured  the  appraisal  of  the 
two  persons  named;  and  as  they  have  not 
performed  the  condition  upon  wiuen  tSev 
worA  t^  ho  p-;^pnse^  from  the  payment  ._Qf_  the 
money,  it  follows  that  the  mnngy  must  be 
Daid.  It  is  not  for  the  defendants  to  say 
m?rt-tiiey  can  make  a  new  agreement  for  the 
plaintiff;  nor  can  the  court  do  it  The  plain- 
tiff has  substantially  said,  I  will  not  agi-ee  to 
take  a  horse  at  all,  unless  at  the  appraisal  of 
these  two  men.  I  will  not  take  the  appraisal 
of  one  of  them,  but  of  both.  The  defend- 
ants entered  voluntarily  into  the  agreement, 
and  they  must  perform  it.  This  case  ap- 
pears to  me  to  be  analogous  to  the  cases 
upon  fire  policies,  where,  if  the  certificate  of 
certain  persons  is  required,  no  other  can  be 
yubstituted-     6  Term  R.  719;    1  H.   BL  254; 


2  H.  BL  574.  This  view  of  the  subject  Is 
suflficient  to  authorize  a  judgment  in  favor  of 
the  plaintiff.  ' 

It  is  not  improper  to  remark,  that  the  plea 
is  defective  in  another  particular,  though  the 
point  is  made  here  as  an  objection  to  the 
replication.  The  horse,  it  seems,  was  ap- 
praised at  $70,  and  the  defendant  claLuis  the 
payment  of  the  difference  in  money,  before 
he  is  liable  to  deliver  tlie  horse.  Under  what 
agreement  of  the  plaiutiff  do  the  defendants 
set  up  this  claim?  The  plaintiff  hath  said 
that  he  will  receive  a  horse  worth  $53,  on 
certain  conditions;  but  it  does  not  follow  that 
he  is  to  receive  a  horse  of  a  greater  value, 
and  pay  the  difference.  He  has  entered  into 
no  such  agreement.  The  defendants  must 
tender  the  horse  according  to  agreement;  if 
he  is  of  greater  value,  they  must  either  tender 
him  at  the  amount  to  be  paid,  or  keep  him, 
and  pay  the  money. 

The  plea  is  bad,  and  the  plaintiff  is  entitled 
to  judgment,  with  leave  to  defendants  to 
amend,  on  payment  of  costs. 


CONDITIONS  SUBSEQUENT. 


577 


^■^^ 


EAY  V.  THOMPSON. 


(12  Gush.  281.) 


//2'< 


Supreme   Judicial    Court   of   Massachusetts. 
Middlesex.      Oct.  Term,  1853. 

Assumpsit  for  the  price  of  a  horse  sold 
to  the  defendant  The  defence  was  that 
the  horse  was  sold  under  a  conditional 
cojiij;act,  with  a  rij^ht  to  return__him  wunin 
a  speciflod  tj^me,  If  IJofgatTs^factory  toTHe' 
^fGIlflant,   and   that  the^efendanf    cII3    so 


rettlTn  him.  At  the  trial  in  the  court  of 
"T'Unriil^~pIt»as  before  Mellen,  J.,  the  plain- 
tiff offered  evidence  tending  to  prove  that 
during  the  time  limited  by  the  contract  for 
the  return  of  the  horse,  and  while  he  was 
in  the  defendant's  possession,  the  defend- 
ant misused  and  abused  the  horse,  whereby 
he  was  materially  Injured  and  lessened  in 
value,  and  that  the  plaintiff  did  not  ac- 
cept him  in  return;  which  evidence,  the 
presiding  judge,  on  objection  by  the  defend- 
ant, rejected,  and,  the  verdict  being  for  the 
defendant,  the  plaintiff  alleged  exceptions 
to  the  ruling.  • 

HOPK,  8KL.  CAS.  CONT. — 87 


J.  W.  Bacon,  for  plaintiff.  G.  A.  Souier- 
by,    for  defendant, 

PER  CURIAM.  The  evidence  offered  by 
the  plaintiff  ought  to  have  been  admitted, 
to  prove,  if  he  could,  that  the  horse  had 
been  abused  and  injured  by  the  defendant, 
and  so  to  show  that  the  defendant  had  put 
it  out  of  his  power  to  comply  with  the  con- 
dition, by  returning  the  horse.  The  pale 
was  OD  a  condition  subsequent;  that  Is,  on 
condition,  ho  did  not  elect  to  keep  the  horse, 
to  return  him  within  the  time  limited.  Be- 
ing on  a  condition  subsequent,  the  prop- 
erty vested  presently  in  the  vendee,  defeasi- 
ble only  on  the  performance  of  the  condi- 
tion. If  the  defendant.  In  the  meantinie, 
disabled  himself  from  performing  the  con- 
dition,—and  if  the  horse  was  substantially 
injured  by  the  defendant  by  such  abuse, 
he  would  be  so  disabled,— then  the  sale 
became  absolute,  the  obligation  to  pay  the 
price  became  unconditional,  and  the  plain- 
tiff might  declare  as  upon  an  indebitatus 
assumpsit,  without  setting  out  the  condi- 
tional contract.  Moss  v.  Sweet,  3  En;?. 
Law  &  Eq.  311,  l(i  Adol.  &  E.  493. 

New    trial    ordered. 


576 


DISCHARGE  OF  COXTKACT. 


njo 


LAKE  SHORE 


&  M.   S.  RY. 
ARDS. 


CO.   V.  RICH- 


(38  N.  E.  773,  152  IlL  59.)  ^ 
Supreme  Court  of  Illinois.    June  19,  1894 


Jt^ 


'•^-f%f  Said  contract  recited  by  way  of  preamble  f 
-    '-T^liat  one  of  its  objects  was  to  provide  a  cheap- 


Appeal  from  appellate  court.  First  district 
Assumpsit  by  Edward  S.  Richards,  sur- 
vivini;  partner  of  the  firm  of  Richards,  May- 
nard  &  Co..  against  the  Lake  Shore  &  Michi- 
gan Southern  Railway  Company.  Plaintiff 
obtained  judgment,  which  was  affirmed  by 
the  appellate  court.  Defendant  appeals.  Re- 
versed. 

The  other  facts  fully  appear  in  the  following 
staement  by  BAILEY,  C.  J.: 

This  was  a  suit  in  assumpsit,  brought  by 
Edward  S.  Richards,  surviving  partner  of  the 
firm  of  Richards,  Mayuard  »&  Co.,  against  the 
Lake  Shore  &  Michigan  Southern  Railway 
Company,  to  recover  damages  for  breaches  of 
a  contract,  the  material  provisions  of  which 
will  be  stated  presently.  Prior  to  the  exe- 
cution of  said  contract,  grain,  brought  by 
western  railroads  to  Chicago,  and  destined, 
either  before  or  upon  its  arxlval  in  that  city, 
for  transportation  by  rail  to  the  east,  was  de- 
livered by  the  western  to  the  eastern  rail- 
roads, and  was  by  the  latter  weighed  and 
transferred  from  western  to  eastern  cars. 
At  that  time  the  transfer  of  such  grain  was 
accomplished  by  placing  the  loaded  and  emp- 
ty cars  side  by  side  on  pai-allel  tracks,  and 
by  shoveling  the  grain  from  one  car  to  the 
other  by  hand.  The  weighing  was  done  on 
track  scales,  by  first  weighing  the  loaded 
car,  and  then  weighing  it  after  it  was  unload- 
ed, the  difference  between  such  weights  being 
the  weight  of  the  grain.  This  process  was 
expensive,  and  the  weights  thus  obtained,  as 
the  evidence  tends  to  show,  were,  owing  to  a 
variety  of  causes,  liable  to  be  inaccurate. 
Richards,  the  plaintiff,  was  the  inventor  and 
patentee  of_  a.  new_process_  for^weighing  _and 
transferring  grain  in  buUjL j^hich  was  claimed 
to  be  cheaper  than  the  old  method,  and  which 
furnished  tuore  accurate  weights,  tMiE_Cfiuld 
be  had  by  the  existing  mode  of  weighing. 
By  this  process,  the  loaded  cars  of  grain 
were  run  up  onto  an  elevated  track  va.  a  trans- 
fer house,  and  empty  cars  were  placed  along- 
side of  them  on  a  lower  track.  The  grain 
was  then  shoveled  by  steam  shovels  from  the 
loaded  cars  into  hoppers,  where  it  was 
weighed,  and  then  allowed  to  run  by  force 
of  gravity  into  the  empty  cars  below.  Ne- 
gotiations were  thereupon  entered  into  be- 
tween Richards  and  the  defendant  company 
with  a  view  to  the  adoption  by  the  latter 
of  this  new  mode  of  weighing  and  transfer- 
ring grain,  and  these  negotiations  resulted  in 
a  written  contract  between  the  company,  of 
the  first  part,  and  Richards,  of  the  second 
part,  bearing  date  January  2,  1884,  which  con- 
tract was  aftei-wards  assigned  by  Richards  to 
the  firm  of  Richards,  Maynard  &.  Co.,  con- 
sisting of  Richards  and  John  W.  Maynard- 


er  method   of  transferring   grain,    mUl   feed, 
and  seed  from  one  car  to  another  than  the 
one  employed  by  said  company,  and  for  that 
puipose   to  use   the  device  of   Richards,    se- 
"vcured  to  him  by  letters  patent,  etc.;    and  that 
Richards  intended  to  erect  and  build  a  grain 
transfer  house  on   the  Land   thereinafter  de-- 
scribed,  for  the  purpose  of  so  handling,  weigh- 
ing, and  trausfeniug  in  bulk  such  grain,  mjll 
feed,  "and  seed  as  might  be  deUVered  to  him 
for  tliat  purpose  by  the  comp3.ny.     The  com- 
pany   then   agreed,    in   consideration    of    the 
nominal  rental  of  $10  per  year,  and  of  the 
covenants  in  the  contract  to  be  kept  and  per- 
formed by  Richards,  to  lease  to  him,  for  the 
term  of  10  years,  certain  land  upon  which  to 
erect  such  transfer  house  and  the  necessary 
approaches  thereto,  and  also  agreed  that,  as 
soon  as  such  transfer  house  and  approaches 
were  constructed,  U  would  build  and  main- 
tain thereon  and  through  such  transfer  house 
such  track  or  tracks  as  might  be  necessary 
to  transact  the  business  contemplated  by  said 
agreement,  and  do  aU  switching  of  loaded  and 
empty  cars  to  and  from  said  transfer  house 
at    its    own    expense,    and    without    cost    to 
Richards,  provided  that  the  actual  cost  there- 
of should  be  taken  into  account  in  determin- 
ing the  fair  amount  to  be  paid  Richards,  as 
provided  in  the  following  covenant:     "Third. 
Said  first  party  further  covenants  and  agrees 
that,  in  case  there  shall  be  any  saving  to  it 
in  switching,   weighing,   and  transferring   of 
products  in  this  agreement  referred  to  through 
the  methods  and  devices  adopted  by  said  sec- 
ond  party,   over  and  above  the  actual  cost 
of  doing  the  same  work  under  the  ways  and 
methods  now  in  use  by  said  first  party,  then, 
and  in  that  event,  it  will  pay  to  second  party 
one  half  of  said  saving,  the  just  and  actual 
ainoimt  tHeFeoF  to  15e~aseertained  and  deter- 
mined   as   provided    in    covenant    'First,'    of 
'Mutual  Covenants,'   said  amounts,  if  found 
due,  to  be  paid  to  said  second  party  on  or 
before   the    middle    of   each    month    for   the 
month    preceding."     Richards,    on    his    part, 
agreed  at  his  own  cost  and  expense  to  con- 
struct and  maintain,   for  the   full   period   of 
10  years,  on  said  land,  a  transfer  house  and 
appi'oaches,  suitable  and  proper  for  carrying 
out   the  purfHDse  in  said  contract  expressed, 
and  furnish  and  supply  said  house  with  hop- 
per scales  and  every  other  device  necessary 
to  properly   weigh  and  transfer   said   grain, 
etc.     He  also  covenanted  as  follows:     "Sec- 
ond. That  he  will  receive,  weigh,  and  trans- 
fer all  products  contemplated  by  this  agree- 
ment   which    may    be   delivered   to   his    said 
transfer  house  by  or  under  the  direction  of 
said    first    party   with    promptness   and    dis- 
patch, and  within  such   time  as   to  prevent 
any  accumulation  of  cars  or  freight,  where- 
by shippers  might  have  just  ground  of  com- 
plaint;   and,   if  said   second   party  shall   fail 
to  transfer  as  fast  as  required,  the  said  first 
party  may  transfer  by  such  other  method  as 


BREACH— EENUNCIATION. 


679 


it  deems  proper,  and  said  sec-ond  party  shall 
do  all  said  work  in  trausfer  Ikjusu  at  Lis 
own  cost  and  expense,  without  cost  to  said 
first  party:  provided,  that  the  actual  cost  of 
iluiuii  said  work  sliall  be  taken  Into  account 
in  deternuninj,'  the  savinj?,  if  any,  between 
the  Ricliards  method  of  transferriuf^  grain  and 
the  methods  in  use  by  the  first  party  at  tlie 
date  of  this  aj^reenieut,  and  also  for  tlie  pur- 
pose of  determining  the  just  amount  to  be 
paid  to  said  second  party,  as  provided  in  cove- 
nant 'Third'  of  first  party:  piovided,  also, 
that  the  cost  of  weijihinj,'  sucli  products  shall 
not  be  considered  in  determining  the  actual 
cost  of  such  transfer." 

Said  conti-act  then  contained  various  para- 
grapiis  denominated  "Mutual  Covenants,"  the 
first  of  wliich  provided  the  mode  for  ascer- 
taining and  determining  the  cost  of  transfer- 
ring grain,  etc..  by  the  new  method,  and  tlie 
amount  of  money  thereby  saved.  The  only 
other  provisions  of  the  contract  material  to 
the  present  controversy  are  the  third,  fourtli, 
and  sixth  of  said  "Mutual  Covenants,"  which 
are  as  follows:  "Third.  And  it  is  mutually 
covenanted  and  agreed  that  all  shipments 
originating  at  points  west  of  Chicago,  and 
properly  billed  thrcnigh  to  eastern  points,  and 
requiring  transfer  through  said  house,  shall 
be  classed  'through  shipments,'  and  be  trans- 
ferred in  the  same  manner  as  reconsigned 
projjcrty,  and  upon  the  same  basis  of  c-ost 
to  said  first  party;  it  being  specially  imdei'- 
stood  and  agreed  that  under  no  circumstances 
is  said  first  party  to  be  charged  for  any 
weights  upon  any  transfers  made  through 
this  house,  but  nothing  in  this  agreement 
contained  shall  be  so  construed  as  to  prevent 
said  second  party  from  charging  such  fees  as 
may  be  agi-eed  upon  between  him  and  the 
owner  of  the  propcn-ty  delivered  for  weights 
and  transfer,  and  for  such  other  service  as 
he  may  render  in  connection  therewith,  and 
from  collecting  his  charges  as  provided  in 
the  following  mutual  agreement.  Fourth.  It  is 
further  mutually  understood  and  agreed  that 
said  second  pai'ty  is  to  receive  his  compensa- 
tion for  his  time,  labor,  and  investments  em- 
ployed in  building,  operating,  and  maintain- 
ing said  transfer  house  entirely  from  the 
weighing  of  property  passing  through  it,  and 
from  the  owners  thereof,  and  not  from  said 
first  party,  except  as  provided  in  covenant 
third  of  Siiid  first  party;  and  said  first  party 
sliall  not  make  use  of  the  weights  obtained 
from  said  second  party  in  the  conduct  of  its 
business  for  any  other  purpose  than  billing 
property  to  destination,  but.  upon  the  request 
of  said  second  party,  said  first  piirty  will  col- 
lect such  weighing  charges  as  he  may  show 
are  due  to  him,  in  the  same  manner  as  other 
advanced  charges  are  collected,  and  pay  the 
amount  so  collected  to  said  second  party  on 
or  before  the  middle  of  each  and  every 
month."  "Sixth.  If  at  any  time  differences 
should  arise  between  the  said  parties  hereto 
as  to  its  spirit,  meaning,  or  execution,  such 
differences  shall  be  settled  by  a  reference  of 


all  matters  in  dispute  to  three  disinterested 
arl)itratoi-s,  each  of  the  jiarties  hereto  to  se- 
lect one,  and  the  two  so  chosen  to  select  a 
third,  and  the  decision  of  any  two  of  the 
court  so  formed  shall  be  binding  between 
the  parties  hereto,  final,  and  without  appeal." 
The  declaration,  after  setting  forth  said 
contract  in  hiec  verba,  alleges  lliat  on  the 
2;kl  day  of  January,  1.S.S4,  the  plaintiff  as- 
signed all  his  interest  in  said  contract  to  the 
firm  of  Richards,  Maynard  &  CfJ..  and  that 
said_  assignment  was  ratified  and  c-onfirmed 
by_jhe_jlefeiulan t ;  that  said  firm  thereuixm 
erected,  on  the  land  described  in  the  contract, 
a  grain  transfer  house  and  hopper  scales, 
and  all  machinery  pertaining  thereto,  the 
same  being  completed  June  24,  1.SS4,  wlien 
said  firm  entered  upon  the  business  of  trans- 
ferring grain,  etc.,  from  car  to  car.  aud"weigh- 
ing  the  same,  as  provided  for  in  the  agree- 
ment; that  said  firm  could  not  conveniently 
transfer  mill  feed  through  their  transfer 
house,  and  that  tlie  right  to  have  such  tran.s- 
fer  of  mill  feed  and  the  weighing  thereof  was 
waived  bj-  the  defendant;  that  .'^aid  firm  cfin- 
tinued  to  transfer  and  weigh  all  such  grain 
and  seed  as  was  presented  to  them  by  the 
defendant  at  their  transfer  house  to  be  trans- 
ferred and  weighed  until  June  IG,  ISSG,  and 
kept  and  performed  the  contract  on  their 
part,  yet  the  defendant,  although  often  re- 
quested so  to  do,  has  not  kept  and  performed 
said  contract  on  its  part;  that  on  June  10. 
ISSG,  the  defendant  abandoned  said  contract, 
and  neglected  and  refused  to  perform  it.  aud, 
without  reasonable  or  just  caiisc,  refused  to 
be_bound  thereby;  that,'"af{eFnie  abandon- 
ment of  said  contract  by  the  defendant,  and 
its  refusal  to  perform  the  same,  to  wit,  in 
December,  1SS7.  said  Maynard  died;  that  said 
firm  and  the  plaintiff  have  always^been 
ready  and  willing  and  have  offered  the  5e- 
"feUdunt  to  continueTfu  the  service  ^nd  £in- 
pToymenF^f  the  defendant  in^  weijrhing^and 
traiisferring  gi-ain  and  seed  as  provided  by 
said  contract;  that  the  weights  so  obtained 
by  said  firm  in  weighing  and  transferring 
grain  and  seed  were  of  the  value  of  $1.40 
per  car,  and  that  the  number  of  c-ars  annually 
transferred  on  the  track  to  the  cars  of  the 
defendant  company  amounted  to  IS.OOO;  that, 
to  wit.  IS.fMX)  cars  of  grain  and  seed  per  an- 
num will  continue  to  be  transferred  en  said 
track  to  the  cars  of  the  defendant  company; 
that  the  saving  to  the  defendant  in  the 
switching,  weighing,  and  transfer  of  grain 
and  seed  by  the  plaintiff's  method  is  $5,000 
per  annum;  that  the  plaintiff's  firm  was 
obliged  to  and  did  lay  out  and  expend  in 
building  and  equipping  their  transfer  house 
a  large  sum  of  money,  and  that  said  tr:ms- 
fer  house  is  valuable  only  for  the  puiposes 
contemplated  by  said  agreement,  and  that  in 
consequence  of  the  refusal  of  the  defend- 
ant to  be  b<iund  by  the  terms  of  said  con- 
tract, said  tTLUisicr^-house^Jias  Jbecpme  of  no 
•plluix  wTieivby-Jiio. plain  tiff  has  suffered  dam- 
rtge  in  the  ^um  cf  ?2."i.0<i0;    that  there  is  due 


5S0 


DISCHARGE  OF  CONTRACT. 


to  the  plaintiff  from  the  defendant,  on  ac- 
count of  such  nonperformance  of  said  con- 
tract by  it,  a  Lirce  sum  of  money,  to  wit, 
the  sum  of  $300,000,  being  the  amount  of 
damage  to  and  amount  due  the  plaintiff  by 
reason  of  the  breach  of  said  contract,  from 
the  date  the  defendant  wrongfully  refused  to 
perfonu  said  conti-act  on  its  part  By  an 
amendment  to  said  count  the  plaintiff'  claimed 
special  damages  for  loss  of  profits  which  said 
fiirm,  or  the  plaintiff,  as -survivor,  would  have 
received  from  the  various  shippers  of  gi-ain 
but  for  said  breach  of  contract,  and  alleged 
that  said  firm,  or  .the  plaintiff,  as  its  repre- 
sentative, had  a  contract  with  the  receivers 
and  shippers  of  grain  and  seed  at  Chicago, 
for  the  purchase  by  them  of  the  weights  of 
grain  and  seed  which  said  firm,  or  the  plain- 
tiff, as  sui-vivor,  obtained  or  would  have  ob- 
tained in  transferring  grain  and  seed  from 
the  cars  of  western  railroads  having  their 
terminus  at  Chicago  to  the  cars  of  the  de- 
fendant company;  that,  but  for  said  breach 
of  said  contract,  said  firm,  or  the  plaintiff, 
as  survivor,  would  have  received  TO  cents 
per  car  from  such  receivers  and  shippers  of 
grain  and  seed  at  Chicago  for  the  weights  of 
15.000  cars  of  grain  and  seed  per  year  for 
eight  years,— the  unexpired  term  of  said  con- 
tract.  -^ 

^T" — TCe  aetendant  pleaded  non  assumpsit,  and 
""vTalso   a  special   plea,    alleging,    in   substance, 

^  tliat  at  the  July  term,  1SS6,  of  the  superior 
court  of  Cook  county,  the  plaintiff  and  said 
Maynard  exhibited  their  bill  in  chancery 
against  the  defendant  in  said  court  for  the 
uonperformance  of  the  same  identical  prom- 
ises and  undertakings  in  the  declaration  men- 
tioned; that  at  the  March  term,  1887,  of  said 
court  the  defendant  was  decreed  to  be  in- 
debted to  said  complainants  for  such  nonper- 
formance of  said  promises  and  undertakings; 
that  said  cause  was  referred  to  a  master  in 
chancery  for  .an  accounting,  to  ascertain  the 
amount  of  such  indebtedness;  that  the  mas- 
ter found  that  the  defendant  was  indebted 
to  said  complainants  in  the  sum  of  ?9,886.68 
damages;  that  the  court  confirmed  such  find- 
ing, and  entered  a  decree  ordering  the  de- 
fendant to  pay  the  complainants  that  sum  and 
costs;  that  while  an  appeal  to  the  appellate 
court  from  said  decree  was  pending,  May- 
nard died;  that  said  appeal,  being  prosecuted 
against  the  present  plaintiff  as  survivor,  was 
afterwards  affirmed  by  the  appellate  court, 
and  that  thereupon  the  defendant  paid  and 
satisfied  the  same.  To  said  special  plea  the 
plaintiff  replied  that  the  cause  of  action  set 
out  in  the  declaration  was  not  for  the  non- 
performance of  the  same  promises  and  un- 
dertakings in  said  plea  mentioned,  and  for 
which  said  decree  was  rendered,  but  for  the 
nonperformance  of  other  and  different  prom- 
ises and  undertakings,  from  the  defendant  to 
the  plaintiff.  At  the  trial,  which  was  had 
before  the  court  and  a  jury,  evidence  was  of- 
fered by  the  plaintiff  tending  to  sustain  the 
cause  of  action  alleged  in  his  declaration,  and 


the  jury  thereupon  returned  their  verdict 
finding  the  issues  for  the  plaintiff,  and  as- 
sessing his  damages  at  $75,000.  For  this 
sum  and  costs  the  court,  after  denying  the 
defendant's  motion  for  a  new  trial,  gave 
judgment  for  the  plaintiff.  On  appeal  to  the 
appellate  court  said  judgment  was  affirmed, 
(40  111.  App.  5G0.)  and  this  appeal  is  from  said 
judgment  of  affirmance. 

Pliny  B.  Smith  (Jas.  I,  Best  and  John  N. 
Jewett,  of  counsel),  for  appellant.  A.  M. 
Pence  (Wm.  A.  Gardner,  of  counsel),  for  ap- 
pellee. 

SHOPE,  J.  It  is  insisted  in  this  court  that 
the  evidence  is  insufficient  to  sustain  the  ver- 
dict and  judgment  The  right  and  duty  of 
this  court  to  review  the  facts  is  placed  upon 
two  grounds:  First,  that  under  section  2, 
art.  6,  of  the  constitution  which  provides, 
"The  supreme  court  shall  consist  of  seven 
judges,  and  shall  have  original  jurisdiction 
in  cases  relating  to  the  revenue,  in  manda- 
mus and  habeas  corpus,  and  appellate  juris- 
diction in  all  other  cases,"  the  provision  of 
section  90  of  the  practice  act  restricting  the 
powers  of  this  court  to  the  consideration  of 
questions  of  law  only,  and  prohibiting  the 
assignment  of  errors  calling  in  question  the 
judgment  of  the  appellate  courts  upon  ques- 
tions of  fact  is  unconstitutional  and  void. 
We  have  so  frequently  held  the  act  valid 
that  it  would  seem  to  be  no  longer  an  open 
question.  But,  if  it  was,  the  con-ectness  of 
former  holdings  in  this  regard  is  clearly  au- 
thorized by  the  provisions  of  section  11  of 
the  same  article  of  the  constitution.  It  is 
there  provided  that  after  the  year  1874  in- 
ferior appellate  courts,  of  uniform  organiza- 
tion and  jurisdiction,  may  be  created  by  the 
legislature,  to  which  appeals  and  writs  of 
error,  as  the  general  assembly  shall  provide, 
may  be  prosecuted,  "and  from  which  appeals 
and  writs  of  error  shall  lie  to  the  supreme 
court  in  all  criminal  cases  in  which  a  fran- 
chise or  freehold  or  the  validity  of  a  statute 
is  involved  and  in  such  other  cases  as  may 
be  provided  by  law."  Under  this  provision 
the  legislature  was  authorized  to  vest  such 
courts  with  appellate  jurisdiction  in  all  such 
cases  as,  in  the  legislative  discretion,  was 
deemed  proper.  In  four  classes  of  cases — 
that  is,  criminal  cases,  and  those  involving 
a  franchise  or  freehold  or  the  validity  of  a 
statute — the  legislature  is  prohibited  from 
making  the  determination  of  such  appellate 
courts  final.  In  such  cases  appeals  and  writs 
of  error  must  be  allowed  to  the  supreme 
court.  In  all  other  cases  in  which  courts  are 
given  jurisdiction  by  statute  it  is  left  by  the 
constitution,  discretionary  with  the  legisla- 
ture to  make  the  judgments  of  those  courts 
final,  or  to  provide  for  further  appeal  or  writ 
of  error,  as  in  the  legislative  discretion  shall 
be  deemed  proper.  It  necessarily  follows 
that  since  the  creation  and  organization  of 
the  appellate  courts,  the  jurisdiction  of  this 
court  to  review  the  final  judgments  of  tliose 


BREACH— RENUNCIATIOX. 


581 


courts,  except  in  the  former  classes  of  cases 
enumerated  in  tlie  constitution,  is  subject  to 
the  restrictions  created  by  the  legislature. 
And  It  follows  that  we  are  precluded  from 
the  consideration  of  any  assignment  of  error 
questioning  the  determination  of  the  appel- 
late court  upon  questions  of  fact 

At  tlie  close  of  plaintiff's  evidence  in  chief, 
the  defendant  moyed  tlie  court  to  instnict 
the  jury  to  return  a  verdict  in  its  favor,  up- 
on the  ground  that  the  evidence  was  insuffi- 
cient to  mainUiin  the  cause  of  action  set 
forth  In  the  declai-ation,  which  was  over- 
ruled. The  motion  was  In  the  nature  of  a 
demuiTcr  to  tlie  evidence,  and,  if  defendant 
desired  to  avail  itself  thereof,  it  should  have 
abided  by  it.  Instead  of  doing  this,  it  in- 
troduced evidence  in  its  behalf,  and  submit- 
ted the  cause  to  the  jury  without  renewing 
its  motion,  thereby  waiving  the  eiTor,  if  er- 
ror there  was,  in  the  decision  of  the  court. 
Railway  Co.  v.  Velie,  140  111.  59.  29  N.  E.  706. 

The  defendant,  however,  by  its  instructions 
1,  2,  and  3,  refused  by  the  court,  sought  to 
raise  the  same  question.  By  these  instruc- 
tions the  court  was  asked  to  instruct  the 
jm-y — First,  the  evidence  was  not  sufficient 
to  sustain  a  verdict  for  plaintiff;  second, 
there  was  a  variance  between  the  proof  and 
caiLse  of  action  stated  In  the  declaration; 
and,  third,  that  the  evidence  did  not  show 
an  abandonment  of  the  contract  by  the  de- 
fondant,  and  the  verdict  should  therefore  be 
for  the  defendant  Instructions  talcing  the 
case  from  the  jury  should  only  be  given 
where  the  evidence,  with  all  the  legitimate 
and  natural  inferences  to  be  drawn  there- 
from, is  wholly  insufficient,  if  credited,  to 
sustain  a  verdict  for  the  plaintiff.  Simmons 
V.  Railroad  Co.,  110  HI.  34G;  Pm-dy  v.  IlaU. 
134  lU.  29S,  25  N.  E.  645;  Car  Co.  v.  Laack, 
143  111.  242,  32  N.  E.  285,  and  cases  cited. 
Where  there  is  evidence  tending  to  sustain 
the  issues  in  behalf  of  the  plaintiff,  the 
weight  to  be  given  thereto  must  be  submit- 
ted to  the  jury;  and,  when  their  finding  of 
facts  has  been  approved  by  the  ti-ial  and 
appellate  courts,  no  question  of  the  suffi- 
ciency of  the  evidence  to  support  the  verdict 
can  be  raised  in  this  court  It  wiU  be  prop- 
er, tliorefore,  to  so  far  examine  the  evidmice 
as  to  enable  us  to  determine  whether  there 
was  evidence  tending  to  support  the  plain- 
tiff's cause  of  action  alleged  in  his  doclaxa- 
tlon.  In  the  discussion  which  will  follow, 
it  will  become  apparent  that  we  are  of 
opinion  that  there  was  evidence  tending 
to  sustain  plaintiff's  cause  of  action,  as  al- 
leged, and  tliat  therefore,  said  insti-uctions 
were  properly  refused.  "VMiether  tlae  evi- 
dence, when  considered  together,  is  suffi- 
cient to  maintain  the  plaintiff's  case,  is  a 
question  which  does  not  fall  within  our  prov- 
ince to  determine. 

The  principal  question  to  be  determined  in 
this  case  arises  upon  the  second  and  third 
instructions  given  at  the  instance  of  the 
plaintiff,    as    follows:    "(2)  If    the    jury    be- 


lieve from  the  evidence  that  the  defendant, 
by  Its  acts  and  conduct,  showed  an  intention 
not  to  be  bound  by  said  couti-act,  then  said 
Richards,  Maynard  &  Co.  had  the  right  to 
treat  said  conU'act  as  abandoned  by  said  de- 
fendant and  to  bring  suit  for  the  recovery 
of  damages  at  any  time  thereafter,  unless 
you  believe  from  the  evidence  that  the  de- 
fendant company  receded  from  such  intention 
not  to  be  bound,  prior  to  the  time  when  said 
plaintiff  chose  to  treat  said  conti-act  as  ab;in- 
doned  by  the  defendant  An  intention  can 
only  be  known  byacts,  conductor  declaration. 
Yoiur  inquiry  In  this  connection  Is:  First 
Did  defendant  by  act  and  conduct  violate 
the  substantial  tei-ms  of  the  contract  and 
commit  breaches  in  substantial  provisions 
thereof?  Second.  Did  such  acts  and  con- 
duct if  you  believe  from  the  evidence  they 
existed,  wan-ant  the  conclusion  that  they 
would  be  continued,  and  that  it  was  the  in- 
tention of  the  defendant  to  continue  such 
acts  and  conduct?  (3j  If  the  jurj'  believe 
from  the  evidence  that  the  defendant  rail- 
way refused  to,  and  did  not  live  up  to  its 
said  contract  in  its  substantial  provisions, 
and  refused  to  perform  it  according  to  its 
terms,  and  abandoned  the  same  without  the 
fault  of  Richards,  Maynard  &  Co..  and  that 
defendant  prevented  Richards,  Maynai'd  & 
Co.  from  performing  the  substantial  provi- 
sions of  said  conti-act  according  to  its  terms, 
then  the  plaintiff  is  entitled  to  recover;  and 
it  is  not  necessary  that  Richards,  Maynard 
&  Co.  should  have  been  prevented  from  per- 
forming said  contract  by  physical  force,  in 
order  to  give  them  the  right  to  treat  said 
contract  as  abandoned  by  the  defendant  rail- 
way, and  to  recover  damages  from  said  de- 
fendant company  in  this  suit  If  the  jury 
believe  from  the  evidence  that  said  defend- 
ant railwaj'  refused  to,  and  did  not,  live  up 
to  its  said  c-onti"act  and  refused  to  perform 
it  according  to  its  terms,  and  if  you  believe 
from  the  evidence  that  defendant  defeated 
the  substxintial  objects  of  the  contract,  or 
rendered  it  imattainable  by  proper  perform- 
ance on  tlie  part  of  the  firm  of  Richards, 
Maynard  &  Co.,  and  that  defendant  prevent- 
ed Richards,  Maynard  »&  Co.  from  perform- 
ing the  said  contract  according  to  its  terms, 
as  above  suggested,  then  the  jury  may  find 
for  the  plaintiff,  and  assess  the  damages  at 
such  a  sum  as  they  believe  from  tlie  evi- 
dence that  the  plaintiff  has  suffered  by  rea- 
son of  such  breach."  Bearing  ujwn  the  s;ime 
proposition,  more  or  less  directly,  the  court 
gave  to  tlie  jury,  at  the  instance  of  tlie  de 
fendant  its  seventh,  twelfth,  sixteenth,  and 
seventeenth  instructions,  as  follows:  "(7) 
You  are  instructed  that,  if  the  defendant 
committed  breaches  of  the  contract  still,  if. 
from  the  evidence,  you  believe  that  such 
broaches  did  not  defeat  the  substantial  ob- 
jects of  the  contract  or  render  it  unattaina- 
ble by  proper  performance  on  the  part  of 
the  firm  of  Richards.  Maynard  &  Co.,  then 
the  plaintiff  cannot  recover,  and  your  verdict 


552 


DISCHARGE  OF  CONTRACT. 


must  be  for  the  defendant"  "(12)  The  jui-y 
are  instructed,  as  a  matter  of  law,  that  a 
mere  faihu-e  or  refusal  of  the  defendant  to 
pay  to  plaintiff,  or  the  firm  of  Richards, 
Maynard  &  Co.,  ajiy  sum  of  money  demand- 
ed by  him  or  them,  and  claimed  to  be  on 
account  of  services  previously  rendered  by 
said  firm  under  the  contract  in  question, 
cannot  be  consti-ued  or  ti-eated  as  an  aban- 
donment of  t±ie  said  conti-act  by  the  defend- 
ant, entitling  the  plaintiff  or  his  said  firm 
to  maintain  the  present  action,  which  is  sole- 
ly for  the  recovery  of  such  profits  as  might 
have  accrued  to  the  plaintiff  or  his  firm,  if, 
on  their  part,  said  contract  had  been  fully 
executed,  continuously,  for  the  period  limited 
by  said  conti-act."  "(IG)  The  jury  is  further 
instructed,  as  a  matter  of  law,  that,  in  or- 
der to  entitle  the  plaintiff  to  recover  in  this 
case,  it  is  necessary  for  him  to  establish  by 
a  preponderance  of  evidence  that  he  and  the 
firm  of  Richards,  Maynard  &  Co.  were,  by 
the  acts  of  the  defendant,  prevented  from 
the  performance  of  said  conti-act  on  their 
pai-t,  or  that  the  execution  of  the  said  con- 
tract on  their  part  was  interrupted  by,  and 
was  the  legitimate  consequence  of,  the  acts 
of  the  defendant  in  disregard  of  its  obliga- 
tions under  said  contract  (17)  The  failure 
of  the  defendant  to  pay,  when  demanded, 
any  moneys  due  and  owing  to  plaintiff  xinder 
the  contract,  was  not  such  an  act  or  omis- 
sion, in  itself,  on  the  part  of  defendant,  as  to 
prevent  the  plaintiff  completing  the  contract" 
Upon  an  examination  of  the  evidence  for 
che  purpose  of  determining  the  propi-iety  of 
the  instructions,  it  will  be  found  that  it 
tends  to  prove  that  shortly  after  the  plain- 
tiff's firm  had,  In  pursuance  of  the  contract, 
constructed  and  equipped  their  transfer 
house,  and  commenced  the  weighing  and 
transfer  of  grain  therein,  controversies  arose 
between  the  parties  as  to  the  proper  con- 
struction of  the  contract,  the  rights  of  the 
plaintiff,  and  the  duties  and  obligations  of 
the  defendant,  thereunder.  It  was  claimed 
by  the  defendant  that  it  was  not  required  by 
the  contract  to  deliver  to  the  plaintiff's  fii-m, 
to  be  by  them  weighed  and  transferred,  all 
of  the  grain  received  by  the  defendant  from 
western  railroads  for  transportation  to  the 
east  over  its  lines,  but  that  it  had  the  op- 
tion to  deliver,  to  be  thus  weighed  and 
transferred,  only  such  grain  as  it  chose  to 
deliver,  and  had  the  right  to  divert  from 
plaintiff's  transfer  house,  and  was  at  liberty 
to  transfer  and  weigh,  all  or  such  part  of  the 
grain  received  by  it  from  western  railroads 
as  it  thought  proper,  by  other  modes;  and, 
acting  on  that  interpretation  of  the  contract, 
It  did  in  fact  withhold  large  amounts  of 
grain  from  the  transfer  house,  and  had  the 
same  transferred  by  other  methods,  thereby 
depriving  the  plaintiff's  firm  of  a  consider- 
.  able  portion  of  the  business  to  which  they 
were  entitled  by  the  terms  of  the  contract. 
And  also  that  soon  after  the  transfer  house 
was  open,  and  during  all  the  time  it  was  in 


operation,   the   defendant  claimed   the  right 
under  the  contract,  and  adopted  and  pei-sist- 
ed  in  the  practice,  of  using  the  weights  ob- 
tained from  the  plaintiff's  firm  for  other  pur- 
poses   than    that    of    billing    the    property 
weighed  to  its  destination,— that  is  to  say, 
by  giving  away  such  weights  to  the  western 
railroads  over  which  the  property  had  been 
brought  to  Chicago,  or  thus  placing  it  out 
of  tlie  power  of  plaintiff's  firm  to  make  sales 
of  such    weights   to   western   railroads    and 
others,— thereby    depriving   them   of   practi- 
cally the   only    source   of   profit   secured   to 
them  by  the  contract     It  will  also  appear 
that  the  evidence  tends  to  show  that  otlier 
differences   arose   as   to   the  amount   to   be 
paid   by    the   defendant  on   account  of   the 
expense  of  transferring  through  the  transfer 
house,  and  as  to  the  basis  upon  which  the 
cost  thereof  should  be  computed,  etc.     The 
construction  placed  upon  this  contract  in  re- 
spect of  the  matters  of  difference  before  men- 
tioned, by  this  court,  in  Railway  Co.  v.  Rich- 
ards, 126  111.  448,  IS  N.  E.  794,  relieves  us 
of  the  necessity  of  again  construing  it.     We 
there   held    that  both   the   giving   away    of 
weights  to  the  western  railroads,  and  the  re- 
fusal   of   appellant   company    to    deliver   to 
plaintiff's  firm,   for  weighing  and  transfer, 
all  grain   received  by   it  for  transportation 
from  western  railroads,  was  a  violation  of 
its  contract     It  was  there  found  that  the 
marliet  value  of  the  weights  was  70  cents 
per  car,   and  that  the  appellant  had  given 
away   to   western  railroa.-i   the  weights   of 
12,357    cars    transferred    and    weighed    by 
plaintiffs,    in  violation   of  the  contract     It 
was  also  found  that  many  other  cars  had 
been  transferred  and  weighed  by  other  meth- 
ods than  through  the  transfer  house  of  plain- 
tiffs;   that  1,2G7  of  such  cars  were  transfer- 
red on  track  by  appellant  in  January,  Feb- 
ruary, and  March,  1885,  alone,  in  violation 
of  the  contract     That  bill  was  filed  on  June 
5,   ISSG,  and   asked,  among  other  things,  a 
reformation  of  the  contract     The  court,  by 
its  final  decree,  refused  to  reform  the  con- 
tract, but  held  it  to  be  valid   and  binding 
between  the  parties,  in  the  form   in   which 
it  was  executed.     There  can  be  no  question 
that  on  June  5,  18SG,  and  prior  thereto,  the 
evidence  tended  to  show  that  the  defendant 
was  then  guilty  of  breaches  of  the  contract, 
as  it  was  then  held   to   be   subsisting  and 
binding   between    the   parties.     Aside    from 
the   large   amount  of  business  diverted   by 
appellant   from   the    transfer   house    of   the 
plaintiffs,    which    it   was    bound   to    furnish 
them  under  the  contract,  as  there  construed, 
of  the  24,700   car  loads  of  grain  and  seed 
which  appellant  delivered  to  and  permitted 
to  be  weighed  and  transferred  through  the 
transfer   house,   the   weight   of   12,357    cars, 
or  50  per  cent  of  the  entire  business  done, 
was  given  away  by  the  defendant,  in  viola- 
tion of  its  covenants. 

We   need  not  pursue   this   branch   of  the 
case  further.     But  to  these  may  be  added 


BREACH— KEXUXCIATIOX. 


583 


other  breaches  of  the  contract  by  the  de- 
fendant, whicli  the  evidence  tends  to  show, 
namely,  its  refusal  to  pay  the  transfer  char- 
ges or  expenses,  and  its  refusal  to  be  bound 
by  the  stipulations  of  the  contract  providing 
for  a  submission  to  arbitration  of  all  differ- 
ences between  the  parties  in  respect  of  the 
spirit,  meaning,  or  execution  of  the  contract 
It  admits  of  no  argument  that  the  principal 
consideration  upon  which  plaintiff's  firm  un- 
dertook to  build,  equip,  and  operate  their 
ti-ansfer  house  was  the  privilege  given  them 
of  weighing  and  transferring  all  grain  and 
seed  delivered  by  western  roads  to  the  de- 
fendant for  tran&TDortation  eastward  over  its 
lines,  and  the  right  secured  to  them  to  con- 
trol the  weights  of  the  grain  thus  transfer- 
red, and  make  sale  of  them  to  whomsoever 
might  desire  to  purchase.  It  was  clearly 
contemplated  that  the  sale  of  such  weights 
should  be  the  source  of  profit  to  plaintiffs, 
and,  as  the  result  shows,  was  practically 
their  only  source  of  profit  from  the  business. 
During  the  time  the  transfer  house  was  in 
operation,  there  is  no  complaint  that  they 
did  not  keep  and  perform  their  agreements. 
By  the  wrongful  act  of  the  defL'udant  In 
giving  away  the  weights,  more  than  one- 
half  of  the  legitimate  profits  of  the  business 
actually  done  was  taken  from  them,  and  by 
the  wrongful  diversion  of  business  they  were 
deprived  of  large  profits  to  which  they  were 
entitled  under  their  contract  By  the  wrong- 
ful act  of  the  defendant,  they  were  deprived 
of  a  very  large  proportion  of  the  snbstantial 
consideration  upon  which  the  contract  was 
entered  into  by  plaintiffs. 

The  evidence  tends  to  show  that  the  de- 
fendant after  the  5th  of  June,  ISSO,— the 
date  of  filing  the  bill  in  the  case  referred  to, 
—manifested  and  declared  its  intention  to 
persist  for  the  future  in  the  same  course  of 
conduct  and  to  insist  upon  the  same  con- 
struction of  the  contract.  May  13,  ISSG,  the 
attorney  to  whom  the  matter  had  been  re- 
ferred by  the  defendant  in  reply  to  a  note 
inclosing  an  itemized  statement  of  account, 
refnsetl  to  allow,  under  the  contract  for 
weigh  ti  giver  away  by  defendant  and  ex- 
pressly said,  "under  the  contract  the  com- 
pany L'.  not  bound  to  deliver  grain  to  Rich- 
ards, except  ai  its  option."  On  June  9,  1SS6, 
the  defendant's  western  division  superin. 
tendent  wrote  to  plaintiff,  acknowledging 
receipt  of  statement  of  May,  1SS6,  for  cost 
of  grain  and  seed  transferred,  and  disallow- 
ing the  account,  but  restating  the  same  in  ac- 
cordance witi  the  interpretation  of  the  con- 
tract previously  insisted  upon  by  the  defend- 
ant On  June  11,  1886,  plaintiff's  firm  re- 
plied, noting  the  refusal  contained  in  the 
letter  of  June  9th,  restating  the  balance  due, 
and  notifying  the  defendant  that  unless  the 
same  was  paid  by  12  m.,  Juno  16th,  plaintiff 
would  be  compelled  to  gnspcnd  operations, 
etc.  On  the  same  day  the  attorney  of  the 
company,  to  whom  the  matter  had  been  re- 
ferred,  wrote  the    plainiiff's    firm   that  the 


company  could  not  change  the  position  tak- 
en in  tlie  letter  of  tlie  superintendent  and  the 
letter  of  May  13,  18SG,  before  mentioned.  It 
thus  appears  that  as  late  as  June  11th  the 
company  was  insisting  tliat  under  the  con- 
ti-act  it  was  not  bound  to  deliver  gi-aln  to 
the  transfer  house  of  plaintiff's  firm,  except 
as  it  chose  to  do  so;  and  was  likewise  deny- 
ing its  liability  under  the  contract  for  the 
weights  it  had  given  away,  and  for  transfer 
charges,  etc.  No  change  occurring  in  the  at- 
titude of  the  parties,  plainiiff's  firm  closed 
their  house  on  June  IGth,  and  notified  the 
defendant  accordingly.  As  early  as  .Septem- 
ber 11,  1885,  the  plaintiff's  firm  addn-ssed  a 
communication  to  the  president  of  the  de- 
fendant company,  asking  for  an  arbitration 
of  the  differences  between  them,  under  the 
contract  and  naming  a  person  to  represent 
the  plaintiff's  firm,  and  again,  on  March  29, 
1880,  made  a  like  demand,  and  naming  an 
arbitrator  to  act  for  and  on  behalf  of  the 
plaintiff's  firm.  The  defendant  company  de- 
clined to  submit  the  matters  in  difference  to 
arbitration.  The  correspondence  before  re- 
ferred to,  as  well  as  other  facts  shown,  may 
be  fairly  said  to  show  a  fixed  determination 
on  the  part  of  the  defendant  company,  after 
Jvne  5,  18S6,  to  persist  in  and  continue  the 
same  breaches  of  its  contract  in  the  future 
of  which  it  had  theretofore  been  guilty;  that 
is,  to  persistently  pui-sue  a  course  of  conduct 
which  would  deprive  plaintiff's  firm  of  much 
the  lai*ger  portion,  if  not  all,  of  the  substan- 
tial benefits  of  the  contract  If  it  might  at 
its  option  and  will,  give  away  one-half  of 
the  weights  of  cars  actually  transferred,  as 
it  claimed  the  right  to  do,  it  might  give  them 
all  away.  If  it  was  optional  with  the  de- 
fendant to  deliver  for  weighing  and  trans- 
fer only  such  cars  of  grain  received  by  it 
from  western  roads  for  transportation  east 
over  its  lines  as  it  might  choose,  and  divert 
the  business  from  the  transfer  house  at  will, 
the  conti-act  ceased  to  be  operative  and  bind- 
ing on  the  defendant  Such  construction,  in 
effect,  was  a  repudiation  of  that  part  of  the 
contract  to  be  kept  and  performed  by  the 
defendant  and  was  a  denial  of  tlic  right  of 
the  plaintiff  to  have  and  demand  the  sub- 
stantial benefits  of  the  contract  as  it  existed 
between  the  paiiies. 

That  the  breaches  of  the  contract  which  the 
evidence  tends  to  establish  were  such  as 
would  justify  a  rescission  thereof  by  Rich- 
ards, Maynard  «&  Co.  and  enable  them  to 
recover  upon  quantum  meruit  or  quantum 
valebant  so  far  as  they  had  actually  per- 
formed, docs  not  admit  of  question.  The 
relief  sought  is  not  upon  that  principle.  The 
law  is  familiar  that  upon  rescission  of  the 
contract  tlie  recovery  is  confined  to  tiie  value 
of  the  services,  etc.,  rendered,  and  that  dam- 
ages for  the  breach,  for  the  loss  of  expendi- 
tures or  of  profits,  would  not  be  allowable. 
U.  S.  T.  Behan.  110  U.  S.  338,  4  Sup.  Ct  81. 
It  is  well  settled  that  where  one  party  re- 
pudiates the  contract  and  refuses  longer  to 


584 


DISCHAEGE  OF  CONTRACT. 


be  bound  by  it,  the  injured  party  has  an 
election  to  pui-sue  either  of  three  remedies: 
He  may  treat  the  conti-act  as  rescinded,  and 
recover  upon  quantum  meruit  so  far  as  he  has 
performed:  or  he  may  liecp  the  contract 
alive  for  the  benefit  of  both  parties,  being 
at  all  times  himself  ready  and  able  to  per- 
form, and,  at  the  end  of  the  time  specified  in 
the  contract  for  performance,  sue  and  recov- 
er under  the  conti-act;  or  he  may  treat  the 
repudiation  as  putting  an  end  to  the  contract 
for  all  purposes  of  performance,  and  sue  for 
the  profits  he  would  have  realized  if  he  had 
not  been  prevented  from  performing.  In  tbe 
latter  case  the  contract  would  be  continued 
in  force  for  that  purpose.  Where,  however, 
the  injured  party  elects  to  keep  the  contract 
in  force  for  the  purpose  of  recovering  future 
profits,  treating  the  contract  as  repudiated 
by  the  other  party,  in  order  to  such  recovery 
the  plaintiff  must  allege  and  prove  perform- 
ance upon  his  part,  or  a  legal  excuse  for  non- 
perfoi-mance.  As  said  by  Lord  Coleridge  in 
Freeth  v.  Burr,  L.  R.  9  C.  P.  20S:  "In  cases 
of  this  sort,  where  the  question  is  whether 
the  one  party  is  set  free  by  the  action  of  the 
other,  the  real  matter  for  consideration  is 
whether  the  acts  or  conduct  of  the  one  do 
or  do  not  amount  to  an  intimation  or  inten- 
tion to  abandon,  and  altogether  refuse  per- 
formance of,  the  contract"  His  lordship 
tlien  adds:  "I  say  this  in  order  to  explain 
the  ground  upon  which  I  think  the  decision 
in  these  cases  must  rest  There  has  been 
some  conflict  among  them.  But  I  think  it 
may  be  taken  that  the  fair  result  of  them  is 
as  I  have  stated,  viz.  that  the  true  question 
is  whether  the  acts  and  conduct  of  the  pai-ty 
evince  an  intention  no  longer  to  be  bound  by 
the  contract." 

It  is  insisted  by  appellant  that,  to  authorize 
one  party  to  treat  the  contract  as  renounced 
and  abandoned  by  the  other,  the  breach  must 
have  been  such,  in  effect,  as  to  prevent  per- 
formance by  the  injured  party,  or  render  the 
further  execution  of  the  contract  by  him  im- 
possible. It  appears  to  be  the  theory  of 
counsel  for  appellant  that,  in  order  to  en- 
title the  plaintiff  to  recover  future  profits 
under  the  contract,  the  breach  by  the  defend- 
ant must  have  been  of  a  condition  precedent 
to  be  performed  on  its  part,  and  which  ren- 
dered the  contract  incapable  of  execution  by 
the  other,  or  some  act  or  conduct  on  the  part 
of  the  defendant  amounting  to  a  physical  ob- 
struction or  prevention  of  performance  by 
the  plaintiff.  This  contention  does  not  com- 
mend itself  either  upon  considerations  of 
good  conscience  or  convenience,  and  it  will 
be  found  not  to  be  sustained  by  the  weight 
of  authority.  It  would  seem  to  be  inequita- 
ble, and  promotive  of  no  good  purpose,  to  re- 
quire a  party  to  continue  in  the  performance 
of  a  contract,  notwithstanding  the  refusal  of 
the  other  party  to  be  longer  bound  by  it 
The  effect  in  many  cases  must  be  great  loss 
to  the  plaintiff,  without  any  corresponding 
benefit  to  the  defendant     Or  if  it  be  ulti- 


mately held  that  the  plaintiff  is  entitled  to 
recover  his  expenditures,  and  for  his  labor  in 
performing,  the  amount  to  be  paid  by  the  de- 
fendant will  be  greatly  enhanced,  while  the 
plaintiff  would,  of  necessity,  take  the  hazard 
of  increased  loss  in  the  event  of  the  defend- 
ant's insolvency.  It  would  seem  to  be  rea- 
sonable and  just,  upon  the  repudiation  of 
the  contract  by  one  party,  that  the  other  be 
held  justified  in  ceasing  performance,  stop- 
ping expenditure,  and  thus  curtailing  the 
damages  which  the  other  party  would  be  ul- 
timately liable  to  pay,  and  to  permit  recov- 
ery once  for  all  of  the  damages  that  the  in- 
jured party  will  sustain  by  the  nonperform- 
ance of  the  other  party;  the  locus  poeniten- 
tiae  being  kept  open  until  the  injured  party 
elects  to  treat  the  contract  as  abandoned  by 
the  other,  and  brings  suit  as  for  nonper- 
formance. While  the  decision  should  not  be 
made  to  rest  upon  grounds  of  convenience 
to  the  parties,  however  just  and  equitable, 
which,  in  view  of  the  decided  cases,  need 
not  be  done,  yet  the  defendant  should  not  be 
heard  to  complain,  if,  after  acts  and  declara- 
tions evincing  a  clear  determination  to  be  no 
longer  bound  by  or  to  perform  the  contract 
on  his  part,  the  other  party  treats  it  as 
abandoned  by  him.  As  said  in  BYost  v. 
Knight,  L.  R.  7  Exch.  Ill:  "It  is  obvious  that 
such  a  course  must  lead  to  the  convenience 
of  both  parties,  and,  though  we  should  be  un- 
willing to  found  our  opinion  upon  ground  of 
convenience  alone,  yet  the  latter  tends 
strongly  to  support  the  view  that  such  an  ac- 
tion ought  to  be  admitted  and  upheld.  By 
acting  upon  such  notice  of  the  intention  of 
the  promisor,  and  taking  timely  measures, 
the  promisee  may  in  many  cases  avert,  or 
at  all  events  materially  lessen,  the  injurious 
effects  which  would  otherwise  flow  from  the 
nonfulfillment  of  the  contract"  See,  also, 
Hosmer  v.  Wilson,  7  Mich.  304;  cases  infra. 
The  right  of  the  plaintiff  to  have  kept  his 
transfer  house  in  operation,  and  have  been 
ready  at  all  times  to  perform  on  his  part, 
and,  under  the  construction  of  the  conti-act 
given  in  Railway  Co.  v.  Richards,  supra,  to 
have  recovered  from  time  to  time  his  dam- 
age for  breaches  thereof,  or,  at  the  end  of 
the  time,  sued  to  recover  damages  for  all 
breaches,  is  not  questioned  in  this  proceed- 
ing. The  plaintiff,  however,  in  good  con- 
science, while  seeking  to  recover  what  he  is 
entitied  to  under  the  contract,  should  do 
that  which  would  be  of  least  injury  to  the 
defendant  And  if  the  defendant  had  re- 
pudiated the  contract,  so  as  to  deprive  the 
plaintiff  of  the  substantial  benefits  arising 
from  performance,  it  ought  not  to  complain 
that  the  course  was  pursued  least  prejudi- 
cial to  it 

The  question  here  presented  has  not  been 
directly  involved  in  any  of  the  cases  here- 
tofore considered  by  the  court.  In  the  cas- 
es of  Fox  V.  Kitton,  19  111.  519;  McPher- 
son  V.  Walker,  40  111.  371;  Chamber  of 
Commerce  v.  Sollitt,  43  Ilk  523;    Follansbee 


BREACH— RENUNCIATION'. 


585 


V.  Adams,  SO  111.  14;  and  Kadish  v.  Young, 
108  Id.  170,— the  questions  involved  were  de- 
termined upon  principles  analogous,  in  some 
respects,  to  those  which  mast  control  in  this 
case.  In  Kadish  v.  Young,  supra,  a  con- 
tract was  made  for  the  future  delivery  of 
grain.  On  the  day  succeeding  the  malcing 
of  the  contract  the  purchasers  gave  notice 
to  the  seller  that  they  would  not  be  l)ound  by 
it,  and  the  question  was  whether  such  no- 
tice created  a  breach  of  the  contract,  and 
imposed  on  the  seller  the  obligation  to  ro- 
sell  the  barley  on  the  market,  or  make  a  for- 
ward contract  for  the  purchase  of  other  grain 
of  like  amount  and  time  of  delivery,  within 
reasonable  time  after  the  notice,  and,  if  he 
sold,  to  credit  the  purchaser  witli  the  amount 
of  the  sale,  or  give  him  the  benefit  of  such 
forward  contract;  or  whether,  notwithstand- 
ing the  notice,  the  seller  had  the  legal  right 
to  wait  until  the  day  of  delivery  under  the 
contract,  and  then  resell  and  charge  the  pur- 
chaser with  the  difference.  And  it  was  held 
that  the  seller  was  not  bound  to  act  upon  the 
notice,  but  was  entitled,  notwithstanding,  to 
tender,  etc.,  on  the  day  for  delivery  fixed 
by  the  contract.  In  the  opinion,  by  the  late 
Mr.  Justice  Scholfield,  the  authorities  were 
reviewed,  and  the  cases  of  Cort  v.  Railway 
Co.,  6  Eng.  Law  &  Eq.  230;  Hochster  v.  De 
Latour,  20  Eng.  Law  &  Eq.  157;  Frost  v. 
Knight,  L.  R.  7  Exch.  Ill;  Roper  v.  John- 
son, L.  R.  8  C.  P.  1G7,  4  Moak,  Eng.  R.  397,— 
and  other  English  and  American  cases,  are 
commented  upon,  approved,  and  are  held 
not  to  be  in  conflict  with  Leigh  v.  Paterson, 
8  Taunt.  540;  Phillpotts  v.  Evans,  5  Mees. 
&  W.  475;  Ripley  v.  McClure,  4  Exch.  344,— 
and  other  cases  in  which  it  is  held  that  a 
party  to  a  contract  to  be  performed  in  the 
future  cannot  create  a  breach  by  merely  giv- 
ing notice  that  he  will  not  perform.  It  will 
be  found,  upon  examination  of  Kadish  v. 
Young,  that  the  learned  writer  clearly  rec- 
ognized the  doctrine,  that  the  party  receiving 
the  notice  might  have  acted  upon  it,  and 
accepted  and  treated  the  contract  as  broken. 
In  Fox  V.  Kitton,  supra,  the  question  was 
whether,  when  a  party  agrees  to  do  an  act  at 
a  future  time,  and,  before  the  time  for  per- 
formance arrives,  declares  he  will  not  keep 
his  contract,  but  repudiates  it,  the  other  par- 
ty may  act  on  such  declaration,  and  treat 
the  contract  as  at  an  end.  And  on  the 
authority  of  Phillpotts  v.  Evans,  and  Hoch- 
ster V.  De  Latour,  it  was  held  that  he  might 
do  so.  It  wiU  be  found,  also,  in  McPher- 
son  V.  Walker  and  Chamber  of  Commerce 
V.  Sollitt,  that  Cort  v.  Railway  Ca,  Hochster 
V.  De  Latour,  and  other  English  and  Amer- 
ican cases  holding  the  same  doctrine,  are 
cited  with  approval,  and  relied  upon  aa  sus- 
taining the  decision  in  those  cases. 

Before  proceeding  to  our  examination  of 
tJie  cases  referred  to,  it  is  proper  to  notice 
otlier  Illinois  cases  supposed  to  have  some 
bearing  upon  the  question  under  considera- 
tion.    Selby  V.   Hutchinson.   4  Gilmau,  319, 


was  a  case  of  rescission  merely.  It  was  there 
said:  "In  order  to  justify  an  abandonment 
of  tlie  contract,  and  of  the  proper  remedy 
growing  out  of  it,  the  failure  of  tlie  opposite 
party  must  be  a  total  one;  the  object  of  the 
contract  must  have  been  defeated,  or  ren- 
dered unattainable,  by"  the  misconduct  or 
default  of  the  other  party.  In  tlie  subse- 
quent case  of  Leopold  v.  Salkey,  89  111.  412, 
also  a  case  of  rescission,  the  language  of  Sel- 
by V.  HutchLnson  is  commented  upon,  and  it 
is  said  that  ca.se  "is  not  understood  as  laying 
down  the  rule  that,  to  Justify  abandonment 
of  a  contract,  the  opposite  party  must  have 
failed  to  discharge  every  obligation  imposed 
upon  him,  but  simply  that  matters  which  do 
not  go  to  the  substance  of  the  contract,  and 
the  failure  to  perform  which  would  not  ren- 
der performance  of  the  rest  a  tiling  different 
in  substance  from  what  was  contracted  for. 
do  not  authorize  an  abandonment  of  the  con- 
u-act;  for  when  the  failure  to  perform  the 
contract  is  in  respect  to  matters  which  would 
render  the  performance  of  the  rest  a  thing 
different  in  substance  from  what  was  con- 
tracted for,  so  fai-  as  we  are  aware,  the  au- 
thorities all  agree  the  party  not  in  default 
may  abandon  tlie  conti-act"  It  may  be  tiiie 
that  there  are  cases  where  the  party  will  be 
justified  in  rescinding  the  contract,  thereby 
putting  an  end  to  it  for  all  pmposes,  where 
he  would  not  be  justified  in  treating  it  as  re- 
nounced by  the  other  party,  which  we  are 
not  called  upon  to  decide.  Yet  it  will  be 
*'nund  that  under  the  rule  as  stated  in  these 
cases,  as  explained  in  the  later  case,  the 
party  will  be  entitled  to  recover  future  prof- 
its. The  court,  in  these  cases,  was  called  up- 
on simply  to  determine,  whether  the  facts 
there  presented  warranted  rescission,  and 
laid  down  the  rule  applicable  to  such  facts, 
without,  as  a  matter  of  course,  intimating  a 
distinction  between  ihe  case  there  being  con- 
sidered and  cases  like  that  under  considera- 
tion here.  In  the  case  of  Palm  v.  Railroad 
Co.,  IS  111.  217,  the  question  presented  to  the 
court  was  whether  the  failure  to  pay  the  con- 
sideration for  the  work  agreed  to  be  done, 
according  to  the  terms  of  the  contract  was 
such  an  act  as  would  authorize  the  other 
party  to  treat  the  contract  as  renounced,  and 
bring  suit  for  future  profits.  And  the  court 
held  that  it  was  not.  The  court  say:  "In 
this  case  we  have  a  contract  for  the  manu- 
facture and  delivery  of  sixteen  engines,  each 
to  be  paid  for  on  deliver}',  without  any  ex- 
pression or  intimation  that  the  parties  ex- 
pected or  intended  thac  any  extraordinary 
consequences  were  to  follow  if  the  money 
was  not  paid  when  due.  All  that  the  con- 
tract provides  is  that  so  much  money  and  so 
much  bonds  shall  become  due  upon  the  deliv- 
ery of  each  engine.  By  its  terms,  it  simply 
gives  the  party  a  cause  of  action  for  that 
amount  •  •  •  The  contract  provides  for 
no  other  penalty  or  liability,  and  the  law  im- 
E>oses  no  other,  except,  perhaps,  that  this  vio- 
lation of  the  contract  by  the  defendant   iB 


5S6 


DISCHARGE  OF  CONTRACT. 


failing   to  make  the  payment,   may  justify 
the  plaintiff  in  ti-eating  the  conti-act  as  re- 
scinded."    Or  they  could  go  ou  and  complete 
the  contract,   and,   at  the  end,   recover  the 
amount  due  thereunder.     There  was  in  that 
case  no  refusal  to  receive  locomotives  under 
the  contract,  nor  were  plaintiffs  forbidden  to 
complete  it  nor  was  it  in  any  way  put  out  of 
their   power  to  do   so.     Yery   many  of   the 
cases  before  referred  to  have  been  decided 
since  the  Palm  Case,  which,  it  must  be  re- 
mai-ked,    cites   no   authority   sustaining   the 
view  of  that  case  contended  for  by  appellant 
in  this  ease.     The  learned  judge  who  wrote 
in  the  Palm  Case  says:     "I  have  examined 
all  the  authorities  referred  to  by  counsel,  and 
have  made  diligent  search  myself,  but  have 
found  no  case  where  the  plaintiff  had  been 
allowed  to  recover  for  losses  sustained  by  not 
being  permitted  to  complete  the  conti-aet,  un- 
less he   has  been  prevented  from  going  on 
with  his  work  by  the  positive  affirmative  act 
of  the  other  party,  or  where  the  other  pai-ty 
has  neglected  to  do  some  act,  without  which 
the    plaintiff    could    not,    in    the    nature    of 
things,    go   on    with    his    contract    *    *    *" 
After  giving  instances  of  conditions  preced- 
ent the  learned  judge  holds,  as  before  said, 
that  the  failiu-e  to  pay  would  not  authorize 
the  plaintiff  to  treat  the  contract  as  aban- 
doned by  the  defendant  unless  payment  in 
a  specified   time  and   manner,   was,   by  the 
contract  made  a  condition  precedent  to  per- 
formance   by    the    plaintiff.     The    case    of 
Christian  Co.  v.  Overholt  18  111.  223,  is  simi- 
lar in  its  facts  to  the  Palm  Case,  and  is  de- 
cided upon  the  same  principle.     In  that  case 
it   is   said:     "The   plaintiffs   could   only   re- 
cover for  prospective  profits  where  they  have 
been  prevented  from  going  on,  either  by  some 
affirmative  act  of  the  defendant  as  by  being 
ordered  to  desist  from  further  work,  or  by 
the  omission  to  perform  some  condition  preced- 
ent to  the  further  prosecution,  as  to  fm-nish 
or  do  something  necessary  to  its  further  prog- 
ress."    The  breach  there  alleged  was  a  fail- 
ure to  pay  an  Installment  as  it  fell  due  under 
the  contract  and  the  case  was  disposed  of 
upon  the  authority  of  the  Palm  Case.     Stress 
is  laid  by  counsel  upon  the  words,  "prevented 
from  going  on."     It  is  apparent  from  the  lan- 
giiage  of  the  court  especially  in  the  Overholt 
Case,  that  physical  prevention  was  not  con- 
templated, for  the  illustration  given  shows 
that  at  least  an  order  to  desist  from   the 
work    would    be    a    prevention,    within    the 
meaning   of  the   term   as  used.     While,    in 
those  cases,  there  was  no  failure  to  perform 
a  condition  precedent  or  a  legal  prevention 
from  going  on  with  the  work  under  the  con- 
tract which  would  authorize  the  plaintiffs  to 
treat  the  contract  as  repudiated  by  the  other 
party,  and  sue  for  prospective  damages,  and 
the  court  so  held,  still  the  cases  clearly  rec- 
ognize that  when  there  is  a  failm-e  to  per- 
form a  precedent  condition,  or  there  is  a  le- 
gal prevention  of  performance,  by  one  party, 
the  other  may  treat  the  contract  as  aban- 


doned by  him,  and  bring  suit  for  future  prof- 
its or  prospective  damages.  The  same  lan- 
guage, i.  e.  that  the  party  suing  must  be  "pre- 
vented" from  performance,  has  been  used  in 
numerous  cases,  but,  wherever  the  attention 
of  the  com-t  has  been  directly  called  to  the 
sense  in  which  the  word  has  been  used,  it 
has  been  held  not  to  mean  that  there  must 
be  physical  prevention,  but  that  any  acts, 
conduct,  or  dcclai-ations  of  the  party,  evin- 
cing a  clear  intention  to  repudiate  the  con- 
tract and  to  treat  it  as  no  longer  binding,  is 
a  legal  prevention  of  performance  by  the 
other  party.  Thus,  in  Hosmer  v.  Wilson,  su- 
pi-a,  it  was  held  that  an  absolute  refusal  of 
the  defendant  to  accept  tie  manufactured 
article  when  it  should  be  completed  was  to 
be  considered  in  the  same  light,  as  respects 
the  plaintiff's  remedy,  as  an  absolute  physi- 
cal prevention  by  the  defendant;  citing,  in 
support  Cort  v.  Railway  Co.,  supra;  Derby 
V.  Johnson,  21  Vt  21;  Clark  v.  Marsiglia,  1 
Deuio,  317;    Hochster  v.  De  Latour,  supra. 

In  Cort  V.  Railway  Co.,  supra,  the  plain- 
tiffs contracted  to  supply  the  defendants  with 
3,900  tons  of  iron  chairs  to  be  used  in  railway 
construction.     They  manufactm-ed  and  deUv- 
ered  various  quantities  of  chairs  from  May, 
1847,  \mtil  December,  1S49,  when  the  defend- 
ants informed    plaintiffs    that  they  did  not 
want  any  more,  and  not  to  send  any  more, 
leaving  2,113  tons  undelivered.     Whereupon, 
phiintiffs  brought  suit  to  recover  damages,  in- 
cluding loss  of  profits.     It  was  objected  that 
to  entitle  the  plaintiffs  to  recover,  they  should 
have  proved  that  the  chairs  had  been  made 
and  had  been  tendered  in  the  manner  pro- 
vided by  the  contract,  or  at  least  before  the 
bringing  of  the  suit  etc.     In  delivering  the 
opinion  of  the  com*t  Lord  Campbell,   C.  J., 
said:    "We  are  of  opinion  that  the  jmr  were 
fuUy  justified,  from  the  evidence,  in  finding 
that  the  plaintiffs  were  ready  and  willing  to 
perform    the   contract    although   they    never 
made  and  tendered  the  residue  of  the  chairs. 
In  common  sense  the  meaning    of     *     *     * 
'readiness  and  willingness'  must  be  that  the 
noncompletion  of  the  contract   was  not  the 
fault  of  the  plaintiffs,  and  that  they  were  dis- 
posed and  able  to  complete  it  if  it  had  not 
been   renounced    by   the   defendants.     What 
more  can  reasonably  be  required  by  the  par- 
ties for  whom  the  goods  are  to  be  manufac- 
tured ?"     And  after  showing  that  if,  after  hav- 
ing accepted  a  part  tlie  defendants  resolved 
not  to  accept  the  balance,  the  effect  of  com- 
peUing  the  plaintiffs  to  proceed  with  the  man- 
ufacture and  tender  of  them  would  be  the 
enhancement  of  the  damages  the  defendant 
would  be  required  to  pay,  his  lordship  pro- 
ceeds:    "Upon  the  last  issue,  was  there  not 
evidence  that  the  defendants  refused  to  ac- 
cept the  residue  of  the  chairs?    If  they  had 
said,  'IMake  no  more  for  us,  for  we  will  have 
nothing  to  do  with  them,'  was  not  that  re- 
fusing  to  accept  or  receive  them   according 
to  the  contract?    But  the  learned  coimsel  for 
the  defendant  laid  peculiar  stress  upon  tlie 


BREACH— RENUNCIATION. 


587 


^ 


words  [of  the  plea],  'nor  did  they  prevent  or 
discharge  the  plaintiffs  from  supplying  the 
residue  of  the  chairs,  and  from  the  fm-ther 
execution  of  the  contract.'  We  consider  the 
material  part  of  the  allegation  which  the  last 
plea  traverses  to  be  that  the  defendants  re- 
fused to  receive  the  residue  of  the  chairs. 
But,  assuming  that  the  whole  must  be  proved, 
we  think  there  is  evidence  to  show  that  the 
defendants  did  prevent  and  discharge  the 
plaintiffs  from  supplying  the  residue  of  the 
chairs,  and  from  the  further  execution  of  the 
contract.  It  is  contended  that  'prevent,'  here, 
must  mean  obstruction  by  physical  force;  and, 
in  answer  to  a  question  from  the  com-t,  we 
were  told  it  would  not  be  a  preventing  of  de- 
livery of  goods  if  the  purchaser  were  to  write, 
in  a  letter  to  the  pereon  who  ought  to  sup- 
ply them,  'Should  you  come  to  my  house  to 
deliver  tliem,  I  will  blow  your  brains  out.' 
But  may  I  not  reasonably  say  that  I  was  pre- 
Tcnted  from  completing  a  contract  by  being 
desired  not  to  complete  it?  Are  there  no 
means  of  preventing  an  act  from  being  done, 
except  by  physical  force  or  brute  violence?" 
After  reviewing  and  commenting  upon  cases 
cite<l,  it  is  then  held  that  the  plaintiffs  were 
entitled  to  a  verdict  "on  pleas  ti'aversing  al- 
legations that  he  was  ready  and  willing  to 
perform  the  contract,  that  the  defendant  re- 
fused to  accept  the  residue  of  the  goods,  and 
that  he  prevented  and  discharged  the  plain- 
tiff    from     manufactuLTing     and     delivering 

them." " 

Without  further  quotation  from  cases,  it 
seems  clear,  both  upon  principle  and  by  au- 
thority, that  where  one  party  to  an  executory 
contract  refuses  to  treat  it  as  subsisting  and 
binding  upon  him,  or,  by  his  act  and  conduct, 
shows  that  he  has  renomiced  it,  and  no  lon- 
ger considers  himself  bound  by  it,  there  is,  in 
legal  effect,  a  prevention  of  performauce_J)y 
the  other  partj.  And  it  can  make  no  differ- 
ence whether  the  contract  has  been  partially 
performed,  or  the  time  for  performance  has 
not  yet  arrived;  nor  is  it  important  whether 
the  renunciation  be  by  declaration  of  the 
pai'ty  that  he  will  be  no  longer  bound,  or  by 
acts  and  conduct  which  clearly  evince  that  the 
determination  has  been  reached,  and  is  being 
acted  upon.  It  would  seem  clear,  on  princi- 
ple, that  a  mere  declaration  of  the  party  of 
an  intention  not  to  be  bound,  or  acts  and  con- 
duct in  repudiation  of  the  contract,  will  not, 
of  themselves,  amount  to  a  breach,  so  as  to 
create  an  effectual  renunciation  of  the  con- 
tract; for  one  party  cannot,  by  any  act  or 
declaration,  destroy  the  binding  force  and  ef- 
ficacy of  the  contract  Kadish  v.  Young,  su- 
pi'a.  As  said  by  Bowen,  li.  J.,  in  Johnstone 
V.  Milling,  IG  Q.  B.  Div.  4G0:  "Its  real  opera- 
tion appears  to  be  to  give  the  promisee  the 
right  of  electing  either  to  treat  the  deelai-a- 
tion  as  brutum  fulraen,  and  holding  fast  to 
the  conti'act  to  wait  till  the  time  for  its  per- 
formance has  arrived,  or  to  act  upon  it,  and 
treat  it  as  a  final  assertion  by  the  promisor 
that  he  is  no  longer  bound  by  the  contract. 


and  a  wrongful  renunciation  of  the  contrae- 
tual  relation  into  which  he  has  entered.  •  •  • 
If  he  does  so  elect,  it  bec-omes  a  breach  of 
contract,  and  he  can  recover  uiwn  it  as  such." 
Upon  the  election  to  treat  the  renunciation, 
whether  by  declanitlon  or  by  acts  and  con- 
duct, as  a  breach  of  the  contract,  the  rights 
of  the  parties  are  to  be  regarded  as  then  cul- 
minating, and  the  contractual  relation  ceases 
to  exist,  except  for  purposes  of  maintaining 
the  action  for  the  recovery  of  damages. 

These  views  are  amply  sustained  by  nu- 
merous decided  cases.  In  Hochster  v.  De  La- 
tour,  20  Eng.  Law  &  Eq.  157,  the  plaintiff 
contracted  to  enter  into  the  service  of  the  de- 
fendant, as  a  courier,  and  in  such  capacity 
attend  him  in  travels  about  the  continent 
of  Europe,  the  service  to  begin  on  June  1st, 
and  to  continue  for  at  least  three  months, 
at  fixed  monthly  wages.  But  before  the  1st 
of  June,  although  the  plaintiff  was  ready  and 
willing  to  perform,  the  defendant  renounced 
the  contract,  and  signilii'd  his  determination 
to  the  plaintiff  no  longer  to  be  bound  by  it; 
and  the  plaintiff,  before  the  time  for  per- 
formance had  arrived,  brought  assumpsit  to 
recover  his  damages  for  the  breach.  It  is 
there  said:  "It  is  surely  much  more  rational, 
and  more  for  the  benefit  of  both  parties,  that 
after  the  renunciation  of  the  agreement  by 
the  defendant  the  plaintiff  should  be  at  lib- 
erty to  consider  himself  absolved  from  any 
future  performance  of  it,  retaining  his  right 
to  sue  for  any  damage  he  has  suffered  from 
the  breach  of  it.  *  •  •  The  man  who 
wrongfully  renounces  a  contract  into  which 
he  has  deliberately  entered  cannot  justly 
complain  if  he  is  immediately  sxied  for  a 
compensation  in  damages  by  the  man  whom 
he  has  injured;  and  it  seems  reasonable  to 
allow  an  option  to  the  injured  party  either  to 
sue  immediately,  or  to  wait  till  the  time  when 
the  act  was  to  hf>  done,  stilThoIfTTng  fE~Tis 
prospectively  binding  for  the  exercise  of  the 
option,  which  may  be  advantageous  to  the 
innocent  party,  and  cannot  be  prejudicial  to 
the  wrongdoer."  And  it  was  there  held  that, 
after  the  defendnnt  had  signified  his  deter- 
mination not  to  be  bound  by  the  contract. 
the  plaintiff  was  entitled  to  bring  his  action 
Immediately,  and  was  not  obliged  to  wait  un- 
til after  the  day  for  the  performance  to  begin 
had  arrived.  In  Frost  v.  Knight,  supra,  the 
defendant  had  promised  to  marry  the  plain- 
tiff upon  the  death  of  his  father.  While  his 
father  was  still  living,  he  repudiated  the  en- 
gagement, and  announced  his  intention  not 
to  fulfill  his  promise.  The  plaintiff,  without 
waiting  for  the  death  of  the  father,  at  once 
brought  her  action  to  recover  damages  for 
the  breach.  And  the  court  there  say:  "The 
promisee,  if  he  pleases,  may  treat  the  notice 
of  intention  as  inoperative,  and  await  the 
time  when  the  contract  was  to  be  executed, 
and  then  hold  the  other  party  responsible  for 
all  the  consequences  of  nonperformance. 
But  in  that  case  he  keeps  the  contract  alive 
for  the  benefit  of  the  other  party  as  well  as 


688 


DISCHARGE  OF  CONTRACT. 


his  own;  he  remains  subject  to  all  his  own 
obligations  and  liabilities  under  it,  and  en- 
ables the  other  party,  not  only  to  complete 
the  contract,  if  so  advised,  notwithstanding 
his  previous  repudiation  of  it,  but  also  to 
take  advantage  of  any  supervening  circum- 
stance which  would  justify  him  in  declining 
to  complete  it  On  the  other  hand,  the  prom- 
isee may,  if  he  thinks  proper,  treat  the  repu- 
diation of  the  other  party  as  a  wrongful  put- 
ting an  end  to  the  contract,  and  may  at  once 
bring  his  action  as  on  a  breach  of  it;  and  in 
such  action  he  will  be  entitled  to  such-  dam- 
ages as  would  have  arisen  from  the  nonper- 
formance of  the  contract  at  the  appointed 
time,  subject,  however,  to  abatement  in  re- 
spect of  any  circumstances  which  may  have 
afforded  him  the  means  of  mitigating  his 
loss."  The  case  of  Freeth  v.  Burr,  supra,  al- 
ready quoted  from,  is  an  instructive  case, 
and  fully  sustains  Hochster  v.  De  Latour, 
and  other  cases  of  like  tenor  before  cited.  It 
is  there  said  that  the  test  of  whether  there  is 
a  renimciation  or  not  is  "whether  the  acts 
and  conduct  of  the  party  evince  an  intention 
no  longer  to  be  bound  by  the  contract."  In 
Iron  Co.  V.  Naylor,  9  Q.  B.  Div.  648,  Jessel, 
M.  R.,  reaffirms  and  approves  the  doctrine  of 
Freeth  v.  Burr,  and  holds  that  the  question 
of  whether  there  has  been  a  renimciation  of 
the  contract  by  the  defendant  is  a  question 
of  fact,  to  be  determined  by  the  considera- 
tion of  the  nature  of  the  breach,  and  the  cir- 
cumstances under  which  it  occurred.  The 
case,  however,  went  off  upon  the  holding  that 
the  circumstances  were  not  sufficient  to 
evince  a  determination  on  the  part  of  the  de- 
fendant to  put  an  end  to  the  contract,  and  to 
be  no  longer  bound  by  it  The  decision  was 
affirmed  by  the  house  of  lords  on  appeal, 
Ix>rd  Selborne  there  saying:  "You  must 
look  at  the  actual  circumstances  of  the  case, 
in  order  to  see  whether  the  one  party  to  the 
contract  is  relieved  from  its  future  perfoi-m- 
ance  by  the  conduct  of  the  other.  You  must 
examine  what  that  conduct  is,  so  as  to,  see 
whether  it  amounts  to  a  renunciation, — to  an 
absolute  refusal  to  perform  the  contract- 
such  as  would  amount  to  a  rescission  if  he 
had  the  power  to  rescind,  and  whether  the 
other  party  may  accept  it  as  a  reason  for  not 
performing  his  part;  and  I  think  that  noth- 
ing more  is  necessary,  in  the  present  case, 
than  to  look  at  the  conduct  of  the  parties, 
and  see  whether  anything  of  that  kind  has 
taken  place  here."  Iron  Go.  v.  Naylor,  L.  R. 
9  App.  Cas.4.38.  See,  also.  Roper  v.  Johnston, 
L.  R.  8  C.  P.  167;  Ex  parte  Stapleton,  10  Ch. 
Div.  586;  Planche  v.  Colbum,  8  Bing.  14; 
Railway  Co.  v.  Xenos,  13  C.  B.  (N.  S.)  82.5. 

The  principle  seems  to  have  found  general 
recognition  by  the  courts  of  the  country,  a 
few  only  of  which  need  be  noticed.  In  Mas- 
terton  v.  Mayor,  etc.,  7  Hill,  61,  the  plain- 
tiffs undertook  and  partially  performed  their 
contract  with  defendants  to  furnish  mate- 
rial, etc,  for  the  construction  of  the  city 
hall.     By  order  of  the  defendants,  the  work 


was  indefinitely  suspended,  and  the  plaintiffs 
brought  suit  to  recover  damages,  including 
future  profits.     The  principle  announced  in 
the  English  cases  before  noted  is  approved. 
Beardsley,  J.,  there  said:     "The  party  who 
is_ready_lQ_peiiorm   is  entitled  to  full   in- 
demnity f OJLJthe  loss  of  his  contract      He 
should    not    be   made__to_  snuffer   by   the    de- 
linquency of  the  oUier  party,  but  ought  to 
recover ..precisely-wlLa±he_would  Ijave  made 
byjperiormance.     This  is  as  sound  in  morals 
as  it  is  in  law.    *    •    *    The  plaintiffs  were 
not  bound  to  wait  till  the  period  had  elapsed 
for  the  complete  performance  of  the  agree- 
ment nor  to  make  successive  offers  of  per- 
formance, in  order  to  recover  all  their  dam- 
ages.    They   might  regard  the  contract  as 
broken  up,  so  far  as  to  absolve  them  from 
making  further  efforts  to  perform,  and  give 
them  a  rigLV:  to  recover  full  damages  as  for 
a   total   breach."     The   case   of   Hosmer   v. 
Wilson  has  been  already  cited.     In  Derby  v. 
Johnson,   supra,  after  holding  that  by  the 
order  of  the  defendants  to  discontinue  the 
work,  the  plaintiffs  were  prevented  from  fur- 
ther performance,  it  is  said:    "The  plaintiffs 
might,  in  addition,  in  another  form  of  ac- 
tion, have  recovered  their  damages  for  being 
prevented  from  completing  the  whole  work. 
In  making  these  claims  the  plaintiffs  would 
be  acting  upon  the  contract  as  still  subsist- 
ing and  binding,  and  they  might  well  do  so, 
for  it  doubtless  continued  binding  on  the  de- 
fendants."   In  Hinckley  v.  Pittsburgh  Steel 
Co.,  121  U.  S.  264,  7  Sup.  Ct  875,  the  defend^ 
ant  agreed  to  purchase   from   the   plaintiff 
steel  rails,   to  be  drilled  as   the   defendant 
might    direct     The    defendant    refused    to 
give  the  directions,  and  at  his  instance  the 
rolling  of  the  rails  was  postponed  until  after 
the  time  of  delivery,  when  the  defendant  re- 
fused to  accept  any  rails  under  the  contract 
It   was    there   said:      "The   defendant  con- 
tends that  the  plaintiff  should  have  manu- 
factured the  rails,  and  tendered  them  to  the 
defendant,  and,  upon  his  refusal  to  accept 
and  pay  for  them,  should  have  sold  them  in 
the  market  at  Chicago,  and  held  the  defend- 
ant responsible  for  the  difference  between 
what  they  would  have  brought  on  such  sale 
and  the   contract  price.     But   we  think   no 
such  rule  is   applicable  to  this  case.     This 
was  a  contract  for  the  manufacture  of  an 
article,  and  not  for  the  sale  of  an  existing 
article.     By  reason  of  the  facts  found  as  to 
the  conduct  and  action  of  the  defendant  the 
plaintiff  was  excused   from  actually  manu- 
facturing the  rails,  and  the  rule  of  damage 
applicable  to  the  case  of  the  refusal  of  a  pur- 
chaser to  take  an  existing  article  is  not  ap- 
plicable   to    a    case   like    the   present."     In 
Haines  v.  Tucker,  50  N.  H.  307,  the  defend- 
ants  agreed    to   purchase    of    the   plaintiffs 
5,000  bushels  of  malt,   and  to  receive  and 
pay  for  the  same  at  the  i-ate  of  1,000  bush- 
els per  month.    Although  plaintiffs  were  pre- 
pared to  deliver  the  1,000  bushels  per  month, 
the  defendants  called  for  and  received  less 


BREACH— RENUNCIATION. 


589 


tlian  1,000  bushels  during  the  firet  three 
months.  The  plaintifis  informed  defendants 
that  they  were  prepared  to  furnish  the  malt 
according  to  the  terms  of  the  contract,  and 
requested  them  to  receive  the  same  at  the 
rate  of  1,000  bushels  per  month,  which  the 
defendants  refused  to  do.  The  undelivered 
malt,  not  utilized  by  plaintiffs  themselves, 
was  sold  on  the  market,  and  plaintiffs 
brought  assumpsit  against  the  defendants  to 
lecover  damages  for  a  breach  of  the  con- 
tract And  it  was  tliere  held— following 
Cort  V.  Railway  Co.,  supra,  and  oUier  cases 
— tliat  the  conduct  of  the  defendants 
amounted  to  an  unqualified  renunciation  of 
the  contract,  and  that  after  such  renuncia- 
tion it  was  no  longer  neces^:^■y  that  the 
plaintiffs  should  hold  theuiselves  in  readi- 
ness to  perform,  or  to  go  to  the  trouble  and 

•  expense  of  offering  what  had  already  been 
refused-  In  Smith  v.  Lewis,  21  Conn.  C24, 
the  doctrine  as  announced  in  Cort  v.  Rail- 
.  way  Co.  was  approved  and  followed,  and 
again  reaffirmed  in  the  same  case.  2G  Conn. 
110.  In  these  cases  the  holding  was  that, 
under  a  conti-act  containing  mutual  and_dc- 
pendent_coveuants^  refusal  on  the  part^  of 
"the  defendant  to  p^erform  obviated  the  ne- 
cessity of  performance,  or  tencler  of  per- 
formance, on  the j)art  of  the  pLaiutiff,  after 
stich  refusal.  See,  also,  U.  S.  v.  Behan,  su- 
pra; Crabtree  v.  Messorsmith,  19  Iowa,  179; 
Ilolloway  v.  Griffith,  32  Iowa,  409;  Dugau 
V.  Anderson,  3G  Md.  5G7;  Burtis  v.  Thomp- 
son, 42  N.  Y.  24G;  Howard  v.  Daly,  61  N.  Y. 
."G2;  Smoot's  Case,  15  Wall.  3G;  Dingley  v. 
Oler,  117  U.  S.  503,  6  Sup.  Ct  850;  Mount- 
joy  V.  Metzger  (Pa,  St)  12  Am,  Law  Reg. 
2?ft  S.)  442. 

^'^  It  follows  that  upon  principle  and  au- 
I'tthority,  we  are  of  opinion  that  insti-uctious 
1/2  and  3,  when  considered  together,  as  they 
^/^must  be,  announced  the  law  to  the  jury  cor- 
^ '  fectly.  The  objection  that  the  jury  were 
'^j  thereby  left  to  determine  what  were  the 
"substantial  provisions  of  the  contract"  is, 
in  view  of  the  coui-se  of  the  trial  and  facts 
proved,  obviated  by  the  instructions  7,  12, 
13,  16,  and  17,  given  for  appellant  By  the 
seventh,  as  will  be  observed,  the  jury  were 
told  that,  if  the  defendant  committed  bi-each- 
es,  still,  if  they  did  not  defeat  the  substan- 
tial objects  of  the  contract  or  render  it 
unattainable  by  proper  performance  on  the 
part  of  Richards,  ^Nlaynard  &  Co.,  then  the 
plaintiff  could  not  recover.  By  the  12th  they 
were  told  that  the  mere  failure  or  refusal 
of  the  defendant  to  pay  the  plaintiff  or  his 
firm  any  sum  of  money  demanded  and 
claimed  to  be  due  on  account  of  services  ren- 
dered under  the  contract  could  not  be  con- 
strued as  an  abandonment  of  the  conti-act 
by  the  defendant  such  as  would  entitle  the 
plaintiff  or  his  firm  to  maintain  the  present 
action.  By  the  sixteenth  the  jury  were  told, 
as  a  matter  of  law,  that  to  entitle  tbe  plain- 
tilf  to  recover  in  this  case,  it  was  necessary 
for  him  to  establish,  by  a  preponderance  of 


the  evidence,  that  he  and  Richards,  May- 
nard  &  Co.  were,  by  tlie  acts  of  the  defend- 
ant, prevented  from  performance  of  said  con- 
tract on  their  part  cic  By  the  seventeenth  . 
they  are  again  told  that  a  failure  to  pay 
money  due  and  owing  to  the  plaintiff  under 
the  contract  was  not  such  an  act  or  omis- 
sion. In  itself,  on  tho  part  of  the  defendant 
as  would  prevent  the  plaintiff  from  complet- 
ing the  contract  And  by  the  thirteenth  In- 
struction given  on  behalf  of  the  defendant 
the  jury  were  told  that  if  they  believe  from 
the  evidence  that  the  plaintiff's  firm  closed 
their  transfer  house  for  tho  reasons  stated 
in  their  letter  of  June  11,  ISSG,  to  Mr.  Anjs- 
den,  namely,  for  refusal  to  pay  their  claim 
of  ?2,.592.95,  and  their  account  for  the  month 
of  May,  ISSG,  "and  for  no  other  reason,"  then 
the  plaintiff  could  not  recover,  and  the  ver- 
dict must  be  for  defendant  So,  by  the 
eleventh  instruction  given  on  behalf  of  de- 
fendant, the  jury  were  told  that  In  deter- 
mining whether  the  damages  arising  from 
any  breach  of  the  contract  by  the  defendant 
can  be  ascertained  and  compensated  for, 
they  were  not  to  take  into  coniiideration  any 
refusal  of  the  defendant  to  submit  any  dif- 
ferences between  it  and  Richards,  Maynard 
&  Co.  to  arbitration;  that  the  refusal  to  sub- 
mit matters  in  dispute  to  arbitration  was  not 
such  a  breach  of  the  terms  of  the  contract 
as  to  warrant  a  recovery  for  such  breach. 
It  seems  clear,  therefore,  under  the  facts 
proved,  that  the  question  submitted  to  the 
jury  was  whether  the  acts  and  conduct  of 
the  defendant  showed  a  fixed  determination 
to  be  no  longer  bound  by  the  substantial  pro- 
visions of  the  contract  upon  its  part.  As. al- 
ready seen,  the  consideration  moving  to  Rich- 
ards, Maynard  &  Co.  for  entering  into  the 
contract  was  the  stipulation,  on  defendant's 
behalf,  to  deliver,  to  be  weighed  and  trans- 
ferred through  their  house,  all  grain  re- 
ceived by  it  from  western  roads,  to  be  trans- 
ported east  over  its  lines,  that  it  could  con- 
trol; that  pi-actieally  the  only  benefit  to  be 
derived  by  Richards,  Maynard  &  Co.  from 
the  contract  was  by  the  sale  of  weights  of 
grain  thus  transferred.  The  evidence  tend- 
ed to  show  that  the  railroad  company  had 
repudiated  its  liability  to  perform  this  part 
of  its  contract,  and  its  duty,  under  the  con- 
tract to  use  tlie  weights  derived  from  the 
plaintiff's  firm  only  in  billing  the  grain  to 
destination,  but  gave  the  same  away,  so  as 
to  deprive  plaintiff's  fii-m  of  the  profits  it 
would  derive  by  the  sale  of  such  weights. 

From  what  has  preceded,  no  extended  dis- 
cussion will  be  necessary  of  tlie  point  made, 
that  there  was  a  variance  between  the  spe- 
cial count  of  the  declaration  and  proof.  It 
w;is  alleged  "that  on  the  IGth  day  of  June, 
1SS6,  the  defendant  abandoned  the  contract 
on  its  part,  neglected  and  refused  to  per- 
form the  same,  and  refused,  witbout  any 
reasonable  or  just  cause,  to  be  bound  by  the 
same,"  etc.  As  already  shown,  the  effect  of 
the  position  taken  by,  and  the  conduct  of. 


590 


DISCHAIIGE  or  CONTRACT. 


appellant,  was  a  denial  of  its  obligation  to 
perform  the  substantial  parts  of  tlie  con- 
tract on  its  part 

In  connection  with  this  point,  it  will  be 
proper  to  notice  the  contention  that  in  the  i 
suit  brought  June  5,  ISSG,  before  referred 
to,  the  plaintiff  recovered  damages  for  all 
the  breaches  of  the  contract  up  to  the  bring- 
ing of  that  suit,  and  that,  therefore,  such 
breaches,  being  merged  in  the  judgment  in 
that  cause,  could  not  subsequently  be  made 
the  occasion,  by  Richards,  jNlaynard  «&:  Co., 
for  treating  the  contract  as  abandoned  by 
appellant  In  bringing  that  suit,  the  plain- 
tiff undoubtedly  treated  the  contract  as  sub- 
sisting, and  had  not  then  elected  to  treat  it 
as  abandoned  by  the  defendant,  and  to  sue 
for  prospective  damages.  The  suit  was 
brought  and  recovery  had  for  actual  breach- 
es to  the  time  of  bringing  it  We  are  not 
required  to  determine  the  question  thus  pre- 
sented. If  It  should  be  conceded  that  the 
plaintiff's  claim  in  bringing  that  action  is 
inconsistent  with  his  right  to  show  such 
breaches  in  this  proceeding,  it  could  not  af- 
fect the  result  Subsequent  to  the  bringing 
of  that  action,  as  already  shown,  the  rail- 
road company  refused  to  recede  from  its 
previous  position,  both  in  respect  of  its  obli- 
gation under  the  contract  to  deliver  cars  to 
Richards,  Maynard  &  Co.,  and  to  observe  its 
contract  in  respect  of  the  use  to  be  made 
of  the  weights.  And  the  evidence  tends  to 
show  that  at  the  time  Richards,  Maynard 
&  Co.  closed  their  transfer  house,  appellant 
was  denying  its  liability  under  the  contract 
and  evinced  a  clear  intention  not  to  be  bound 
by  its  provisions. 

It  is  urged,  however,  that  there  was  here 
only  a  partial  breach,  arising  from  a  differ- 
ence In  the  construction  of  the  contract  and 
that  there  was  at  no  time  a  repudiation  or 
renunciation  of  the  contra<;t  by  appellant; 
that  they  were  at  all  times  desirous  of  keei)- 
Ing  it  in  force,  and  performing  it  These 
are,  as  a  matter  of  course,  questions  of  fact 
which  are  conclusively  settled  by  the  judg- 
ment of  the  appellate  court  But  in  view  of 
the  instructions  aslied  and  refused,  which 
sought  to  take  the  case  from  the  jury,  it 
may  be  remarked  that  the  evidence  tended 
to  show  a  repudiation  by  the  railway  com- 
pany of  the  substantial  provisions  of  the 
contract  which  formed  the  consideration  for 
the  execution  of  it  by  plaintiff's  firm.  It 
was  not  enough,  to  show  that  there  was 
no  repudiation  of  the  contract  obligation  of 
the  plaintiff,  to  prove  tliat  appellant  was 
furnishing  some  cars  to  be  transfeiTed 
through  plaintiff's  transfer  house,  whereby 
plaintiff  was  partially  receiving  the  benefits 
he  claimed  under  the  contract  The  cor- 
respondence between  the  parties  before  and 
after  the  5th  of  June,  ISSfJ,  shows  that  appel- 
lant was  not  delivering  cars  of  grain  to  be 
transferred  through  the  transfer  house  be- 
cause it  recognized  any  obligation  on  its 
part  to  do  so,  but  claimed,  and  acted  on  such 


claim,  that  it  was  only  bound  to  deliver  such 
cars  as  it  saw  proper.  In  other  words,  it 
refused  to  be  boimd  Dy  the  provision  of  the 
contract  requiring  it  to  deliver  cars  to  plain- 
tiff's firm.  Under  the  construction  of  the 
contract  upon  which  it  had  acted,  and  was 
proposing  to  continue  to  act  it  was  under 
no  obligation  to  deliver  any  cars  to  be  trans- 
ferred by  plaintiff's  firm,  thus  absolutely 
repudiating  its  contract  liability  to  do  so. 
True,  it  had  not  altogether  ceased  to  dehver 
some  cars  to  be  thus  transfeiTed,  but  they 
were  not  delivered  because  of  any  contract 
liability  to  do  it  but  at  their  convenience 
and  option.  Its  persistence  in  this  couree 
of  conduct  had  been  shown  by  its  repeated 
refusal  to  submit  the  matters  in  dispute  to 
arbiti-ation  imder  the  contract  The  presi- 
dent of  the  company  wrote,  in  reply  to  the 
demand  of  plaintiff's  firm  for  arbitration,  "I 
have  to  say  tbat  this  company  having  jt  all 
times  faithfully  performed  its  obligations 
under  said  contract,  I  do  not  consider  there 
are  any  matters  calling  for  arbitration,"  and 
declining  the  request  for  arbitration.  While 
It  is  imdoubtedly  true  that  refusal  to  arbi- 
trate would  not  under  the  provisions  of  this 
contract,  justify  the  plaintiff  in  treating  the 
contract  as  renounced  by  appellant  company, 
yet  such  refusal,  and  the  correspondence  in 
respect  of  the  matter,  tend  to  show  the 
persistency  with  which  appellant  refused  to 
be  bound  by  the  contract 

It  is  also  objected  that  the  court  erred  In 
the  admission  of  testimony:  Fii-st  that  ap- 
pellee was  permitted  to  prove  the  cost  of 
the  transfer  house,  etc  It  is  a  sufficient  an- 
swer to  say  that  it  does  not  appear  the  evi- 
dence was  objected  to.  It  is,  however,  said 
that  the  coiu-t  erred  in  refusing  to  give  the 
fifth  instruction  for  appellant,  which  was, 
in  effect  tliat  no  recovery  could  be  had  for 
the  cost  or  value  of  the  transfer  house  and 
its  equipments  in  this  action.  This  instruc- 
tion might  with  propriety  have  been  given, 
but  its  refusal  was  not  error.  At  the  be- 
ginning of  the  healing  before  the  jury,  coun- 
sel for  the  plaintiff  stated  that  he  did  not 
attempt  to  show  the  breaches  for  the  purpose 
of  recovering  for  them,  but  proved  them  for 
thepurpose  of  showing  simplya  breachof  the 
contract,  which  entitled  the  plaintiff  to  aban- 
don the  further  performance  of  it  and  sue 
for  damages  for  loss  of  future  profits,  when 
the  following  colloquy  occurred:  Mr,  Jew- 
ett  (for  defendant):  "In  other  words,  there 
is  nothing  but  the  claim  for  future  profits  in 
this  case."  Mr.  Pence  (for  plaintiff):  "That 
is  all  there  is  in  this  case."  Later,  and  at 
the  close  of  plaintiff's  testimony,  the  plaintiff 
sought  to  show  what  the  transfer  house  was 
worth,  "standing  tliere,  useless  for  the  pur- 
pose for  which  it  had  been  erected,"  to 
which  an  objection  by  the  defendant  was 
sustained.  This  all  took  place  in  the  pres- 
ence of  the  jm*y.  and  would  leave  no  ques- 
tion in  the  mind  of  any  Intelligent  per- 
son as  to  the  damages  sought  and  allowed  to 


BREACH— RENUNCIATION. 


591 


be  lecovered.  It  seems  clear  that  the  jury 
could  not  have  understood  that  they  were 
to  take  anything  into  consideration  other 
than  the  profits  to  be  derived  from  the  trans- 
fer of  grain  under  the  contract,  and  they 
were  in  effect  so  told  by  the  fourth  instruc- 
tion given  at  tlie  instance  of  plaintiff. 

On  the  trial  of  the  cause,  certain  letters 
written,  one  by  Mr.  Blodgett  and  one  by  Mr. 
Clark,  commendatory  of  plaintiff's  method  of 
transferring  grain,  etc.,  were  offered  and 
reati  in  evidence  over  the  objection  of  defend- 
ant. That  these  letters  were  incompetent 
scfircely  admits  of  question,  and  it  is  diflieult 
to  DfL-e^ve  upon   what  principle  they   were 


admitted.  That  the  error  was  a  harmless 
one  Is  equally  apparent  It  was  not  contro- 
verted that  the  "Itichards  Method,"  so  call- 
ed, accomplLshefl  the  purpose,  nor  was  there 
any  pretense  that  it  was  a  failure,  so  that 
the  plaintiffs  did  not  p'-rform  tlieir  contiacL 
Other  points  are  made  In  argument,  which, 
in  view  of  the  length  of  this  opinion,  seeming- 
ly made  neces.sary  by  the  very  Ingenious  ar- 
gumout  of  the  learned  counsel,  it  must  suffice 
to  say,  have  been  carefully  con.sidered,  and 
are  not  deemed  of  such  gravity  as  to  warrant 
further  discussion.  Finding  no  prejudicial  er- 
ror In  tliis  record,  the  judgment  of  the  appel- 
late court  will  be  allirmed.     AfiirmeU. 


6 


592 


DISCHARGE  OF  CONTRACT. 


NEWCOMB  V.   BRACKETT.  ^ 

(16  Mass.  161.)  'V' 

Supreme  Judicial    Court   of   Massachusetts, 
Norfolk.    1819. 

The  declaration  was  in  case,  "for  that  the 
said  B.  at,  &c.  on  the  8th  of  August,  1808, 
by  his  memorandum  in  writing  of  that  date; 
by  him  subscribed,  acknowledged  that  he 
had  then  and  there  received  of  the  plaintiff 
a  bill  of  sale  of  one  half  of  the  sloop  Union 
and  her  apparel,  the  consideration  whereof 
the  said  B.  then  and  there  acknowledged  in 
writing  under  his  hand  to  be  200  dollars; 
which  sum  the  said  B.  then  and  there,  in 
said  memorandum  by  him  subscribed,  prom- 
ised the  plaintiff  to  account  to  him  for^jn 
a  transfer  of  a  deed  which  the  said  B.  then 
held  against  one  Jackson  Field's  -estate,  ,aa. 
soon  as  the^Iainfiff^hould  pay  said  B.  the 
residue  of  a~^debt  to  him,~~wHchZsEouIdr  noT" 
exceed  100  dollars^  5nd  the  plaintiff  ^rerS 
that  the  transfer  of  a  deed  against  said  J. 
Field's  estate,  mentioned  in  said  memoran- 
dum, was  to  be  a  transfer,  assignment  and 
conveyance  of  the  land,  described  in  a  cer- 
tain deed  made  to  said  B.  by  one  J.  Field, 
which  land  the  said  B.  then  and  there  prom- 
ised to  convey  to  the  plaintiff.  And  the 
plaintiff  further  avers  that  the  said  B.  on 
the  19th  of  April,  1810,  by  his  deed  of  re- 
lease and  quitclaim,  by  him  duly  executed, 
did  release  and  qtiitclaim  to  one  J.  N.  Arnold 
all  the  right,  title  and  interest,  which  he  the 
said  B.  then  had  to  a  certain  real  estate  de- 
scribed  in  said  deed,  which  said  real  estate 
was  the  same  of  which  the  said  BTtljen  held 
a  deed  from  said  J.  Field,  and  of  wljifliTbe 
said  B.  was  then  in  possession,  and  which 
he  had  in  and  by  said  memorandum  engaged 
to  transfer  to  the  plaintiff;  and  upon  which 
transfer  he  had  engaged  to  account  for  said 
200  dollars.  And  the  plaintiff  further  avers, 
that  the  said  B.  had  not  before  said  19th  of 
April  accounted  to  the  plaintiff  for  said  200 
dollars,  in  a  transfer  of  a  deed  held  by  him, 
the  said  B.,  against  said  J.  Field's  estate. 
And  the  plaintiff  further  says,  that  the  said 
B.,  by  his  deed  aforesaid  made  to  said  J.  N. 
Arnold,  has  broken  his  promise  aforesaid, 
and  become  unable  to  perform  the  same,  ac- 
cording to  the  terms  thereof.  To  the  dam- 
age, &c." 

The  defendant  demurred  to  this  declara- 
tion, and  assigned  the  following  causes  of 
demurrer. 

1.  That  the  plaintiff  hath  not  alleged  or 
shown,  that  he  has  ever  paid  or  tendered 
to  the  defendant  the  residue  of  said  debt, 
mentioned  in  the  declaration. 

2.  That  he  has  not  alleged  or  shown,  that 
he  has  paid  or  offered  to  pay  to  the  defend- 
ant the  sum  of  100  dollars,  mentioned  in 
the  declaration. 

3.  That  he  has  not  alleged  or  shown,  that 
he  ever  requested  the  defendant  to  transfer 
to  him  the  deed  which  the  defendant  held 
against  J.  Field's  estate,  or  to  assign  and 


transfer  to  him   the  land  mentioned  in  the 
declaration. 
The  demurrer  was  joined  by  the  plaintiff. 

Mr.  Loud,  for  the  defendant.  The  under- 
taking of  the  defendant,  as  it  is  stated  in 
the  declaration,  should  receive  the  same  con- 
struction, as  it  would  have,  if  the  sale  of 
the  sloop  by  the  plaintiff  had  been  executory, 
and  had  been  written  thus:  "In  considera- 
tion that  J.  Newcomb  has  agreed  to  execute 
a  bill  of  sale  of  one  half  of  the  sloop,  &c., 
the  value  of  which  is  200  dollars,  I  promise 
to  account  for  the  same  in  the  transfer  of  a 
deed,  «S:c.  as  soon  as,"  «&c.  It  was  a  part  of 
the  same  transaction,  executed  at  the  same 
time,  and  given  in  consideration  of  the  de- 
fendant's promise  to  convey  the  land.  The 
plaintiff  was  to  convey  the  sloop,  and  to  pay 
100  dollars;  and  when  he  had  done  both, 
the  defendant  was  to  give  a  deed  of  the  land 
spoken  of. 

If  the  plaintiff  can  recover  in  the  present 
action,  he  must  do  so,  either  upon  the 
ground  of  the  contract's^  being  rescinded,  or 
Because  ne  has  performed  all  the  precedent 
condrtions  orfhis  ^artTTo^ entitle  himself  to 
damages;,  and"  we  contend  that  he  cannot 
recover  on  either  ground.  Not  on  that  of 
the  contract's  being  rescinded;  because  he 
declares  only  upon  the  special  agreement, 
and  admits  it  to  be  open.  He  claims,  not 
the  value  of  the  sloop,  as  so  much  money 
paid,  but  general  damages;  the  rule  of  which 
would  probably  be  the  value  of  the  land,  at 
the  time  it  was  conveyed  to  Arnold,  or  at 
the  time  of  bringing  his  action.  Assumpsit 
for  money  had  and  received  is  the  usual  ac- 
tion to  recover  monej'  paid  by  the  plaintiff, 
in  pursuance  of  a  contract  which  has  failed; 
as  where  either  of  the  parties  had  a  right 
to  consider  the  contract  rescinded  by  the 
terms  of  it,  or  where  the  plaintiff  is  pre- 
vented by  the  defendant  from  performing 
some  antecedent  condition.  No  case  is  rec- 
ollected, in  which  an  action  upon  the  special 
agreement  has  been  brought,  to  recover  back 
money  so  paid,  or  the  value  of  any  goods 
sold  and  delivered,  unless  upon  the  notion 
of  fraud  practised  by  the  purchaser. 

Another  reason,  why  the  contract  cannot 
be  considered  as  rescinded,  is  that  the  par- 
ties cannot  be  put  in  statu  quo.  It  was  a 
barter  transaction.  The  sloop  sold  to  the 
defendant  was  not  money  paid.  The  plain- 
tiff' then  has  performed  a  part  of  the  con- 
tract. 

If  the  contract  is  to  be  considered  as  still 
open,  the  action  can  be  no  better  supported. 
The  payment  of  the  100  dollars  is  a  condi- 
tion precedent  on  the  part  of  the  plaintiff, 
and  that  too  upon  which  the  defendant  as- 
sumed to  convey  the  land.  If  the  defendant 
had  not  subsequently  conveyed  the  same  land 
to  Arnold,  there  could  be  no  pretence  for  an 
action  by  the  plaintiff,  before  payment  or  ten- 
derof  thelOO  dollars.  It  is  difficult  to  perceive 
why  that  conveyance  should  alter  the  case. 


BREACH— IMPOSSIBILITY  CAUSED  BY  PARTY. 


593 


The  misfeasance  of  the  defendant  cannot  ex- 
cuse the  plaintiff  from  performing  the  whole 
of  a  condition  precedent,  of  which  he  has 
performed  a  part;  and  it  certainly  ouglit  not 
to  have  that  effect  here,  where  the  plaintiff 
has  lain  by  until  the  dofend^int  has  lost  any 
other  remedy  for  the  recovery  of  the  money, 
by  lapse  of  time. 

This  is  not  like  that  class  of  cases,  which 
contain  mutual  covenants,  and  in  which  it  is 
held  that  the  plaintiff,  after  having  perform- 
ed the  gist  of  the  consideration  on  his  part, 
may  maintain  an  action  against  the  defend- 
ant for  non-performance  on  his  part;  upon 
the  ground  that  the  latter  has  his  remedy 
against  the  plaintiff,  for  neglect  of  any  col- 
lateral stipulations.  This  is  the  conditional 
promise  of  the  defendant  alone. 

If  the  plaintiff,  on  the  contrary,  has  sus- 
tained any  loss,  it  has  always  been  and  stiU 
is  in  his  power,  by  paying  the  100  dollars, 
to  compel  the  defendant  to  execute  a  good 
conveyance  of  the  land,  or  to  answer  in 
damages  for  its  value. 

Mr.   Metcalf,  for  plaintiff. 

PARKER,  0.  J.  The  contract  set  forth  in 
the  declaration  Is  substantially,  that  in  con- 
sideration of  the  value  of  a  sloop  sold  by  the 
plaintiff  to  the  defendant,  estimated  at  200 
dollars,  the  defendant  would,  upon  payment 
of  100  dollars  by  the  plaintiff,  which  was 
due  to  the  defendant  from  one  Field,  and 
to  secure  which  he  had  taken  a  deed  of 
Field's  estate,  convey  said  estate  to  the 
plaintiff;  and  the  breach  of  the  contract  al- 
leged is,  that  the  defendant  had  disabled 
himself  from  performing  the  contract,  by 
conveying  the  same  estate  to  another  per- 
son. 

The  declaration  Is  demurred  to,  and  the 
objection  to  It  is,  that  the  plaintiff  had  nei- 
ther paid,  nor  offered  to  pay,  the  debt  of 
Field  to  the  defendant;  and  therefore  has  no 
title  to  the  action- 
No  time  Is  fixed  in  the  contract,  within 
which  the  money  was  to  be  paid,  or  the  es- 
tate conveyed  to  the  plaintiff.  The  plaintiff 
then  had  a  reasonable  time,  by  virtue  of  the 
contract,  to  perform  his  part  of  it;  and  the 
defendant  might  have  hastened  him,  by  ten- 
dering the  deed,  and  demanding  the  money 
which  the  plaintiff  had  assumed  to  pay. 

HOPK.  SEL.  CAS.  CONT.  — 38 


It  is  Implied  in  the  contract,  on  the  part  of 
the  defendant,  that  he  would  do  nothing  by 
which  he  should  become  unable  to  perform 
It;    and  by  making  a  deed  to  another  per- 
,son,  he  has  di.sablcd  himself,  and  so  virtual- 
|ly  broken  his  contract.     It  being  impossible 
for  him,  after  having  thus  done,  to  account 
/for  the  'KM)  dollars  in  the  land,  as  he  under- 
I  took,  there  is  a  breach  of  his  contract,   for 
I  which    proper   damages   may   be    recovered., 
The  law  will  not,  in  such  circumstances,  re- 
quire a  payment  or  tender  by  the  plaintiff; 
for  this  would  be  to  hazard  an   additional 
loss,  without  any  possible  advantage. 

This  opinion  is  supported  by  several  de- 
cided cases,  which  are  collected  by  Mr.  Met- 
calf in  a  note  to  the  case  of  Raynay  v.  Alex- 
ander, In  his  valualjle  edition  of  Yelverton's 
Reports  (page  7G).  The  case  in  the  text  is— 
The  plaintiff  declared  upon  a  promise  to  de- 
liver, on  a  particular  day,  fifteen  out  of  sev- 
enteen tods  of  wool,  to  be  chosen  by  the 
plaintiff,  upon  payment  of  £G,  and  averred 
that  he  was  ready  to  pay  the  £G  on  the  day; 
yet  the  defendant  had  not  delivered  the 
wool.  Verdict  for  plaintiff— and  judgment 
arrested,  because  not  averred  tbat  the  plain- 
tiff had  chosen  the  fifteen  tods  out  of  the 
seventeen;  which  was  a  condition  precedent. 
But  Popham,  C.  J.,  said,  if  the  defendant 
had  sold  one  of  the  tods  of  wool  before  the 
election  made  by  the  plaintiff,  that  had  de- 
stroyed the  election  and  made  the  promise 
absolute,  and  had  been  a  breach  of  it.  The 
same  law,  If  the  defendant  would  not  have 
permitted  the  plaintiff  to  see  the  wool,  that 
he  might  make  election;  for  that  had  ex- 
cused the  act  to  be  done  by  the  plaintiff, 
and  had  been  a  default  by  the  defendant. 

The  law  is  well  summed  up  by  Mr.  Metcalf 
In  his  note:  "When  the  consideratioiLQ^  the 
contract  Is^,executory,  oTTts^efformanc^ili^ 
pends  upon  some  act  to  l)e~doni~or  forborne 
by  fhe_glaintiff,  or_onsome_other^ event.  The 
plalntiffmust  aver  performj^c^Iof  siich^re- 
cedent  condition,  or  show  some  excuse  for 
the  non-performance."  ~ —        "- 

The  declaration,  in  the  case  at  bar,  shows 
that  the  defendant  had  conveyed  to  a  stran- 
ger the  land,  which  he  promised  to  convey 
to  the  plaintiff.  This  excuses  the  plaintiff 
from  tendering  the  money,  and  entitles  him 
to  damages  from  the  breach  of  the  contract. 
Declaration  adjudged  good. 


5'J4 


DISCHARGE  OF  CONTRACT. 


MORTON  T.  LAMR 

(7  Term.  R.  125.) 

Trinity  Term.    37  Geo.  IIL 


V/ 


In  an  action  on  the  case  the  plaintiff 
declared  against  the  defendant  for  that 
whereas  on,  the  10th  Feb.  179G,  at  Manches- 
ter in  the  county  of  Lancaster,  in  consid- 
eration tliat  the  plaintiff,  at  the  special  in- 
stance and  request  of  the  defendant  had 
then  and  there  bought  of  the  defendant 
200  quarters  of  wheat  at  £5  Os.  6d.  per  quar- 
ter, suoli  price  to  be  therefore  paid  by  the 
plaintiff  to  the  defendant,  he  the  defend- 
ant undertook  and  then  and  there  promised 
the  plaintiff  to  deliver  the  said  corn  to  him 
(the  plaintifiEl)  at  Shardlow  In  theL_CQiinty_pf 
Derby  in  one  month_from^that  ,time,  viz.  of 
the  sale;  and  then  he  alleged  that  although 
he  (the  plaintiff)  always  from  the  time  of 
making  such  sale  for  the  space  of  one 
month  then  next  following  and  afterwards 
was  ready  and  Willing  to  receive  .  the— gald 
corn  at^  Shardlow,  yet  the  defendant  not 
regarding  his~~said  promise  &c.  did  not  in 
one  month  from  the  time  of  the  making 
of  such  sale  as  aforesaid  or  at  any  other 
time  deliver  the  said  com  to  the  plaintiff 
at  Shardlow  or  elsewhere,  although  he  (the 
defendant)  was  often  requested  so  to  do, 
&c.  The  defendant  pleaded  the  general  is- 
sue; and  at  the  trial  the  plaintiff  recov- 
ered a  verdict. 

Mr.  Holroyd  obtained,  in  the  last  term, 
a  rule  calling  on  the  plaintiff  to  shew  cause 
why  the  judgment  should  not  be  arrested, 
because  it  was  not  averred  that  the  plain- 
tiff had  tendered  to  the  defendant  the  price 
of  the  com,  or  was  ready  to  have  paid  for 
it  on  delivery.  He  said  this  was  necessary 
on  the  principle  established  In  many  cases, 
particularly  in  Thorpe  v.  Thorpe,  Salk.  171; 
Callonel  v.  Briggs,  Id.  113;  Kingston  v. 
Preston,  Doug.  GS8;  Jones  v.  Barclay,  Doug. 
684,  and  Goodisson  v.  Nunn,  4  Term  R.  761,— 
that  when  something  Is  to  be  done  by  both 
parties  to  a  contract  at  the  same  time,  as  in 
thi.s  case  the  tendering  of  the  money  and  the 
dehvery  of  the  com,  there  the  party  suing  the 
other  for  non-performance  of  his  part  must 
aver  an  offer  at  least  at  the  same  time  to  per- 
form what  was  to  be  done  by  himself. 

Messrs.    Law,    Wood,    and    Scarlett,    now 

shewed  cause.  The  covenants  here  are 
mutual  and  independent,  and  each  party 
has  a  remedy  by  action  against  the  other 
for  non-performance  of  his  part.  But  if 
thprpijTg_pny.pteeedp.nn£_J:ietween  thf'Tn,  ^^^ifi* 
delivery  of  the  goodsaught,  in  the  regular 
order7^5r~linngs,  to  precede  the^jBJXi^Dt 
of  the  price.  In  neither  case  can  the  aver- 
ment^contencTed  for  be  necessary,  '^t^g.^disr 
tinction  is  taken_Jn_inany-Gases-fehat— v^itei* 
two   ii  '   to   be ^onej_and^  the   time 

of  (Ti.':  ..Lntioncd  for  one  and  notlfor 

the  other,  there  the  thing  for  doing  which 


the  time  is  stipulated  must  be  done  first, 
and  so  averred  to  be.  Pafford  v.  Webbe, 
2  Rolle,  S8;  Pordage  v.  Cole,  1  Saund.  319; 
Peters  v.  Opie,  2  Saund.  352;  1  Vent.  177, 
214;  El  wick  v.  Cud  worth,  1  Lutw.  493; 
Plilton  V.  Smith,  Id.  49G.  So  in  Thorpe  v. 
Thorpe,  1  Salk.  171;  1  Lutw.  250;  it  was 
said  by  Holt,  C.  J.,  that  if  by  the  agree- 
ment a  day  certain  is  appointed  for  the  pay- 
ment of  money,  and  this  day  is  to  happen 
before  the  act  can  be  performed  for  which 
the  money  is  to  be  paid,  there  although  the 
words  are  that  he  shall  pay  so  much  for 
the  performance  of  the  act,  yet  after  the 
day  appointed  the  party  shall  have  his  ac- 
tion for  the  money  before  the  thing  is  per- 
formed. And  that  is  a  stronger  case  than 
the  present,  because  the  act  for  which  the 
recompense  is  to  be  given  ought  in  reason 
to  precede  the  recompense  itself.  In  Black- 
well  V.  Nash,  1  Strange,  535,  the  plaintiff 
declared  in  debt  for  a  penalty  on  a  cove- 
nant that  he  should  transfer  so  much  stock 
to  the  defendant  on  or  before  the  21st  Sep- 
tember, and  that  the  defendant  in  consid- 
eration of  the  premises  covenanted  to  ac- 
cept and  pay  for  it;  and  then  the  plaintiff 
averred  that  he  was  ready  and  offered  to 
transfer  the  stock  on  that  day,  but  that  the 
defendant  refused  to  accept  or  pay  for  it: 
It  was  objected  in  arrest  of  judgment  that 
the  actual  ti*ansfer  of  the  stock  was  a  con- 
dition precedent  which  ought  to  have  been 
averred:  But  the  court  held  that  "in  con- 
sideration of  the  premises"  meant  in  con- 
sideration of  the  covenant  to  transfer,  and 
not  of  an  actual  transferring,  for  which  the 
defendant  had  his  remedy;  though  if  it 
did  mean  the  latter,  a  tender  and  refusal 
would  amount  to  performance.  And  they 
added  that  in  all  such  cases  the  great  ques- 
^^n_waSj_who_was_to  do  the  first  act?  But 
that  where  the  traasfer  was  to  "Be  upon  pay- 
rn5Trt7^there  "was  no  colour  to  make  the 
transfer  a  con3Ttion  precedent.  The  same 
doctrine"  wa^  "held"  in  Dawson  v.  Myer,  1 
Strange,  712.  These  cases  went  on  the 
ground  that  the  parties  had  mutual  reme- 
dies on  their  reciprocal  promises,  and  there- 
fore there  was  no  need  of  the  avennent 
contended  for.  But  the  case  of  Merrit  v. 
Rane,  1  Strange,  458,  applies  as  strongly 
in  another  point  of  view.  There  the  plain- 
tiff declared  on  an  agreement  that  in  con- 
sideration of  £252  paid  to  the  defendant 
he  agreed  to  transfer  £G000  South-sea  stock 
to  the  plaintiff  or  his  executors,  &c.  at  any 
time  before  the  0th  January  1720,  within 
thi'ee  days  after  demand  in  writing,  upon 
payment  of  the  further  sum  of  £0(KK)  then 
he  averred  the  demand  in  writing,  and  that 
he  attended  on  the  day,  but  that  the  de- 
fendant did  not  appear  to  transfer:  One 
of  the  objections  was,  that  the  plaintiff 
had  not  averred  that  he  had  money  there 
on  the  day  to  have  paid  upon  the  transfer: 
But  the  court  said  that  as  to  the  plaintiff's 
not   shewing  a   tender   that   ought   to   have 


BREACn— CONCURRENT  CONDITIONS. 


595 


cuiuu    from    the   defendant   by    way    of    ex- 
cuse,   that    he    was    there    leady    to    have 
tniusferred   if   the   plaintiff  had  been   there 
to   have   paid   the  money.     To   apply   there- 
fore  the   reasoning  of   all   these  authorities 
to  the   present  case:— g,ere  the  tlrst  act   to 
ljfi.._done__v>'jis_by_  the    defendant,    namely-, 
the  carrying^  the  corn   to   Shardl.owi_by 
out   doing   which    he  Ijroke   his    aijreement, 
and  a  cause  of  action  accryed  to  the  plaln- 
tiff_according  to  that  class  of  cases,  where- 
in agreements   of   this   sort    have    been  con- 
strued to  sivc  mutual  remedies  to  the.  parties. 
But  admitting  that  he  was  not  bound  to  deliv- 
er the  com  there  until  the  plaintiff  was  pre- 
pared to  pay  for  it;  still  that  ought  to  come 
from  the  defendant  by  way  of  excuse,  and  the 
tender  of  payment  was  not  necessary  to  be 
averred  by  the  plaintiff  as  a  condition  pre- 
cedent to  the  right  of  action.     The  defendant 
might  have  shewn   in  excuse   for   the   non- 
performance   on    his    part,    either    that    he 
caiTied    the    corn    to    the    place,    and    was 
ready    to    have   delivered    it,    but   that    the 
plaintiff    was    not    there    to    receive    It;    or 
that  the  plaintiff  refused   to   receive   it;    or 
that  he  was  not  ready  to  pay  for  it     l.au- 
cashire  v.  Klllingworth,   12   Mod.  531,   Salk. 
C23.     Ughtred's    Case,    7    Coke,    10.     Where 
an   action   is    brought    for    money    due,    the 
defendant  may  shew  in  his  defence  a  ten- 
der and   refusal,   or   that   he   was   prepared 
at  the  day  and  place  appointed  to  pay  the 
money,  but  that  the  plaintiff  was  not  there 
to  receive  it;    yet  it  never  was  held  neces- 
sary for  the  plaintiff  to  aver  in  his  declara- 
tion that  he  was  ready  to  receive   it.     And 
here,    if    the    readiness    to    pay    had    been 
averred,  it  could  have  answered  no  puiTpose; 
because  no  issue  could  have  been  taken  on 
it.     Besides  in  no  case  is  tender  of  payment 
necessary  to  be  averred  when  the  contract 
Is  executory,  as  it  is  in  this  case;    for  there 
the   parties    necessarily    rely   upon    the    mu- 
tual  remedies   arising  out   of   it;    they   give 
mutual  credit  to  each  other.     All  the  cases 
cited  on  the  other  side  are,  if  strictly  con- 
sidered,  cases  of   condition   precedent.     Sev- 
eral   of    them,    as    well    as    the    subsequent 
cases  of  Campbell  v.  Jones,  G  Term  li.  570, 
and  Porter  v.  Shepherd,  Id.  GG5,  laid  down 
the   rule   that   whether   covenants   be   or  be 
not  independent  on  each  other  must  depend 
on    the    good    sense   of    the    thing;    Uiat    is, 
w]}o  in  the  fa_ir  sense  and  meaning  of  the 
parties    was    required    to    do    the    first   act. 
Now_here_there   is   no  doubt   that   the   first 
act  was  to  be^^done  by  the  defendant  whic-h 
iie'^eg^lected  to  do:    and  it  would  be  absurd 
to  require  a  person  to  pay  for  goods  before 
he   had   received   them;    though    if   he    were 
not  ready  to  pay  for  them  at  the  time  when 
the  other   was   ready   to  deliver   them,   that 
might    be    a    reason    for    the    non-dolivery. 
But   still    that    is    only    matter    of    defence 
and   excuse   on   the   part   of   the   defendant, 
which    it    is    incumbent    on    him    to    shew. 
And  yet  the  effect  of  the  avenuent  required 


is,  that  the  plaintiff  was  bound  to  tender 
the  price  before  the  goods  were  even  offered 
to  him. 

Mr.  Holroyd,  contrS,.  Thl8__  action  la  not 
brought  against  the  defendant  for  having 
omitted  to  carrj'"  the  corn  to  Shardlow,  even 
allowing  that  to  be  the  first  act  to" be  do£e; 
and  therefore  much  of  the  piainiiffi's  argu- 
ment does  not  apply.  But  the  ground  of 
complaint  Is  that  it  was  not  delivered  to  hijn 
tjiere;_and  conseqliently  upon  this  form  of 
declaring  it  may  be  assumed  that  the  de- 
fendant did  carry  the  com  there.  Tlie 
question  then  comes  to  this,  whether  the 
defendant  was  bound  to  deliver  his  corn, 
the  plaintiff  not  being  there  ready  to  pay 
for  it  For  If  not  then  it  follows,  accord- 
ing to  all  the  late  determinations,  that  he 
ought  to  have  averred  a  tender  of  the  price, 
or  that  he  was  there  ready  to  pay  for  it 
If  the  defendant  had  been  there  ready  to 
receive  it,  and  deliver  the  com.  And  for 
this  purpose  it  is  not  necessary  to  shew 
that  the  tender  of  the  price  was  a  condi- 
tion precedent  strictly  so  considered;  for 
according  to  Goodikson  v.  Nunn,  4  Term  R.  7G1, 
and  Kingston  v.  Preston,  Doug.  GSS,  Lf  the 
acts  are  concurrent  and  in  the  nature  of 
the  transaction  to  be  done  at  the  same  time, 
before  one  of  the  parties  can  maintain  an 
action  against  the  other  for  the  non-per- 
formance of  his  part,  he  must  aver  that 
he  performed  or  was  ready  to  perform 
every  thing  on  his  own  part.  Callonel  v. 
Brig'gs,  1  Salk.  113,  is  hi  point.  TkU 
was  an  executory  agreement,  like  the  pres- 
ent, to  pay  so  much  money  six  months  after 
the  bargain,  the  plaintiff  transferring  stock. 
There  Lord  Holt  said,  "If  either  party 
would  sue  upon  this  agreement,  the  plain- 
tiff for  not  paying,  or  the  defendant  for 
not  transferring,  the  one  must  aver  and 
prove  a  transfer  or  a  tender,  and  the  other 
a  payment  or  a  tender;  and  this."  says  he, 
"though  there  be  mutual  promises.  If  I 
sell  you  my  horse  for  fio.  if  you  will  have 
the  horse,  I  must  have  the  money;  or  if  I 
will  have  the  money,  you  must  have  the 
horse."  Or  according  to  Lancashire  v.  Kll- 
lingworth. Salk.  023.  the  plaintiff  should 
have  averred  that  he  was  ready  at  the 
place  to  have  received  the  com  on  the  last 
day  of  the  time  within  which  it  was  to  be 
delivered,  and  ready  and  willing  to  have 
paid  the  price;  but  that  no  person  was 
there  on  the  part  of  the  defendant  to  deliver 
the  com.  The  delivery  of  the  corn,  and 
the  payment  of  the  price,  were  concurrent 
acts  to  be  done  by  the  parties  at  the  same 
time,  the  one  depending  on  the  other;  and 
if  so,  then  within  the  principle  of  all  the 
modem  cases,  the  plaintiff  ought  to  Jie^e 
averred  In  his  declaration  a  tender  of  the 
price,  for  want  of  which  it  is^bad. 

Lord  KENTON.  Ch.  J.    If  tliis  question  de- 
pended on  the  technical  niceties  of  pleading, 


596 


DISCHARGE  OF  CONTRACT. 


I  should  not  feel  so  much  confidence  as  I  do: 
but  it  depends  altogether  on  the  true  con- 
struction of  this  agreement  The  defendant 
agreed  with  the  plaintiff  for  a  certain  quanti- 
ty of  corn,  to  be  delivered  at  Shardlow  with- 
in a  certain  time;  and  there  can  be  no  doubt 
but  that  the  parties  intended  that  the  pay- 
ment should  be  made  at  the  time  of  the  de- 
livery. It  is  not  imputed  to  the  defendant 
that  he  did  not  carry  the  com  to  Shardlow, 
but  that  he  did  not  deliver  It  to  the  plaintiff: 
to  this  declaration  the  defendant  objects,  and 
says  "I  did  notjieliver  the  ^orn_to^  you  (the 
plaintiff),  because  you  dojiot  say  that  you 
were  ready  to' pay  for  it;  and  if  you  were 
not  ready,  I  am  not  bound  to  deliver^  the 
corn;"  and  the  question  is  whetlier  .that 
should  or  should  not  have  been  alleged.-  The 
case  decided  by  Lord  Holt,  in  Salii.  112,  if 
indeed  so  plain  a  case  wanted  that  authority 
to  support  it,  shows  that  where  two  con- 
current acts  are  to  be  done,  the  party  who 
sues  the  other  for  non-performance-  must 
aver  that  he  had  performed  or  was  ready  to 
perform,  his  part  of  the  contract.  Then  the 
plaintiff  in  this  case  cannot  impute  to  the 
defendant  the  nondelivery  of  the  com,  with- 
out alleging  that  he  was  ready  to  pay  the 
price  of  it.  A  plaintiff,  who  comes  into  a 
court  of  justice,  must  show  that  he  is  in  a 
condition  to  maintain  his  action.  But  It 
has  been  argued  that  the  delivery  of  the  com 
was  a  condition  precedent,  and  some  eases 
have  been  cited  to  prove  it:  but  they  do  not 
appear  to  me  to  be  applicable.  In  the  one 
in  Saunders  (Saund.  350),  the  party  was  to 
pull  down  a  wall,  and  was  then  to  be  paid 
for  it;  there  is  no  doubt  but  that  the  pulling 
down  of  the  wall  was  a  condition  precedent 
to  the  paj'ment;  the  act  was  to  be  done,  and 
then  the  price  was  to  be  paid  for  it  So  in 
the  case  in  SaHi.  171,  where  work  was  to 
be  done,  and  then  the  workman  was  to  fee 
paid.  And  in  ordinary  cases  of  this  kind 
the  work  is  to  be  (lone  before  the  wages  are 
earned:  but  those  cases  do  not  apply  to  the 
present,  where  both  the  acts  are  to  be  done 
at  the  same  time.  Spealdng  of  conditions 
precedent  and  subsequent  in  other  cases  only 
leads  to  confusion.  In  the  case  of  Campbell 
v.  Jones,  I  thought,  and  still  continue  of  that 
opinion,  that  whether  covenants  be  or  be 
not  independent  of  each  other  must  depend 
on  the  good  sense  of  the  case,  and  on  the 
order  in  which  the  several  things  are  to  be 
done:  but  here  both  things,  the  delivery  of 
the  corn  by  one,  and  the  payment  by  the 
other,  were  to  be  done  at  the  same  time;  and 
as  the  plaintiff  has  not  averred  that  he  was 
ready  to  pay  for  the  corn,  he  cannot  main- 
tain this  action  against  the  defendant  for  not 
delivering  it 

GROSE,  J.  It  Is  difficult  to  reconcile  all  the 
cases  in  the  books  on  the  subject  of  con- 
ditions precedent;  but  the  good  sense  to  be 
extracted  from  them  all  is,  that  if  one  party 
covenant  to  do  one  thing  in  consideration  of 


the  other  party's  doing  another,  each  must 
be  ready  to  perform  his  part  of  the  contract 
at  the  time  he  charges  the  other  with  non- 
performance. Here  the  question  is,  what 
was  the  intention  of  the  parties;  they  clear- 
ly intended  that  something  should  be  done 
by  each  at  the  same  time.  The  corn  was  to 
be  delivered  at  Shardlow  to  the  plaintiff  for 
a  certain  price  to  be  therefore  paid  by  him, 
that  is,  at  the  time  of  the  delivery;  then  the 
readiness  to  pay  should  have  been  averred  by 
the  plaintiff. 

LAWRENCE,  J,  It  has  been  argued,  on 
behalf  of  the  plaintiff,  that  this  must  be  con- 
sidered as  a  declaration  on  mutual  promises, 
and  that  as  this  is  a  demand  on  the  defend- 
ant on  the  ground  of  some  mutual  promise 
made  by  him,  and  which  was  the  considera- 
tion of  the  plaintiff's  promise,  it  was  not 
necessary  to  aver  performance  on  his  part: 
but  if  so,  the  declaration  is  not  adapted  to 
the  truth  of  the  case,  in  not  stating  that  the 
defendant's  promise  was  in  consideration  of 
the  plaintiff's.  But  on  this  declaration  I 
can  only  consider  it  as  an  agreement  by  the 
defendant  to  deliver  the  com  at  Shardlow  on 
being  paid  for  it  The  payment  of  the 
money  was  to  be  an  act  concurrent  with  the 
delivei-y;  and  then  the  case  is  like  that  of 
CaUonel  v.  Briggs,  which  was  on  an  agree- 
ment to  pay  so  much  money  sjx  months  after 
the  bargain,  the  plaintiff  transferring  stock; 
and  there  Lord  Holt  said,  "If  either  party 
would  sue  upon  this  agreement,  the  plaintiff 
for  not  paying,  or  the  defendant  for  not 
transferring,  the  one  must  aver  and  prove 
a  transfer  or  a  tender:"  he  -did  not  say,  that 
the  not  doing  it  should  c5me  from  the  de- 
fendant by  way  of  excuse,  but  that  the  do- 
ing it  must  be  alleged  in  the  declaration;  and 
that  affords  an  answer  to  great  part  of  the 
argument  urged  on  behalf  of  the  defendant 
in  this  case.  The  tendering  of  the  money  by 
the  plaintiff  makes  part  of  the  plaintiff's 
title  to  recover,  and  he  must  set  out  the 
whole  of  his  title.  The  strongest  case  cited 
for  the  defendant  was  that  of  Merrit  v.  Rane, 
1  Strange,  458:  but  that  does  not  appear  to 
me  of  sufficient  weight  to  overturn  the  au- 
thority of  the  case  of  CaUonel  v.  Briggs.  I 
do  not  quite  understand  what  the  court  there 
said,  that  it  was  not  necessary  to  allege  a 
tender,  for  that  it  should  have  come  from  the 
defendant  by  way  of  excuse;  for  as  it  was 
stated  that  the  plaintiff's  agent  was  ready 
to  receive  a  transfer  of  the  stock,  but  that 
the  defendant  did  not  attend,  it  would  have 
been  absurd  to  state  a  tender  of  the  money 
to  a  person  who  was  not  present  to  receive 
it.  There  is  however  another  case,  not  re- 
ferred to  in  the  argument.  Lea  v.  Exelby, 
Cro.  Eliz.  888,  which  is  an  authority  to  show 
that  the  plaintiff  in  this  case  should  have 
averred  a  tender.  There  the  plaintiff  declar- 
ed that  in  consideration  that  he  had  promised 
to  pay  the  defendant  (who  was  possessed  of 
a  lease  for  years,  the  inheritance  of  which- 


BREACH— CONCURRENT  CONDITIONS. 


597 


was  In  the  plaintiff)  a  certain  sum  on  such 
a  day,  the  defendant  promised  on  payment 
to  surrender  to  him  the  lease;  and  that  he 
had  tendered  the  money  at  the  time,  but  thai 
the  defendant  bad  not  surrendered;  and  on 
motion  in  arrest  of  judgment,  because  It  was 
not  "alleged   that   the   defendant    refused   as 


well  as  that  the  plaintiCt  tendered,  the  court 
held  that  the  declai-ation  was  bad  for  th.it 
reason.  Therefore,  on  the  authority  of  that 
case,  and  of  that  of  Callonel  v.  Briggs,  I  am 
of  opinion  that  the  declaration  cannot  be 
supported,  and  that  the  judgment  must  be 
arrested.    Rule  absolute. 


DISCHARGE  OF  CONTRACT. 


DEY  V.  DOX  et  al 
/  '  (9  Wend.  129.) 

Supreme  Court  of  New  York.    May,  1832. 

This  was  an  action  of  assumpsit,  tried  at 
the  Seneca  circuit  in  June,  1830,  before  the 
Hon.  Daniel  Moseley,  one  of  the  circuit 
■judges. 

The  pLaintiflf  proved  a  contract  signed  by  the 
defendants  in  these  words:  "We  have  this  day 
bought  of  David  Dey  1280  bushels  of  first 
quality  merchantable  wheat  to  be  delivered 
on  board  of  boats,  at  or  near  the  store  house 
of  David  Brooks,  at  any  time  we  may  require 
the  delivery  of  the  same  after  the  first  day  of 
April  next,  and  are  to  pay  seventy-five  cents 
per  bushel,  payable  the  first  of  September 
next,  and  have  paid  him  one  dollar  on  ac- 
count .  of  the  same;  Geneva,  2Gth  March, 
1828;"  and  claimed  to  recover  the  price  stipu- 
lated in  the  contract  •  The  defendants  insist- 
ed that  the  plaintiff  was  not  entitled  to  re- 
cover, unless  he  proved  a  delivery  of  the 
wheat  or  an  offer  or  readiness  to  do  so.  The 
judge  ruled  that  the  promises  of  the  parties 
were  independent  and  refused  to  nonsuit  the 
plaintiff.  The  defendants  thep  proved  a  ten- 
der of  the  price  and  a  demand  of  the  wheat, 
made  about  the  middle  of  September,  1828, 
and  the  refusal  of  the  plaintiff  to  accept  the 
money  and  to  deliver  the  wheat— this  evi- 
dence was  objected  to  by  the  plaintiff.  The 
plaintiff  then  introduced  the  record  of  the 
judgment  in  favor  of  the  defendants  against 
the  plaintiff,  docketed  the  loth  January,  1830, 
as  of  January  term,  1830,  by  which  it  ap- 
peared that  the  defendants  had  sued  the 
plaintiff  for  the  non-delivery  of  the  wheat 
and  obtained  a  verdict  against  him  for  $1,- 
670.92,  being  the  full  value  of  the  wheat  on 
the  day  it  was  demanded.  In  the  record, 
however,  there  was  a  remittitur  of  $1,005.25, 
stated  to  be  the  value  of  the  wheat  at  G5-100 
per  bushel,  T\ith  the  Interest  thereof,  and 
judgment  was  taken  for  only  $771.61,  the  bal- 
ance of  the  verdict  and  the  costs  of  increase. 
The  plaintiff  also  proved  the  issuing  of  an  ex- 
ecution on  such  judgment,  which  was  deliv- 
ered to  the  sheriff  on  the  IGth  January,  1830, 
directing  the  levy  of  5771.61,  and  that  the 
same  was  returned  satisfied;  all  which  evi- 
dence in  relation  to  the  judgment  and  execu- 
tion was  objected  to  by  the  defendants.  The 
suit  in  this  case  was  commenced  on  the  11th 
January,  1830,  previous  to  which  time  the 
plaintiff  demanded  of  the  defendants  the 
price  of  the  wheat  as  stipulated  in  the  con- 
tract; the  defendants  told  him  they  would  re- 
mit such  price  from  their  verdict  which  the 
plaintiff  said  he  would  not  accept,  and  that  if 
they  entered  such  remittitur,  they  would  do 
so  against  his  wishes  and  consent  The  con- 
tract price  of  the  wheat  with  the  Interest 
thereof,  was  shewn  to  be  .$992.16,  for  which 
sum  the  jury  found  a  verdict  notwithstand- 
ing the  presiding  judge  in  his  charge  to  the 
jury  expressed  his  opinion,  that  the  plaintiff 


was  not  entitled  to  recover.    The  defendants 
now  moved  to  set  aside  the  verdict 

J.  A.  Spencer,  for  plaintiff.    J.  C.  Spencer, 
for  defendants. 

NELSON,  J.  The  plaintiff  must  fail  u^on 
principles  too  well  settled  to  requii'e  examina- 
tion, and  the  omission  to  avail  himself  of 
those  principles,  when  prosecuted  by  the 
present  defendants  on  the  contract  relative 
to  this  same  subject  matter,  has  no  doubt 
given  rise  to  the  present  suit;  for,  had  they 
been  applied,  he  would  have  had  no  cause  of 
complaint.  K  a  greater  amount  in  damages 
for  a  breach  of  his  agreement  has  been  re- 
covered against  him  than  the  well  settled 
principles  of  law  would  warrant,  it  is  his  own 
fault,  and  cannot  be  heard  or  admitted  as  a 
suSicient  reason  to  indulge  him  In  a  cross  suit 
to  right  himself.  But  before  inquiring  to  see  if, 
upon  principles  of  law  and  justice,  the  whole 
subject  of  litigation  arising  upon  this  agree- 
ment could  not  have  been  properly  adjusted 
in  the  former  suit  I  will  examine  this  case 
for  the  present  as  if  the  former  suit  was  out 
of  the  question,  and  which  Is  perhaps  placing 
It  upon  the  ground  upon  which  it  ought  to 
have  been  litigated.  It  would  then  stand 
thus:  the  plaintiff,  after  being  called  upon  to 
carry  into  execution  the  agreement  on  his 
part  peremptorily  refused;  and  while  persist- 
ing in  such  refusal,  instituted  a  suit  for  dam- 
ages, for  the  non-fulfilment  of  the  agreement 
on  the  part  of  the  defendants.  There  is  cer- 
tainly no  principle  upon  which  such  an  action 
can  be  sustained,  nor  have  we  been  referred 
to  any  authority  in  support  of  it  It  cannot  be 
that  the  plaintiff  seeks  to  recover  damages  in 
the  strictest  sense  of  that  term  for  the  breach 
of  the  contract  on  the  part  of  the  defendants, 
for  his  own  conduct  is  conclusive  to  shew  that 
he  considers  the  fulfilment  of  it  an  injury  to 
him,  and  has  therefore  preferred  the  hazard 
of  responding  in  damages  himself,  rather  than 
carry  it  into  execution.  Can  he  recover  the 
whole  consideration  for  the  wheat?  This 
would  be  unjust,  for  he  has  positively  refused 
to  deliver  the  wheat  when  demanded,  imless, 
indeed,  under  the  idea  that  they  are  inde- 
pendent agreements,  the  court  is  bound  to  af- 
ford to  each  party  a  specific  performance,  or 
its  equivalent  in  damages.  Suppose  the  court 
should  do  so,  how  would  the  case  then  stand? 
The  plaintiff  would  recover  the  consideration 
to  be  paid  for  the  wheat  and  the  defendants 
the  same  sum  for  the  non-delivery  of  it  be- 
sides such  damages  as  a  jury  would  aUow  for 
the  default  in  not  delivering  it  It  is  obvious 
from  this  view,  that  confining  the  remedy  for 
a  violation  of  this  contract  to  a  suit  for  dam- 
ages against  the  party  violating  it  the  result 
is  exactly  the  same  to  both  parties  as  that  to 
which  we  arrive  after  the  above  circuity  of 
action,  and  I  apprehend  that  such  is  the  well 
settled  law  of  tlie  case.  It  is  true,  where  the 
covenants  or  agreements  are  mutual  and  in- 
dependent that  is.   mutual  and  distinct  one 


BREACH— CONDITIOXS  PRECEDENT. 


599 


party  may  maintain  an  action  against  the 
other  without  averring  or  shewing  perform- 
ance on  his  part,  and  the  defendant  in  such 
ease  cannot  plead  the  non-performance  by 
the  plaintiff  in  bar  of  the  action.  Wheat. 
Selw.  383;  1  Saund.  320,  note.  When  this 
prhiciple  is  rij;litly  understood  and  applied, 
there  can  be  no  objection  to  It;  and  tlie  sound 
reason  given  for  It  is,  that  the  damages  in 
each  covenant  or  agreement  may  be  very  dif- 
ferent, as  where  they  are  in  the  same  instni- 
ment  and  the  one  not  the  consideration  of  the 
other,  or  where  th-:  covenants  or  agi'eemcnts 
gc  only  to  part  of  the  consideration  on  both 
sides,  part  having  been  executed,  and  the  like 
cases;  in  all  such  the  damages  might  be  dif- 
ferent and  a  remedy  must  be  sought  in  a  suit 
by  each  party  for  a  breach.  So  the  terms  of 
the  insti-ument  may  be  such  that  the  cove- 
nants; or  agreements  must  necessarily  be  in- 
dependent, without  the  existence  of  the  rea- 
Boi-  above  assigned;  in  such  case,  the  court 
will  can-j  into  effect  the  agreement,  accord- 
hig  to  the  intent  cf  the  parties;  but  whether 
the  covenants  or  promises  are  independent 
or  no',,  where  the  agreement  is  wholly  execu- 
tcry.aiH  the  ono  covenant  or  promise  or  per- 
foTcarce  i<i  thf  consideration  for  the  cove- 
nsnt  or  pivmisc  or  performance  of  the  other, 
it  may  be  stated  with  confideneo  that  there  is 
no  prine5)le  or  authorify  which  will  maintain 
J?  suit  at  law  b^  a  party  who  has  positively 
refuse^  to  fulfil  his  part  cf  the  agreement 
against  the  other  to  recover  damages  for  a 
breach  of  It  Though  the  consideration  of  the 
defendants'  covenant  or  promise  cannot  be 
said  technically  to  ha^^e  failed,  the  principle 
and  reason  of  that  rule  have  a  strong  appli- 
cation, but  perhaps  the  best  reason  is,  that 
this  circuity  of  action,  as  I  trust  has  already 
been  shewn,  is  wholly  imnecessary,  and  there- 
fore should  not  be  sanctioned  by  the  court 
The  case  of  Van  Benthuysen  v.  Crapser,  8 
Johns.  257,  I  consider  as  containing  the  prin- 
ciple I  am  here  applying  to  this  case.  See, 
also,  13  Johns.  3G5.  Mr.  Justice  Marcy,  in  de- 
livering the  opinion  of  the  court,  when  this 
agi'eement  was  before  under  consideration  (3 
Wend.  35G),  referred  to  Van  Benthuysen  v. 
Crapser,  and  distinguished  it  from  that  case; 
but  the  distinction  taken  confirms  its  applica- 
tion here. 

It  seems  to  be  considered  by  the  counsel  for 
the  plaintiff  that  if  one  of  the  promises  in  the 
agreement  is  independent,  the  other  must  be 
so  also;  and  as  it  has  been  decided  by  this 
court  (3  Wend.  35G)  that  the  plaintiff's  prom- 
ise to  deliver  the  wheat  was  independent, 
tlierefore  the  defendants'  promise  to  pay  the 
money  must  be  also  Independent  This  is  an 
entire  mistalve.  In  all  cases  (except  concur- 
rent promises,  where  the  performance  of  both 
takes  place  at  the  same  time)  where  the  per- 
formance of  one  promise  is  a  condition  preced- 
ent, and  must  be  performed  or  excused  be- 
fore the  right  of  action  exists  for  the  breach 
of  the  other  promise,  the  one  Is  independent 
and  the  other  dependent    The  definition  of  a 


dependent  covenant  or  promise  shews  this: 
If  A.  covenants  to  do  or  to  abstain  from  do- 
ing a  certain  act,  in  consideration  of  the  prior 
performance  of  some  covenant  on  the  part  of 
B.,  A.'s  covenant  is  termed  a  dependent  cove- 
nant because  B.'s  right  of  suing  A.  for  a 
breach  of  this  covenant  depends  upon  the 
prior  performance,  or  what  is  equivalent  cf 
the  covenant  to  be  performed  by  B.,  which, 
from  its  nature,  is  termed  a  condition  preced- 
ent Now  It  is  obvious  that  the  covenant  of 
B.  is  independent  because  it  must  be  per- 
foi-med  without  reference  to  the  covenant  of 
A.,  and  for  a  breach  of  It,  A.  may  recover 
damages  without  shewing  a  performance  him- 
self. Where  the  promises  are  concurrent, 
there,  either  party  seeking  to  enforce  the 
agreement  against  the  other  must  aver  and 
prove  performance  on  his  part  or  what  Is  in 
law  equivalent  before  his  right  of  action 
commences.  There  can  be  no  doubt  that  the 
promise  of  the  plaintiff  in  this  suit  was  inde- 
pendent, upon  the  reasons  and  authorities 
given  by  the  court  (3  Wend.  S'M);  but  is  not 
that  of  the  defendant  dependent?  One  of  the 
rules  of  construction  applicable  to  questions 
of  this  kind  from  the  same  high  authority 
there  referred  to  is,  that  "when  a  day  is  ap- 
pointed for  the  paymen^  of  money,  &c.  and 
the  day  is  to  happen  after  the  thing,  which  is 
the  consideration  of  the  money,  &c  Is  to  b3 
performed,  no  action  can  be  maintained  for 
the  money,  &c.  before  performance.  1  Saund. 
320b.  In  the  case  under  consideration,  by 
the  terms  of  the  agreement,  the  delivery  of 
the  wheat  became  due,  and  demandable  on 
the  first  day  of  April,  and  the  consideration 
money  therefor  was  not  to  be  paid  until  the 
first  of  September  thereafter.  Applying  the 
above  rule,  the  delivery  of  the  wheat  is  a  con- 
dition precedent  which  must  be  performed,  or 
that  must  be  done  which  is  equivalent  in  law, 
before  this  suit  can  be  sustained  for  a  breach 
of  the  agreement  by  the  defendants.  It  may  be 
remarked  that  this  rule.andthe  one  upon  which 
the  case  in  3  Wend,  was  decided,  so  far  as 
the  dependency  or  independency  of  the  prom- 
ises was  concerned,  are  conclusive  to  shew 
that  one  of  the  covenants  or  promises  In  an 
agreement  may  be  dependent  and  the  other 
Independent.  If  the  money  Is  to  be  paid  on 
a  day  fixed  before  the  act  is  to  be  done  for 
which  it  Is  the  consideration,  the  payment  of 
the  money  docs  not  depend  upon  the  per- 
formance of  the  act — the  promise  is  Independ- 
ent; but  the  performance  of  the  act  may  de- 
pend upon  the  payment  of  the  monej- — that 
promise  may  be  dependent  If  the  money  Is 
made  payable  after  the  act  Is  to  be  performed, 
the  performajice  of  the  act  does  not  depend 
upon  the  payment  of  the  money,  but  accord- 
ing to  the  rule  I  have  above  referred  to,  the 
payment  of  the  money  depends  upon  the  per- 
formance of  the  act;  that  is.  this  cnsr-.  The 
payment  of  the  money  was  fixed  at  a  day  aft- 
er the  plaintiff  was  bound  to  dehver  the 
wheat;  by  the  tenus  of  it.  therefore,  the  de- 
fendants   were  not   to   trust  to  the  credit  or 


600 


DISCHARGE  OF  CONTRACT. 


personal  responsibility  of  the  plaintiff,  but  had 
a  rig-ht  to  have  possession  of  the  wheat  before 
they  parted  with  their  money.  This  may  be 
no  great  matter  here,  where  all  parties  are 
responsible,  but  the  rule  is  no  less  valuable, 
and  must  be  universal  in  its  application. 

The  rule  to  which  I  have  before  referred, 
and  which  ousht  to  have  been  applied  to  the 
defence  on  the  former  suit  by  the  then  de- 
fendant, and  would  have  adjusted  all  the 
rights  of  the  parties  without  further  litigation 
upon  principles  of  law  and  justice,  and  which 
has  been  very  fully  considered  by  this  court- 
will  be  found  in  the  case  of  Clark  v.  Piniioy, 
7  Cow.  6S1.  The  principle  of  that  case  is, 
that  where  the  vendor  is  in  default  for  not  de- 
livering goods  or  chattels  in  pursuance  of  the 
contract  of  sale,  and  no  money  has  been  ad- 
vanced by  the  vendee,  the  true  measure  of 
damages  is  the  difference  between  the  con- 


tract price  and  the  value  at  the  time  the  ar- 
ticle should  have  been  delivered;  and  the  rea- 
son of  the  rule  is  conclusive,  to  wit,  that  such 
damages,  added  to  the  contract  price  which 
the  vendee  has  not  parted  with,  will  enable 
him  to  buy  the  article  in  the  market  It  is 
obvious,  if  this  rule  had  been  applied,  the 
plaintiff  here  would  have  had  no  cause  of 
complaint,  and  his  omission  to  apply  it  can- 
not be  remedied  in  this  suit.  This  principle 
itself  Is  sufficient  to  defeat  this  action  without 
the  interposition  of  any  other,  and  settles, 
with  the  utmost  exactness,  all  rights  and  rem- 
edies upon  the  agreement,  with  the  least  pos- 
sible litigation. 

The  view  I  have  thus  taken  of  the  case, 
renders  It  unnecessary  to  examine  many  of 
the  questions  raised;  those  which  have  been 
examined  were  raised  upon  the  trial. 

New  trial  granted,  costs  to  abide  the  event. 


/     ■!  ^         GRANT  V.  JOHNSON. 

Ip  ^  (5  N.  Y.  247.)  ^y^-^ 

Court  of  Appeals  of  New   York.    1851. 

Covenant  on  articles  of  agreement  for  the 
sale  of  laud,  between  the  plaintiff  (Grant)  of 
the  liist  part,  and  the  defendant  (Johnson) 
of  the  second  part  "The  party  of  the  first 
part  for  the  consideration  of  nine  hundred 
and  fifty  dull^irs,  to  be  paid  as  follows,  to 
wit:  two  hundred  dollars  on  the  first  day  of 
April  next,  two  hundred  dollars  on  the  first 
of  April,  1S47,  the  remainder  in  two  annual 
payments  of  equal  amoimt,  to  be  paid  on 
the  first  of  April  of  the  two  succeeding  years, 
together  with  interest  from  the  first  of  April 
next,  agrees  to  sell  to  the  party  of  the  second 
part,  a  certain  piece  of  land  lying  in  the 
town  of  Neversinli:,"  (describing  it)  "And 
the  party  of  the  first  part,  agrees  to  give  to 
the  party  of  the  second  part,  the  quiet  and 
peaceable  possession  of  said  premises  on  the 
first  of  November  next,  with  the  exception 
of  certain  privileges  granted  to  Nicholas 
Wakeley,  and  certain  other  privileges  grant- 
ed to  Tennis  Misener,"  «&c.  "And  the  said 
party  of  the  first  part  further  agrees  to  give 
to  the  said  party  of  the  second  part  a  good 
and  sufficient  deed  for  the  same  on  the  first 
of  May  next,  if  the  above  conditiohs  are. com- 
plied with." 

The  agreement  contained  a  further  stipula- 
tion, which  it  is  unnecessary  to  mention,  and 
was  executed  under  the  hands  and  seals  of 
the  parties,  on  the  twenty-fourth  day  of  Au- 
gust, 1S45. 

The  declaration  assigned  as  a  breach,  the 
non-Bayment  of  the  second  instalment  of  two 
hundred  dollars,  payable  on  the  first  of  April, ^ 
1847;  but  it  contained  no  averment  of  thel 
tender  of  a  deed  of  the  premises,  before,  on,( 
or  subsequent  to  the  first  day  of  May,  1840,' 
or  a  readiness  or  wilhngness  to  execute  one,  I 
in  accordance  with  the  covenant  of  the  plain-) 
tiff. 

The  defendant  interposed  several  pleas, 
which,  as  no  question  arose  upon  thoni,  it  is 
unnecessary  to  mention  more  particularly. 

At  the  trial  the  plaintiff  proved  the  agree- 
ment, and  rested.  The  defendant  moved  for 
a  non-suit,  on  the  ground  that  the  plaintiff 
was  bound  to  show  the  delivery  or  tender 
of  a  deed  before  he  could  recover  the  second 
instalment. 

The  Judge  decided  that  the,  covenants  were 
Independent,  and  that  the  plaioiig.  could^re; 
<^ver  without  shiQwiBg  either  a  delijvery_pr 
tender  of  a  dee^j__  To  this  decision  the  de- 
fendant excepted. 

It  was  then  admitted  that  the  defendant 
had  received  possession  of  the  premises  ac- 
cording to  the  contract,  and  had  paid  the 
first  instalment  He  then  offered  to  prove, 
tliat  no  deed  of  the  premises  in  question 
had  been  tendered  to  him  up  to  the  fiiteenth 
of  July,  1846.  The  court  rejected  the  evi- 
dence as  not  constituting  a  legal  defence,  and 
the  defendant  excepted.    The  jury,  under  the 


BREACH— CONDITIONS  PRECEDENT. 


60] 


direction  of  the  judge,  found  a  verdict  for 
the  plaintiff  for  the  amount  of  the  second 
insUiliiieiit,  and  interest  Upon  a  bill  of  ex- 
ceptions presenting  the  above  facts,  a  motion 
for  a  new  trial  was  made  before  the  supreme 
court  in  the  third  district  and  denied.  An 
issue  of  law  arising  upon  a  demurrer  to  the 
replication  of  the  plaintiff  presenting  the 
same  question,  had  previously  been  decided 
by  the  same  court  in  favor  of  the  plaintiff. 
The  new  trial  was  denied,  and  the  defend- 
ant's demurrer  overruled,  upon  the  ground 
that  the  Qovenants  were  independent  and 
that  tlie  plaintiff  could  recover  without  aver- 
ring or  proving  performance,  or  an  offer  to 
perform  the  covenant  on  his  part  See  0 
Barb.  337.  From  this  decision  the  defend- 
ant appealed  to  this  court 


N.   Hill,  Jr.,  for  appellant 
for  respondent 


S.  Beardsley, 


GARDINER,  J.  The  question  in  this  case 
is,  whether  the  plaintiff  can  sustain  an  ac- 
tion for  the  second  installment  of  the  pur- 
chase-money secured  by  the  a^eement  with- 
out averring  and  proving  the  delivery,  or  an 
offer  to  deliver  a  deed  of  the  premises. 

The  parties  have  declared  that  certain  pay- 
ments were  to  be  made,  and  certain  acts  per- 
formed by   them   respectively,   at   the  times 
specified  in  the  agreement     They  must  be ' 
held   to   have   intended   the   performance   of( 
these  acts,  when,  and  of  course  in  the  order: 
{of  time  indicated   in  their  covenants.     The! 
plaintiff  was  to  give  the  defendant  posses-) 
sion  on  the  1st  of  November,  lS4u.     The  per- 
formance of  this  requirement  preceded  any 
thing  to  be  done  by  the  defendant  and  it 
might  consequently  have  been  enforced  with- 
out any  offer  upon  the  part  of  the  defendant; 
but   if   no    possession    had    been   given,    the 
plaintiff  could  not  have  recovered  the  $200  to 
be  paid  by  the  vendee  on  the  1st  of  April, 
1S4U. 

The  possession,  however,  was  given,  and 
the  first  S;200  paid,  and  on  the  1st  of  May, 
1S4G,  the  vendee  was  entitled  to  his  deed,  as 
the  thing  next  to  be  done  in  the  order  pre- 
scribed by  the  parties  in  their  agreement 
It  was  not  executed,  nor  a  willingness  to  exe- 
cute it  either  averred  or  proved.  The  pay- 
ment of  the  ?2<X)  for  which  the  suit  is 
brought  was  fixed  upon  a  day  subsequent  to 
that  agreed  upon  for  tlie  delivery  of  the  deed. 
The  case  is,  therefore,  brought  directly  with- 
in the  letter  and  spirit  of  the  2d  rule  suggest- 
ed by  Sergeant  Williams  in  his  note  to  Por- 
.dage  V.  Cole,  1  Sauud.  320b,  that  "when  a  J 
[day  is  appointed  for  the  payment  of  money, 
'etc.,  and  the  day  is  to  happen  after  the  thing 
which  is  the  consideration  is  to  be  perform- 
ed, no  action  for  the  money  can  be  sustained  \ 
ivithout  averring  performance." 

The  plaintiff  relies  upon  the  3d  role  of  Ser- 
geant Williams  in  his  note  to  the  case  above 
cited,  that  "where  a  covenant  goes  only  to  a 
part  of  the  coiisideration  on~both  sides,  apd 


602 


DISCHARGE  OF  CONTRACT. 


a  breaclLJOf-sncb-Coyenant  may  be  paid  for 
in  damages,  it  is  _aii  independent  covenant, 
~ana~an'actibn  may  be  maiutaiued,   without 

ayerrins2lii52EPS^^'  '^^^  ^^^^  '^  °^*  ^^^'^ 
from  obscurity.  It  was  given  by  Lord  Mans- 
field originally  in  Boone  v.  Eyre,  1  H.  Bl. 
273,  note  a.  The  defendants  in  that  suit, 
after  having  received  a  conveyance  of  the 
equity  of  redemption  of  a  plantation,  and 
the  negroes  upon  it,  when  sued  for  a  part  of 
the  consideration,  set  up  a  breach  of  a  col- 
lateral covenant  on  the  part  of  the  plaintiff, 
relating  to  the  title  and  possession  of  the 
negroes,  in  bar  of  the  action.  The  warranty 
extended  both  to  the  estate  and  negroes.  4 
Mees.  &.  W.  311.  The  covenant  of  the  plain- 
tiff, it  will  be  perceived,  embraced  the  whole 
and  every  part  of  the  subject  conveyed.  If 
the  title  failed  to  a  single  negro,  or  the  de- 
fendant was  evicted  from  an  acre  of  the 
land,  the  covenant  was  intended  to  afCord 
redress,  and  enable  a  jury  to  apportion  the 
.damages  according  to  the  agreement  of  the 
parties.  A  "breach  of  the  plaintiff's  cove- 
nant might  be  paid  for  in  damages,"  because 
a  failure  of  title  as  to  any  part  of  the  consid- 
eration could  be  compensated  according  to 
the  standard  fixed  by  the  parties.  In  other 
words,  the  consideration  for  the  defendant's 
promise  was  divisible,  and  the  damages  aris- 
ing from  a  breach  of  the  covenant  of  war- 
ranty were  apportioned  to  each  parcel  of 
that  consideration,  by  the  agreement  itself. 
This,  it  is  supposed,  is  what  is  meant  by  the 
expression  above  quoted,  that  the  breach 
may  be  paid  for  in  damages.  5  Mees.  &  W. 
701.  Accordingly  it  is  stated  in  the  note  to 
Pordage  v.  Cole,  supra,  that  "when  the  con- 
sideration for  the  payment  of  the  money  is 
entire  and  indivisible,  so  that  the  money  pay- 
able is  neither  apportioned  by  the  contract, 
nor  capable  of  being  apportioned  by  a  jury, 
an  action  is  not  maintainable." 

The  doctrine  is  thus  stated  in  Chanter  y. 
Leese,  4  Mees.  &  W.  311,  "The  party  con- 
tracting to  pay  his  money  is  under  no  obhga- 
tion  to  pay  for  a  less  consideration  than  that 
for  which  he  has  stipulated.  If,  indeed,  he 
does  accept  a  partial  performance,  and  to  a 
certain  extent  enjoys  the  benefit  of  that  for 
which  he  has  stipulated,  it  may  become  a 
question  whether  he  may  not  be  liable  upon 
an  impUed  contract  to  pay  for  what  he  has 
had.  And  when  the  consideration  is  in  its 
nature  capable  of  being  divided,  and  the  pay- 
ment apportioned  by  the  terms  of  the  con- 
tract, there  may  be  still  a  right  to  recover 
the  portion  due  on  the  original  contract." 
This  decision  was  affirmed  in  the  exchequer 
chamber  (5  Mees.  &  W.  701),  in  1839,  and 
may  be  considered  as  the  established  doc- 
trine in  England  at  that  day. 

The  rule  of  Lord  Mansfield,  according  to 
its  original  application,  and  as  expounded  in 
the  decision  above  mentioned,  is  reasonable. 
It  brings  us  bade  to  the  contract  to  learn 
the  intention  of  the  parties.  Courts  are  not 
required  to  speculate  upon  the  inequality  of 


loss  to  the  parties,  or  to  look  beyond  the 
agreement  to  its  performance,  in  order  to  as- 
certain its  character,  as  suggested  by  some 
judges  and  commentators.  1  Saund.  320a. 
These  inquiries  are  proper  where  the  ques- 
tion arises,  whether  the  plaintiff  has  any 
remedy  for  what  he  has  done,  or  parted 
with,  or  whether  the  defendant  is  not  es- 
topped by  his  acts  subsequent  to  the  agree- 
ment, from  insisting  upon  a  condition  pre- 
cedent in  his  favor.  Much  of  the  confusion 
in  the  books,  it  is  believed,  arises  from  con- 
founding the  doctrine  of  waiver  by  matters 
ex  post  facto,  with  a  rule  of  construction  ap- 
plicable to  the  agreement  as  it  came  from 
the  hands  of  the  parties.  Havelock  v.  Ged- 
des,  10  East,  555.  A  defendant  may  waive 
the  performance  by  the  plaintiff,  in  case  of 
a  covenant  clearly  dependent,  and  thus  ren- 
der himself  liable  in  some  form  of  action 
(Mitchell  V.  Darthez,  2  Bing.  N.  C.  555;  Lu- 
cas V.  Godwin,  3  Id.  737),  but  it  is  only 
when  the  consideration  is  divisible,  and  the 
payments  are  apportioned  by  the  agreement 
to  the  different  parts  of  the  consideration, 
that  the  covenant  becomes  independent,  and 
a  recovery  can  be  had  upon  the  original  con- 
tract without  averring  performance,  or  an 
excuse  for  non-performance. 

A  covenant,  therefore,  which  goes  only  to 
a  part  of  the  consideration,  is  not  necessa- 
rily independent.  Nor  is  it  conclusive  upon 
this  point  that  the  consideration  is  divisible 
in  its  own  nature,  or  that  a  part  of  it  has 
been  received  by  the  defendant;  nor  will  the 
circumstance  that  one  or  any  number  of 
covenants  in  an  agreement  are  independent, 
render  others  so.  In  Chanter  v.  Leese,  4 
Mees.  &  W.  311,  the  agreement  was,  that 
the  defendants  should  have  the  exclusive 
use  and  sale  of  six  different  patents,  and 
they  were  to  pay  £400  in  half-yearly  pay- 
ments, for  one  of  which  payments  tae  ac- 
tion was  brought.  The  defense  was  a  fail- 
ure of  title  as  to  one  of  the  patents.  The 
grant  of  the  exclusive  right  was  an  inde- 
pendent covenant,  which  the  defendants 
could  have  enforced  without  any  averment; 
the  consideration  for  the  undertaking  of  the 
defendants  was  divisible  in  its  own  nature. 
The  undertaking  upon  which  the  action  was 
brought  went  only  to  a  part  of  the  consid- 
eration to  be  paid;  and  the  court  remarked, 
that  although  it  had  appeared  affirmatively 
that  the  other  five  patents  had  been  enjoyed 
by  the  defendants,  the  plaintiff  could  not 
have  recovered  on  the  contract.  Terry  v. 
Duntze,  2  II.  Bl.  389,  which  was  followed  in 
our  supreme  court  in  Seers  v.  Fowler,  2 
Johns.  272,  in  Havens  v.  Bush,  Id.  387,  and 
in  Wilcox  V.  Ten  Eyck,  5  Johns.  78,  to  the 
contrary,  is  not  the  law  in  this  state  or  in 
England.  The  two  cases  in  2  Johns,  were 
expressly  overruled  in  Cunningham  v.  Mor- 
rell,  10  Johns.  203,  and  the  court,  in  Wilcox 
V.  Ten  Eyck,  observe,  that  that  case  could 
not  be  distinguished  from  Seers  v.  Fowler. 

The  decision  in  Bennet  v.  Pixley,  7  Johna 


BREACH— CONDITIONS  PIIECEDENT. 


co:j 


249,  is  placed  by  the  court  on  the  same 
ground  with  that  of  Seers  v.  Fowler,  aud 
Terry  v.  Dunlze,  and  the  reasouiug  of  tlie 
court  in  that  case  is  overruled  by  Cuiuiiu}^- 
ham  V.  Morrell,  and  by  Dey  v.  Dux,  9  Wend. 
1119.  'J'hc  case,  I  think,  should  be  classed 
with  Cauipbell  v.  Jones,  G  Term  R.  570, 
aud  Tompkins  v.  Elliot,  5  Wend.  49G,  all  of 
which  I'all  within  the  principle  of  the  first 
rule  in  Saunders,  "that  if  a  day  be  appointed 
lor  the  payuieut  of  money,  or  part  of  it,  or 
the  doing  of  any  other  act,  and  the  day  is  to 
happen,  or  may  happen,  before  the  thiug 
which  is  the  consideration  of  the  money,  or 
other  ae*^,  in  action  may  be  brought  for  the 
money,  ox  foi  not  doing'  such  other  act  be- 
fore performance,"  etc  1  Saund.  o-Oa.  The 
decisions  in  T^rm  R  and  in  Wendell,  wei'e 
placed  distu-c^ly  upon  that  ground  (6  Johns. 
572;  5  Wena.  499);  and  what  fell  from  Lord 
Kecyor  and  Judge  Savage,  beyond  a  mere 
recognition  of  the  rule  laid  down  by  Lord 
Mansheld,  was  no  way  necessaiy  to  the  de- 
termination of  those  cases.  The  judgments 
were  unquestionably  correct  for  other  rea- 
sons assigned  by  those  judges. 

The  question  then  returns, was  the  consid- 
eration in  this  case  divisible,  and  were  the 
payments  apportioned  by  the  agreement  to 
the  different  parts  of  the  cousideratiDU  with- 
in the  principles  above  stated?  According 
to  th£  contract,  the  $950  to  be  paid  by  the 
defendant,  as  therein  stipulated,  was  the  en- 
tire eoQsideration  for  a  complete  title  to  the 
preroifefo  The  possession  was  incident  to 
the  t\t'<i.  the  v^hole  of  which  the  defendant 
\7-A^  in  cecyiVi  as  the  consideration  for  his 
pg.yjieai^.  Hp  received  one  element  of  a 
compiler  ti  'o,  ^o-wit,  the  possession,  on  the 
J  St  oi  Noreciber,  1845.'  He  then  paid  on  the 
Ipl  of  the  f  allowing  April  all  that  he  was  to 
advance  by  the  terms  of  the  agreement,  until 
the  fee  should  be  added  to  the  possession  by 
a  conveyance  from  the  plaintiff,  and  the  title 
of  the  defendant  be  then  perfected.  The 
plaintiu:  refuses  or  neglects  to  convey,  and 
yet  by  this  action  claims  the  purchase-mon- 
ey of  the  defendant 

If  we  assume  that  the  consideration  of  the 
defendant's  undertaking  was  divisible,  yet 
by  the  terms  of  the  agreement  he  was  to  re- 
ceive both  the  possession  and-  a  deed  of  the 
premises  before  he  could  be  called  upon  for 
the  payment  of  the  installment  in  contro- 
versy. These  things  were  "to  be  done  to 
him"   according  to   the  rule   of   Lord    Holt, 


adopted  in  10  Johns.  1100.  He  was  not  to 
trust  to  the  per.soual  responsibility  of  the 
plaintiff.  9»  Wend.  134.  The  plaintiff  had 
covenanted  that  the  thing  stipulated  should 
bo  performed  before  the  defendant  could  be 
required  to  pay.  Nor  by  the  contract  were 
the  payments  to  be  made  by  the  defendant 
apportioned  to  any  particular  part  of  the 
consideration.  He  was  not  to  pay  any  thing 
for  the  possession  as  distinguished  from  the 
tee  of  the  land,  but  a  gross  sum  for  both  by 
separate  installments.  If  he  had  refused  to 
accept  a  deed,  all  that  the  plaintiff  could 
have  recovered  would  have  been  the  balance 
of  the  purchase-money  with  interest  On  the 
contrary  had  the  plaintiff  refused  to  convey, 
the  recovery  on  the  pai't  of  the  defendant 
would  have  been  confined  to  the  difference 
between  the  contract  price  and  the  actual 
value  of  the  land  with  interest  In  a  word, 
the  covenant  souL'^ht  to  he  onforoed  ap^ninst 
the  defendant  in  this  action  went  to  the 
whole  consideration  on  the  other,  slde^  and. 
depended  on  it 

The  judgment  of  the  supreme  court  should 
be  reversed- 

FOOT,  J.  The  question  Is,  whether  the 
covenants  to  pay  the  second  and  subsequent 
installments  are  dependent 

So  many  decisions  have  been  made  on  the 
vexed  question  of  what  are,  and  what  are 
not  dependent  covenants,  and  so  many  of 
them  are  irreconcilable,  that  they  rather  per- 
plex than  aid  the  judgment  in  determining 
a  given  case.  One  rule. is  universal,  and  that 
is,  that  the  intent  of  the  parties  is  to  control. 
On  reading  the  covenant  in  this  case,  it  is 
clear  to  my  mind  that  giving  the  deed  was 
to  precede  the  payment  of  the  second  and 
subsequent  installments.  The  parties  have 
said  so  in  so  many  words.  The  deed  was 
to  be  given  on  the  1st  of  May,  1S4G;  and 
the  second  and  subsequent  installments  paid 
on  the  1st  day  of  April  in  the  following 
years.  If  each  had  fulfilled  his  contract  the 
appellant  would  have  had  his  deed  when  the 
second  installment  was  payable.  The  chiuse 
"if  the  above  coudltions  are  complied  with" 
can  only  apply  to  such  conditions  as  were  to 
be  performed  by  the  appellant  before  the 
deed  by  the  terms  of  the  contract  was  to  be 
given.  The  possessipn  Is  a  mere  Incident 
which  follows  the  title,  and  cannot  be  re- 
tained independently  of  it 

Judgment  reversed. 


604 


DISCHARGE  OF  CONTRACT. 

NOERINGTON  v.  WRIGHT  et  aL  y-f_k    sel  in  July,   and   notified   to   the  defendants 

"  ^        each  shipment     The  defendants  received  and 


(6  Sup.  Ot.  12,  U5  U.  S.  1S8.) 


^ 


Snpreme  Court  of  the  United  States.    Oct. 
1SS5. 

In  error  to  the  circuit  court  of  the  United 
States  for  the  Eastern  distinct  of  Pennsylva- 
nia. 

The  facts  fully  appear  in  the  following 
statement  by  Mr.  Justice  GRAY: 

This  was  an  action  of  assumpsit,  brought 
by  Arthur  Norrington,  a  citizen  of  Great  Brit- 
ain, ti-ading  under  the  name  of  A.  Norring- 
ton &  Co.,  against  James  A.  Wright  and  oth- 
ers, citizens  of  Pennsylvania,  trading  under 
the  name  of  Peter  Wright  &  Sons,  upon  the 
following  conti-act:  "Philadelphia,  January 
19.  ISSO.  Sold  to  Messrs.  Peter  Wright  & 
Sons,  for  account  of  A.  Norrington  &  Co., 
London:  Fiye  thousand  (5,000)  tons  old  T 
Iron  rails,  for  shipment  from  a  European  port 
or  ports,  at  the  rate  of  about  one  thousand 
(1.000)  tons  per  month,  beginning  February, 
ISSO,  but  whole  contract  to  be  shipped  be- 
fore Augiist  1,  ISSO,  at  forty-five  dollars  ($45.- 
00)  per  ton  of  2,240  lbs.  custom-house  weight, 
ex  ship  Philadelphia.  Settlement,  cash,  on 
presentation  of  bills  accompanied  by  custom- 
house certificate  of  weight.  Sellers  to  notify 
buyers  of  shipments  with  vessels'  names  as 
soon  as  known  by  them.  Sellers  not  to  be 
compelled  to  replace  any  parcel  lost  after 
shipment.  Sellers,  when  possible,  to  secure 
to  buyers  right  to  name  discharging  berth  of 
vessels  at  Philadelphia.  Edward  J.  Etting, 
Metal  Broker." 

The  declaration  contained  three  counts. 
The  first  count  alleged  the  contract  to  have 
been  for  the  sale  of  about  5,(XX)  tons  of  T 
iron  rails,  to  be  shipped  at  the  rate  of  about 
1.000  tons  a  month,  beginning  in  February, 
and  ending  in  Julj,  1880.  The  second  count 
set  forth  the  contract  verbatim.  Each  of 
these  two  counts  alleged  that  the  plaintiffs  in 
February,  March,  April,  May,  June,  and  July 
shipped  the  goods  at  the  rate  of  about  1,000 
tons  a  month,  and  notified  the  shipments  to 
the  defendants;  and  further  alleged  the  due 
arrival  of  the  goods  at  Philadelphia,  the  plain- 
tiff's readiness  to  deliver  the  goods  and  bills 
thereof,  with  custom-house  certificates  of 
weight,  according  to  the  contract,  and  the 
defendants'  refusal  to  accept  them.  The  third 
count  differed  from  the  second  only  in  aver- 
ring that  400  tons  were  shipped  by  the  plain- 
tiff in  February  and  accepted  by  the  defend- 
ants, and  that  the  rest  was  shipped  by  the 
plaintiffs,  at  the  rate  of  about  1,000  tons  a 
month,  in  March,  April,  May,  June,  and  July. 
The  defendants  pleaded  non  assumpsit.  The 
material  facts  proved  at  the  trial  were  as  fol- 
lows: 

The  plaintiff  shipped  from  various  Euro- 
pean ports  400  tons  by  one  vessel  in  the  last 
part  of  February,  885  tons  by  two  vessels  in 
March,  1,571  tons  by  five  vessels  in  April,  S.jO 
tons  by  three  vessels  in  May,  1,000  tons  by 
two  vessels  in  June,  and  300  tons  by  one  ves- 


paid  for  the  February  shipment  upon  its  ar- 
rival in  March,  and  in  April  gave  directions 
at  what  wharves  the  March  shipments  should 
be  discharged  on  their  arrival,  but  on  May 
14th,  about  the  time  of  the  arrival  of  the 
March  shipments,  and  having  been  then  for 
the  first  time  informed  of  the  amounts  ship- 
ped in  February,  March,  and  April,  gave  Et- 
ting written  notice  that  they  should  decline  to 
accept  the  shipments  made  in  March  and 
April,  because  none  of  them  were  in  accord- 
ance with  the  contract;  and  in  answer  to  a 
letter  from  him  of  May  16th,  wrote  him  on 
May  17th,  as  follows:  "We  are  advised  that 
what  has  occuiTed  does  not  amount  to  an  ac- 
ceptance of  the  iron  under  the  circumstances, 
and  the  terms  of  the  contract  You  had  a 
right  to  deliver  in  parcels,  and  we  had  a  right 
to  expect  the  stipulated  quantity  would  be 
delivered  untU  the  time  was  up  in  which  that 
was  possible.  Both  delivering  and  receiving 
were  thus  far  conditional  on  there  being  there- 
after complete  delivery  in  due  time  and  of 
the  stipulated  article.  On  the  assumption 
that  this  time  had  arrived,  and  that  you  had 
ascertained  that  you  did  not  intend  to,  or 
could  not,  make  any  further  deliveries  for 
the  February  and  March  shipments,  we  gave 
you  the  notice  that  we  declined  accepting 
those  deliveries.  As  to  April,  it  is  too  plain, 
we  suppose,  to  require  any  remark.  If  we 
are  mistaken  as  to  our  obligation  for  the  Feb- 
ruary and  March  shipments,  of  course  we 
must  abide  the  consequences;  but  if  we  are 
right,  you  have  not  performed  your  contract, 
as  you  certainly  have  not  for  the  April  ship- 
ments. There  is  then  the  very  serious  and 
much  debated  question,  as  we  are  advised, 
whether  the  failure  to  make  the  stipulated 
shipments  in  February  or  March  has  absolved 
us  from  the  contract.  If  it  does,  we  of  course 
will  avail  ourselves  jf  this  advantage." 

On  May  18th  Etting  wrote  to  the  defend- 
ants, insisting  on  their  liability  for  both  past 
and  future  shipments,  and  saying,  among  oth- 
er things:  "In  respect  to  the  objection  that 
there  had  not  been  a  complete  delivery  in  due 
time  of  the  stipulated  article,  I  beg  to  call 
your  attention  to  the  fact  that  while  the  con- 
tract is  for  five  thousand  tons,  it  expressly 
stipulates  that  deliveries  may  be  made  during 
six  months,  and  that  they  are  only  to  be  at 
the  rate  of  about  one  thousand  tons  per 
month."  "As  to  April,  while  it  seems  to  me 
'too  plain  to  require  any  remark,'  I  do  not  see 
how  it  can  seem  so  to  you,  unless  you  Intend  to 
accept  the  rails.  If  you  object  to  taking  all 
three  shipments  made  in  that  month,  I  shall 
feel  authorized  to  deliver  only  two  of  the  car- 
goes, or  for  that  matter,  to  make  the  delivery 
of  precisely  one  thousand  tons.  But  I  think 
I  am  entitled  to  know  definitely  from  you 
whether  you  intend  to  reject  the  April  ship- 
ments, and,  if  so,  upon  what  ground,  and  aJ- 
so  whether  you  are  decided  to  reject  the  re- 
maining shipments  under  the  conti-act    You 


BREACH— CONDITIONS  PRECEDENT. 


605 


sny  in  your  last  paragrraph  that  you  shall 
avail  yourselves  of  the  advantage,  if  you  are 
alisolved  from  the  contract;  but,  as  you  seem 
to  be  in  doubt  whether  you  can  set  up  that 
claim  or  not,  I  should  like  to  know  definitely 
what  is  your  intention." 

On  May  I'Jth  the  defendants  replied:  "We 
do  not  read  the  contract  as  you  do.  We 
read  it  as  stipulating  for  monthly  shipments 
of  about  one  thousand  tons,  beginning  in  Feb- 
niary,  and  that  the  six  months'  clause  is  to 
secure  the  completion  of  whatever  had  fallen 
s<hort  in  the  five  months.  As  to  the  moaning 
of  'about,'  it  is  settled  as  well  as  such  a  thing 
can  be;  and  certainly  neither  the  Febiniarj', 
.March,  nor  April  shipments  are  within  the 
limits.  As  to  the  proposal  to  vary  the  notices 
for  April  shipments,  we  do  not  think  you  can 
do  this.  The  notice  of  the  shipments,  as  soon 
as  known,  you  were  bound  to  give,  and  can- 
not afterwards  vary  it  if  they  do  not  con- 
form to  the  contract.  Our  right  to  be  notified 
immediately  that  the  shipments  were  known 
is  as  material  a  provision  as  any  other,  nor 
can  it  be  changed  now  in  order  to  make  that 
a  performance  which  was  no  performance 
within  the  time  requirecj."  "You  ask  us  to 
determine  whether  we  will  or  will  not  object 
to  receive  further  shipments  because  of  past 
defaults.  We  tell  you  we  will  if  we  are  en- 
titled to  do  so,  and  will  not  if  we  are  not  en- 
titled to  do  so.  We  do  not  think  you  have 
the  right  to  compel  us  to  decide  a  disputed 
question  of  law  to  relieve  you  from  the  risk 
of  deciding  it  yourself.  You  know  quite  as 
well  as  we  do  what  Is  the  rule  <ind  its  uncer- 
tainty of  application."  On  June  10th  Etting 
offered  to  the  defendants  the  alternative  of 
delivering  to  them  one  thousand  tons  strict 
measure  on  account  of  the  shipments  in  April. 
This  offer  they  immediately  declined.  On 
.Tune  15th  Etting  wrote  to  the  defendants 
that  two  cargoes,  amounting  to  221  tons,  of 
the  April  shipments,  and  two  cargoes,  amount- 
ing to  G50  tons,  of  the  May  shipments,  (desig- 
nated by  the  names  of  the  vessels,)  had  been 
erroneously  notified  to  them,  and  that  about 
900  tons  had  been  shipped  by  a  certain  other 
vessel  on  account  of  the  May  shipments.  On 
the  same  day  the  defendants  replied  that  the 
notification  as  to  April  shipments  could  not 
be  corrected  at  this  late  date,  and  after  the 
terms  of  the  contract  had  long  since  been 
broken.  From  the  date  of  the  contract  to  the 
time  of  its  rescission  by  the  defendants,  the 
market  price  of  such  Iron  was  lower  than  that 
stipulated  in  the  contract,  and  was  constant- 
ly falling.  After  the  arrival  of  the  cargoes, 
and  their  tender  and  refusal,  they  were  sold 
by  Etting,  with  the  consent  of  the  defendants, 
for  the  benefit  of  whom  it  might  concern. 

At  the  trial  the  plaintiff  contended  (1)  that 
under  the  contract  he  had  six  months  in 
which  to  ship  the  5,000  tons,  and  any  deficien- 
cy in  the  earlier  mouths  could  be  made  up 
subsequently,  provided  that  the  defendants 
could  not  be  required  to  take  more  than  l.(^X) 
tons  in  any  one  month;    (2)  that,  if  this  was 


not  so,  the  contract  was  a  divisible  contract, 
and  the  remedy  of  the  defendants  for  a  de- 
fault In  any  month  was  not  by  rescission  of 
tlie  whole  contract,  but  only  by  deduction  of 
the  damages  caused  by  the  delays  In  the 
shii)mc'nts  on  the  part  of  the  plaintiff.  But 
the  court  instructed  the  jury  that  If  the  de- 
fendants, at  the  time  of  accepting  the  deliv- 
ery of  the  cargo  paid  for,  had  no  notice  of  the 
failure  of  the  plaintiff  to  ship  about  1,000 
tons  in  the  month  of  February,  and  immedi- 
ately upon  learning  that  fact  gave  notice  of 
their  intention  to  rescind,  the  verdict  should 
be  for  them.  The  pkiiutiff  excepted  to  this 
instruction,  and,  after  verdict  and  judgment 
for  the  defendants,  sued  out  this  writ  of  er- 
ror. 

Samuel  Dickson  and  J.  C.  Bullitt,  for  plain- 
tiff in  error.  Richard  C.  McMurtrie,  for  de- 
fendants  in  error. 

Mr.  Justice  GRAY',  after  stating  the  facts 
as  above,  delivered  the  opinion  of  the  court. 

In  the  contracts  of  merchants,  time  is  of 
the  essence.  The  time  of  shipment  Is  the 
usual  and  convenient  means  of  fixing  the 
probable  time  of  arrival,  with  a  view  of  pro- 
viding funds  to  pay  for  the  goods,  or  of  ful- 
filling contracts  with  third  persons.  A  state- 
ment descriptive  of  the  subject-matter,  or  of 
some  material  incident,  such  as  the  time  or 
place  of  shipment,  is  ordinarily  to  be  regarded 
as  a  warranty  in  the  sense  in  which  that  term 
is  used  in  insurance  and  maritime  law,  that  is 
to  say,  a  condition  precedent  upon  the  fail- 
ure or  non-performance  of  which  the  party 
aggrieved  may  repudiate  the  whole  contracL 
Behn  v.  Burness,  3  Best  &  S.  751;  Bowes  v. 
Shand,  2  App.  Cas.  455;  Lovber  v.  Bangs,  2 
Wall.  728;  Davison  v.  Von  Lingen,  113  U.  S. 
40,  5  Sup.  Ct.  340. 

The  contract  sued  on  Is  a  single  contract 
for  the  sale  and  purchase  of  5,000  tons  of 
iron  rails,  shipped  from  a  European  port  or 
ports  for  Philadelphia.  The  subsidiary  pro- 
visions as  to  shipping  in  different  months, 
and  as  to  paying  for  each  shipment  upon  its 
delivery,  do  not  split  up  the  contract  into  as 
many  contracts  as  there  shall  be  shipments, 
or  deliveries  of  so  many  distinct  quantities  of 
Iron.  Mersey  S.  &  1.  Co.  v.  Najior,  9  App. 
Cas.  434.  439.  The  further  provision  that  the 
sellers  shall  not  be  compelled  to  replace  any 
parcel  lost  after  shipment,  simply  reduces,  in 
the  event  of  such  a  loss,  the  quantity  to  be 
delivered  and  paid  for.  The  times  of  ship- 
ment, as  designated  in  the  contract,  are  "at 
the  rate  of  about  1,000  tons  per  month,  be- 
ginning February,  ISSO.  but  whole  contract  to 
be  shipped  before  August  1,  ISSO."  These 
words  are  not  satisfied  by  shipping  one-sixth 
part  of  the  5,000  tons,  or  about  833  tons,  in 
each  of  the  six  months  which  begin  with  Feb- 
ruary and  end  with  July.  But  they  require 
about  1,000  tons  to  be  shipped  in  each  of  the 
five  months  from  February  to  June  inclusive, 
and  allow  no  more  than  slight  and  unimpor- 
tant   deficiencies    in    the    shipments    during 


€06 


DISCHARGE  OF  CONTRACT. 


those  monitlis  to  be  made  up  in  the  month  of 
July.  The  contract  is  not  one  for  the  sale 
of  a  specific  lot  of  goods,  identified  by  inde- 
pendent circumstances,— such  as  all  those  de- 
posited in  a  certain  warehouse,  or  to  be  ship- 
ped in  a  particular  vessel,  or  that  may  be 
manufactured  by  the  seller,  or  may  be  re- 
quired for  use  by  the  buyer,  in  a  certain 
mill,— in  which  case  the  mention  of  the  quan- 
tity, accompanied  by  the  qualification  of 
"about,"  or  "more  or  less,"  is  regarded  as  a 
mere  estimate  of  the  probable  amount,  as  to 
which  good  faith  is  all  that  is  required  of 
the  party  maidng  it.  But  the  contract  before 
us  comes  within  the  general  rule:  "When  no 
such  independent  circumstances  are  referred 
to,  and  the  engagement  Is  to  furnish  goods  of 
a  certain  quality  or  character  to  a  certain 
amoimt,  the  quantity  specified  is  material, 
and  governs  the  contract.  The  addition  of 
the  quaJifj-ing  words  'about,'  'more  or  less,' 
and  the  like,  in  such  cases,  is  only  for  the 
purpose  of  providing  against  accidental  vari- 
ations arising  from  slight  and  unimportant 
excesses  or  deficiencies  in  number,  measure, 
or  weight"  Brawley  v.  U.  S.,  96  U.  S.  1G8, 
171,  172.  The  seller  is  bound  to  deliver  the 
quantity  stipulated,  and  has  no  right  either 
to  compel  the  buyer  to  accept  a  less  quantity, 
or  to  require  him  to  select  part  of  a  greater 
quantity;  and  when  the  goods  are  to  be  ship- 
ped in  certain  proportions  monthly,  the  sell- 
er's failure  to  ship  the  required  quantity  in  tlie 
first  month  gives  the  buyer  the  same  right  to 
i-escmd  the  whole  contract  that  he  would 
have  had  if  it  had  been  agreed  that  all  the 
goods  should  be  delivered  at  once. 

The  plaintiff,  instead  of  shipping  about 
1,000  tons  in  February  and  about  1,000  tons 
in  March,  as  stipulated  in  the  contract,  ship- 
ped only  400  tons  in  February,  and  885  tons 
In  March.  His  failure  to  fulfill  the  contract 
on  his  part  in  respect  to  these  first  two  in- 
stallments justified  the  defendants  in  rescind- 
ing the  whole  contract,  provided  they  dis- 
tinctly and  seasonably  asserted  the  right  of 
rescission.  The  defendants,  immediately  af- 
ter the  arrival  of  the  March  shipments,  and 
as  soon  as  they  knew  that  the  quantities 
which  had  been  shipped  in  February  and  in 
March  were  less  ttian  the  contract  called  for, 
clearly  and  positively  asserted  the  right  to 
rescind,  if  the  law  entitled  them  to  do  so. 
Their  previous  acceptance  of  the  single  cargo 
of  400  tons  shipped  in  February  was  no 
waiver  of  this  right,  because  it  took  place 
without  notice  or  means  of  knowledge  that 
the  stipulated  quantity  had  not  been  shipped 
in  February.  The  price  paid  by  them  for 
that  cargo  being  above  the  market  value, 
the  plaintiff  suffered  no  injury  by  the  omis- 
sion of  the  defendants  to  return  the  iron; 
and  no  reliance  was  placed  on  that  omission 
in  the  cori  ospondence  between  the  parties. 

The  case  wholly  differs  from  that  of  Lyon 
v.  Bertram.  20  How.  149,  in  which  the  buyer 
of  a  specific  lot  of  goods  accepted  and  used 
part  of  them  with  full  means  of  previously 


ascertaining  whether  they  conformed  to  the 
contract.  The  plaintiff,  denying  the  defend- 
ants' right  to  rescind,  and  asserting  that  the 
contract  was  still  in  force,  was  bound  to  show 
such  performance  on  his  part  as  entitled  him 
to  demand  performance  on  their  part,  and, 
having  failed  to  do  so,  cannot  maintain  this  ac- 

For  these  reasons  we  are  of  opinion  that 
the  judgment  below  should  be  atfirmed.  But 
as  much  of  the  argument  at  the  bar  was 
devoted  to  a  discussion  of  the  recent  Eng- 
lish cases,  and  as  a  diversity  in  the  law,  as 
administered  on  the  two  sides  of  the  Atlantic, 
concerning  the  interpretation  and  effect  of 
commercial  contracts  of  this  kind,  is  greatly 
to  be  deprecated,  it  is  proper  to  add  that 
upon  a  careful  examination  of  the  cases  re- 
ferred to  they  do  not  appear  to  us  to  estab- 
lish any  rule  inconsistent  with  our  conclusion. 

In  the  leading  case  of  Hoare  v.  Rennie,  5 
Hurl.  &  N.  19,  which  was  an  action  upon  a 
contract  of  sale  of  GG7  tons  of  bar  iron,  to  be 
shipped  from  Sweden  in  .lune,  July,  August, 
and  September,  and  in  about  equal  portions 
each  month,  at  a  certain  price  payable  on 
delivery,  the  declaration  alleged  that  the 
plaintiff's  performed  all  things  necessary  to 
entitle  them  to  have  the  contract  performed 
by  the  defendants,  and  were  ready  and  will- 
ing to  perform  the  contract  on  their  part, 
and  in  June  shipped  a  certain  portion  of  the 
iron,  and  within  a  reasonable  time  after- 
wards offered  to  deliver  to  the  defendants 
the  portion  so  shipped,  but  the  defendants 
refused  to  receive  it,  and  gave  notice  to  the 
plaintiffs  that  they  would  not  accept  the 
rest  The  defendants  pleaded  that  the  ship- 
ment in  June  was  of  about  20  tons  only,  and 
that  the  plaintiffs  failed  to  complete  the 
shipment  for  that  month  according  to  the 
contract.  Upon  demurrer  to  the  pleas,  it 
was  argued  for  the  plaintiffs  that  the  ship- 
ment of  about  one-fourth  of  the  iron  in  each 
month  was  not  a  condition  precedent,  and 
that  the  defendants'  only  remedy  for  a  fail- 
ure to  ship  that  quantity  was  by  a  cross- 
action.  But  judgment  was  given  for  the  de- 
fendants, Chief  Baron  Pollock  saying:  "The 
defendants  refused  to  accept  the  first  ship- 
ment, because,  as  they  say,  it  was  not  a 
performance,  but  a  breach  of  the  contract. 
Where  parties  have  made  an  agreement  for 
themselves,  the  courts  ought  not  to  make 
another  for  them.  Here  they  say  that,  in  the 
events  that  have  happened,  one-fourth  shall 
be  shipped  in  each  month,  and  we  cannot 
say  that  they  meant  to  accept  any  other 
quantity.  At  the  outset  the  plaintiffs  failed 
to  tender  the  quantity  according  to  the  con- 
ti-act,— they  tendered  a  much  less  quantity. 
The  defendants  had  a  right  to  say  that  this 
was  no  performance  of  the  contract,  and 
they  were  no  more  bound  to  accept  the  short 
quantity  than  if  a  single  delivery  had  been 
contracted  for.  Therefore  the  pleas  are  an 
answer  to  the  action."  5  Hurl.  &,  N.  28.  So 
in  Coddington  v.  Faleologo,  L.   R.  2   Exch. 


BREACH— CONDITIONS  PRECEDENT. 


607 


193,  while  there  was  n  division  of  opinion 
upon  the  question  wliether  a  contract  to  sup- 
ply goods,  "delivering  on  April  17th,  com- 
plete Sth  May,"  bound  the  seller  to  begin 
delivering  on  April  17th,  all  the  judges  agreed 
that  'f  it  did,  and  the  seller  made  no  de- 
livery on  that  day,  the  buyer  might  rescind 
the  conti"act. 

On  the  other  hand  in  Simpson  v.  Crippin, 
L.  R.  8  Q.  B.  14,  under  a  contract  to  supply 
from  0,000  to  8,000  tons  of  coal,  to  be  taken 
by  the  buyer's  wagons  from  the  seller's  col- 
liery In  equal  monthly  quantities  for  12 
months,  the  buyer  sent  wagons  for  only  150 
tons  during  tlie  first  month;  and  it  was  held 
that  this  did  not  entitle  the  seller  to  annul 
the  contract  and  decline  to  deliver  any  more 
coal,  but  that  his  only  remedy  was  by  an 
action  for  damages.  And  in  Bi"andt  v. 
Lawrence,  1  Q.  B.  Div.  344,  in  which  the 
conti-act  was  for  the  purchase  of  4,500  quar- 
ters, 10  per  cent,  more  or  less,  of  Russian 
oats,  "shipment  by  steamer  or  steamers  dur- 
ing February."  or,  in  case  of  ice  preventing 
shipment,  then  immediately  upon  the  opening 
of  navigation,  and  1,139  quarters  were  shii>- 
ped  by  one  steamer  in  time,  and  3,301  quar- 
ters were  shipped  too  late,  it  was  held  that 
the  buyer  was  bound  to  accept  the  1,139 
quarters,  and  was  liable  to  an  action  by  the 
seller  for  refusing  to  accept  them.  Such  be- 
ing the  condition  of  tlie  law  of  England  as 
declared  in  the  lower  courts,  the  case  of 
Bowes  v.  Shand,  after  conflicting  decisions  in 
the  queen's  bench  division  and  the  court  of 
appeal,  was  finally  determined  by  the  house 
of  lords.  1  Q.  B.  Div.  470;  2  Q.  B.  Div.  112; 
2  App.  Cas.  455.  In  that  case,  two  contracts 
were  made  in  London,  each  for  the  sale  of  300 
tons  of  "Madras  rice,  to  be  shipped  at  Madras 
or  coast  for  this  port  during  the  months  of 
March  ^'^^^t' April,  1874,  per  Rajah  of  Cochin." 
The  GOO  tons  filled  8,200  bags,  of  which  7,120 
bags  were  put  on  board,  and  bills  of  lading 
signed  in  February;  and  for  the  rest,  con- 
sisting of  1,030  bags  put  on  board  in  Feb- 
ruary, and  50  in  March,  the  bill  of  lading 
was  signetl  in  March.  At  the  trial  of  an  ac- 
tion by  the  seller  against  the  buyer  for  re- 
fusing to  accept  the  cargo,  evidence  was 
given  that  rice  shipped  in  February  would 
be  the  spring  crop,  and  quite  as  good  as 
rice  shipped  in  March  or  April.  Yet  the 
house  of  lords  held  that  the  action  could 
not  be  maintained,  because  the  meaning  of 
the  contract,  as  apparent  upon  its  face,  was 
that  all  the  rice  must  be  put  on  board  in 
March  and  April,  or  in  one  of  those  months. 
In  the  opinions  there  delivered  the  general 
principles  underlying  this  class  of  cases  are 
most  cleiirly  and  satisfactorily  stated.  It 
will  be  sufficient  to  quote  a  few  passages 
from  two  of  those  opinions. 

Lord  Chancellor  Cairns  said:  "It  does  not 
appear  to  me  to  be  a  question  for  your  lord- 
ships, or  for  any  court,  to  consider  whether 
that  is  a  contract  which  bears  upon  the  face 
■  if  it  some  reason,  some  explanation,  why  it 


I  was  made  in  that  form,  and  why  the 
stipulation  is  made  that  the  shipment 
should  be  during  these  particular  months. 
It  is  a  mercantile  contract,  and  mer- 
chants are  not  in  the  habit  of  placing 
upon  their  contracts  stipulations  to  which 
they  do  not  attach  some  value  and  impor- 
j  tance."  2  App  Cas.  403.  "If  it  be  admitted 
that  the  literal  meaning  would  imply  that 
the  whole  quantity  niust  be  put  on  board 
during  a  specified  time,  it  is  no  answer  to 
that  literal  meaning,— it  is  no  observation 
which  can  dispose  of,  or  get  rid  of,  or  dis- 
place, that  literal  meaning,— to  say  that  it 
puts  an  additional  burden  on  the  seller  with- 
out a  coiTesponding  benefit  to  the  purchaser; 
that  is  a  matter  of  which  the  seller  and  pur- 
,  chaser  are  the  best  judges.  Nor  is  it  any 
]  reason  for  saying  that  it  would  be  a  means 
i  by  which  purchasers,  without  any  real  cause, 
;  would  frequently  obtain  an  excuse  for  re- 
jecting contracts  when  prices  had  dropped. 
j  The  non-fulfillment  of  any  term  in  any  con- 
tract is  a  means  by  which  a  purchaser  is 
able  to  get  rid  of  the  contract  when  prices 
have  dropped;  but  that  is  no  reason  .why  a 
j  term  which  is  found  in  a  contract  should  not 
be  fulfilled."  Pages  4G5,  400.  "It  was  sug- 
gested that  even  if  the  construction  of  the 
contract  be  as  I  have  stated,  still  if  the  rice 
was  not  put  on  boaid  in  the  particular 
'  months,  that  would  not  be  a  reason  which 
would  justify  the  appellants  in  having  re- 
jected the  rice  altogether,  but  that  it  might 
afford  a  grouna  for  a  cross-action  by  them 
if  they  could  show  that  any  particular  dam- 
age resulted  to  them  from  the  rice  not  hav- 
ing been  put  on  boai-d  in  the  months  in  ques- 
tion. My  lords,  1  cannot  think  that  tht  re  is 
any  foundation  whatever  for  that  argument. 
If  the  construction  of  the  contract  be  as  I 
have  said,  that  it  bears  that  the  rice  is  to 
be  put  on  board  in  the  months  in  quesnon. 
that  is  part  of  tlie  description  of  the  subject- 
matter  of  what  is  sold.  What  is  suld  is  not 
300  tons  of  rice  in  gross  or  in  general.  It  is 
300  tons  of  Madras  rice  to  be  put  on  board 
at  Madras  during  the  particular  months." 
"The  plaintiff,  who  sues  upon  that  contract, 
has  not  launched  his  ca^e  until  he  has 
shown  that  he  has  tendered  that  thing  which 
has  been  contracted  for,  and  if  he  is  unable 
to  show  that,  he  cannot  claim  any  damages 
for  the  non-fulfillment  of  the  contract." 
Pages  407.  40S. 

Lord  Blackburn  said:  "If  the  description 
of  the  article  tendered  is  different  in  any  re- 
spect, it  is  not  the  article  bargained  for, 
and  the  other  party  is  not  bound  to  tiilce  it. 
I  think  in  this  case  what  the  parties  bar- 
gained for  was  rice,  shipped  at  Madras  or 
the  coast  of  Madras.  Equally  good  rice 
might  have  been  shipped  a  little  to  the 
north  or  a  little  to  the  south  of  the  coast  of 
Madras.  I  do  not  quite  know  what  the 
boundary  is,  and  probably  equally  good  rice 
might  have  been  shipped  in  February  as  was 
shipped  in  March,  or  equally  good  rice  might 


608 


DISCHARGE  OF  CONTRACT. 


have  been  shipped  in  May  as  was  shipped 
in  April,  and  I  dare  say  equally  good  rice 
might  have  been  put  on  board  another  ship 
as  that  which  was  put  on  board  the  Kajah 
of  Cochin.  But  the  parties  have  chosen,  for 
reasons  best  known  to  themselves,  to  say: 
We  bargain  to  take  rice,  shipped  in  this  par- 
ticular region,  at  that  particular  time,  on 
board  that  paiticular  ship;  and  before  the 
defendants  can  be  compelled  to  take  any- 
thing in  fulfillment  of  that  contract  it  must 
be  shown  not  merely  that  it  is  equally  good, 
but  that  it  is  the  same  article  as  they 
have  bargained  for,  otherwise  they  are  not 
bound  to  take  it."    2  App.  Cas.  4S0,  481. 

Soon  after  that  decision  of  the  house  of 
lords,  two  cases  were  determined  in  the  court 
of  appeal.  In  Renter  v.  Sala,  4  C.  P.  Div. 
239,  under  a  contract  for  the  sale  of  "about 
25  tons  (more  or  less)  black  pepper,  October 
^^'^  November  shipment,  from  Penang  to 
London,  the  name  of  the  vessel  or  vessels, 
marks,  and  full  particulars  to  be  declared  to 
the  buyer  in  writing  within  60  days  from  date 
of  bill  of  lading,"  the  seller,  within  the  60 
days,  declared  25  tons  by  a  particular  vessel, 
of  which  only  20  tons  were  shipped  in  No- 
vember, and  five  tons  in  December;  and  it 
was  held  that  the  buyer  had  the  right  to  re- 
fuse to  receive  any  part  of  the  pepper.  In 
Honck  V.  Muller,  7  Q.  B.  Div.  92,  under  a 
contract  for  the  sale  of  2,000  tons  of  pig-iron 
to  be  delivered  to  the  buyer  free  on  board  at 
the  maker's  wharf  "in  November,  or  equally 
over  November,  December,  and  January 
next,"  the  buyer  failed  to  take  any  iron  in 
November,  but  demanded  delivery  of  one- 
third  in  December  and  one-third  in  January; 
and  it  was  held  that  the  seller  was  justified 
in  refusing  to  deliver,  and  in  giving  notice  to 
the  buyer  that  he  considered  the  contract  as 
canceled  by  the  buyer's  not  taking  any  iron 
in  November. 

The  plaintiff  in  the  case  at  bar  greatly  relied 
on  the  very  recent  decision  of  the  house  of 
lords  in  Mersey  Co.  v.  Naylor,  9  App.  Cas. 
434,  afiirming  the  judgment  of  the  court  of 
appeal  in  9  Q.  B.  Div.  648,  and  following  the 
decision  of  the  court  of  common  pleas  in 
Freeth  v.  Burr,  L.  R.  9  C.  P.  208.  But  the 
point  there  decided  was  that  the  failure  of 
the  buyer  to  pay  for  the  first  installment  of 
the  goods  upon  delivery  does  not,  unless  the 
circumstances  evince  an  intention  on  his  part 
to  be  no  longer  bound  by  the  contract,  entitle 
the  seller  to  rescind  the  contract,  and  to  de- 
cline to  make  further  deliveries  under  it.  And 
the  gro\mds  of  the  decision,  as  stated  by  Lord 
Chancellor  Selborne  in  moving  judgment  in 
the  house  of  lords,  are  applicable  only  to  the 
case  of  a  failure  of  the  buyer  to  pay  for,  and 
not  to  that  of  a  failure  of  the  seller  to  de- 
liver, the  first  installment.  The  lord  chan- 
cellor said:  "The  contract  is  for  the  purchase 
of  5,000  tons  of  steel  blooms  of  the  company's 
manufacture;  therefore,  it  is  one  contract  for 
the  purchase  of  that  quantity  of  steel  blooms. 
No  doubt,  there  are  subsidiary  terms  in  the 


contract,  as  to  the  time  of  delivery, — 'delivery 
1,000  tons  monthly,  commencing  January 
next,'— and  as  to  the  time  of  payment,— 'pay- 
ment net  cash  within  three  days  after  receipt 
of  shipping  documents,'— but  that  does  nut 
split  up  the  contract  into  as  many  contracts 
as  there  shall  be  deliveries  for  the  purpose 
of  so  many  distinct  quantities  of  iron.  It  is 
quite  consistent  with  the  natural  meaning  of 
the  contract  that  it  is  to  be  one  contract  for 
the  purchase  of  th.-it  quantity  of  iron  to  be 
delivered  at  those  times  and  in  that  manner, 
and  for  which  payment  is  so  to  be  made.  It 
is  perfectly  clear  that  no  particular  payment 
can  be  a  condition  precedent  of  the  entire 
contract,  because  the  delivery  under  the  con- 
tract was  most  certainly  to  precede  payment; 
and  that  being  so,  I  do  not  see  how,  without 
express  words,  it  can  possibly  be  made  a  con- 
dition precedent  to  the  subsequent  fulfillment 
of  the  unfulfilled  part  of  the  contract  by  the 
delivery  of  the  undelivered  steel."  9  App. 
Cas.  439. 

Moreover,  although  in  the  court  of  appeal 
dicta  were  uttered  tending  to  approve  the  de- 
cision in  Simpson  y.  Crippin,  and  to  disparage 
the  decisions  in  Hoare  v.  Rennie  and  Honck 
V.  Muller,  above  cited,  yet  in  the  house  of 
lords  Simpson  v.  Crippin  was  not  even  refer- 
red to,  and  Lord  Blackburn,  who  had  given 
the  leading  opinion  in  that  case,  as  well  as 
Lord  Bramwell,  who  had  delivered  the  lead- 
ing opinion  in  Honck  v.  Muller,  distinguished 
Hoare  v.  Rennie  and  Honck  v.  Muller  from 
the  case  in  judgment.     9  App.  Cas.  444,  446. 

Upon  a  review  of  the  English  decisions,  the 
rule  laid  down  in  the  earlier  cases  of  Hoare 
V.  Rennie  and  Coddington  v.  Paleologo,  as 
well  as  in  the  Jater  cases  of  Reuter  v.  Sala 
and  Honck  v.  Muller,  appears  to  us  to  be  sup- 
ported by  a  greater  weight  of  authority  than 
the  rule  stated  in  the  intermediate  cases  of 
Simpson  v.  Crippin  and  Brandt  v.  Lawrence, 
and  to  accord  better  with  the  general  prin- 
ciples affirmed  by  the  house  of  lords  in  Bowes 
V.  Shand,  while  it  in  no  wise  contravenes  the 
decision  of  that  tribunal  in  Mersey  Co.  v. 
Naylor.  In  this  country  there  is  less  judicial 
authority  upon  the  question.  The  two  cases 
most  nearly  in  point  that  have  come  to  oiu- 
notice  are  Hill  v.  Blake,  97  N.  Y.  216,  which 
accords  with  Bowes  v.  Shand,  and  King  Phil- 
ip Mills  V.  Slater,  12  R.  I.  82,  which  approves 
and  follows  Hoare  v.  Rennie.  The  recent 
cases  in  the  supreme  court  of  Pennsylvania, 
cited  at  the  bar,  support  no  other  conclusion. 
In  Shinn  v.  Bodine,  60  Pa.  St.  182,  the  point 
decided  was  that  a  contract  for  the  purchase 
of  800  tons  of  coal  at  a  certain  price  per  ton, 
"coal  to  be  delivered  on  board  vessels  as  sent 
for  during  the  months  of  August  and  Septem- 
ber," was  an  entire  contract,  under  which 
nothing  was  payable  until  delivery  of  the 
whole,  and  therefore  the  seller  had  no  right 
to  rescind  the  contract  upon  a  refusal  to  pay 
for  one  cargo  before  that  time.  In  Morgan 
V.  McKee,  77  Pa.  St.  228,  and  in  Scott  v.  Kit- 
tanning  Coal  Co.,  89  Pa.  St.  231,  the  buyers 


BP^EA'.n— CONDITIONS  PRECEDENT. 


609 


rijrht  to  rescind  the  whole  contract  upon  the 
failure  of  the  seller  to  deliver  one  installment 
was  denied,  only  because  that  rif,'lit  had  Iji'cn 
waived,  in  the  one  case  by  unreasonable  delay 
in  asserting  it,  and  in  the  other  by  liaving  ac- 
cepted, paid  for,  and  used  a  previous  instaJl- 
ment  of  the  goods.  The  decision  of  the  su- 
preme judicial  court  of  Massachusetts  in  Win- 
chester V.  Newton,  2  Allen,  492,  resembles 
that  of  the  house  of  lords  in  Mersey  Co.  v. 
Naylor. 

Being  of  opinion  that  the  plaintiff's  failure 
to  make  such  shipn  ents  in  February  and 
March  as  the  contract  required  prevents  his 
maintaining  this  action.  It  is  needless  to  dwell 

HOPK.SEL.CA8.CONT.— 89 


upon  the  further  objection  that  the  shipments 
in  April  did  not  comply  with  the  contract,  be- 
cau.se  the  defendants  could  not  be  compelled 
to  take  about  1,(mjO  tons  out  of  the  larger 
quantity  shipped  in  that  month,  and  the  plain- 
tiff, after  once  designating  the  names  of  ves- 
sels, as  the  contract  bound  him  to  do,  could 
not  substitute  other  vessels.  See  Busk  v. 
Spence,  4  Camp.  329;  Graves  v.  Legg,  9  Exch. 
7U9;  Renter  v.  Sala,  above  cited. 
Judgment  affirmed. 

The  CHIEF  JUSTICE  was  not  present  at 
the  argument,  and  took  no  part  in  the  decision 
of  this  ca.se. 


610 


DISCHARGE  OF  CONTRACT. 


a^ 


^^f 


WOOTEN  V.  WALTERS  et  aL 
J  a-A  S.   E.  12A,  110  N.  C.  251.) 

Snpreme  Court  of  North  Carolina.    March  15, 
1892. 

Appeal  from  superior  court,  Lenoir  county; 
E.  T.  Boylcin.  Judge. 

Action  by  Simeon  Wooten  against  John  D. 
Waltere  and  others  to  avoid  a  contract  for  the 
SJ^le  of  real  and  personal  property,  and  to  re- 
cover such  property.  Exceptions  were  taten 
to  the  report  of  a  referee,  and  from  'a  judg- 
ment modifying  the  report,  sustaining  an  ex- 
ception of  defendants  and  oveiTuling  plain- 
tiff's exceptions,  plaintiff  appeals.     Affirmed. 

The  other  facts  fully  appear  in  the  follow- 
ing statement  by  MERRIMON,  C.  J.: 

The  following  is  a  copy  of  the  case  settled 
on  appeal:  "The  facts  found  by  the  referee 
are  as  follows:  (1)  That  in  the  year  1SS9  the 
plaintiff  and  defendants  formed  themselves 
into  a  company  and  were  incorporated  under 
the  name  of  the  'Kinstou  Oil-Mill  Company,' 
for  the  purpose  of  manufacturing  cotton^seed 
oil.  (2)  The  plaintiff  and  each  of  the  defend- 
ants agreed  to^ke  one:fourth_ea£h^  pXJthe 
capital  stock,  and  the  company  was  organ- 
ized, and  the  defendant  J.  D.  "Walters  was 
elected  president  of  the  company,  and  was  the 
general  superintendent  of  the  business  in 
erecting  buildings,  machinery,  and  making 
the  necessary  preparation  for  commencing 
the  manufacture  of  the  oil.  (3)  That  no  cer- 
tificates or  other  evidence  of  stock  were  ever 
issued  by  said  company.  (4)  In  November  of 
said  year  1SS9,  and  before  the  company  was 
ready  to  commence  operation,  the  plaintiff 
agreed  with  the  defendant  J.  D.  Walters  to 
selLto  him  his  stock  of  merchandise  and  two 
Stores,  a nd  lots.  aU  being  in  La  Grange,  and 
was  to  take  in  payment  therefor  the  interests 
of  the  said  X.  D.  Walters  and  the^Sef endant 
41ex.  Sutton'inl;Ee~said  oil-mill,  the  difference 
to  be^^aidjas  If  sliould  appear  on  estimation. 
(5)  The  contract  above  mentioned  was  as  fol- 
lows: Walters  was  at  the  store  of  Wooten, 
and  a  proposition  to  trade  was  made,  by 
which  party  is  uncertain,  and  whether  the 
stores  were  then  named  or  not  is  uncertain. 
They  agreed  to  meet  again  that  night  At 
night  Walters  went  to  Wooten's  store,  and 
after  a  while  they  agreed  that  the  goods  were 
worth  twenty  per  cent  less  than  their  original 
cost  They  then  immediately  began  to  talk 
about  the  price  of  the  stores,  but  did  not 
agree  as  to  their  price.  They  then  began  to 
talk  about  the  price  of  the  oil-mill  property. 
Walters  said  it  was  worth  dollar  for  dollar 
for  what  had  been  put  into  the  mill.  Wooten 
thought  he  ought  to  make  some  reduction. 
Walters  refused  to  do  so.  Then  they  began 
to  talk  again  about  the  stores,  bu^  did  not 
■ascree  .aS-to,the.  price.  At  this  point  Walters 
said  to  Wooten,  'Do  we  understand  each  oth- 
er?' Wooten  said  he  thought  so.  Walters 
said,  'You  are  to  take  the  oil-mill  property  at 
what  it  cost  us,  and  I  am  to  take  the  goods 
at  20  per  cent  off  first  cost'     Wooten  made 


no  reply,  but  walko;!  off  to  attend  to  some 
matter,  came  back,  and  they  walked  out  of 
the  store,  and  went  to  the  pump,  and  got 
some  water.  Walters_again  spoke  about  the 
stores L  Wooten  asked  $3,000;  Walters  offer- 
ed  $2t500.  Before  they  separated  tht^  agreed 
on  the  price  of  the  stores  at  $2,750,  and 
Wooten  then  asked  Walters  when  he  wanted 
to  take  an  inventory  of  the  goods.  (6)  The 
contract  was  not  reduced  to  writing,  nor  any 
note  or  memorandum  thereof.  (7)  An  inven- 
tory of  goods  was  taken,  and  they  amounted 
to  $9,514.38.  This  amount,  reduced  six  and 
one-fourth  per  cent.,  would  be  the  first  cost 
of  the  goods,  which  is  $8,919.73,  (first  cost) 
This,  reduced  by  20  per  cent,  would  leave 
$7,135.79,  the  price  Walters  was  to  pay  Woot- 
en for  the  goods.  (S)  After  thejnventory  was 
completed,  Wooten  delivered^he_  stores  and 
^oods~lnto'jEie_  possession  of  Waltejrs.  (9) 
WooEeiT  took  possession  of  the  oil-mill  prop- 
erty, completed  the  erection  of  machinery, 
etc.,  and  operated  the  mill  about  two  weeks, 
and  then  stopped  running  the  mill,  and  about 
a  week  after  informed  Walters  he  should  not 
carry  out  and  complete  the  contract,  and  of- 
fered to  return  to  him  the  miU  property,  and 
demanded  of  Walters  the  return  of  the  stores 
and  goods.  (10)  Walters  has  always  been 
willing  and  able  to  perform  his  part  of  the 
contract  and  several  tim<?s  so  informed  Woot- 
en. (11)  Wooten.  after  he. stopped  running 
the  mill,  sold  off  cotton-seed  and  other  ma- 
terial, which  belonged  to  the  company  before 
he  and  Walters  traded,  to  the  value  of  $1,- 
834.18.  (12)  The  mill,  machinery,  etc.,  can 
be  put  in  as  good  condition  as  it  was  when 
Wooten  took  charge  of  it,  at  a  cost  of  about 
$12.  (13)  The  amount  of  mill  property  bought 
by  Wooten  from  Waltere,  at  the  price  agreed 
on,  is  $S,107.1L  Therefore  the  accounts 
stand  thus: 

Wooten  to  Walters,  Dr. 

To   mill   property $8,107  11 

By  merchandise    $7,135  79 

By  two  stores  and  lots...  2,750  00 

To  amount  due  by  Walters     1,778  68 

$9,885  79  $9,885  79 
Wooten  refusing  to  convey  the  stores, 
and  deducting  their  value,  Wooten 
will  be  due  Walters $    971  32 

—(14)  Walters  had  sold  a  considerable  quan- 
tity of  the  goods  before  Wooten  demanded 
their  return.  The  siock  of  goods  has  been  re- 
plenished with  other  goods,  which,  or  a  part 
of  which,  cannot  now  be  separated  from  the 
original  stock  turned  over  by  Wooten  to 
Walters.  Conclusions  of  law  from  the  fore- 
going facts:  (1)  That_the_contract  for  the  sale 
of  the  stores  and  the  goodsjs_arLentire  con- 
tract,  ang'caiinonje  divided_  or_apportioned, 
"(2)  That  the  plaintiff,  Wooten,  is  entitled  to 
recover  the  possession  of  the  two  stores  and 
lots  mentioned  in  the  pleadings.  (3)  That  the 
plaintiff,  Wooten,  is  not  entitled  to  recover  the 
goods,  or  the  value  of  them,  from  the  defend- 
ants. (4)  That  the  defendants  are  not  enti- 
tled to  have  the  contract  enforced  as  to  the 


i;i;ExiCH— CONDITIONS  PRECEDENT. 


611 


stores  and  lots.  (5)  That  the  defendants  are 
entitled  to  recover  of  the  plaintifC  $'J71.32,  it 
being  the  amount  paid  plaintiff  over  the  value 
of  goods  received  from  plaintiff." 

The  court  siLstaiued  the  defendants'  excep- 
tion to  tlie  lirst  conclusion  of  law,  and  "ad- 
judged that  the  said  contract  is  divisible." 
The  plaintiff  filed  exceptions  as  follows;  "(1) 
riainLiff  excepts  to  conclusion  of  law  No.  3, 
that  the  plaintilT  is  not  entitled  to  recover  the 
goods,  or  the  value  of  them,  from  the  defend- 
ant, whereas  he  ought  to  have  found  that  Uie 
plaibtiff  was  entitled  to  recover  the  value  of 
the  goods,  as  he  has  found  that  the  goods  had 
been  sold  by  the  defendant  J.  D.  Walters. 
(2.  Plaintiff  excepts  to  conclusion  of  law  No. 
n,  wherein  he  finds  that  the  defendants  are 
eutitled  to  recover  $971^2  from  plaintiffs 
whereas  he  ought  to  have  found  that  the 
plaintiff  was  entitled  to  recover  of  the  defend- 
ant John  D.  Walters  the  value  of  the  goods, 
to  wit,  $7,134.78,  and  interest  thereon."  The 
CO  art  overniled  these  exceptions,  and  gave 
judgment  as  foUows:  "It  is  further  adjudged 
that  the  report  of  the  referee,  as  above  modi- 
fied, be  and  is  confirmed.  It  is  further  ad- 
judged that  the  plaintiff  recover  of  the  de- 
fendants the  two  stores  and  lots  mentioned 
in  the  pleadings;  that  tlie  defendants  retain 
possession  of  the  stock  of  goods  and  general 
merchandise;  and  that  the  defendants  re- 
cover of  the  plaintiff  the  sum  of  nine  hundred 
seventy-one  and  32 /^^q  dollars,  the  amount 
found  due  by  tlis  rerepee,  with  interest  on  the 
said  amount  from  December  1,  1SS9,  tUl  paid; 
and,  further,  that  the  plaintiff  recover  of  the 
defendants  his  co.=  ts  of  this  action,  to  be  tax- 
ed by  the  clerk."  The  plaintiff  assigned  as 
error  that  the  court  sustained  the  defendant's 
exception  above  mentioned,  and  overruled  his 
exceptions  abo'^e  net  forti,  and  appealed  to 
this  court. 

Geo.  Rountreo^  fo-  iippeUant.  G-  V.  Strong 
and  W.  R.  Alltn,  for  appellees. 

MERRIMON,  C.  J.  (after  stating  the  facts.)' 
A  contract  is  entut,  and  not  severable,  whenJ 
by  its  terms,  nature  and  puipose,  it  contem-\ 
plates  and  intends  that  each  and  all  of  its 
parts,  material  provisions,  and  the  considera- 
tion are  common  each  to  the  other,  and  inter- 
dependent. Such  a  contract  possesses  essen- 
tial oneness  in  all  material  respects.  The 
consideration  of  it  is  entire  on  both  sides. 
Hence,  where  there  is  a  contract  to  pay  a 
gross  sum  of  money  for  a  certain  definite  con- 
sideration, it  is  entire,  and  not  severable  or 
apportionable,  in  law  or  equity.  Thus,  where 
a  particular  thing  is  sold  for  a  definite  price, 
the  contract  is  an  entirety,  and  the  purchas- 
er wiU  be  liable  for  the  entire  sum  agreed  to 
be   paid.     And   so.  _a.lso.   when  two  or  more 

things   fli-P    snlfl    tnfinthrr   fr>r   ^    crfrLgq    gnm     f|io 

contract  i^^  not  severable.  The  seller  is  bound 
to  deliver  the  whole  of  the  things  sold,  and 
the  buyer  to  pay  the  whole  price,  in  the  ab- 
sence of  fraud.  Hence  it  has  been  held  that, 
where  a  cow  and  400  pounds  of  hay   were 


sold  for  $17,  the  contract  was  entire.  Mr. 
Ju.stice  Story  says  that  "the  principle  upon 
which  this  rule  is  founded  seems  to  be  that, 
as  the  contract  is  founded  upon  a  con.sidera- 
tion  dependent  upon  the  entire  performance 
thereof,  If  for  any  cause  it  be  not  wholly  i>er- 
foimed,  the  casus  foederis  does  not  arise,  and 
the  law  will  not  make  provision  for  exigencies 
against  which  the  parties  have  neglected  to 
fortify  themselves."  1  Storj',  ConL  (5th  Ed.) 
§  2G.  Such  contracts  are  enforceable  nnly  qh 
IL  whole.  On  the  other  hand,  a  severable 
contract  is  one  in  its  nature  and  purpose  sus- 
ceptible of  division  and  apportionment,  hav- 
ing two  or  more  parts,  in  respect  to  matters 
and  things  contemplated  and  embraced  by  it, 
not  necessarily  dependent  upon  each  otJier, 
nor  is  it  intended  by  the  parties  that  they  shall 
be.  Hence  an  action  may  be  maintained  for 
a  broach  of  it  in  one  respect,  and  not  neces- 
sarily in  another,  or  for  several  breaches, 
while  in  other  material  resfKiCts  it  remains  in- 
tact. In  such  a  contract,  the  consideration  is 
not  single  and  entire  as  to  all  its  several  pro- 
visions as  a  whole  until  it  is  performed;  it 
is  capable  of  division  and  apportionment. 
Thus,  though  a  number  of  things  be  bought 
together  without  fixing  an  entire  price  for  the 
whole,  but  the  price  of  each  article  is  to  b€ 
ascertained  by  a  rate  or  measure  as  to  thr 
several  articles,  or  when  the  things  are  of 
different  kinds,  though  a  total  price  is  named 
but  a  certain  price  is  aflixed  to  each  thing, 
the  contract  in  such  cases  may  be  treated  as 
a  separate  contract  for  each  article,  althoug 
they  all  be  included  in  one  iosfrument  of  couJ 
veyance,  or  by  one  contract  Thus  where  a 
party  purchased  two  parcels  of  real  estate, 
the  one  for  a  specified  price  and  the  other  for 
a  fixed  price,  and  took  one  conveyance  of 
botli,  and  he  was  afterwards  ejected  from 
one  of  them  by  reason  of  defect  of  title,  it 
was  held  that  he  was  entitled  to  recover  there- 
for from  the  vendor.  Johnson  v.  Johnson,  3 
Bos.  &  P.  1G2;  Miner  v.  Bradley,  22  Pick.  45G. 
So,  also,  it  was  held,  where  a  certain  farm 
and  dead  stock  and  growing  wheat  were  all 
sold  together,  but  a  separate  price  was  affix- 
ed to  each  of  these  things,  tluit  the  contract 
was  entire  as  to  each  item,  and  was  severable 
into  three  contracts,  and  hence  a  failure  to 
comply  with  the  contract  as  to  one  item,  did 
not  invalidate  the  sale,  and  give  the  vendor  a 
right  to  reject  the  whole  contract.  In  such 
case,  the  contract  may  be  entire  or  several, 
according  to  the  circumstances  of  each  partic- 
ular case,  and  the  criterion  is  to  be  found  in 
the  question  whether  the  whole  quantity — all 
of  the  things  as  a  v^hole — is  of  the  essence  of 
the  contract  If  it  appear  that  the  purpose 
was  to  tike  the  whole  or  none,  then  the  con- 
tract would  be  eaitire;  otherwise  it  wonld  be 
severable.  It  is  sometimes  difficult  to  deter- 
mine whether  the  contract  is  entire  or  sever- 
able in  such  cases,  and  there  is  great  di- 
versity of  decision  on  the  subject,  "but,  on 
the  whole,  the  weight  of  opinion  and  the 
more  n^sonable  rule  would  seem  to  be  that 


612 


DISCHARGE  OF  CONTRACT. 


where  there  is  a  purcbasR  of  different  artl- 
.  cleg,  at  different  j>rl£es,_at  the  same  time^the 
"contract  would  be  severable  as  to  eacli  arti- 
ie  taEinj 


unless  the  talking  of  the  whoie  was  ren- 
^ed^  essential  eittrer-by  the  nature  of  the 
subject-matter  or  by  the  acT  of  the  parties." 
This  rule  maues  the  interpretatton  of  the  con- 
tract depend  on  the  intention  of  the  parties 
as  manifested  by  their  acts  and  the  circum- 
stances of  each  particular  case.  Brewer  v. 
Tysor,  3  Jones,  (N.  C.)  ISO;  Niblett  v.  Her- 
ring, 4  Jones,  (N.  C.)  262;  Brewer  v.  Tysor,  5 
Jones,  (N.  C.)  173;  Dula  v.  Cowles,  7  Jones, 
(N.  C.)  290;  Jarrett  v.  Self,  90  N.  a  478; 
Chamblee  v.  Baker.  95  N.  C.  9S;  La  wing  v. 
Rintels,  97  N.  C.  350,  2  S.  B.  252;  Pioneer 
Manuf'g  Co.  v.  Phoenix  Assur.  Co.,  14  S.  E. 
731  (decided  at  the  present  term);  Story,  Cont. 
(5th  Ed.)  §§  21-25;  3  Pars.  Cont  187;  Whart 
Cont.  §§  338,  511,  748. 

Applying  the  rules  of  law  thus  stated  to  the 
case  before  us,  \££_a,re-_of -opinion  that__the 
contract  to  be  interpreted,_treated  as^  execu- 
tory,.is  severable,  and  the  sale  of  the  goods 
therein  mentioned  was  not  necessarily  an  in- 
separable part  of  the  sale  of  the  land  em- 
braced by  this  contract.  Although  it  is  sm- 
gle,  it  embraces  the  sale  of  two  distinct 
things,  each  having  a  certain  price  affixed  to 
it,  and  the  price  paid  for  the  whole  being 
susceptible  of  apportionment  Neither  by  the 
terms  of  the  contract  settled  by  the  findings 
of  fact  nor  by  its  nature  and  purpose,  does 
it  appear  that  the  store-house  lot  of  land  and 
stock  of  goods,  distinct  things,  were  both 
necessary  parts  of  an  entire  contract  These 
things  were  not  necessary  parts  of  each  oth- 
er; they  were  entirely  capable  of  being  sold 
sepan;tely.  Nor  does  it  appear  that  they 
were   sold  as  a  single   whole.     On  the  con- 


trary, they  were  spokMi  of  and  treated  as  dLf-_ 
ferent  subjects  of  sale,  a  specified  price  was 
affixed  to  the  land,  and  a  distinct,  defiuite 
price  affixed  to  the  goods.  Wherefore  this 
distinction?  "Why  was  the  price  fixed  as  the 
separate  and  distinct  subject  of  sale?  As  we 
have  seen,  the  two  things  were  not  necessary 
to  each  other,  and  nothing  was  said  or  done 
by  the  parties,  nor  does  anything  appear  to 
show  that  the  parties  would  not  have  made 
the  contract  unless  it  embraced  both  the  sale 
of  the  land  and  the  stock  of  goods.  The  sale 
of  the  stock  of  goods  was  not  part  or  parcel 
of  the  sale  of  the  land,  nor  dependent  upon 
it  although  the  sale  of  both  was  made  at 
the  same  time,  and  embraced  by  the  same  con- 
ti-act  severable  in  its  nature  and  purpose. 
Thej'  were  treated  as  distinct  subjects  of  sale, 
the  price  of  each  being  definitely  fixed.  The 
mere  fact  that  the  plaintiff  was  about  to 
change  the  character  of  his  business  did  not 
imply  that  the  store-houses  and  the  land  on 
which  they  were  situate  must  be  sold  with 
the  goods,  else  the  goods  would  not  be  sold. 
Such  things  are  valuable  to  let  for  rent 
There  is  the  absence  of  anything  that  shows 
a  purpose  to  sell  the  two  things  as  an  insep- 
arable whole.  When,  therefore,  the  plaintiff 
avoided  the  contract,  not  reduced  to  writing 
as  to  the  land,  as  he  might  do  under  the 
statute  pertinent  he  did  not  avoid  the  con- 
tract as  to  the  stock  of  goods.  The  contract 
was  severable,  and,  as  to  the  goods,  was 
valid  and  remained^of  force  and  continued  to 
have  effect  It  seems  that  reaUy:  _the  con- 
tract wvcs  executed  as  to  the  goods,  and  the 
sale  might  on  that  ground,  be  upheld  with- 
out reference- ta_±he  ineffectual  sale  of  the 
land;  hut  no  jjueslion  in  that  aspect-- of  the 
case  was  raised.     Judgment  affirmed- 


BREACH— CONDITIONS  PRECEDENT. 


^3^ 


-0^^^^, 


613 


BAST  V.  BYRNE. 

(8  N.  W.  494,  51  Wis.  531.) 

Supreme  Court  of  Wisconsin.    March  24,  1881. 

Appeal  from  circuit  court,  Green  coimty. 

January  19,  1870,  the  defendant,  Byrne, 
agreed  In  writing  to  pay  the  plaintiff,  Bast, 
$300  for  one  year's  work  in  his  store,  and 
to  let  liTm  Tiave"  all  the  goods  ho  needed  for 
himself  airP6st,~wTth  10  per  cent,  added,  dur- 
ing the  tlme^and  reserving  to  himself  the 
privilege  of  dismissing  Bast  at  the  end  of 
six  months  if  ho  should  no  longer  need  his 
services;  and  Best  agreed  therein  and  there- 
for to  work  strenuously  in  the  store  for 
Byrne's  interest.  The  complaint  alleged  the 
substance  of  the  agreement,  and  performance 
by  the  plaintiff,  and  admitted  payment  of 
$14S..o4  in  goods.  .1553.29  in  cash,  etc.,  and  loss 
of  time  amounting  to  $9,  and  claimed  a  bal- 
ance of  ?l-i9.29.  The  defendant  offered  and 
tendered  judgment  for  $120,  with  costs  of 
action,  which  the  plaintiff  refused  to  accept. 
The  answer  alleged  payment,  and  that  the 
plaintiff  had  forfeited  his  wages  by  leaving 
his  employ  many  times  without  leave,  and 
by  altogether  absenting  himself  from  the  de- 
fendant before  he  had  completed  the  work- 
ing of  his  year.  On  the  trial  in  the  circuit 
court  the  defendant  objected  to  any  evidence 
under  the  complaint,  on  the  ground  that  it 
appeared  from  the  complaint  that  the  plaintiff 
agreed  to  work  a  year,  but  had  failed  to  work 
out  his  time;  which  objection  was  overruled 
by  the  court  and  the  defendant  excepted. 
The  undisputed  evidence  shows  that  the  plain- 
tiff began  work  under  the  contract  January 
26,  1878,  and  quit  on  the  evening  of  Jan- 
uary 25,  1879;  that  the  plaintiff  had  lost  at__ 
different  times  in^  the_aggi:e:gate_iune^aad— a. 
half  days.  _At  the  close  of  the  plaintiff's  tes- 
Hmony  the  defendant  moved  for  a  nonsuit, 
which  was  overruled,  and  the  defendant  ex- 
cepted. There  was  evidence  tending  to  show 
that  there  was  an  attempt  and  failure  to  set- 
tle on  the  evening  that  he  quit  and  some  dis- 
pute about  the  amount  he  had  received,  and 
whether  his  time  was  out,  or  would  not  be 
out,  until  the  following  day.  At  the  close 
of  the  testimony  and  the  ai'gTiments  of  coun- 
sel, the  court  charged  the  jury.  Thereupon 
the  jury  retired  and  returned  a  verdict  for 
the  plaintiff  of  $147.32,  which  the  defendant 
moved  to  set  aside  and  for  a  new  trial,  which 
motion  was  overruled  by  the  court,  and  the 
coimsel  for  the  defendant  excepted.  No  ex- 
ception was  taken  to  any  portion  of  the 
charge,  and  no  instructions  were  refused  or 
requested. 

A.  A.  Douglass,  B.  Dunwiddie,  and  S.  U. 
Pinney,  for  appellant.  P,  J.  Clawson,  for  re- 
spondent. 

CASSODAY,  J.  There  Is  no  dispute  but 
what  it  was  a  year  from  the  time  the  plain- 
tiff began  the  work  until  he  quit.  Had  he 
lost   no  time   he    would   have   fully  complied 


th  his  contract.  It  is  urged,  however,  that 
never  the  plaintiff,  from  his  own  fault 
or  necessity,  lost  any  time,  it  Ix'came  optional 
with  the  defendant  to  allow  him  to  resume 
work  or  not,  and  that  when  he  did  "choose 
to  allow  him  to  resume  work"  then  the  plain- 
tiff became  bound  to  make  up  the  days  so 
lost  by  working  after  what  would  have  other- 
wise been  the  end  of  the  year.  In  other 
words,  it  Is  claimed  that  the  clau.se,  "agrees 
to  pay  *  •  •  the  sum  of _S3C0  forgone 
Xcax.!!  does  not  refer  tcji.  delinile.  period  of 

time,  but  fl  d^'fi^'te  nnmher  nf  days  of  S£iy- 
ice>  and  that  until  the  number  of  days  of 
service  were  in  fact  rendered,  either  during 
the  year  or  subsequently,  no  recovery  -c^uild 
be  bad  upon  the  contract  In  support  of  this 
theory  we  are  referred  to  Winn  v.  Southgate, 
17  Vt  3.55,  and  Lamburn  v.  Cruden,  2  Man. 
&  G.  253.  In  Winn  v.  Southgate  the  con- 
tract was  that  the  plaintiff  should  labor  six 
months  for  the  defendant.  He  commenced 
work  May  17th,  and  during  the  term,  with 
the  consent  of  the  defendant  was  absent  on 
a  journey  16  days,  but  returned  October  5th, 
and  continued  to  work  untU  October  30th, 
when  he  quit,  being  17  days  before  the  end 
of  the  six  months,  and  then  insisted  that  his 
time  was  out,  claiming  that  24  working  days 
was  a  month,  and  thereupon  sued  for  the 
balance  of  his  wages,  and  the  court  held  that 
he  could  not  recover.  It  is  evident  from  this 
statement  that  the  question  here  involved  did 
not  there  arise.  In  Lamburn  v.  Cruden  the 
plaintiff  had  been  engaged  by  the  defendant 
at  a  yearly  salary,  payable  quarterly.  The 
last  year  of  service  expired  S^tember  29, 
1837,  and  his  salary  up  to  that  time  had  been 
duly  paid.  Before  the  expiration  of  the  year 
a  misunderstanding  had  arisen.  October  20th 
the  plaintiff  tendered  his  resignation,  which 
was  accepted  December  13th.  In  the  mean- 
time he  had  performed  no  service,  except 
upon  one  occasion,  and  tlien  against  the  as- 
sent of  the  defendant.  The  action  was  for 
services  between  September  29th  and  De- 
cember 13th,  but  the  plaintiff  was  nonsuited, 
and  the  rule  for  a  new  trial  was  made  abso- 
lute, on  the  ground,  that  the  court  should 
have  submitted  to  the  jury  the  question  as 
to  whether  there  was  a  new  agreement. 

The  question  there  involved  seems  to  have 
lx>en  foreign  to  the  question  here  presented. 
There  the  subsequent  services  were  claimed 
under  a  new  agreement;  here  subsequent 
services  were  demanded  by  virtue  of  the  old 
agreement  Of  course  it  was  competent  for 
the  parties  In  this  case  to  have  made  a  new 
agreement  whereby  the  plaintiff  should  work 
a  certain  number  of  days  in  lieu  of  the  nme 
and  one-half  days  which  he  had  lost  but 
there  Is  no  claim  that  any  such  new  agree- 
ment was  ever  made,  and  the  question  is, 
can  the  court  expand  an  agreement  which  by 
its  terms  was  limited  to  "one  year,"  so  as 
to  require  a  party  under  it  to  render  services 
after  the  expiration  of  the  year,  in  lieu  of 
certain   days   of   service   which    he    failed   to 


614 


DISCHARGE  OF  CONTRACT. 


perform  during  the  year?  No  case  has  been 
cited  going  to  tliat  extent,  and  we  have  no 
disposition  to  furnish  one.  A  party  contract- 
ing to  labor  for  a  limited  period  cannot  be 
required,  after  the  expiration  of  the  period, 
to  render  additional  services  under  such  con- 
tract, without  any  new  agreement,  merely  be- 
cause he  had  lost  certain  days  during  the 
term.  The  court  charged  the  jury  on  the 
theory  that  it  was  competent  for  the  defend- 
ant, during  the  contract,  to  waive  a  strict 
performauco  of  any  particular  day's  work, 
and  that  when  the  plaintiff  from  time  to  time 
lost  a  day,  and  the  defendant,  with  knowl- 
edge of  the  fact,  received  him  back  into  his 
employ,  it  was  such  waiver;  at  least  to  the 
extent  of  preventing  the  defendant  from  en- 
forcing a  forfeiture  of  payment  for  the  serv- 
ices actually  performed.  It  is  true  the  charge 
in  this  respect  is  not  very  full  or  explicit, 
but  if  the  defendant  desired  to  have  it  more 
definite  he  should  have  so  requested.  We  are 
convinced  that  the  theory  upon  which  the 
cause  was  submitted  to  the  jury  was  correct. 
Such  acts  of  the  defendant,  without  objec- 
tion, we  regard  as  a  prima  facie  waiver  of 
the  breach.  They  presume  condonation.  The 
loss  of  a  half  day,  a  day,  or  two  days,  at  in- 
tervals, and  long  prior  to  the  termination  of 
the  contract,  without  objection  on  the  part  of 
the  defendant,  should  not,  upon  principle, 
operate  so  harshly  as  to  work  a  forfeiture 
of  payment  for  services  subsequently  ren- 
dered in  good  faith,  and  with  no  notice  that 
such  forfeiture  would  be  insisted  upon. 

There  may  be  adjudged  cases  going  to  that 
extent,  but  we  should  be  very  slow  to  follow 
them.  In  Ridgway  v.  Hungerford,  3  Adol. 
&  E.  171,  Lord  Denman,  C.  J.,  declared  that 
nrhere  the  servant  was  guilty  of  misconduct 
in  .Tune,  and  the  master,  knowing  it,  retained 
him  until  November,  "a  condonation  might 
be  presumed."  This  was  dicta,  to  be  sure, 
but  we  think  it  was  good  law.  In  Prentiss 
V.  Ledyard,  2S  Wis.  131,  although  the  con- 
tract was  for  no  definite  time,  yet  it  was  held 
that,  "where  the  employe  was  to  receive  pay- 
ment at  a  specified  rate,  if  he  continued  tem- 
perate and  faithful  in  the  employer's  service, 
the  fact  that  he  was  occasionally  intemperate 
and  discontinued  the  service  for  short  peri- 
ods would  not  prevent  bus  recovering  the 
stipulated  rate  for  the  time  actually  spent  in 
such  service,  if  he  was  received  back  into  it, 
and  continued  therein,  without  any  new  ar- 
rangement being  made,  or  any  intimation 
given  that  the  old  one  was  terminated."  We 
see  no  difference  in  principle  between  the 
waiver  of  the  conditions  of  a  contract  In  re- 
spect to  personal   habits,   and   In   respect   to 


interruptions  of  service,  or  any  other  stipula- 
tion. The  question  of  waiver  of  the  breach, 
by  the  retention  of  the  employs  for  11  or  12 
days  after  the  master's  knowledge  of  the  ex- 
istence of  the  causes,  was  held  properly  sub- 
mitted to  the  jury  m  McGrath  v.  Bell,  33  N. 
Y.  Sui>er.  Ct.  195.  It  is  certainly  equitable, 
and,  we  think,  according  to  well-established 
principles  of  law,  to  hold  that  where  an  em-  / 
ploye,  for  a  fixed  period  and  without  any 
fault  of  his  employer,  absents  himself  for  a 
short  time,  and  then  the  employer,  with 
knowledge  of  the  fact,  receives  him  back  into 
his  service  without  objection,  and  retains  him 
until  the  termination  of  the  contract,  he  there- 
by waives  the  right  to  declare  the  contract 
forfeited  as  to  the  services  actually  renderedJ 
^his  is  not  going  as  far  as  the  opinion  of  tne 
court  in  Britton  v.  Turner,  6  N.  H.  4S1.  It 
is  true,  that  case  has  frequently  been  dis- 
approved, but  it  is  also  true  that  it  has  been 
frequently  approved.  Elliot  v.  Heath,  14  N. 
BL  131;  La  ton  v.  King,  19  N.  H.  280;  Davis 
V.  Baxrington,  30  N.  H.  517;  Pixler  v.  Nich- 
ols, 8  Iowa,  106;  Byerlee  v.  Mendel,  39  Iowa, 
382,  and  cases  there  cited,  in  which  last  case 
it  was  held  that  "where  a  party  hires  himself 
to  another  for  a  fixed  period  of  time,  and 
leaves  the  service  before  the  expiration  of 
the  term,  without  any  fault  on  the  part  of 
the  employer,  the  former  may  recover  the 
value  of  his  services  performed  as  upon  a 
quantum  meruit,  without  showing  that  he 
left  the  service  of  his  employer  for  good 
cause."  Britton  v.  Turner,  was  also  followed 
In  Fenton  v.  Clark,  11  Vt.  5G0;  Oilman  v. 
Hall,  Id.  510;  Blood  v.  Enos,  12  Vt.  625. 
There  are  strong  equitable  reasons  to  sus- 
tain the  doctrine  of.  the  above  cases,  but  they 
would  seem  to  be  in  conflict  with  the  weight 
of  authority,  and  we  therefore  cite  them 
merely  because  they  furnish  strong  reasons 
in  favor  of  the  conclusions  which  we  have 
reached  in  this  case. 

There  is  still  another  reason  why  this 
judgment  should  be  sustained.  Prior  to  the 
first  trial  there  was  a  dispute  as  to  the  amount 
due,  and  the  defendant  offered  and  tendered 
judgment  for  the  amount  which  he  consid- 
ered due,  with  costs  of  action.  Such  offer 
and  tender  were  competent  evidence,  and  au- 
thorized a  verdict  of  waiver  of  all  forfeiture 
under  the  contract.  Cahill  v.  Patterson,  30 
Vt.  592;  Seaver  v.  Morse,  20  VL  620;  Pat- 
note  V.  Sanders,  41  Vt  GO;  Boyle  v.  Parker, 
46  Vt  343.  A  party  who  proposes  to  insist 
upon  a  technical  forfeiture  should  act  prompt- 
ly, and  consistently  with  the  right  claimed. 

The  judgment  of  the  circtiit  court  is  af- 
firmed- 


BY  OPEKATION  OF  LAW— IMPOSSIIilLITY. 


615 


SUrERINTENDENT     &     TRUSTEES     OF 

PUI5LIC    SCHOOLS   OF   CITY    OF 

TRENTON  T.  BENNETT  et  aL 

^:^/  (27  N.  J.  Law,  513.)  ^V3 

Supreme    Court   of   New   Jersey.     June    Term, 
1859. 

Argued  at  Feb.  term,  1859,  before  GREEN, 
C.  J.,  and  OGDEN,  VREDENBURGII,  and 
WHELPLEY,  JJ. 

E.  W.  Scudder  and  Mr.  Butcher,  for  plaln- 
tlCfs.  Mr.  Gummere  and  W.  L.  Dayton,  for 
defendants. 

WHELPLEY,  J.  This  case  presents  the 
naked  question  whether,  where  a  builder  has 
agreed,  by  a  contract  under  seal,  with  the 
owner  of  a  lot  of  land,  "to  build,  erect,  and 
completea  building  upon  the  lot  for  a  certain 
entire  price,  but  payable  in  arbitrary  in- 
stallments,  fixed  without  regard  to  the  value 
of  the  work  done,  and  the  house  before  its 
cuinplotiou  falls  do'wn,  solely  by  reason  of 
^latent  defect  in  the  soil,  and  -not  on  ac- 
count of  faulty  construction,  the  loss  falls 
upon  the  builder  or  the  owner  of  the  land." 

The  case  comes  before  the  court,  upon  a 
certifiealj  from  the  Mercer  circuit,  for  the 
advisory   opinion  of  this   court. 

The  covenant  of  Evernham  and  Hill  was 
to  build,  erect,  and  complete  the  school-house 
upon  the  lot  in  question  for  the  sum  of 
$2G10;  the  whole  price  was  to  be  paid  for 
the  whole  building;  the  division  of  that  sum 
into  installments,  payable  at  certain  staged 
of  the  work, "was  not  intended  to  sever  (he 
entirety  of  the  contract,  and  make  the  pay- 
ment of  the  installments  payments  for  such 
parts  of  the  work  as  might  be  done  when 
they  were  paj-able:  this  division  was  made, 
not  to  apportion  the  price  to  the  different 
part:j  of  the  work,  but  to  suit  the  wants  of 
the  contractor,  and  aid  him  in  the  comple- 
tion of  the  work;  the  consideration  of  the 
covenant  to  complete  the  building  was  the 
whole  price,  and  not  the  mere  balance  that 
might  remain  after  the  payment  of  the  in- 
stallments: it  cannot  be  pretended  that  the 
contractor,  after  payment  of  a  part  of  the 
installments,  might  refuse  to  go  on  and 
complete  the  building,  and  yet  retain  that 
part  of  the  price  he  had  received.  Haslack 
V.  Mayers,  2G  N.  J.  Law,  284. 

No  rule  of  law  is  more  firmly  establisned 
by  a~riui^-ir!il'ti  of  doctstoutf  thiin  thife.  that 
where  a  party,  by  his  own  contract,  croatos 
a'TTuiy  or  cnarge  upon  hims^ir.  L'J  is  uuiinij"^ 
to  make  it  good  if  he  may,  notwithstanding 
any  accident  by  inevitable  necessity,  because 
he  jnlght  have  provided  against  it  by  his 
^H^tractl  iherefore.  ir  a  lessee  covenant'  to 
repair  a  hous^  thoug"h  It  bo  burno<l  by  light- 
ning.  or"  tlirown  down  py  onemios.  yet  lie~i3 
"BgnilTrjo  repair  it.  Paradine  v.  Jayne,  Ai- 
leyn,  i&T  Walton  v.  Waterhouse,  2  W.  Saund. 
422a,    note  2;     Brecknock   Co.    v.    Pritchard, 


G  Term  R.  750.  Tliis  case  was  an  action 
upon  a  covenant  to  build  a  bridge,  and  keep 
it  in  repair:  the  defendant  pleaded  that  the 
bridge  was  carried  away  by  the  act  of  God, 
by  a  great  and  extraordinary  flood,  although 
well  built  and  in  good  repair.  The  plea 
was  held  bad  on  demurrer. 

To  the  same  effect  are  Bullock  v.  Domtnit, 
6  Term  R.  G50;  Phillips  v.  Stevens,  IG  Mass. 
238;  Dyer,  33a.  And  there  is  no  relief  In 
equity.  Gates  v.  Green,  4  Paige,  3.".j;  Holt- 
zapffcll  V.  Baker,  18  Ves.  115.  Chaifcellor 
Walworth,  in  Gates  v.  Green,  in  denying 
relief  in  equity  against  a  covenant  to  pay 
rent  after  the  destruction  of  the  demised 
premises,  admits  the  rule  to  be  against  nat- 
ural law,  and  not  to  be  found  in  the  law 
of  other  countries  where  the  civil  law  pre- 
vails; yet  says  it  is  firmly  established,  not- 
withstanding the  struggles  of  some  of  the 
early  English  chancellors  against  it 

In  Beebe  v.  Johnson,  19  Wend.  500,  it  was 
held  by  Nelson,  C.  J.,  delivering  the  opinion 
of  the  court,  that  the  defendant  was  not 
excused  from  performing  his  covenant  to 
perfect,  in  England,  a  patent  granted  in  this 
country,  so  as  to  insure  to  the  plaintifif  the 
exclusive  right  of  vending  the  patented  ar- 
ticle in  the  Cauadas,  because  the  power  of 
gi-anting  such  an  exclusive  privilege  apper- 
tained not  to  the  mother  country,  but  to  the 
provinces,  and  was  never  granted,  except  to 
subjects  of  Great  Britain  and  residents  of 
the  provinces;  and  the  plaintifif  and  defend- 
ant were  both  American  citizens. 

The  court  said,  if  the  covenant  be  within 
the  range  of  possibility,  however  absurd  or 
improbable  the  idea  of  execution  may  be, 
it  will  be  upheld,  as  where  one  covenants 
it  shall  rain  tomorrow,  or  that  the  pope  shall 
be  at  Westminster  on  a  certain  day.  To 
bring  the  case  within  the  rule  of  dispensa- 
tion, it  must  appear  that  the  thing  to  be  done 
cannot  by  any  means  be  accomplished;  for 
if  it  be  only  improbable,  or  out  of  the  power 
of  the  obligor,  it  is  not  deemed  in  law  im- 
possible. 3  Comyn.  Dig.  93.  If  a  party  en- 
ter into  an  absolute  contract,  without  any 
qualification  of  exception,  and  receives  from 
the  party  with  whom  he  contracts  the  con- 
sideration of  such  engagement,  he  must 
abide  by  the  contract  and  either  do  the  act 
or  pay  the  damages;  his  liability  arises  from 
his   own   direct   and   positive   undertaking. 

In  Lord  v.  Wheeler,  1  Gray.  282,  where  a 
workman  had  agreed  to  repair  a  building 
for  an  entire  sum.  and  after  the  owner  had 
moved  in.  it  was  burned  up  before  the  re- 
pairs were  completed,  it  was  h^d  that  where 
one  person  agrees  to  expend  labor  upon  a 
specific  subject,  the  property  of  another,  as 
to  shoe  his  horse,  or  slate  his  dwelling-house, 
If  the  horse  dies,  or  the  dwelling-house  Is 
destroyed  by  fire,  before  the  work  is  done, 
the  performance  of  the  contract  becomes  im- 
possible, and  with  the  principal  perishes  the 
incident     The  case  was  clearly  distinguish- 


616 


DISCHARGE  OF  CONTRACT. 


ed  from  the  ordinary  contract  of  one  to  erect 
a  building  upon  tlie  lauds  of  another,  per- 
forming the  labor  and  supplying  the  ma- 
terials therefor;  where,  if  before  the  build- 
ing is  completed  or  accepted,  it  is  destroyed 
by  fire  or  other  casualty,  the  loss  falls  upon 
the  builder,  he  must  rebuild.  The  thing  may 
be  done,  and  he  has  contracted  to  do  it, 
Nichols  V.  Adams,  19  Pick.  275;  Brumby 
V.  Smith,  3  Ala.  123;  2  Pars.  Cont  1S4;  1 
ChiL  Cont.  56S. 

No  matter  how  harsh  and  apparently  un- 
just in  its  operation  the  rule  may  occasion- 
ally be,  it  cannot  be  denied  that  it  has  its 
foundations  in  good  sense  and  inflexible 
honesty.  He  that  agrees  to  <1n  an  act  shouid 
do  it,  unless  ^absal"'p1v  impossible.  He 
"should  provide  against  contingencies  in  his 
conti-acL  Where  one  of  two  innocent  pe?= 
sons  Tnust  sustain  a  loss,  the  law  casts  it 
upon  him  who  has  agreed  to  sustain  it,  or 
rather  the  law  leaves  it  where  the  agi-eement 
of  the  parties  has  put  it;  the  law  will  not 
insert,  for  the  benefit  of  one  of  the  parties, 
by  construction,  an  exception  which  the  par- 
ties have  not,  either  by  design  or  neglect, 
inserted  in  their  engagement.  If  a  party,  for 
a  suflBlcient  considei-ation,  agrees  to  erect  and 
complete  a  building  upon  a  particular  spot, 
and  find  aU  the  materials,  and  do  all  the 
labor,  he  must  erect  and  complete  it,  be- 
cause he  has  agreed  so  to  do.  No  matter 
what  the  expense,  he  must  provide  such  a 
substruction  as  will  sustain  the  building  up- 
on that  spot,  until  it  is  complete  and  deliver- 
ed to  the  owner.  If  he  agrees  to  erect  a 
house  upon  a  spot  where  it  cannot  be  done 
without  driving  piles,  he  must  drive  them, 
because  he  has  agreed  to  do  everything  neces- 
sary to  erect  and  complete  the  building.  If 
the  difficulties  are  apparent  on  the  surface, 
he  must  overcome  them.  If  they  are  not, 
but  become  apparent  by  exc-avation  or  the 
sinking  of  the  building,  the  rule  is  the  same. 
He  must  overcome  them,  and  erect  the  build- 
kig,  simply  because  he  has  agreed  to  do  so 
—to  do  everything  necessary  for  that  pur- 
pose. 

TTTpf^Rpi.j  make  no  distinction  between  ac- 
cidents that  could  be  foreseen  when  the  con- 
tract was  entertvi  intn^  and  those  ttiRt  rmi1d 
not  have  been  foreseen.  Between  accidents 
by~~the  fault  of  the  "dontractor,  and  those 
where  he  is  without  fault,  they  all  rest  mp- 
on  the  simple  principle— such  is  the  agreement, 
clear  and  unqualified,  and  it  must  be  per- 
formed, no  matter  what  the  cost,  if  perform- 
ance be  not  absolutely  impossible. 

The  case  of  a  bailment  of  an  article — locatlo 
operis  faciendi— is  not  analogous  to  the  case 
before  the  court;  there,  if  the  article  intrust- 
ed to  the  workman  is  lost  without  his  fault, 
the  owner  sustains  the  loss;  not  because  he 
is  the  owner,  but  because  the  contract  of 
bailment  is  well  defined  by  the  law;  there  is 
no  express  agreement  to  return  the  article  to 
the  owner  in  a  finished  state;   but  the  agree- 


ment is  an  implied  agreement,  a  duty  Im- 
posed by  the  law  upon  a  bailee,  because  the 
chattel  has  beidn  bailed  to  him,  to  use  his 
best  endeavors  to  protect  the  bailment  from 
injury.  Parsons  states  the  obhgation  of  the 
workman  to  be,  to  do  the  work  in  a  proper 
manner,  to  employ  the  materials  furnished  in 
the  right  way.  These  obligations  grow  out 
of  the  act  of  bailment;  they  are  its  legal  con- 
sequences, and  the  law  declares  them  to  be  so, 
not  because  the  parties  have  actually  so  stipu- 
lated, but  because  they  are  equitable  and  fair; 
and  in  the  absence  of  express  agreement  such 
will  be  implied. 

The  case  of  Menetone  v.  Athawes,  3  Burrows, 
1592,  was  relied  upon  by  defendants'  coimsel 
to  show  Umt  when  the  failure  to  perform  the 
contract  was  not  the  fault  of  the  contractor, 
he  can  recover.  It  was  the  baUnient  of  a 
ship,  to  be  repaired  while  in  the  shipwrights' 
dock,  for  the  use  of  which  the  owner  paid  £5. 
The  vessel  was  burned  when  the  repairs  were 
nearly  completed;  the  action  was  for  these 
repairs.  It  was  like  the  case  of  Lord  v. 
Wheeler,  before  cited.  The  right  to  recov- 
er was  put  upon  the  ground  that  the  plain- 
tiff was  not  answerable  for  the  accident, 
which  happened  without  his  default,  unless 
there  had  been  a  special  vmdertaking;  that 
this  liability  did  not  grow  out  of  the  law  of 
bailments. 

The  cases  of  Trippe  v.  Armitage,  4  Mees.  & 
W.  6S9;  Woods  v.  Russell,  5  Bam.  &  Aid. 
942;  Clarks  v.  Spence,  4  AdoL  &  E.  448,— 
have  no  application;  they  are  aU  cases  arising 
under  the  bankrupt  laws,  involving  the  ques- 
tion when,  under  the  circumstances  of  each 
case,  the  property  in  an  incomplete  chattel 
in  process  of  manufacture  passed  out  of  the 
banki-upt,  so  as  not  to  belong  to  his  assignees. 
They  are  inapplicable,  because  the  rights  of 
the  parties  to  this  suit  do  not  turn  upon  the 
question  whether  the  property  in  an  incom- 
plete building  is  in  the  owner  of  the  land  or 
the  builder,  or  whether  the  owner  would  de- 
rive a  partial  benefit  from  partial  perform- 
ance, but  upon  what  was  the  express  contract 
between  the  parties.  The  question  upon  whom 
the  loss  is  to  fall,  occasioned  by  an  inevitable 
accident,  is  not  to  be  setUed  by  determinmg 
what  is  equitable,  what  is  right,  or  by  the 
application  of  the  maxim,  res  perit  domino, 
or  by  any  nice  philosophical  disquisitions 
whether  the  owner  or  the  builder  shall  bear 
the  loss.  These  considerations— this  maxim- 
have  their  full  application  in  cases  where  the 
rights  of  the  parties  have  not  been  fixed  by 
contract,  but  are  to  be  settled  by  the  law 
upon  facts  of  the  case;  where  resort  is  to  b^ 
had  to  an  imphed  contract,  to  a  legal  ob- 
ligation raised  by  the  law  out  of  the  natural 
equities  of  the  case,  m  the  absence  of  an  ex- 
press agreement. 

Neither  the  destruction  of  the  incomplete 
building  by  a  sudden  tornado,  nor  its  falling 
by  reason  of  a  hitent  softness  of  the  soil  which 
rendered  the  foundation  insecure,  necessarily 


BY  OPERATION  OF  LAW-IMPOSSIBILITY. 


617 


prevented  the  perfo-mance  of  ^^e  con^ct  to 
Lid,  erect,  and  complete  this  building  for 
tZ  specified  price;  It  can  still  be  done,  for 
aught  that  was  opened  to  the  jury  as  a  de- 
fence, and  ovprrulfd  by  the  court. 

The  wholp  defence  was  properly  overruled 
because  It  did  not  show  the  Pf  ^rexcu^e 
the  covenant  Impossible,  or  any  lawful  excuse 
for  non-performance  of  the  contract. 


I  am  also  of  opinion  that  the  damage  occa- 
sioned by  the  destruction  of  the  bmldmg  by 
the  gale  of  wind  must  be  borne  by  the  de- 
fendants, for  the  reasons  before  given,  and 
that  the  circuit  court  be  advised  accordmgly. 

Cited  in  Brown  v.  Fitch.  33  N.  J.  Law.  422; 
Insurance  Co.  v  HiUyard.  37  N.  J.  Law.  4S.i. 
Coles  V.  Maniifacturine  Co..  .iO  N.  J.  Law.  62i , 
Dermott  ?.  Jonea,  2  WalL  8. 


618 


DISCHARGE  OF  CONTRACT. 


if 


TEERINGTON  v.  GREENE  et  aL     .  ^  / 


(7  R.  I.  589.) 


7 


■0 


Supreme  Conrt  of  Rhode  Island.     Sept.  Term, 
18G3. 

Assumpsit  against  the  defendants,  as  ad- 
ministi-ators  on  the  estate  of  William  W. 
Keach,  for  the  recovery  of  damages  for  the 
breach  of  a  contract  by  which  the  said  Keach 
nqi'ppd  X()  emnloY  the  plaiutia.  at  a  salaiy, 
for  three  years,  in  his  business. 

At  the  trial  of  the  caseT^Tn^^jr  the  general 
issue,  at  the  March  term  of  this  court,  1S63, 
before  the  chief  ji;  tice,  with  a  jury,  it  was 
proved  by  letters  iutei'changed  between  the 
plaintiff,  who  then  resided  in  Boston,  a.nd 
the  intestate,  who  was  a  manufacturing  jew- 
eller, in  Providence,  that  on  the  19th  'day  of 
March,  ISGO,  the  former  agreed  to  serve  the 
intestate,  and  the  latter  agreed  to  employ 
the  plaintiff,  as  a  clerli  and  salesman,  hav- 
ing charge  of  the  intestate's  office,  or  place 
of  sale,  in  New  York,  and  as  agent  in  his 
business  in  making  occasional  trips  for  him 
to  Philadelphia  for  the  term  of  three  years 
from  the  first  day  of  April,  1860,  or  as  soon 
thereafter  as  the  plaintiff  could  obtain  a  re- 
lease from  his  employment  in  Boston,  at  a 
salary  of  ^welye  hnndrt^d  dollars,  for  the 
first  year,  of  tlli^tPPJ'  hundred  doUars,  for 
the  second  year,  and  of  fifteep  hnndrpH  dol- 
lars, for  the  third  year;  that  on  the  six- 
teenth  day_  qI  April,  1,86(V  the  plaintiff  cen- 
tered into  the  service  of  the  intestate,  under 
this  contract,  and  continued  to  serve  him  un- 
der it  until  the  first  day  of  April,  1861,  When 
thesaid,K^ch  diedr  that  the  defendants,  as 
administrators  of  said  Keach,  continued  to 
employ  the  plaintiff,  at  the  stipulated  sal- 
ary, untU  the  sixteenth  day  of  June,  1S61,> 
/when,  having  discontinued  the  office  in  Ne\Y 
York,  and  removed  what  goods  were  there 
I  to  Providence,  where  Keach  had  anothen 
(place  of  sale,  they  declined  longer  to  emJ 
ploy  the  plaintiff,  or  to  pay  him  his  salary, 
though  from  that  time  to  the  date  of  the 
writ,  he  had  been  ready  and  willing  to  serve 
In  said  business,  and  had  tendered  his  serv- 
ices in  it  to  them,  and  had  been  unable  to 
procure  other  employment;  that  the  defend- 
antSj_as  administrators  of  Keach,  wouutt~ap 
his  hnpjfiess  by  selling  the  goods  removed 
from  New  York,  with  other  p^oods  of  his,  at. 
Providence,  and  had  been  allowed  by  the' 
icourt  of  probate,  for  their  services  as  admin-y 
istrators,  the  sum  of  three  thousand  dollars.' 
Upon  this  state  of  facts,  the  chief  justice 
instructed  the  jury,  that  the  death  of  Keach 
terminated  this  contract  of  service,  and  that 
no  recovery  of  damages  could  be  had  of  the 
defendants,  as  his  administrators,  for  their 
refusal  to  employ  the  plaintiff  under  it  after- 
wards; whereupon,  the  jury  having  return- 
ed a  verdict  for  the  defendants,  the  plaintiff, 
having  duly  excepted  thereto,  now  moved  for 
a  new  trial,  on  the  ground  of  error  in  law  in 
said  instruction. 


Mr.  Browne,  for  plaintiff.     James  Tilling- 
hast,  for  defendants. 

AMES,  C  J.  It  is,  in  general,  true,  that 
death  does  not  absolve  a  man  from  his  con- 
tracts; but  that  they  must  be  performed  by) 
his  personal  representatives,  or  their  non-per-'i 
Lformance  compensated,  out  of  his  estate  J 
An  exception  to  this  rule,  equally  well  estab- 
lished, at  both  the  civil  and  common  law,  is, 
that  in  contracts  in_which  performance  de- 
pends 'triTDn_tIl£_continued  existence  of  a  cer- 
taTn~person  or  thing,  a  conditionals^  jmpligd, 
that"^the^jmg0S5tbITrty  of  performancearis- 
ing  from  the  perishin^of  .tlie-persan_or^ing 
shall  excuseT^perfo^aance.  The  implica- 
ti^^'arlSesTn  spite  of  the  unqualified  char- 
acter of  the  promissory  words,  because,  from 
the  nature  of  the  contract,  it  is  apparent 
that  the  parties  contracted  upon  the  basis 
of  the  continued  existence  of  the  particular 
person  or  chattel.  The  books  afford  many 
illustrations  of  this  reasonable  mode  of  con- 
struing contracts,  de  certo  corpora,  as  the 
civil  law  designation  of  them  is,  in  further- 
ance of  the  presumed  and  probable  jntent  of 
the  parties.  The  most  obvious  cases  are, 
the  death  of  a  party  to  a  contract  of  mar- 
riage before  the  time  fixed  by  it  for  the  mar- 
riage; the  death  of  an  author  or  artist  be- 
fore the  time  contracted  for  the  finishing  and 
delivery  of  the  book,  picture,  statue,  or  other 
work  of  art;  the  death  of  a  certain  slave 
promised  to  be  delivered,  or  of  a  horse  prom- 
ised to  be  redelivered,  before  the  day  set  for 
the  delivery  or  redelivery;  and  the  death  of 
a  master  or  apprentice  before  the  expiration 
of  the  term  of  service  limited  in  the  inden- 
ture. The  bodily  disability  from  superven- 
ing illness,  as  of  an  artist,  from  blindness,  ta 
paint  the  picture  contracted  for,  or  of  a 
scholar  to  receive  the  instruction  his  father 
had  stipulated  should  be  received  and  paid 
for,  has  been  held,  for  the  like  reason,  ta 
excuse  each  from  the  performance  of  his 
contract  Hall  v.  Wright,  1  El.,  BL  &  El.  746; 
Stewart  v.  Loring)  5  Allen,  306.  The  cases 
in  support  of  these  and  other  illustrations  of 
the  exception  to  the  general  rule  are  set 
down  in  the  defendants'  brief,  and  It  is  un- 
necessary to  repeat  them.  Both  at  the  civil 
and  the  common  law,  it  is  necessair.  that 
the  party^who^^would  "avail  himseff'"'gf'  tSTs 
ex^use^  f orjaon-perfouBance  of  the_contract. 
should  be  without  faultjn  the  mattex-Jipon 
which  he  relies  as  an  excuse.  The  latest 
and  most  instructive  case,  upon  this  subject, 
so  far  as  the  discussion  of  the  principle  of 
decision  is  concerned,  is  that  of  Taylor  v. 
Caldwell,  decided  by  the  queen's  bench,  in 
May  last,  8  Law  T.  Rep.  356.  In  that  case 
It  was  held,  that  the  parties  were  discharged 
from  a  contract  to  let  a  music  hall  for  four 
specified  days  for  a  series  of  concerts,  by 
the  accidental  destruction  of  the  hall  by  fire 
before  the  first  day  arrived.  The  full  and 
lucid  exposition  by  Mr.  Justice  Blackburn, 
who  delivered  the  opinion  of  the  court,  of  the 


BY  OPERATION  OF  LAW— IMrOS.-^IBILITY. 


GVJ 


prior  cases  uud  of  tliu  principle  upon  whicli 
they  have  been  decided,  leaves  nothing  fur- 
ther to  be  desired  upon  this  subject. 

Does  the  case  at  bar  fall  witliiu  tlie  gen- 
eral rule,  or  within  the  exception  we  have 
been  consider  in;;'.'  This  must  depend  upon 
the  nature  of  the  contract,  whether  one,  re- 
quiring the  continuing  existence  of  the  em- 
ployer, Keacti,  for  performance  on  his  part, 
or  one  which  could,  according  to  its  spirit 
and  meaning,  be  performed  by  the  defend- 
ants, his  administrators.  The  contract  was, 
to  employ  the  plaintiff  as  clerk  and  agent  of 
the  intestate,  in  his  business,  in  New  York 
and  PLiladelphia:  and  it  seems  to  us  un- 
doubted, that  th*^  ^!jiiiDtiniie<1  eyiRypncp  of 
6oth  parties  to_the  contract  for  the  whole 
gtipulatej^erm,  was  the  basis  upon  which 
t h e_contractj)rocecd(i4»  a-Q<J  if  called  to  thei r 
attention  at  the  time  of  the  contract^  must 
have  been  contemplated  as  such  by  them. 
The  death  of  the  plaintiff  within  the  three 
years  would  certainly  have  been  a  legal  ex- 
cuse from  the  further  performance  of  his 
contract;  since  it  was  an  employment  of 
confidence  and  skill,  the  duties  of  which.  In 
the  spirit  of  the  contract,  comd  be  fuliilleu 
by  him  alone.  If  this  be  the  law  in  appli- 
cation to  a  covenant  for  ordinary  service 
(Shep.  Touch.  180),  how  much  more  in  ap- 
plication to  a  contract  for  service  of  such 
confidence  and  skill  as  that  of  a  clerk  and 
agent  for  sale.  On  the  other  hand,  this  em- 
ployment could  continue  no  longer  than  the 
business  in  which  the  employer  was  engaged, 
and  the  plaintiff  retained.  The  intestate, 
when  living,  could,  by  the  contract,  havo  re- 
quired the  services  of  the  plaintiff  in  no  eth- 


er business  than  that  in  which  he  had  en- 
gaged, him,  and  with  no  other  person  than 
himself.  It  would  seem,  then,  necessarily  to 
follow,  that  when  the  death  of  the  employ- 
er put  a  stop  to  this  business,  and  left  no 
legal  right  over  it  in  the  admiuistnitors,  ex- 

to 


Iwist   loss 


iy  were,  bjT 
employ  thJ 
serve  themj 


cepi   10   close    it   up    with   th 

tne  esTate"  of  tlTTTr  (li>(~edent.   thcTv 

/  the  contract,  bound  no  longer  to 
plaintiff,  any  more  than  he  to 
'Che  act  of  God  had  taken  away  the 
master  and  principal,— tho  law  had  revoked 
his  agency,  and"  stopped  the  business  to 
which  alone  his  contract  bound  him,— and  if 
he  would  serve  the  administrators  in  wind- 
ing up  the  estate,  it  must  be  imder  a  new 
contract  with  them,  and  under  renewed  pow- 
ers granted  by  them.  Any  other  result  than 
that  this  contract  of  service  was  upon  the 
implied  condition  that  the  employer,  as  well 
as  the  employed,  was  to  continue  to  live 
during  the  stipulated  term  of  employment, 
would  involve  us  in  the  strange  conclusiea, 
that  the  administrators  might  go  on  with  the 
business  of  their  mtestale;  m  which — the 
plaintiff  must  continue  with  p6\\'{^ra  uure- 
voked  by  the  death  of  his  principal,  or,  thsL^ 

Tie,  with  new  powers  from  them,  was  boundJ 
by  the  contract  to  serve  them  as  new  mas-j 

Iters,  and  In  a  different  service,  and  that  they! 

Iwere  bound  to  grant  him  such  powers,  and! 
employ  him  for  the  stipulated  time  in  such' 
service.  The  novelty  of  such  a  claim,  and 
the  contradiction  of  well-settled  principles 
necessary  to  mlintain  it,  justify  the  ruling 
of  the  judge  who  tried  the  cause;  and  this 
motion  must  be  dismissed  with  co>ts,  and 
judgment  entered  upon  the  verdict. 


620 


DISCHARGE  OF  CONTRACT. 


^> 


TAX  VLEIT  et  al.  v.  JONES  et  aL 


(20  N.  J.  Law.  340.) 


^' 


Supreme    Court   of   New   Jersey. 
1845. 


Feb.    Term, 


This  was  a  certiorari  to  tlie  common  pleas 
of  Hudson  county  to  remove  certain  pro- 
ceedings, had  in  that  court,  uijder  the  "Act 
to  secure  to  creditors  an  equal  and  just 
division  of  the  estates  of  debtors,  who  con- 
vey to  assignees  for  the  benefit  of  credit- 
ors." 

The  facts  of  the  case  appear  in  the  opin- 
ion of  the  court  delivered  by 

RANDOLPH,  J.  The  papers  come  before 
us  in  rather  an  irregular  form;— there  being 
two  statements  of  the  case  sent  up  by  dif- 
ferent branches  of  the  court  below;  and  un- 
der a  rule  to  take  proof  as  to  what  were  the 
facts  in  evidence  before  the  court  of  com- 
mon pleas,  there  have  been  two  sets  of 
affidavits  taken;  and  each  of  these  state- 
ments and  affidavits  differs  from  the  other. 
Such  a  course  of  proceedings  may  have 
grown  out  of  the  situation  of  the  court  and 
the  parties  and  the  circumstances  of  the 
case;  but  it  certainly  Is  not  to  be  com- 
mended for  a  precedent,  nor  yet  can  this 
court  reject  the  proceedings,  if  there  shall 
appear  to  be  sufficient  on  which  to  found 
iheir  judgment  The  case  according  to  the 
papers,  is  this.  Some  time  prior  to  Decem- 
ber, 1841,  Samuel  Bridgart  of  Hudson 
county,  madeajQ_a5SismrLent-^OE— the—benfir 
fit  of  his  creditors,  amongst  whom  were 
the  plaintitTS  Ih  certiorari.  Van  Vliet  Thd 
"Wlkog,  who  filed  their  account  pursuant 
to  law,  amounting  to  $2103;  to  which 
Jones  and  the  other  defendants  in  certio- 
rari, who  were  also  applying  creditors  of 
Bridgart,  filed  their  exceptions;  and  this 
claim  and  the  exceptions'  thereto  coming 
before  the  court  of  common  pleas  for  trial, 
neither  party  demanding  a  jury,  the  court 
disaUowed  the  account  on  the  groundthat 
Van  Vllet  and  Wikoff  had  taken  .a  bond  and 
mortgage  of  Bridgart  for  the  same  account. 
ATthough  there  is  much  discrepancy  as  to 
what  was  proved  before  the  court,  fortu- 
nately as  to  this  bond  and  mortgage,  both 
the  statements  and  affidavits  substantially 
agree;  and  from  these  sources  it  appears 
to  have  been  proved  before  the  court  be- 
low, that  Bridgart  had  an  account  with  the 
plaintiffs  for  goods  bought  of  them,  and  that 
as  a  collnteral  semritv  both  as  to  that  ac- 
count and  also  a  further  running  account 
all  of  which  is  embraced  In  the  present 
claim,  the  bond  and  mortgage  were  given, — 
a  small  note  was  also  included  in  the  ac- 
count and  covered  by  the  security.  The 
mortgage  was  on  a  house  and  lot  in  Jersey 
City,  being  the  third  in  priority,  and  a  bill 
to  foreclose  was  filed  by  one  of  the  prior 
mortgagees  and  the  plaintiffs  made  parties, 
who  also  became  the  purchasers  of  the  prop- 


erty, on  its  being  sold  under  a  decree,  for 
fifteen  dollars  less  than  the  amount  of  the 
prior  incumbrances.  There  can  be  no  douM, 
as  a  general  rule,  that  the  taking  of"  aT  bond 


"giidmurlgage  OT~ol:her  security  of  a  higher 
nature  extinguishes  a  debt  arising  from  mere 
matter  of  account,  yet~  this^will  depend  on 
the  intention  of  the  parties.  If  the  higher 
security  was  given  as  the  future  evidence 
of  the  debt,  to  which  the  party  was  to  look 
for  payment,  then  the  less  security  would 
merge  in  the  greater;    but,  if  the  higherse- 

ional  or  "col- 


cnrity  -wna  tn  pe  merely^ 
lateral  tothe  less,  showing  that  the  int_en- 
tlon  of_jt£e^  parties  was  to  ]ieep_the  latter 
open^o  be  looked  <n  fpr  pnympnt  in  any 
event — then  the  less  is  not  extinguished  by 
ttre  greater_secujit3z:._^This  doctrine  is  famil- 
iaTpjnnir^ay  be  found  in  most  of  the  ele- 
mentary works  and  cases  that  treat  upon 
this  subject,  particularly  in  Chit.  Cont.  607, 
and  authorities  there  cited.  The  defend- 
ant's counsel  admitted  the  position,  but  in- 
sisted that  it  must  appear  upon  the  face  of 
the  instrument  itself,  that  it  was  an  addi- 
tional or  collateral  security,  and  the  works 
that  treat  on  this  subject  and  cases  adduced, 
seem  to  give  countenance  to  this  idea;  for 
in  the  former  it  is  usually  stated  as  an  ex- 
ception to  the  general  doctrine  of  merger, 
that  if  it  appear  upon  the  face  of  the  instru- 
ment that  it  is  intended  to  be  a  further  or 
collateral  security,  then  the  rule  of  merger 
does  not  apply,  and  the  cases  referred  to  by 
counsel,  are  of  the  description  where  the 
matter  appeared  upon  the  face  of  the  in- 
strument But  these  authorities,  altaough 
they  show  very  clearly  that  when  the  mat 
ter  does  so  appear  the  general  rule  of  extin- 
guishment does  not  apply,  yet  they  do  not 
therefore  prove  that  when  it  does  not  so 
appear  the  rule  does  apply;  and  if  such 
cases  do  exist  the  labors  of  counsel  and  the 
researches  of  the  court  have  failed  to  pro- 
duce them.  Deciding  the  case  then  upon 
principle  rather  than  precedent,  the  question 
of  extinguishment  or  not  is  one  of  intention. 
What  did  the  parties  mean  by  the  transac- 
tion? Did  they  intend  that  the  old  security 
should  remain  open  and  the  new  one  be 
merely  collateral  or  additional;  or  did  they 
Intend  to  extinguish  the  former?  This  in- 
tention is  of  course  to  be  collected  from  the 
face  of  the  instrument  itself,  where  It  so  ap- 
pears; and,  if  it  does  not  so  appear,  then 
from  the  next  best  evidence:  the  only  dif- 
ference being,  that  In  the  former  case  the 
security  itself  proves  the  exception  -to  the 
rule,  and  also  the  intention  of  the  parties, 
whilst  in  the  latter,  the  party  alleging  the 
exception  must  prove  it.  And  in  this  no 
evil  can  arise,  there  is  no  parol  contradic- 
tion of  a  written  instrument,  but  only  an 
explanation  as  to  the  object  for  which  it 
was  given.  A  contrary  doctrine  would  pro- 
hibit parol  proof  of  the  payment  of  a  col- 
lateral security,  by  the  payment  of  the  orig- 
inal claim,  unless  it  appeared  upon  the  face 


BY  OPERATION  OF  LAW-^IERGER.  621 

T      *^  ■  MP'VTrs    J     and  WHITEHEAD,  J.,  con- 

of  the  collatoral  that  It  was  s^^-b-  J^J ^l"  1  .J^red  HORNBl. :.^\^iil,  C.  J.,  and  CAR- 
particular  the  court  of  ^^^^'^^Ifll^l'"^^^'  \  pi^vfER  J.,  did  not  hear  the  argument,  and 
and  their  pro<-oodings  should  be  reversed.         PLNi^^    .^.^.^^ 

Judgment  reversed.  ' 


L9- 


€22 


'3' 


DISCHARGE  OF  CONTRACT. 


WOOD  T.  STEELE. 
(6  Wall.  SO.) 


m 


Supreme    Uonrt   of   the    United    States.     Dec, 
1S67. 

Error  to  the  circuit  court  for  the  district  of 
Minnesota. 

Mr.  Justice  SWAYNE  delivered  the  opinion 
of  the  court. 

The  action  was  brought  by  the  plaintiff  in 
error  upon  a  promissnrv  note,  made  by  Steele 
and  Newson,  bearing  date  October  11th,  1S58, 
for  |3720,  payable  to  their  own  order  one  year 
from  date,  with  interest  at  the  rate  of  two 
per  cent,  per  month,  and  indorsed  by  them  to 
-.Wood,  the  plaintiff. 

1    Upon  the  trial  it  appeared  that  Newson  ap-i 
jplied  to  Allis.  the  agent  of  Wood,  for  a  loan 
jof  money  upon  the  note  of  himself  and  Steela 
[Wood  assented,  and  Newson  was  to  procure 
/the  note.      Wood  left  the  money  with   Alhs 
So  be  paid  over  when  the  note  was  produced. 
The  note  was  afterwards  delivered  by  New- 
son,  and  the  money  paid  to  him.    Steele  re- 
ceived no  part  of  it.    At  that  time, 'it  appear- 
ed  on  the  face  of  the  note,  that  "September" 
hJTr~TJegir' sh-lcReti  6lit  and   "October  llthV 
l^bstitutcQ  as  tue  date,    yhis  was  done  after 

rgr7>p]p"  hnn    gi,«rn)>)|    th'^    y^c^\(^     gnri    witlmni-    hid 

Iknowledqe  or  consent.  These  circumstances 
■nere  unknown  to  Wood  and  to  Allis.  Steele 
was  the  surety  of  Newson.  It  does  not  /ap- 
pear that  there  was  any  controversy  about 
the  facts.  The  argument  being  closed,  the 
court  instructed  the  jury,  "^hat  if  the  said 
alteration  was  made  after  the  note  was  sign- 
ed by  the  detenaant,  Steele,  and  by  him  de- 
livered to  the  other  maker,  Newson,  Steele 
was  discharged  from  all  liability  on  said 
note."  The  plaintiff  excepted.  The  jury 
TOuuTT^for  the  defendant,  and  the  plaintiff 
prosecuted  this  writ  of  error  to  reverse  the 
judgment  Instructions  were  asked  -by  the 
plaintiff's  counsel,  which  were  refused  by  the 
court  One  was  given  with  a  modification. 
Exceptions  were  duly  taken,  but  it  is  deemed 
unnecessary  particularly  to  advert  to  them. 
The  views  of  the  court  as  expressed  to  the 
jury,  covered  the  entire  ground  of  the  contro- 
versy between  the  parties. 

The  state  of  the  case,  as  presented,  relieves 
us  from  the  necessity  of  considering  the  ques- 
tions,—upon  whom  rested  the  burden  of  proof, 
the  nature  of  the  presumption  arising  from 
the  alteration  apparent  on  the  face  of  the  pa- 
per, and  whether  the  insertion  of  a  day  in  a 
blank  left  after  the  month,  exonerates  the 
maker  who  has  not  assented  to  it 

Was  the  instruction  given  correct? 


It  was  a  rule  of  the  common  law  as  far  back 
as  the  reign  of  Edward  III,  that  a  rasure  in  a 
deed  avoids  it.  The  effect  of  alterations  in 
deeds  was  considered  in  Pigot's  Case,  11 
Coke,  27,  and  most  of  the  authorities  upon  the 
subject  down  to  that  time  were  referred  to.  In 
Master  v.  Miller,  4  Term  R.  320,  1  Smith, 
Lead.  Cas.  1141,  the  subject  was  elaborately 
examined  with  reference  to  commercial  pa- 
per. It  was  held  that  the  established  rules 
apply  to  that  class  of  securities  as  well  as  to 
deeds.  It  is  now  settled,  in  both  English 
and  American  jurisprudence,  that  a  material 
alteration  in  any  commercial  paper,  without 
the  consent  of  the  party  sought  to  be  charged, 
extinguishes  his  liability.  The  materiality  of 
the  alteration  is  to  be  decided  by  the  court. 
The  question  of  fact  is  for  the  jury.  The 
alteration  of  the  date,  whether  it  hasten  or 
delay  the  time  of  payment,  has  been  uniform- 
ly held  to  be  material.  The  fact  in  this  case 
that  the  alteration  was  made  before  the  note 
passed  from  the  hands  of  Newson,  cannot  af- 
fect the  result  He  had  no  authority  to 
change  the  date. 

The  grounds  of  the  discharge  in  such  cases 
are  obvious.  The  agreement  is  no  longer  the 
one  into  which  the  defendant  entered.  Its 
identity  Is  changed:  another  is  substituted 
without  his  consent;  and  by  a  party  who  had 
no  authority  to  consent  for  him.  There  is  no 
longer  the  necessary  concurrence  of  minds. 
If  the  instrument  be  under  seal,  he  may  well 
plead  that  it  is  not  his  deed;  and  if  it  be  not 
under  seal,  that  he  did  not  so  promise.  In 
either  case,  the  issue  must  necessarily  be 
found  for  him.  To  prevent  and  punish  such 
tampering,  the  law  does  not  permit  the  plain- 
tiff to  fall  back  upon  the  contract  as  it  was 
originally.  In  pursuance  of  a  stern  but  wise 
policy,  it  annuls  the  instrument,  as  to  the 
party  sought  to  be  wronged. 

The  lailes,  that  where  one  of  two  innocent 
persons  must  suffer,  he  who  has  put  it  in  the 
power  of  another  to  do  the  wrong,  must  bear 
the  loss,  and  that  the  holder  of  commercial 
paper  taken  in  good  faith  and  in  the  ordinary 
course  of  business,  is  unaffected  by  any  latent 
infirmities  of  the  security,  have  no  application 
this  class  of  cases.    The  defendant  couldi 
o  more  have  prevented  the  alteration  tharu 
he  could  have  prevented  a  complete  fabrica 
tion;  and  he  had  as  little  reason  to  anticipat( 
one  as  the  other.     The  law  regards  the  secur 
ity,  after  it  is  altered,  as  an  entire  forgery 
with  respect  to  the  parties  who  have  not  con 
sented,    and    so  far  as  they  are  concerned, 
deals  with  it  accordingly. 

The  instruction  was  correct  and  the  judg- 
ment is  affirmed. 


mc 


INDEX. 


ACCEPTANCE. 

See  "Offer  and  Acceptance." 

Of   goods   sold    within   statute   of   frauds,   see 

"Statute   of  Frauds,"   §  8. 

ACCOMMODATION. 

Liability  of  wife's  separate  estate,  see  "Mar- 
ried Women." 

ACKNOWLEDGMENT. 

Of    contract    made    during    infancy,    se»»    "In- 
fants," §  3. 

ADEQUACY. 

Of  consideration,  see  "Consideration,"  §  2. 

AFFECTION. 

See  "Consideration,"  §  6, 

AGE. 

Presumption  as  to  undue  influence,  see  "Undue 
Influence." 

AGENCY. 

Of  husband  for  wife,  see  "Married  Women." 


ALTERATION. 

See  "Reformation." 

Alteration  of  the  date  of  a  note  without  the 
consent  of  the  party  sought  to  be  charged  ex- 
tinguishes his  liability. — Wood  v.  Steele,  622. 

The  fact  that  an  alteration  in  a  note  is  made 
by  one  of  the  parties  signing  it  before  it  passed 
from  his  hands  does  not  alter  its  effect  of  re- 
leasing one  who  had  signed  previously. — Wood 
V.  Steele,  622. 


APPRENTICES. 

Code  Md.  art.  6,  §  20,  provides  a  method  by 
which  a  father  may  bind  his  son  as  appren- 
tice until  he  reaches  the  age  of  21.  A  mother 
entered  into  a  written  agreement  with  defend- 
ants to  bind  her  son,  then  '20  years  of  age,,  as 
apprentice  for  5  years.  Ilclil,  that  the  contract 
was  void.— Baker  v.  Lauterback,  218. 

ASSIGNMENTS. 

See  "Assignments  for  Beneflt  of  Creditors." 
Of  mortgage,  see  "Mortgages." 
Right  of  assignee  to  disallirm  contract  made  by 
infant,  see  "Infants,"  §  6. 

One  who  acquires  title  to  real  estate  from 
the  owners  thereof  after  a  contract  of  sale  bv 


the  latter  to  others   cannot  maintain  an  action 
on  the  contract. — McGovern   v.   Hern,   183. 

A  contract  in  restraint  of  trade,  running  to  a 
corporation,  "its  successors  and  assigns,"  is 
assignable  to  and  enforceable  by  a  corporation 
who  succeeds  to  the  business  and  property  of 
such  obligee. — Diamond  Match  Co.  v.  Roeber, 
461. 

Manufacturers  of  a  certain  machine  made  a 
contract  for  the  sale  of  a  number  of  them,  to 
be  paid  for  by  the  notes  of  the  purchasers.  It 
was  provided  by  the  contract  that  the  purchas- 
ers were  to  sell  such  machines  within  a  given 
territory,  receiving  in  payment  either  cash, 
which  was  to  be  applied  in  payment  of  their 
notes,  or  notes,  which  were  to  be  delivered  to 
the  manufacturers  as  collateral  security.  Held, 
that  the  purchasers  cannot  assign  the  contract, 
so  as  to  compel  the  manufacturers  to  take  the 
notes  of  other  persons,  in  lieu  of  the  purchas- 
ers', in  payment  of  the  machines,  as  Code 
Iowa,  g§  2082-2087,  declaring  all  contracts  as- 
signable, only  authorize  the  transfer  of  the  as- 
signor's rights  in  possession  or  in  action  under 
such  contracts,  but  not  of  his  obligations  there- 
under.— Rapplye  v.  Racine  Seeder  Co.,  534. 

A  written  promise  to  pay  bearer  a  sum  of 
money  provided  a  certain  ship  arriyus  at  a 
European  port  of  discharge  free  from  capture 
and  condemnation  by  the  British  is  not  assign- 
able.—Coolidge  V.  Ruggles,  538. 

A  court  of  equity  will  not  entertain  a  bill 
by  the  assignee  of  a  strictly  legal  right,  merely 
because  he  cannot  bring  an  action  at  law  in 
his  own  nanic.  ^^•hero  he  has  a  complete  legal 
remedy. — Walker  v.  Brooks,  539. 

Defendant  contracted  to  deliver  10,000  tons 
of  lead  ore  from  its  mines  to  the  firm  of  B.  & 
E.,  at  their  smelting  works,  the  ore  to  be  de- 
livered at  the  rate  of  50  tons  per  day,  and  to 
become  the  property  of  B.  ^S:  E.  as  soon  as 
delivered.  The  price  was  not  fixed,  but  as 
often  as  100  tons  had  been  delivered  the  ore 
was  to  be  assayed  by  the  parties,  or,  if  they 
could  not  agree,  by  an  umpire;  and  after  that 
had  been  done,  and  according  to  the  result  of 
the  assay,  and  the  proportions  of  lead,  silver, 
silica,  and  iron  thereby  proved  to  be  in  the 
ore,  the  price  was  to  be  ascertained  and  paid. 
During  the  time  that  must  elapse  between  the 
delivery  of  the  ore  and  the  ascertainment  of 
the  price,  defendant  had  no  security  for  its 
paviiu'iit.  (>xrcpt  in  the  character  and  solvency 
of  B.  &  E.  Held,  that  the  contract  was  per- 
sonal in  its  nature,  and  that  plaintiff,  claim- 
ing as  assignee,  could  not  compel  defendant^  to 
continue  delivering  the  ore. — Arkansas  Val. 
Smelting  Co.  v.  Belden  Min.  Co.,  542. 

After  a  part  of  the  ore  had  been  delivered, 
the  firm  of  B.  &  E.  dissolved,  and  the  contract 
was  assigned  to  B.,  to  whom  thereafter  de- 
fendant continued  to  deliver  ore  under  the  con- 
tract. Held,  that  this  fact  did  not  put  defend- 
ant under  any  obligation  to  deliver  ore  to  plain- 
tiff, an  entire"  stranger  to  the  contract,  to  whom 
B.  had  assigned  it  without  defendant's  con- 
sent.—Arkansas  Val.  Smelting  Co.  v.  Belden 
Min.  Co.,  542. 


Hopk.Sel.Cas.Cont. 


An  attaching  creditor  without  notice  of  the 
assignment  acquires  a  lien  on  the  debt  as  valid 

(623) 


G24 


INDEX. 


as    the    title    of    a    purchaser.— Vanbuskirk    T. 
Hartford  Fire  Ins.  Co.,  545. 

Where  one  assigned  a  claim  against  an  in- 
surance company,  and  before  notice  to  the 
company  a  creditor  of  the  assignor  attached  it, 
such  as'sicnment  would  not  defeat  the  attach- 
ment.—Vanbuskirk  V.  Hartford  Fire  Ins.  Co., 
545. 

To  perfect  an  assignment  of  a  chose  in  ac- 
tion, notice  of  such  assignment  must  be  CTven 
to  the  debtor  within  a  reasonable  time.— Van- 
buskirk V.  Hartford  Fire  Ins.  Co.,  545. 


ASSIGNMENTS    FOR    BENEFIT    OF 
CREDITORS. 

A  creditor  who,  by  a  secret  agreement  not 
to  assert  his  claim,  induced  an  assignee  for 
the  benefit  of  creditors  and  other  creditors  to 
release  the  debtor,  cannot  maintain  an  action 
against  the  assignee  for  the  dividend  on  his 
debt.— Frost  v.  Gage,  509. 

Where  the  purchasers  under  a  contract  to 
buy  certain  machines  to  be  sold,  and  the  pro- 
ceeds paid  to  the  vendors  on  account,  become 
insolvent,  and  make  an  assignment  for  the  ben- 
efit of  creditors,  the  manufacturers  may  re- 
fuse to  complete  the  contract.— Rapplye  v. 
Racine  Seeder  Co.,  534. 

Where  a  party  to  an  executory  contract  be- 
comes insolvent  before  performance,  it  is  the 
duty  of  the  assignees  within  a  reasonable  time 
to  elect  whether  or  not  to  proceed  under  the 
contract,  and  notify  the  other  party  thereto  ac- 
cordingly.—Hobbs  V.  Columbia  Falls  Brick 
Co.,  506. 

Where  the  assignees  held  the  assigned  prop- 
erty for  more  than  three  months,  and  took  no 
action  with  reference  to  an  executory  contract 
made  between  the  assignors  and  defendant,  but 
gave  defendant  to  understand  they  were  not 
^oing  to  claim  under  it,  a  reconveyance  of  the 
assigned  property  to  the  assignors  gave  them 
no  right  of  action  on  the  contract. — Hobbs  v. 
Columbia  Falls  Brick  Co.,  566. 


ATTACHMENT. 

Validity  as  against  assignment,  see  "Assign- 
ments." 

ATTORNEY  AND   CLIENT. 

See  "Breach  of  Trust";  "Champerty  and  Main- 
tenance." 

Contracts  against  public  policy,  see  "Injury  to 
Public  Service." 

AUCTIONS. 

Withdrawal  of  bid,  see  "Offer  and  Acceptance," 
§  10. 

BANKS  AND  BANKING. 

A  deposit  of  money  to  remain  in  a  bank  for 
a  certain  time  being  illegal  and  void  under 
Rev.  St.  c.  36,  §  57,  no  action  can  be  main- 
tained by  the  depositor  on  such  contract. — 
White  V.  Franklin  Bank,  520. 

The  parties  to  an  illegal  deposit  in  a  bank 
not  being  in  pari  delicto,  the  depositor  may 
maintain  an  action  for  the  money. — White  v. 
Franklin   Bank,   520. 


BASTARDY. 

A  joint  plea  of  the  infancy  of  one  defendant 
in  an  action  on  a  joint  and  several  bastardy 
bond  is  bad  iu  substance,  as  in  proceedings  un- 
der the  bastardy  act  the  infancy  of  the  re- 
puted father  is  no  defense,  when  he  is  legally 
chargeable  in  exoneration  of  the  public. — Town- 
ship of  Bordertown  v.  Wallace,  281. 

BILLS  AND  NOTES. 

See  "Alteration";  "Corporations." 
As  payment,  see  "Payment." 
By  wife,  see  "Married  Women." 
Effect  of  duress,  see  "Duress,"  §§  3,  4. 
Rights  of  holder  of  unauthorized  notes  of  cor- 
poration, see  "Corporations." 


BONA  FIDE  PURCHASERS. 

From  fraudulent  vendee,  see  "Fraud,"  §  6. 
Of  mortgage,  see  "Mortgages." 


BONDS. 

In  bastardy  proceedings,  see  "Bastardy." 

A  bond  of  a  public  officer  voluntarily  given 
to  the  United  States,  although  not  prescribed 
or  required  by  law,  is  binding  on  the  parties 
to  it.— United  States  v.  Tingey,  276. 

Where  it  is  charged  that  a  voluntary  bond 
has  been  given,  irregularities  in  proceedings 
under  the  statute  are  irrelevant  in  an  action  on 
the  bond. — Township  of  Bordentown  v.  Wal- 
lace, 281. 

BREACH  OF  MARRIAGE  PROMISE. 

Defendant,  who  was  a  suitor  of  plaintiff,  an 
unmarried  woman,  solicited  her  to  have  sexual 
intercourse  with  him,  and  on  her  refusal  agreed 
that  if  she  should  yield  to  his  wishes,  aud  there- 
by become  pregnant,  he  would  at  once  mari-y 
her,  to  which  she  assented,  and  did  have  sexual 
intercourse  with  defendant,  from  which  preg- 
nancy resulted,  and  from  which  a  child  was 
born  to  plaintiff.  Ueld,  that  an  action  for  the 
breach  of  the  contract  to  marry  would  not  lie, 
the  contract  being  based  on  an  immoral  con- 
sideration.—Saxon  V.  Wood,  444. 

BREACH  OF  TRUST. 

A  contract  by  which  an  attorney  takes  a 
claim  against  an  intestate  for  collection,  and 
to  that  end  agrees  to  administer  the  estate, 
is  void.— Spinks  v.  Davis,  452. 

BROKER. 

Sufficiency  of  memorandum  by  broker,  see 
"Statute  of  Frauds,"   §   9. 

CAPACITY. 

Of  parties,  see  "Corporations";  "Drunkards"; 
"Infants";  "Insane  Persons";  "Married  Wo- 
men":   "United  States." 


CARRIERS. 

A  common  carrier  cannot  stipulate  for  ex- 
emption from  responsibility  for  the  negligence 
of  himself  or  servants.— Railroad  Co.  v.  Lock- 
wood,  480. 


INDEX. 


625 


CHAMPERTY  AND  MAINTENANCE. 

A  contract  by  which  an  attorney  agrees  to 
institute  and  prosecute  suits  at  his  own  ex- 
Ijensc,  and  receive  as  Lis  only  compensation  a 
portion  of  the  projierty  I'ecovered,  is  void. — 
Thompson  v.  Keynolds,  440. 

Defendant  was  a  devisee,  under  a  will,  of 
certain  real  estate,  and  the  validity  of  the  wijl 
was  threatened  in  proceedings  instituted  in  the 
surrogate's  court.  He  sought  and  retained 
plaintiff  as  attorney,  and  gave  him  a  deed  of 
the  undivided  half  part  of  the  property,  taking 
back  his  covenant  to  conduct  the  defense,  pay- 
ing all  costs  and  expenses,  and  indemnifying 
defendant  against  liability.  Uclu,  that  this  did 
not  constitute  champerty,  and  the  statute  did 
not  condemn  such  an  agreement. — Fowler  v. 
Callan,  442. 

The  New  York  Code  contemplates  a  case  in 
which  the  action  might  never  have  been 
brought  but  for  the  inducement  of  a  loan  or 
advance  ottered  by  the  attorney,  and  by  which 
the  latter,  by  oUicious  interference,  procures 
the  suit  to  be  brought,  and  obtains  a  retainer 
in  it.— Fowler  v.  Callan,  442. 

The  old  rules  regarding  champerty  are  abro- 
gated except  as  preserved  by  the  statutes.  The 
attorney  may  agree  upon  his  compensation,  and 
it  may  be  contingent  upon  his  success,  payable 
out  of  the  proceeds  of  the  litigation. — Fowler 
V.  Callan,  442. 

A  champertous  and  illegal  contract  between 
plaintiff  and  his  attorney  can  only  be  set  up 
by  the  client  against  the  attorney  when  the 
champertous  agreement  itself  is  sought  to  be 
enforced. — Courtright  v.  Burns,  443. 


CHARTER. 

Limitation   of  corporate   authority,   see   "Cor- 
porations." 


COLLATERAL  AGREEMENT. 

See  "Statute  of  Frauds,"  §§  3,  4 

COMBINATIONS. 

See  "Monopolies." 

COMPROMISE. 

See  "Consideration,"  §  4. 

CONCEALMENT. 

Amounting  to  fraud,  see  "Fraud,"  §  3. 

CONDITIONS. 

Concurrent,  see  "Performance  or  Breach."  §  4. 
Conditional  acceptance,  see  "Offer  and  Accept- 
ance,"  §  9. 
Precedent,  see  "Performance  or  Breach,"   §  2. 
Subsequent,  see  "Performance  or  Breach,"  §  3. 

CONSIDERATION. 

See  "Pleading";  "Subscriptions." 

Expression    of    consideration    in    written    con- 
tracts, see  "Statute  of  Frauds." 

Sealed  agreements,  see  "Contracts  under  Seal," 
§  1. 

Hopk.Sel.Cas.Cont.— 40 


§    1.     Necessity. 

An  administratrix,  who  promises  to  pay  a 
debt  of  her  intestate,  cann>t  bf  held  liable  in 
her  personal  capacity,  where  made  witiiout  con- 
sideration, although  in  writing. — Kann  v. 
Hughes,  224. 

§    2.     Adequacy. 

An  agreement  by  A.  to  perform  a  contract 
and  rent  B.'s  store  10  days  before  the  contract 
required  is  sulhcient  consideration  for  a  prom- 
ise by  B.  not  to  engage  in  the  grocery  lousi- 
ness for  five  years  in  a  certain  town. — Doyle  v. 
Dixon,   350. 

Refraining  from  the  use  of  liquor  and  to- 
bacco for  a  certain  time  at  the  request  of  an- 
other is  a  suUicient  consideration  for  a  prom- 
ise by  the  latter  to  pay  a  sum  of  money. — 
Hamer  v.  Sidway,  220. 

Giving  up  a  guaranty  for  advances  on  be- 
half of  one  party  is  sulhcient  consideration  for 
a  promise  by  the  guarantor  to  pay  acceptances 
of  the  first  party.— Haigh  v.  Brooks,  220. 

Where  one  had  received  something  which  at 
the  time  he  considered  valuable,  in  considera- 
tion of  a  promise,  he  cannot  excuse  a  breach  of 
the  promise  because  the  thing  was  not  of  the 
value  he  supposed.— Haigh  v.  Brooks,  22G. 

An  agreement  made  by  a  father,  in  considera- 
tion of  the  surrender  to  him  of  his  son's  note, 
to  pay  the  amount  of  the  note,  is  founded  on 
a  valid  consideration,  though  the  son  at  the 
time  of  such  agreement  may  have  been  dead, 
and  the  note  may,  to  the  knowledge  of  both 
parties,  have  been  uncollectible  because  of  the 
insolvency  of  his  estate.— Judy  v.  Louderman, 
227. 

The  law  will  not  enter  into  an  inquiry  as  to 
the  adequacy  of  the  consideration  for  a  prom- 
ise, but  will  leave  the  parties  to  be  the  sole 
judges  of  the  benefits  to  be  derived  therefrom, 
unless  the  inadequacy  of  consideration  is  so 
gross  as  of  itself  to  prove  fraud  or  imposition. 
— Judy  V.  Louderman,   227. 

A  consideration  of  one  cent  will  not  support 
a  promise  to  pay  $000.- Schnell  v.  Nell,  230. 

A  promise  by  a  husband  to  legatees  to  pay 
legacies  given  by  his  wife,  she  having  no  prop- 
erty to  pay  them  with,  is  not  binding  on  him. 
— Schnell  v.  Nell,  230. 

§    3.     Mutual  promises. 

Plaintiff's  promise  to  account  to  defendant 
for  one-half  of  the  profits  is  supported  by  de- 
fendant's obligation  to  share  one-half  of  the 
losses. — Coleman  v.  Eyre,  232. 

A  promise  to  refund  in  case  of  a  deficiency 
is  coosideratimi  for  a  promise  to  pay  for  an 
excess  over  what  is  called  for  in  a  deed. — Sew- 
ard V.  Mitchell,  233. 

Where  the  agreement  of  plaintiff  and  defend- 
ant to  abide  by  an  award  are  not  concurrent, 
the  promise  of  defendant  is  not  binding  on  him. 
— Keep  V.  Goodrich,  236. 

An  agreement  by  an  indorser  to  pay  a  note 
not  yet  matured  is  a  valid  consideration  for 
an  agreement  to  pay  for  the  money  paid  by 
him  upon  it. — L'Amoreux  v.  Gould,  238. 

A  verbal  agreement  by  plaintiffs  to  work  in 
defendant's  mine,  and  to  receive  ^l.'iO  per  ton 
for  all  the  ore  they  produced,  "as  long  as  they 
could  make  it  pay,"  is  not  enforceable  as  an 
executory  contract,  because  of  its  uncertainty 
and  want  of  mutuality. — Davie  v.  Lumber- 
man's Min.  Co.,  240. 

§    4.     Forbearance. 

An  agreement  by  a  creditor  to  forbear  prose- 
cuting his  claim,  and  an  actual  forbearance,  ia 


626 


INDEX. 


good  cousideration  for  a  note  by  a  third  person  i 
to  the  creditor. — Robinson  v.  Gould,  dJb. 

Compromise  of  a  claim  is  good  consideration 
for  a  promise,  although  litigation  has  not  been 
actually  commenced.— Cook  v.  Wright,  -4'-. 

The  abandonment  by  the  sole  heir  at  law 
of  a  testator  of  opposition  to  the  probate  of  the 
will,  at  the  request  of  the  executor,  is  a  sutb- 
cient  cousideration  for  the  promise  of  the  es- 
ecutur  to  pav  a  named  sum  to  a  third  person, 
thousrh  such  payee  had  no  interest  in  the  es- 
tate under  the  will,  or  otherwise.— Rector,  etc., 
of  St.  Mark's  Church  v.  Teed,  246. 

Forbearance  to  sue  on  an  honestly  asserted 
claim  for  damases  arising  out  of  a  trade  of 
property  is  suliicient  consideration  for  a  prom- 
ise to  pay,  whether  such  damages  could  haye 
been  recoVered  or  not.— McKinley  v.  Watkins, 
248. 

Forbearance  of  suit  to  enforce  a  disputed 
claim  or  right,  where  the  claim  or  right  is 
honestly  asserted  under  a  belief  that  it  is  sub- 
stantial, although  it  is  in  fact  wholly  uufouud- 
ed,  is  a  good  consideration  for  a  promise  to  pay 
money.— Rue  v.  Meirs,  249. 

§    5.     Natural  affection. 

The  love  a  husbaud  bore  his  wife  is  no  con- 
sideration for  a  promise  to  legatees  to  pay 
legacies  left  by  the  wife.— Schnell  v.  Nell,  2dU. 

Natural  love  and  affection  is  not  a  sufficient 
consideration  for  a  promissory  note  given  by 
father  to  son.— Fink  v.  Cox,  253. 

§   6.     Moral  obligation. 

Services  bv  a  wife  in  the  acquisition  of  her 
husband's  property  are  no  consideration  for  his 
promise  to  legatees  to  pay  legacies  left  by  her. 
-Schnell  v.  Nell,  230. 

A  promise  by  a  father  to  repay  strangers  for 
expenses  incurred  in  caring  for  his  son,  who 
was  of  full  age,  and  not  a  member  of  his  fam- 
ily, cannot  be  enforced.— Mills  v.  Wyman,  2o4. 


Where  a  creditor  accepts  his  debtor's  notes 
secured  by  a  chattel  mortgage  for  part  of  the 
debt  due,  in  satistaction  of  the  whole,  the  whole 
debt  is  extinguished. — Jalfray  v.  Davis,  26G. 

I  §    9.     Fast   consideration. 

I  Transfer  of  an  unenforceable  bargain  for  the 
purchase  of  land,  not  made  at  the  request  of 
the  maker,  is  not  consideration  for  a  note. — 
iihle  V.  Judson,  269. 

An  oral  contract  by  defendant's  testator  with 
plaintiff  to  purchase  land,  and  on  its  resale  to 
pay  plaintiff  the  increase  over  the  original  pur- 
chase price,  iu  consideration  of  which  plaintiff 
agreed  to  pay  an  old  debt  he  owed  testator,  and 
to  pay  the  taxes,  insurance,  etc.,  on  the  land, 
and  keep  it  in  good  repair,  though  void  under 
the  statute  of  frauds,  its  performance  by  plain- 
tiff was  sufficient  to  uphold  a  subsequent  prom- 
ise by  testator,  after  a  resale  of  the  land,  to 
pay  plaintiff  the  amount  realized  over  the  orig- 
inal  purchase  price. — Pool  v.  Horner,   271. 

If  the  consideration,  even  without  request, 
moves  directly  irom  the  plaintiff  to  the  defend- 
ant, and  inures  directly  to  the  defendant's  ben- 
efit, the  promise  is  binding  though  made  upon  a 
past  consideration. — Boothe  v.  Fitzpatrick,  272. 

Plaintiff  had  guarantied  repayment  of  ad- 
vances made  to  defendant,  and  defendant,  who 
became  a  bankrupt,  after  the  fiat  was  issued 
promised  to  repay  plaintiff"  if  he  was  compelled 
to  pay  the  advances.  Ueld  made  on  good  con- 
sideration.—Earle  V.  Oliver,  274. 


CONSTRUCTION. 


§    7.     Impossible  promises. 

A  contract  by  which  one  bound  himself  that 
certain  land,  belonging  to  another,  should  sell 
for  a  certain  amount  or  more  on  a  certain  day, 
is  void. — Stevens  v.  Coon,  256. 

§    8.     Doing  wliat  one  is  bound  to  do. 

Promise  of  a  captain  of  a  ship  to  divide  the 
wages  of  deserting  members  of  the  crew 
among  the  remainder  is  void.— Stilk  v.  Mynck, 
257. 

Plaintiff  agreed  by  an  instrument  under  seal 
to  erect  a  building  at  a  fixed  price,  which  was 
inadequate,  and  refused  to  proceed,  but,  on  de- 
fendant's parol  promise  to  pay  for  the  material 
and  work,  finished  the  building.  Held,  that 
he  might  recover  on  the  promise.— Munroe  v. 
Perkins,  258. 

Where  one  contracted  to  do  work,  and  receive 
in  payment  of  an  installment  an  assignment  of 
a  mortgage,  the  completion  of  the  work  by  him 
is  no  consideration  for  a  guaranty  of  the  mort- 
gage by  the  assignor.— Vanderbilt  v.  Schreyer, 
260. 

The  receipt  of  a  part  of  a  debt  in  full  satis- 
faction being  void,  the  fact  that  a  similar  agree- 
ment was  made  with  all  the  creditors,  without 
its  appearing  that  they  had  been  paid,  or  had 
released  their  debts,  or  signed  any  composition 
deed,  does  not  alter  the  case.— Wheeler  v. 
Wheeler,  264. 

The  receiving  of  a  part  of  a  debt,  then  due, 
in  full  satisfaction,  is  no  legal  defense  to  an  ac- 
tion to  recover  the  balance.— Wheeler  v.  Wheel- 
er, 264. 


Effect  of  custom,  see  "Custom  and  Usage." 
Parol  evidence  to  vary  or  alter  terms,  >-'ee  "Evi- 
dence." 

§    1.     General  rules  of  construction. 

In  the  construction  of  contracts  the  first  rule 
to  be  regarded  is,  to  make  them  speak  the  in- 
tention of  the  parties,  as  gathered  from  the 
entire  transaction.  All  other  rules  are  subor- 
dinate to  this  one,  and  when  they  contravene 
it  are  to  be  disregarded.— Gray  v.  Clark,  556. 

Nice  grammatical  construction  is  not  always 
to  be  regarded,  especially  when  instruments  are 
inexpertly  drawn.— Gray  v.  Clark,  556. 

When  a  term  or  phrase  is  eqtiivocal  in  re- 
gard to  the  subject  to  which  it  refers,  resort 
may  be  had  to  the  circumstances  under  which 
the  contract  was  executed,  and  the  contempora- 
neous exposition  of  the  parties,  as  evidenced 
by  possession  and  other  similar  acts.— Gray  v 
Clark,  556. 

§    2.     Parties. 

The  purchaser  of  a  business,  who  delivers 
goods  to  one  contracting  with  the  original  own- 
er, without  informing  such  person  of  the 
change,  cannot  recover  for  the  goods.— Boston 
Ice  Co.  V.  Potter,  524. 

A  factor  who  promised  the  consignor  to  ac- 
cept a  draft  drawn  against  cotton  consigned  to 
him  when  he  received  the  bill  of  lading  is  not 
liable  to  the  payee  on  such  promise,  or  for  the 
proceeds  of  the  cotton.— Exchange  Bank  v. 
Rice,  526. 

Plaintiff  may  enforce  a  promise  made  by  de- 
fendant to  a  third  person  for  his  benefit,  al- 
though not  privy  to  the  consideration,  nor  cog- 
nizant of  the  promise  when  made.— Lawrence 
V.  Fox,  529. 

§   3.     Nature  of  contract. 

A  contract  to  manufacture  and  furnish  arti- 
cles for  the  especial,  exclusive,  and  peculiar 
use  of  another,  with  special  features  which  he 


INDEX. 


627 


requires,  and  which  render  them  of  value  to 
him,  but  useless  and  unsalable  to  others, — arti- 
cles whose  chief  cost  and  value  are  derived 
Iroiu  the  labor  and  skill  bestowed  upon  ihciii, 
and  not  from  the  materials  of  which  they  are 
made, — is  a  contract  for  work  and  labor,  and 
not  a  contract  of  sale.— Beck  <fc  Tauli  Litho- 
graiihing  Co.  v.  Colorado  Milling  &  Elevator 
Co.,  058. 

§    4.     Time. 

In  a  contract  by  a  lithographing  company  to 
furnish,  "in  the  course  of  the  year,"  designs  of 
certain  buildings  of  a  manufacturing  company, 
with  sketches  of  its  trade-marks,  to  execute 
engravings,  and  to  embody  them  on  large 
amounts  of  stationery,  to  engrave  a  vignette 
of  one  of  the  firm's  plants,  aiul  to  furnish  a 
certain  number  of  hangers,  after  approval  of 
proofs,  the  stipulation  as  to  time  is  not  of  the 
essence  of  the  contract  so  as  to  justify  a  re- 
pudiation thereof  because  of  a  delay  in  delivery 
till  eight  (lays  after  the  close  of  the  year. — 
Beck  «fc  Pauli  Lithographing  Co.  v.  Colorado 
Milling  &  Elevator  Co.,  558. 

In  contracts  for  work  or  skill,  and  the  ma- 
terials upon  which  it  is  to  be  bestowed,  a  state- 
ment fixing  the  time  of  performance  of  the  con- 
tract is  not  ordinarily  of  its  essence;  and  a 
failure  to  perform  within  the  time  stipulated, 
followed  by  substantial  performance  after  a 
short  delay,  will  not  justify  the  aggrieved 
party  in  repudiating  the  entire  contract,  but 
will  simply  give  him  his  action  for  damages 
for  the  breach  of  the  stipulation. — Bock  &  Pauli 
Lithographing  Co.  v.  Colorado  Milling  &  Ele- 
vator Co.,  558. 

In  contracts  of  merchants  for  the  sale  and  de- 
livery or  for  the  manufacture  and  sale  of  mar- 
ketable commodities,  a  statement  descriptive  of 
the  subject-matter,  or  some  material  incident, 
such  as  the  time  of  shipment,  is  a  condition 
precedent,  upon  the  failure  oi-  nonperformance 
of  which  the  party  aggrieved  may  repudiate 
the  whole  contract. — Beck  »S:  Pauli  Lithograph- 
ing Co.  V.  Colorado  Milling  He  Elevator  Co., 
558. 

Under  a  contract  made  in  Philadelphia  for 
the  sale  of  "5,000  tons  of  iron  rails,  for  ship- 
ment from  a  European  port  or  ports,  at  the 
rate  of  about  1,000  tons  per  month,  beginning 
February,  18S0,  but  whole  contract  to  be  ship- 
ped before  August  1,  1S80,  at  ^45  per  ton  of 
2,240  lbs.  custom-house  weight,  ex  ship  Phila- 
delphia; settlement,  cash,  on  presentation  of 
bills  accomi)aniod  by  custom-house  certificate 
of  weight;  sellers  not  to  be  compelled  to  re- 
place any  parcel  lost  after  shipment," — the  sell- 
ers are  bound  to  ship  1,000  tons  in  each  month, 
from  February  to  .Tune  inclusive,  except  that 
slight  and  unimportant  deficiencies  may  be 
made  up  in  .Inly;  and  if  only  400  tons  are  ship- 
ped in  February,  and  S8.1  tons  in  March,  and 
the  buyer  accepts  and  pays  for  the  February 
shipment  on  its  arrival  in  March,  at  the  stipu- 
lated price,  and  above  its  market  value,  and 
in  ignorance  that  no  more  has  been  shipped  in 
February,  and  is  first  informed  of  that  fact  aft- 
er the  arrival  of  tlu'  March  shipments,  and  be- 
fore accepting  or  paying  for  either  of  them, 
he  may  rescind  the  contract  by  reason  of  the 
failure  to  ship  about  1.000  tons  in  each  of  the 
months  of  Februarv  and  March. — Xorriugton  v. 
Wright.  604. 


CONSTRUCTIVE  CONTRACTS. 

See  "Judgment." 

A  constructive  contract  is  a  fiction  of  law 
adapted  to  enforce  legal  duties  by  actions  of 
contract,  where  no  proper  contract  exists,  ex- 
j)ress  or  implied. — Hertzog  v.  Hertzog,  5;  Sceva 
V.  Tru»    S. 


CONTINGENT  FEES. 

See  "Champerty  and  Maintenance." 

CONTRACTS  UNDER  SEAL. 

Delivery,  see  "Deeds." 

§    1.     Consideration. 

It  is  not  a  good  defense  to  a  promise  in  writ- 
ing under  >eal  t<j  pay  money,  for  value  re- 
cei\ed,  that  it  was  voluntary. — AUer  v.  AUer, 
110. 

A  seal  implies  a  consideration  sulUcient  to 
support  a  promise  by  a  conveuantor  to  convey 
lands  upon  the  payment  of  the  consideration 
therein  named. — 5lcMillan  v.  Ames,  ll.'j. 

§   2.     Revocation  of  offer  under  seal. 

An  instrument  under  seal,  unilateral  in  form, 
wherein  a  party  promises  to  convey  lands  upon 
the  payment  of  the  consideration  therein  nam- 
ed on  or  before  a  future  day,  is  obligatory  upon 
him  as  a  covenant,  subject  to  the  performance 
of  the  condition  by  the  covenantee. — McMillan 
V.  Ames,  113. 

CONVEYANCE. 

See  "Deeds";  "Fraudulent  Conveyanced." 

CORPORATIONS. 

A  corporation  cannot  ratify  a  contract,  made 
by  its  agent,  which  it  could  not  lawfully  au- 
thorize.— Downing  v.  Mt.  Washington  Road 
Co.,  342. 

Corporations  have  no  powers  except  such  as 
are  given  by  their  charter  and  such  as  are  in- 
cidental and  necessary  to  effect  the  purpose  of 
their  creation.— Downing  v.  Mt.  Washington 
Road  Co.,  342. 

A  contract  by  which  a  railroad  company 
renders  itself  incapable  of  performing  its  duties 
to  the  public,  or  attempts  to  absolve  itself  from 
its  obligation  without  consent  of  the  state,  is 
void. — Thomas  v.  Railroad  Co.,  345. 

A  lease  by  a  railroad  company  of  all  its  road, 
rolling  stock,  and  franchise,  not  authorized  by 
its  charter,  is  void. — Thomas  v.  Railroad  Co., 
345. 

A  private  corporation  having  power  to  bor- 
row money  and  give  notes  therefor  cannot 
avoid  liabiiity  on  the  notes  because  the  money 
borrowed  was  used  in  a  business  beyond  its 
powers.— Bradley  v.  Ballard,  350. 

A  corporation  created  to  construct  a  railroad 
mav  borrow  money  and  execute  a  note  for  its 
payment.— Union  Bank   v.  Jacobs,  3152. 

A  foreign  corporation  may  enforce  its  con- 
tracts by  action  in  the  state  of  New  York.— 
Diamond  Match  Co.  v.  Roeber.  401. 

A  vendor  of  stocks  to  a  banking  company, 
reeiMving  in  payment  notes  on  time.  whi<h  the 
corporation  is  fntbidden  by  law  to  issue,  mny 
recover  for  the  stocks.— Tracy  t.  Talmage.  497; 
State  of  Indiana  v.  Leavitt,  Id. 


CORRESPONDENCE. 

See  "Ofifer  and  Acceptance,"  §  7. 

COVENANT. 

Of  feme  covert,  see  "Married  Women. 


628 


INDEX. 


CRIMINAL  LAW. 


Where  an  illegal  contract  has  been  fully  ex- 
ecuted, and  money  paid  thereon  remains  in  the 


Contracts^to  commit  offense,  see  "Obstructing    ^-,X'J,^  v'f KnS,'  511?'"  ''  recovered.- 
Justice. 


CUSTOM  AND  USAGE. 

Where  a  contract  for  excavation  is  silent  as 
to  whom  the  material  excavated  should  belong, 
a  custom  that  it  belongs  to  the  excavator  may 
be  shown  as  evidence  of  the  contract. — Cooper 
y.  Kane,  555. 

DAMAGES. 

An  agreement  by  a  vendor  not  to  engage 
again  in  the  same  business  for  a  certain  time 
on  forfeiture  of  a  certain  sum  is  for  stipulated 
damages  for  breach  of  the  agreement,  and  not 
for  a  penalty. — Jaquith  v.  Hudson,  561. 

In  cases  where  damages  for  breach  of  con- 
tract are  stipulated,  whether  the  sum  is  in 
fact  a  penalty  will  be  determined  by  the  magni- 
tude of  the  sum  in  connection  with  the  subject- 
matter. — Jaquith  v,  Hudson,  561. 

Where,  from  the  nature  of  the  contract  and 
the  subject-matter  of  the  stipulation  for  the 
breach  of  which  a  sum  is  provided,  the  actual 
damages  from  a  breach  are  uncertain,  the  par- 
ties may  provide  in  the  contract  for  such  dam- 
ages.— Jaquith  v.  Hudson,  561. 


DEATH. 

Operating  as  discharge  of  contract,  see  "Per- 
formance or  Breach,"  §  7. 

lievocaiiun  of  offer  by  death,  see  "Offer  and 
Acceptance,"   §  11. 


See  "Fraud." 


DECEIT. 


DEEDS. 


See  "Escrow." 

Effect  of  duress,  see  "Duress,"  §  1. 
Effect  of  undue  influence,   see   "Undue  Influ- 
ence." 
Of  infant,  see  "Infants,"  §  4. 
Of  insane  person,  see  "Insane  Persons." 
Of  wife,  see  "Married  Women." 

Where  the  owner  of  real  estate  executes  a 
deed  to  her  daughters,  from  whom  she  takes 
back  a  life  lease  of  the  premises,  and  some 
months  later  the  owner,  with  one  of  her  daugh- 
ters, delivers  to  a  third  party  a  package  con- 
taining the  deed  and  lease,  and  inscribed  with 
directions  to  deliver  the  same  to  the  owner, 
and  in  case  of  her  death  to  one  of  the  daugh- 
ters, and  afterwards  speaks  of  the  deed  as  "the 
girls'  deed."  and  occupies  the  premises  under 
the  lease  till  her  death,  the  facts  show  a  pres- 
ent delivery  of  the  deed  to  the  daughters. — 
Martin  v.  Flaharty,   106. 


DELIVERY. 


DEPOSITS. 

See  "Banks  and  Banking." 
With   third   person   under  illegal  contract,   see 
"Depositaries." 

DISCHARGE. 

See  "Alteration";    "Modification  and  Merger"; 
■  "Novation";    "Payment." 


DRUNKARDS. 

A  contract  made  when  the  obligor  is  so  in- 
toxicated as  to  be  deprived  of  the  exercise  of 
his  understanding  is  voidable. — Barrett  v.  Bux- 
ton, 329. 


DURESS. 


See   "Pleading.' 


Of  deed,  see  "Deeds." 


DEPOSITARIES. 

A  third  person,  who  receives  money  from 
one  party  for  another  on  a  contract,  cannot  set 
up  the  illegality  of  the  contract  as  a  defense  to 
an  action  for  the  money. — Woodworth  v.  Ben- 
nett,  511. 


§    1.     Of  the  person. 

A  deed  procured  through  fear  of  loss  of  life 
produced  by  threats  of  the  grantee  may  be 
avoided  for  duress. — Brown  v.  Pierce,  391. 

§    2.     Of  property. 

Where  the  owner  of  perishable  goods  going 
rapidly  to  destruction,  in  order  to  get  the  goods, 
in  addition  to  the  amount  due,  is  compelled 
to  release  one  in  possession  under  a  fraudulent 
attachment  from  all  damages  for  his  wrongful 
acts,  the  release  is  void. — Spaids  v.  Barrett, 
3<J6. 

§    3.     Of  third  person. 

It  is  no  defense  to  a  promissory  note  made 
by  one  party  to  another  that  it  was  given  to 
release  a  third  person  from  an  unlawful  arrest. 
— llobiuson  v.  Gould,  3U8. 

§   4.     By  third  person. 

In  suit  on  a  promissory  note  made  by  defend- 
ant and  her  husband  to  plaintiff's  order,  that 
her  signature  thereto  was  obtained  by  duress 
and  threats  on  her  husband's  part  is  imma- 
terial, where  plaintiff  did  not  know  when  he 
received  it  that  it  was  so  signed. — Fairbanks 
V.  Snow,  400. 

ESCROW. 

Where  the  owner  of  real  estate  executes  a 
deed  to  her  daughters,  from  whom  she  takes 
back  a  life  lease  of  the  premises,  and  some 
months  later  the  owner,  with  one  of  her  daugh- 
ters, delivers  to  a  third  party  a  package  con- 
tainiiig  the  deed  and  lease,  and  inscribed  with 
directions  to  deliver  the  same  to  the  owner, 
and  in  case  of  her  death  to  one  of  the  daugh- 
ters, the  leaving  of  the  papers  with  the  de- 
positary did  not  constitute  an  escrow;  there  be- 
ing no  condition  to  be  performed  before  deliv- 
ery.— Martin  v.  Flaharty,  106. 


ESTOPPEL. 

A  defendant  who  has  violated  a  contract 
with  a  corporation  is  not  in  a  position  to  com- 
plain that  the  contract  is  ultra  vires  of  such 
corporation,  after  he  has  received  the  benefits 
of  the  contract. — Diamond  Match  Co.  v.  Koe- 
ber.  461. 


INDIZX. 


629 


EVIDENCE. 

A  contract  may  be  proved  by  circumstantial 
evidence. — Heffron  v.  Brown,  95. 

A  contract  cannot  bo  f-rcnlcd  by  adding  to  the 
written  communication  additional  facts  by  parol 
evideuTL'. — .Muulluu  V.   Kcrhhaw,  D'J. 

The  burden  of  proof  is  on  one  afDrming  the 
coiu|ik'lion  ui'  a  ctailraLt  to  show  that  the  sign- 
ing of  the  written  draft  thereof  was  not  nec- 
essary to  its  (-umpletiou. — Mississipiji  6c  Do- 
minion Steamship  Co.  v.  Swift,  101. 

The  testator  in  consideration  of  the  convey- 
ance of  a  farm  to  him,  ui»on  which  the  plain- 
tiff, at  the  reqiu'st  of  the  testator's  gniiilor, 
had  erected  a  barn,  promised  to  pay  the  plain- 
tiff the  cost  of  said  barn.  The  grantor's  deed 
to  the  testator  was  for  the  expressed  considera- 
tion of  $yOO;  and  the  testator  gave  to  the 
grantor  a  bond  and  mortgage,  providing  for 
his  support,  and  the  payment  of  specilied  sums 
to  his  daughters.  Uclil,  that  though  the  bond 
might  be  the  only  evidence  as  to  the  extent 
of  any  personal  claim  in  favor  of  the  grantor, 
yet  that  it  would  not  prevent  the  plaintiff  from 
showing  the  existence  of  an  additional  and  sup- 
pletory  agreement  by  parol,  in  his  own  favor, 
as  entering  into  and  constituting  a  part  of  the 
consideration  expressed  in  the  deed. — Wait  v. 
Wait's  Ex'r,   123. 

The  defendant  sold  the  plaintiff  certain  stock, 
and  executed  to  her  at  the  time  a  written 
contract  that  he  would  repurchase  it,  if  she  de- 
sired, after  a  certain  time  at  a  stipulated  price, 
and  he  afterwards  did  repurchase  it  at  such 
price.  Ucld,  in  an  action  by  the  plaintiff'  for 
fraudulent  representations  and  concealment  by 
the  defendant  in  regard  to  the  value  of  the 
stock  in  connection  with  its  repurchase,  that 
parol  evidence  of  what  was  said  between  the 
parties  at  the  time  the  written  contract  was 
made,  was  admissible  for  the  purpose  of  show- 
ing such  a  confidential  relation  of  the  parties 
as  rendered  fraudulent  the  course  of  the  de- 
fendant in  making  the  repurchase. — Mallory  v. 
Leach,  390. 

Parol  evidence  is  admissible  to  show  that  a 
written  contract,  regular  in  form,  and  pur- 
porting to  be  for  the  purchase  and  actual  fu- 
ture delivery  of  cotton,  was  in  fact  entered  into 
for  the  sole  puriiose  of  speculating  in  futures, 
and  with  no  intention  to  deliver  the  cotton 
purchased,  but  to  pay  the  difference  between 
the  contract  price  and  the  price  on  a  future 
named  day;  but,  the  terms  of  the  contract  im- 
l)lying  good  faith,  the  burden  of  proof  is  on 
tlie  partv  resisting  to  show  the  illegal  purpose. 
—Beadles  v.  McElrath,  44S. 

Where  one  has  sold  an  article  giving  a  writ- 
ten warranty  but  omitting  soundness,  evidence 
of  a  jiarol  warranty  of  soundness  is  inadmissi- 
ble.—Smith  v.  Williams,  552. 

Where  nothing  has  been  omitted  from  or  in- 
serted in  a  written  contract  through  fraud,  acci- 
dent, or  mistake,  parol  evidence  is  inadmissible 
to  vary  its  terms. — Smith  v.  Williams,  552. 


EXECUTORS  AND  ADMINISTRATORS. 

Agreement    to    administer    estate    and    collect 

claims,  see  "Breach  of  Trust." 
Promise  within  statute  of  frauds,  see  "Statute 

of  Frauds,"   §  3. 


FALSE  REPRESENTATIONS. 

See   "Fraud." 


FORBEARANCE. 

See  "Consideration,"  §  4. 

FRAUD. 

See  "Breach  of  Trust";  "Statute  of  Frauds." 

Liability  of  infants  for  fraud,  see  "Infants,"  S 
2. 

Parol  evidence,  see  "Evidence." 
Pleading  fraud,  see  "Pleading." 

§    1.     Representations  in  generaL 

In  order  to  eslabli.sh  a  case  of  false  repre- 
sentation, it  is  not  necessary  that  things  which 
are  false  shall  have  been  stated  as  if  they  were 
true,  but  where  the  presentation  of  that  which 
is  true  creates  an  obvious  impression  which  is 
false,  as  to  one  who  seeks  to  profit  by  the  mis- 
apprehension he  has  thus  produced,  it  is  a  case 
of  false  representation. — Lomerson  v.  John- 
ston, 379. 

One  who  was  surety  for  another's  payment  of 
trust  funds  stated  to  the  latter's  wife  that  her 
husband  had  been  guilty  of  embezzlement,  and 
might  be  imprisoned  therefor.  She  understood 
that  her  husband  was  in  imminent  danger  of 
arrest,  though  such  was  not  the  fact,  and  the 
surety  did  not  so  state,  but  he  was  aware  that 
he  had  produced  this  impression.  She  thereup- 
on executed  to  him  a  mortgage  to  indemnify 
him  for  the  payment  of  the  trust  fund,  and  to 
avert  her  husband's  arrest.  Ucld,  that  the 
mortgage  was  secured  by  false  representations. 
— Lomerson  v.  Johnston,  379. 

A  representation  by  defendant  that  plaintiff 
could  have  possession  of  a  certain  building  on 
property  leased  to  plaintiff  on  a  certain  date, 
several* months  after  the  making  of  such  rep- 
resentation, is  not  actionable,  though  such 
event  did  not  occur,  in  that  it  relates  to  a  fu- 
ture and  not  to  a  past  or  present  event. — Shel- 
don V.  Davidson,  382. 

■§  2.     False  representations  made  in  ig^no- 
rance. 

It  is  not  necessary,  in  order  to  constitute  a 
fraud,  that  the  party  who  makes  a  false  repre- 
sentation should  know  it  to  be  false,  if  such 
party  made  the  false  representation  not  know- 
ing whether  it  was  false  or  not.— Stimson  v. 
Helps,  384. 

The  law  holds  a  contracting  party  liable  as 
for  a  fraud  on  his  express  representations  con- 
cerning facts  material  to  the  treaty,  the  truth 
of  which  he  assumes  to  know,  and  the  truth  of 
which  is  not  known  to  the  other  contracting 
party,  where  the  representations  were  false, 
and  the  other  party,  relying  upon  them,  has 
been  misled  to  his  injury. — Stimson  v.  Helps, 
3^4. 

§    3.     Concealment. 

Defendants,  knowing  that  accepted  drafts 
were  not  drawn  against  funds,  but  for  accom- 
modation of  acceptor,  sold  them  without  in- 
forming the  purchaser  of  the  origin  and  consid- 
eration of  the  paper.  Uild  no  fraud. — People's 
Bank  v.  Bogart,  37G. 

The  defendant,  being  desirous  of  purchasing 
certain  stock  of  the  plaintiff,  of  the  value  of 
which  he  knew  she  was  ignorant,  for  the  pur- 
pose of  misleading  her  and  inducing  her  to  sell 
the  stock  at  less  than  its  value,  told  her  of  a 
fact  calculated  in  itself  to  depreciate  the  value 
of  the  stock,  but  omitted  to  disclose  other  facts 
within  his  knowledge  which  would  have  given 
hiT  correct  information  of  such  value,  and  by 
this  course  succeeded  in  obtaining  the  stock  at 
much  less  than  what  it  was  worth.  Ucld,  that 
the  course  of  the  defendant,  under  the  partic- 


630 


INDEX. 


ular  confiJential  relations  subsisting  between 
the  parties,  was  fraudulent  and  actionable.— 
Mallory  v.  Leach,  390. 

Held,  also,  that  if  the  defendant  was  aware 
that  the  plaintiff  placed  ooniideuee  in  him  to 
inform  her  fully  of  the  value  of  the  stock,  and 
acted  in  reliance  upon  his  representations,  in 
regard  to  its  value  at  the  time  of  his  repur- 
chase of  it,  and  if  this  confidence  was  solicited 
by  him,  it  was  fraudulent  in  him  to  purchase  it 
of  her  without  communicating  to  her  all  the 
material  knowledge  he  possessed  in  regard  to 
it.— Mallory  v.  Leach,  31)0. 

The  allegation  of  only  a  part  of  the  truth, 
with  the  view  of  deceiving  the  other  party,  and 
inducing  him  to  act  differently  from  what  he 
otherwise  would,  is  equivalent  to  a  false  repre- 
sentation, and  will  avoid  a  contract  thereby  in- 
duced.—Mallory  V.  Leach,  390. 

§    4.     Matters    within    knowledge    of    ad- 
verse   party. 

False  representations  as  to  the  quality  and 
productiveness  of  soil  and  the  number  of  acres 
contained  within  the  boundaries  truly  pointed 
out  will  not  invalidate  a  note  given  for  the  pur- 
chase price  of  land.— Gordon  v.  Parmelee,  380. 

§    5.     Matters  of  opinion. 

A  representation  by  defendant  that  plaintiff 
could  have  possession  of  a  certain  building  or 
property  leased  to  plaintiff  on  a  certain  date, 
several  months  afterwards,  is  not  actionable, 
being  a  mere  opinion,  on  which  plaintiff  had  no 
right  to  rely.— Sheldon  v.  Davidson,  3S2. 

§    6.     Rescission. 

On  rescission  of  a  contract  for  fraud  what- 
ever has  been  received  under  the  contract  must 
be  returned. — Cobb  v.  Hatfield,  38U. 

A  fraudulent  purchase  of  goods,  accompanied 
by  delivery,  is  voidable  by  the  vendor,  and  un- 
til avoided  the  vendee  can  make  a  valid  sale 
to  a  bona  fide  purchaser  without  notice.— Row- 
ley V.  Bigelow,  388. 

A  party  to  a  contract  has  a  right  to  rescind 
it  on  account  of  the  fraud  of  the  other  party  as 
soon  as  he  discovers  the  same;  but,  if  he  elect 
to  proceed  and  take  his  rights  under  the  con- 
tract, he  may  still  maintain  an  action  against 
the  other  party  for  the  damages  occasioned  by 
his  fraud. — Mallory  v.  Leach,  390. 

FRAUDULENT   CONVEYANCES. 

See  "Pleading." 

An  attorney  who  obtains  an  assignment  from 
a  client  of  an  interest  in  land,  to  defraud  a 
creditor  of  the  assignor  promising  to  reconvey 
when  the  creditor  is  settled  with,  will  be  com- 
pelled to  reconvey  to  the  client. — Ford  v.  Har- 
rington, 517. 

A  fraudulent  conveyance  by  a  joint  obligor 
will  not  be  set  aside  as  long  as  there  is  a  legal 
remedy  against  the  other  joint  obligors. — Eller 
v.  Lacy,  549. 


See  "Gaming." 


FUTURES. 


GAMING. 


One  cannot  recover  for  property  won  of  an- 
other on  a  wager  that  a  certain  chaise  was 
the  property  of  A.  B. — Collamer  v.  Day,  447. 

Appellants  made  a  contract  to  buy  for  ap- 
pellee a  certain  quantity  of  cotton  for  future 
delivery.  It  appeared  that  appellants  were 
members  of  the  2sew  Orleans  Cotton  Exchange; 


that  they  had  bought  in  the  year  preceding  this 
contract  300,000  bales  of  cotton,  and  were  im- 
der  contract  to  take  60,000  bales,  worth  $200,- 
000,  at  the  time  of  this  contract,  while  they 
were  worth  only  $75,000.  Held,  that  these 
circumstances  showed  the  cotton  contracted  to 
be  bought  for  appellee  was  on  speculation  only, 
and  no  future  actual  delivery  was  intended, 
and  therefore  void,  notwithstanding  a  rule  of 
the  exchange  provided  that  actual  delivery  of 
the  cotton  might  be  exacted.— Beadles  v.  Mc- 
Elrath,   448. 

If  money  is  lent  with  the  mere  knowledge 
or  belief  on  the  part  of  the  lender  that  it  is  to 
be  used  for  gambling  purposes,  and  without 
any  participation  on  his  part  in  the  illegal  act, 
an  action  can  be  maintained  for  its  recovei-y. — 
Tyler   v.   Carlisle,   508. 

"Where  money  is  lent  for  gambling  purposes, 
even  if  the  lender  participates  in  the  purposes 
of  the  borrower,  he  may  recover  the  money 
of  the  borrower,  if  demanded  before  it  has  been 
actually  used.  In  minor  offenses  the  locus  pen- 
itentise  continues  until  the  execution  of  the  il- 
legal act.— Tyler  v.  Carlisle,  508. 


GOVERNMENT. 

Capacity  of  government  to  contract,  see  "Unit- 
ed States." 

GUARANTY. 

Debt  of  another,  see  "Statute  of  Frauds,"  §  4. 

GUARDIAN  AND  WARD. 

Conveyance  to  guardian,  see  "Undue  Influ- 
ence." 

HUSBAND  AND  WIFE. 

Contract  of  wife,  see  "Married  Women." 

ILLEGALITY  OF  OBJECT. 

See  "Breach  of  Marriage  Promise";  "Breach  of 
Trust";  "Champerty  and  Maintenance"; 
"Fraudulent  Conveyances";  "Gaming";  "In- 
jury to  Public  Service";  "Intoxicating  Liq- 
uors"; "Libel  and  Slander";  "Monopolies"; 
"Obstructing  Justice";  "Public  Policy"; 
"Restraint  of  Marriage";  "Restraint  of 
Trade";  "Sunday";  "Usury." 

Agreements  in  fraud  of  creditors,  see  "As- 
signments  for  Benefit  of  Creditors." 

Illegal  deposits  in  banks,  see  "Banks  and  Bank- 
ing." 

Limiting  liability  for  negligence,  see  "Carriers. 

Partial  invalidity  of  mortgage,  see  "Mort- 
gages." 

Rescission  for  illegality,  see  "Rescission  and 
Abandonment." 

Recovery  by  actor  for  services  in  unlicensed 
theater,  see  "Theaters." 

for    goods    sold    for    illegal    purpose,    see 

"Sales." 

Right  of  depositary  of  money  to  assert  invalid- 
ity of  contract,  see  "Depositaries." 

Where   parties  to  a   contract   prohibited   by 

statute,  but  not  malum  in  se,  are  not  pari  de- 
licto, the  less  guilty  party  may  have  relief.— 
Tracy  v.  Talmage,  497;  State  of  Indiana  v. 
Leavitt,   Id. 

Where  the  recovery  of  money  paid  in  per- 
formance of  an  illegal  contract  requires  en- 
forcement of  some  unexecuted  provisions  of  the 
illegal  contract,  an  action  cannot  be  maiutain- 
ed.— AVoodworth  v.  Bennett,  511. 


INDEX. 


631 


IMPLIED  CONTRACTS. 

A  sick  man  handed  his  wifo  a  sum  of  money 
for  safe-keeping  until  he  should  be  well  enough 
to  put  it  in  the  Lank,  and  died  shortly  after. 
Held,  that  his  executor  could  recover  the  money. 
— Lawson   v.   Lawsou,   3. 

Where  a  son  continues  in  the  employ  of  his 
father  alter  his  iiiajurity,  the  law  implies  uo 
contract  by  the  lather  to  pay  for  the  services. 
— Hertzog  v.  Hertzog,  5. 

A  contract  implied  by  law  is  a  legal  fiction 
invented  and  used  for  the  sake  of  the  remedy 
to  enforce  performance  of  a  legal  duty. — Sceva 
V.   True,   8. 

Interest  is  given  on  a  judgment  not  as  on 
the  principle  of  implied  contract,  but  as  dam- 
ages, the  measure  of  which  is  the  statutory 
rate. — O'Brien  v.  Young,  11. 

A  promise  to  pay  for  a  party  wall  cannot  be 
implied  from  the  fact  that  it  was  built  with 
defendant's  knowledge  and  that  defendant  used 
it. — Day  v.  Caton,  28. 

There  is  no  implied  warranty  or  representa- 
tion on  the  part  of  the  vendor  of  a  bill  valid 
in  the  hands  of  an  indorsee  that  it  was  drawn 
against  funds,  or  was  not  accommodation  pa- 
per.— People's  Bank  v.  Bogart,  376. 

INFANTS. 

See    "Apprentices." 

Liability  on  bond  ic   bastardy  proceedingF,   see 

'"Bastardy." 

§    1.     Necessaries. 

Au  infant  may  bind  himself  by  an  express 
contract  for  necessaries  if  the  form  of  the  con- 
tract is  such  that  the  consideration  may  be  in- 
quired into. — Stone  v.  Dennison,  116. 

A  minor  son  of  a  baronet  having  a  large  al- 
lowance is  not  liable  for  the  price  of  jeweled 
solitaires  and  an  antique  vase  intended  for  a 
present. — liyder    v.    Wombwell,    282. 

Where  a  guardian  in  good  faith  acting  for 
the  best  interests  of  the  infant  ward  furnishes 
means  suitable  to  her  age  and  station  in  life 
with  reference  to  her  estate,  the  ward  is  not 
liable  for  money  advanced  to  her  for  traveling 
expenses,  even  as  necessaries. — McKanna  v. 
Merry,  286. 

An  infant  is  liable  for  necessaries  furnished 
him,  but  only  for  such  an  amount  as  is  ac- 
tually needed. — Johnson  v.  Lines,  287. 

S   2.    Fraud. 

An  infant  who  secures  and  retains  personal 
property  of  an  adult,  who  has  acted  in  good 
faith,  and  exercised  care  and  diligence,  upon 
a  false  representation  that  he  is  of  full  age, 
is  liable  for  the  value  of  the  property.— Rice  v. 
Boyer,  315. 

§    3.     Ratification. 

Acknowledgment  by  one,  after  coming  of  age, 
that  a  note  given  in  infancy  was  owing,  and 
a  promise  to  try  and  pay  it,  is  a  sulBcient  rati- 
fication.—Whitney  V.  Dutch,  278. 

Ratification  by  an  infant,  after  coming  of 
age,  of  a  partnership  note,  given  by  his  part- 
ner during  infancy,  will  bind  him.— Whitney  v. 
Dutch,  278. 

Recognition  by  an  infant,  on  coming  of  age,  I 
of  the  fact  of  a  conveyance  during  nonage  is 
not  per  se  proof  of  a  confirmation  of  it. — Tucker  i 
V.  Moreland,  20."). 

An  infant  cannot  retain  the  benefits  of  his  | 
contracts,    after   becoming   of   age,    and   plead 


infancy  to  avoid  the  payment  of  the  purcha.se 
money.— Henry  v.  Root,  301. 

An  infant  who  has  purchased  real  estate 
ratifies  the  contract  of  purchase  by  taking  and 
continuing  in  possession  and  exercising  acts  of 
o\vnershi|>  after  becoming  of  full  age.— Henry 
V.  Root,  301. 

§    4.     Disaffirmance. 

An  infaiit  having  a  general  guardian  may 
maintain  trover  before  coming  of  age  for  a 
horse  sold,  but  not  delivered  with  his  own 
hands,  without  demanding  the  horse.— Stafford 
V.   Roof,  200. 

The  sale  and  actual  delivery  of  a  personal 
chattel  by  au  infant  is  voidable  before  he  at- 
tains the  age  of  21  years. — Stafford  v.  Roof, 
200. 

Deed  conveying  real  estate,  executed  by 
minor,  must  be  disaflirmed  within  a  reasonable 
time  after  he  cumes  of  age,  or  he  will  be  barred 
of  his  right  to  do  so. — Goodnow  v.  Empire 
Lumber  Co.,  202. 

Reasonable  time  within  which  minor  must 
disaffirm  deed  is  a  question  for  the  court,  and 
a  delay  of  three  years  and  a  half,  unexjjlained, 
is  unreasonable. — Goodnow  v.  Empire  Lumber 
Co.,   292. 

Where  an  infant  executed  a  deed  of  his 
realty,  and  after  coming  of  age  deeded  the 
same  property  to  another,  the  second  deed 
is  a  disaffirmance  and  avoidance  of  the  first. — 
Tucker  v.  Moreland,  205. 

Where  an  infant  purchased  a  stock  of  drugs 
which  were  afterwards  taken  on  execution 
against  a  third  party,  the  infant  may  on  dis- 
ailirmance  of  the  contract  maintain  an  action 
for  the  recovery  of  the  purchase  money,  even 
though  he  took  no  steps  to  recover  the  prop- 
erty thus  wrongfully  taken. — Lemmon  v.  Bee- 
man,  313. 

The  contract  of  an  infant  is  voidable,  and 
may  be  repudiated  during  nonage,  so  as  to  ef- 
fectually destroy  the  contract  for  all  purposes. 
— Rice  V.  Boyer,  315. 

§    5.     Performance  of  contract. 

An  infant  contracting  to  labor  until  of  age 
for  his  board,  clothing,  and  education,  which 
was  approved  by  his  guardian,  where  the  con- 
tract has  been  fully  performed  cannot  recover 
on  quantum  meruit.— Stone  v.  Dennison,  116. 

§    6.     Personal  privilege. 

The  defense  of  infancy  being  a  personal  priv- 
ilege, a  joint  plea  of  the  infancy  of  one  defend- 
ant in  an  action  on  a  joint  and  several  bond 
is  bad  on  demurrer. — Township  of  Bordentown 
V.  Wallace,  281. 

Under  an  assignment  by  an  insolvent,  includ- 
ing "all  his  rights  of  action  for  goods  or  es- 
tate, real  or  personal,"  the  assignee  will  not 
bo  permitted  to  disaffirm  a  mortgage  made  by 
the  insolvent  while  under  age,  and  not  ratified 
or  aOirnied  by  him  after  attaining  his  majority; 
the  right  to  avoid  such  a  contract  is  a  per- 
sonal i>rivilcge  of  the  infant. — Mansfield  v.  Gor- 
don,  204. 

INJUNCTION. 

Where  a  bond  was  given  providing  liquidated 
damages  in  the  sum  of  .'?1.5,000  for  a  breach  of 
this  covenant,  the  obligee  is  not  confined  to  his 
remedy  by  way  of  damages  for  the  breach  of 
contract,  but  upon  defendant's  violation  there- 
of, is  entitled  to  an  injunction  restraining  him 
from  continuing  to  disregard  his  covenant. — 
Diamond  Match  Co.  v.  Roeber,  461. 

It  is  not  necessary  that,  before  a  preliminary 
injunction    issue    restraining    violation    of    an 


G32 


INDEX. 


agi-eement  not  to  engage  in  a  certain  business 
in  a  certain  place,  the  rights  of  the  parties  be 
established  by  a  judgment  at  law.— Carll  v. 
Snyder,  4(J5. 


INJURY  TO  PUBLIC  SERVICE. 

An  assignment  by  a  public  officer  of  the  fu- 
ture salary  of  his  office  is  contrary  to  public 
policy  and  void. — Bliss  v.  Lawrence,  425;  Same 
V.  Gardner,  Id. 

An  agreement  for  compensation  for  procur- 
ing a  contract  from  the  government  cannot  be 
enforced.— Providence  Tool  Co.  v.  Norris,  428. 

A  contract  to  take  charge  of  a  claim  before 
congress,  and  prosecute  it  as  an  agent  and  at- 
tornev  for  claimant,  is  void.— Trist  v.  Child, 
430. 

Professional  services  by  an  attorney  in  pro- 
cuiing  the  allowance  of  a  claim  by  congress 
may  be  recovered  for  when  they  are  not 
blended  with  services  which  are  forbidden. — 
Trist   V.   Child,   430. 


INSANE  PERSONS. 

A  deed  executed  by  a  person  when  non  corn- 
pos  mentis  is  voidable  only,  and  may  be  rati- 
fied by  him  when  he  is  of  sane  mind  by  ac- 
ceptance of  the  benefits. — Allis  v.  Billings,  319. 

The  deed  of  an  insane  person  not  under  guar- 
dianship, which  has  never  been  ratified  or  af- 
firmed, may  be  avoided  by  his  heirs. — Hovey  v. 
Hubsou,  C)22. 

An  obligation  entered  into  by  an  insane  per- 
son to  repay  money  loaned,  of  which  he  had  the 
benefit,  is  valid.— Mutual  Life  Ins.  Co.  v.  Hunt, 
325. 

Declaring  a  person  insane  on  inquisition  taken 
subsequent  to  an  agreement  to  repay  money 
loaned  does  not  affect  such  agreement. — Mutual 
Life  Ins.  Co.  v.  Hunt,  325. 

It  is  no  defense  to  trover  for  a  note  pledged 
by  plaintiff  while  insane  that  defendajit  did 
not  know  of,  and  had  no  reason  to  suspect, 
such  insanity,  and  that  he  acted  without  fraud. 
— Seaver  v.  JPhelps,  326. 

The  liability  of  the  estate  of  an  insane  per- 
son over  21  years  of  age  and  under  guardian- 
ship for  necessary  nursing  and  care  furnished 
in  good  faith  and  under  justifiable  _clrcura- 
stances  is  not  changed  by  Rev.  St.  c.  67,  §  22. 
— Sawyer  v.  Lufkin,  328. 


INSOLVENCY. 

See  "Assignments  for  Benefit  of  Creditors." 

INTENT. 

Contractual  intention,  see  "Offer  and  Accept- 
ance," §  12. 

INTEREST. 

See  "Implied  Contracts";  "Usury." 

INTOXICATING   LIQUORS. 

One  who  soils  lirpior  without  a  license  in 
violation  of  the  excise  law  cannot  recover  of 
the  purchaser.— Griffith  v.  Wells,  416. 


JUDGMENT. 

See  "Pleading." 

A  judgment  is  not  a  contract. — O'Brien  v. 
Young,  11. 

KNOWLEDGE. 

As  affecting  false  representations,  see  "Fraud," 
§2. 

LAPSE. 

Of  offer  or  acceptance,  see  "Offer  and  Accept- 
ance," §  11. 

LETTERS. 

Acceptance  by  letter,  see  "Offer  and  Accept- 
ance," §  7. 

LIBEL  AND  SLANDER. 

A  journalist  cannot  protect  himself  from  the 
consequences  of  publishing  a  libelous  article  by 
assurances  of  its  truthfulness,  and  by  a  con- 
tract of  indemnity  from  the  writer  of  the  libel. 
The  case  comes  within  the  rule  that  there  can 
be  no  contribution  or  indemnity  between  joint 
wrongdoers. — Atkins  v.  Johnson,  412. 

Nor  will  such  contract  avail  the  publisher, 
though  renewed  after  the  publication  of  the 
libel,  and  made  in  consideration  that  he  would 
not  disclose  the  name  of  the  writer  on  its  be- 
ing demanded  by  the  victim  of  the  article. — 
Atkins  V.  Johnson,  412. 

A  contract  between  an  author,  intending  to 
write  an  autobiography,  and  a  publisher, 
whereby  the  author  agrees  "to  accept  full  re- 
sponsibility for  all  matter  contained  in  said 
work,  and  to  defend  at  his  own  costs  any  suits 
which  may  be  brought  against  the  publisher 
for  publishing  any  statement  contained  in  said 
work,  and  to  pay  all  costs  and  damages  arising 
from  said  suits."  does  not  show  on  its  face  that 
the  parties  contemplated  the  publication  of 
scandalous  or  libelous  matter,  so  as  to  prevent 
the  publisher  from  recovering  for  the  author's 
refusal  to  permit  it  to  publish  the  work  after 
it  was  written.— Jewett  Pub.  Co.  v.  Butler, 
414. 

LICENSES. 

Sale  of  liquors  without  license,  see  "Intoxicat- 
ing Liquors." 
To  enter  lands,  see  "Statute  of  Frauds,"  §  6. 

MAINTENANCE. 

See  "Champerty  and  Maintenance." 

MARRIAGE. 

See  "Breach  of  Marriage  Promise";  "Restraint 

of  Marriage." 
Agreement   in    considoi'sitlon   of   marriage,   see 

"Statute  of  Frauds,"  §  5. 

MARRIED  WOMEN. 

A  covenant  entered  into  by  a  feme  covert, 
except  as  to  her  separate  property  or  property 
subject  to  exclusive  control,  is  void.— Martin  v. 
Dwelly,  331. 

A  deed  of  lands  belonging  to  a  feme  covert, 
executed   by   her   with  her   husband,    but   not 


INDEX. 


633 


acknowledged  by  her  pursuant  to  the  statute, 
is  not  such  an  agreement  to  convey  as  will  be 
enforced  against  her  heirs. — Martin  v.  Dwelly, 
331. 

A  wife  is  not  liable  on  a  note  as  a  feme 
«ole,  unless  her  husband  has  voluntarily  sepa- 
rated from  and  abauduued  her  with  an  in- 
tent to  renounce  de  facto  the  marital  relation. — 
Gregory  v.  Pierce,  335. 

A  debt  of  a  married  woman,  contracted  for 
accommodation  of  another,  without  considera- 
tion to  her,  will  not  be  enforced  iigainst  her 
separate  estate,  unless  exi)rossly  made  a  charge 
thereon. — Willard  v.  Eastham,  330. 

A  maVried  woman  is  bound  by  a  charge  cre- 
ated by  her  own  express  agreement  for  a  good 
consideration,  though  for  a  purpose  not  benefi- 
cial to  her  separate  estate. — Owen  v.  Cawlev, 
339. 

A  married  woman  is  liable  for  services  ren- 
dered by  her  procurement  I'or  the  benefit  of  her 
separate  estate.— Owen  v.  Cawley,  339. 

A  married  woman  may  avail  herself  of  the 
agency  of  her  husband  as  if  they  were  not  mar- 
ried.— Owen  v.  Cawley,  339. 

.\  married  woman  may  bestow  hoi-  separate 
«state  upon  her  husband. — Osburn  v.  Throckmor- 
ton, 374. 

MASTER  AND  SERVANT. 

No  recovery  can  be  had  on  a  quantum  mer- 
uit, for  services  rendered  in  the  grocery  part 
of  the  business  under  a  contract  to  work  for 
agreed  wages  as  bartender  and  clerk  for  a 
dealer  in  groceries  and  liciuors,  the  sale  of  the 
latter  being  prohibited  when  the  contract  was 
made  and  the  services  rendered. — Sullivan  v. 
Hergan,  490. 


MEMORANDUM. 

Sufficiency     under    statute,     see 
Frauds,"  §  9. 


'Statute    of 


MERGER. 

Of  oral  agreement  in  writing,  see  "Offer  and 
Acceptance,"  §  12. 


See  "Infants." 


MINORS. 


MISTAKE. 


§    1.    Of  law. 

Where  wife  transfers  her  separate  estate  to 
her  husband,  she  cannot  avoid  the  transaction 
because  of  her  ignorance  of  the  law. — Osburn 
V.  Throckmorton,  374. 

§   2.     Of  fact. 

One  who  indorsed  a  bill  of  exchange  on  the 
representation  that  it  was  a  guaranty,  and  be- 
lieving it  to  be  a  guaranty,  is  not  liable  as  in- 
dorser. — Poster  v.  MacKinnon,  358. 

Where  one  ordering  goods  signed  his  name 
so  that  it  resembled  the  name  of  a  reliable 
firm,  and  the  goods  were  directed  to  the  firm, 
though  to  his  address,  there  was  no  contract 
with  him,  and  a  sale  bv  him  conveyed  nothing. 
—Gundy  v.  Lindsay,  3G0. 

A  factor  who  sold  corn  in  ignorance  of  the 
fact  that  it  had  already  been  sold  to  another 
is  not  liable  for  the  price. — Couturier  v.  Hastie, 
3G3. 


One  who  has  exchanged  land  for  land  in 
another  state,  with  which  both  parties  are  un- 
acquainted, but  whose  value  is  stated  to  them 
by  a  third  person,  under  a  mistake  as  to  the 
identity  of  the  laud,  can,  on  learning  of  the  mis- 
take a  few  mouths  after  the  deeds  have  been 
maile  and  delivered,  rescind  by  tendering  back 
a  deed  of  the  land  and  the  notes  ami  mortgage 
received  by  him  to  boot,  on  the  ground  of  mu- 
tual mistake,  since  he  cannot  be  considered 
negligent  in  relying  on  the  third  person's  state- 
ments.— Irwin  v.  Wilson,  3G(j. 

Where  defendants  had  sold  a  blooded  cow 
for  514  cents  per  pound,  supiiosjnj;  her  to  be 
sterile,  hrlil  that  they  were  justili"!!  in  rescind- 
ing the  sale  before  delivery  on  finding  her  to  be 
in  calf.— Sherwood  v.  Walker,  370. 


MODIFICATION  AND  MERGER. 

Release  of  a  party  from  performance  of  a 
contract  is  sufficient  consideration  for  his  prom- 
ise 1o  aocnunt  with  the  other  party  for  moneys 
paid  by  the  latter  under  the  contract.— Cutter 
v.  Cochrane,  507. 

A  lesser  security  merges  in  and  is  extin- 
guished by  a  higher  security,  taken  for  the 
same  debt,  unless  taken  as  further  collateral 
security.— Van  Vleit  v.  Jones,  620. 


MONEY  HAD  AND  RECEIVED. 

Recovery    from    depositary    under    illegal    con- 
tract, see  "Depositaries." 


MONEY  LENT. 

Recovery    of    money    lent    for    gambling,    see 
"Gaming." 

MONOPOLIES. 

Where  coal  companies  having  control  of  certain 
coal  regions  enter  into  an  agreement  to  con- 
trol the  output,  a  bill  drawn  by  one  company 
on  another  to  equalize  prices  on  a  settlement 
under  the  contract  cannot  be  recovered. — Mor- 
ris Run  Coal  Co.  v.  Barclay  Coal  Co.,  469. 

An  agreement  between  several  parties,  sever- 
ally engaged  in  the  business  of  manufacturing 
and  selling  balance  shade  rollers,  for  the  pur- 
pose of  avoiding  competition,  organize  them- 
selves into  a  corporation,  and  severally  enter 
into  an  agreement  with  the  corporation,  so  or- 
ganized, that  all  sales  of  the  shade  roller  shall 
be  made  in  the  name  of  the  corporation,  and 
at  once  reported  to  it:  that,  when  either  party 
shall  establish  an  agency  in  any  city  for  the 
sale  of  a  roller  made  exclusively  for  that  pur- 
pose, no  other  party  shall  take  orders  for  the 
same  roller  in  the  same  place;  and  that  the 
prices  for  rollers  of  the  same  grade,  made  by 
the  different  i>arties.  shall  be  the  same,  and 
shall  be  according  to  a  schedule  contained  in 
the  contract,  subject  to  changes  which  may  be 
made  by  the  cori>oration  ui^on  recommendation 
of  three-fourths  of  the  stockholders. — is  not 
void  as  in  restraint  of  trnde. — Central  Shade- 
Roller  Co.  V.  Cushman,  473. 

An  agreement  by  a  patentee  to  allow  an  as- 
sociation and  its  members  the  exclusive  use  and 
sale  of  inventions  patented  by  him  is  not  illegal 
as  creating  a  monopoly  or  being  in  restraint  of 
trade. — Good  v.  Daland,  474. 

An  association  of  stenographers,  formed 
to  establish  and  maintain  uniform  rates  of 
charges,  and  to  prevent  competition  among  its 
members  under  certain  penalties,  is  illegal,  as 
in  restraint  of  trade  and  against  public  policy. 
and   one   member   cannot   maintain   an   action 


t)o4 


INDEX. 


against  another  for  damages  occasioned  by  the 
latter  underbidding  the  former,  in  violation  of 
the  rules  of  the  association. — More  v.  Bennett, 
476. 

MORAL  OBLIGATIONS, 

See  "Consideration,"  §  6. 


MORTGAGES. 

Notes  were  given,  secured  by  mortgage,  the 
consideration  being  the  good  will,  fixtures,  and 
stock  of  a  business,  the  two  latter  specified  in  in- 
ventories upon  which  each  article  with  its  price 
was  separately  cariiod  out.  A  part  of  the 
stock  sold  and  specified  in  the  inventory  was 
lager  beer,  cider,  ale,  porter,  and  alcohol,  the 
sale  of  the  ale,  porter,  and  alcohol  being  illegal. 
On  petition  to  foreclose  by  an  assignee  for 
value  and  without  notice  of  the  iiotos  and 
mortgage,  held  that,  the  articles  illegally  sold 
and  their  value  being  certainly  ascertainable, 
the  contract  is  divisible,  and  mortgage  may  be 
foreclosed  for  the  amount  of  the  legal  sales. — 
Shaw  V.  Carpenter,  491. 

An  assignee  of  a  bona  fide  assignee  of  a 
mortgage,  whose  assignment  was  not  register- 
ed, is  not  affected  by  registry,  after  the  first 
assignment  and  before  the  second,  of  a  prior 
conveyance  to  a  cestui  que  trust  under  a  secret 
trust.— Mott  v.  Clark,  546. 

Assignee  of  a  mortgagee  talces  subject  to  the 
equities  of  the  mortgagor,  but  not  as  to  latent 
equities  of  cestuis  que  trustent  of  the  mort- 
gagor or  other  persons. — Mott  v.  Clark,  546. 


MUTUAL  PROMISES. 

.See  "Consideration,"  §  3. 

NECESSARIES. 

Infant's  contracts  for,  see  "Infants,"  §  1. 

NEGLIGENCE. 

Limitation  of  carrier's  liability,  see  "Carriers." 


NOVATION. 

Where  a  debtor  left  money  in  the  hands  of  a 
third  person,  who  agreed  to  pay  a  debt,  the 
creditor  having  never  accepted  such  person  as 
his  debtor,  or  released  the  original  debtor,  can- 
not maintain  an  action  against  such  third  per- 
son.— Butterfield  v.  Hartshorn,  5G8. 


OBSTRUCTING  JUSTICE. 

A  creditor  of  one  who  has  sold  all  his  prop- 
erty, and  fled  from  the  country,  agreed  with 
complainant  that  if  he  would  procure  the  alli- 
davits  and  testimony  of  the  debtor,  and  of  two 
other  witnesses,  showing  that  no  consideration 
was  paid  for  said  property,  and  that  the  pur- 
chaser knew  of  the  debtor's  insolvency,  lie 
would  give  complainant  a  share  of  whatever  he 
recovered  upon  a  creditors'  bill  filed  by  him 
against  the  debtor  and  said  purchaser.  Held, 
that  the  agreement  was  illegal,  as  leading  to 
subornation  of  perjury. — Goodrich  v.  Tenney, 
434. 

A  creditor  of  one  who  had  sold  all  his  prop- 
erty, and  fled  from  the  country,  agreed  with 
complainant  that  if  he  would  procure  the  affi- 
davits and  testimony  of  the  debtor,  and  of  two 
other  witnesses,  showing  that  no  consideration 


was  paid  for  said  property,  and  that  the  pur- 
chaser knew  of  the  debtor's  insolvency,  he 
would  give  complainant  a  share  of  wliiitever 
he  recovered  ui)ou  a  creditors'  bill  filed  by  him 
against  the  debtor  and  said  purchaser.  Held 
that,  the  contract  being  illegal,  the  creditor, 
although  he  has  recovered  a  large  sum  of 
money  by  help  of  it,  will  not  be  compelled  by 
the  courts  to  account  therefor  to  conii)lainaut. 
— Goodrich  v.  Tenney,  4o4. 

A  promissory  note  given  for  compounding  a 
public  prosecution  for  a  misdemeanor  is  found- 
ed on  an  illegal  consideration. — Jones  v.  Kice, 
439. 

OFFER  AND  ACCEPTANCE. 

Acceptance  of  goods   within   statute  of  frauds, 

see  "Statute  of  Frauds,"  §  8. 
Knowledge  of  oiler  of  reward,  see  "Rewards." 

§    1.     Necessity  of  offer  and  acceptance. 

To  constitute  a  binding  contract,  there  must 
be  a  meeting  of  the  minds  of  the  parties. — 
Thurston  v.  Thornton,  14. 

A  document  signed  by  the  owner  of  prop- 
erty purporting  to  be  an  agreement  to  sell  at 
a  fixed  price,  with  a  postscript,  "This  offer  to 
be  left  over  until  Friday,  9  a.  m.,"  is  only  an 
offer. — Dickinson  v.  Dodds,  77. 

<§   2.     Effect  of  acceptance. 

A  contract  is  obligatory  from  the  moment  the 
minds  of  the  parties  meet,  signified  by  overt 
acts,  though  such  occurence  is  not  known  to 
buth  parties  at  the  time. — Mactier's  Adm'r  v. 
Frith,  38. 

Acceptance  of  an  offer  to  sell  constitutes  a 
contract  for  sale  only  from  time  of  accept- 
ance.— Dickinson   v.   Dodd,   77. 

§    3.     Necessity  of  communication — Offer. 

One  receiving  a  ticket  on  deposit  of  goods, 
in  which  the  liability  of  the  bailee  is  limited,  ia 
under  no  obligation  to  read  the  condition. — 
Parker  v.  Southeastern  Ry.  Co.,  18. 

§    4.    -^—   Acceptance. 

Plaintiff,  a  builder,  received  a  note  stating- 
that  upon  an  agreement  to  finish  worlc  in  cer- 
tain time  he  might  commence  at  once,  to  which 
he  did  not  reply,  but  purchased  lumber  for  the 
work,  and  commenced  to  prepare  it.  Held  no 
acceptance. — White  v.  Corlies,  16. 

§    5.     Manner  of  communication. 

Communication  of  acceptance  of  an  offer  sent 
to  a  different  place  than  that  directed  in  the 
offer  does  not  bind  the  party  making  the  offer. 
— Eliason  v.  Henshaw,  24. 

§    6.     Communication  by  conduct. 

One  not  a  subscriber,  who  takes  a  newspaper 
directed  to  him  from  the  postoflicc,  and  pays 
postage  thereon,  and  continues  doing  so  after 
demand  of  the  subscription  price,  is  liable  there- 
for.— Fogg  V.   Portsmouth  Atheneum,   26. 

One  who  made  no  objection  to  work  which 
he  had  reason  to  know  was  being  done  in  ex- 
pectation that  he  would  pay  for  it,  is  liable 
therefor.— Day  v.  Caton,  28. 

Plaintiff,  seeking  to  establish  a  renewal  of 
his  policy,  called  a  clerk  of  his  agent  as  a  wit- 
ness, who  testified  that  lie  asked  defendant's 
agent  to  bind  or  renew  the  policy  in  question; 
that  he  received  no  reply,  and  the  agent  did 
nothing  indicating  either  that  he  heard  or  in- 
tended to  comply  with  the  request.  Held,  that 
no  inference  could  be  drawn  from  such  silence 
to  imi]ose  a  contractual  ofilitrntion  on  defendant. 
—Royal  Ins.  Co.  v.  Reutty,  29. 


INDEX. 


635 


8    7.     Communication  by   correspondence.  ' 

A  contract  is  accepted  by  the  posting  of  a 
letter  declaring  its  acceptance. — Duolop  v.  Hig- 
gins,  31. 

Posting  an  answer  to  a  letter  containing  an 
offer  on  the  day  of  receiving  the  oiler  is  suffi- 
cient.— Dunlop  V.  Higgins,  31. 

Acceptance,  by  letter,  of  an  offer  made  by 
letter  before  retraction,  completes  the  contract, 
although  the  acceptance  does  not  reach  its  des- 
tination until  after  death  of  acceptor.— Mac- 
tier's  Adui'r  V.  Frith,  38. 

A  company  allotted  shares  to  defendant  for 
which  he  had  applied,  and  addressed  to  him, 
and  posted  a  notice  of  the  allotment,  but  which 
he  never  received.  //(■/(/,  that  he  was  a  share- 
holder.— Ilouseliuld  Fire  &  Carriage  Ace.  Ins. 
Co.  V.  Grant,  58. 

An  offer  by  letter,  requesting  an  answer  by 
telegraph,  and  stating  that,  unless  received  by 
a  certain  date,  the  answer  would  be  considered 
a  refusal,  is  made  dependent  upon  actual  re- 
ceipt of  the  telegram  before  such  date. — Lewis 
v.   Browning,   G2. 

A  contract  made  by  telegraph  is  completed 
when  an  acceptance  of  the  proposition  is  de- 
posited for  transmission  in  the  telegraph  office. 
— Minnesota  Linseed  Oil  Co.  v.  Collier  White 
Lead  Co.,  87. 

§    8.     General  offer. 

An  advertisement  offered  to  pay  a  certain 
sum  to  any  one  contracting  influenza  after 
using  a  certain  remedy.  IJchl,  that  one  pur- 
chasing the  remedy  on  faith  of  such  advertise- 
ment, and  using  it,  who  contracted  the  disease 
afterwards,  may  recover  the  sum  offered. — 
Carlill  v.   Carbolic  Smoke  Ball   Co.,  67. 

§    9.     Character  of  acceptance. 

Whatever  amounts  to  a  manifestation  of  de- 
termination to  accept  an  offer,  c(juiniuuicated, 
or  put  in  a  i)roper  way  to  be  communicated,  to 
the  other  party,  is  an  acceptance. — Mactier's 
Adm'r  t.  Frith,  38. 

Where  one  is  to  decide  on  the  happening  of 
a  certain  event,  whether  he  will  accept  an 
offer  or  not,  happening  of  the  event  docs  not 
complete  the  contract  until  the  decision  is 
made. — Mactier's  Adm'r  v.  Frith,  38. 

A  conditional  acceptance  of  a  proposition  by 
letter  does  not  constitute  a  contract. — Harris 
V.  Scott,  03. 

Defendants  wrote  plaintiff  offering  to  sell  a 
quantity  of  powder  of  different  grades  at  a 
unifurm  price,  but  reserving  to  themselves  the 
right  to  retain  1,500  pounds  thereof,  and  also 
certain  caps  and  fuse,  ending  the  letter  say- 
ing: "Should  you  decide  to  order  these  goods, 
you  may  give  us  indorsed  note  that  we  can 
use  as  cash,  *  *  *"  etc.  Plaintiff  replied : 
"*  *  *  I  will  take  7.200  lbs.  of  the  powder, 
leaving  you  the  1.500  lbs.  in  reserve,  os  you 
wish,  *  *  *  and  on  receipt  of  invoice  will 
forward  indorsed  note.  etc.  You  are  too  high 
on  caps  and  fuse."  Held,  that  there  was  no 
valid   contract. — Thomas  v.   Greenwood,    G5. 

§  10.    Revocation  of  offer  or  acceptance. 

Revocation   of  offer  under  seal,   see  "Contracts 
under  Seal,"  §  2. 

A  bidder  at  an  auction  may  retract  his  bid 
any  time  before  the  hammer  is  down. — Paine  v. 
Cave,  74. 

An  offer  to  sell  land  at  a  certain  price  if 
taken  within  30  days  is  a  continuing  offer,  ac- 
ceptance of  which  within  the  time  limited  and 
before  retraction  constitutes  a  valid  contract. 
—Boston  &  M.  R.  R.  v.  Bartlett,  75. 


Formal  notice  of  withdrawal  of  an  offer  be- 
fore acceptance  need  not  be  given.  Knowledge 
by  one  to  whom  the  offer  is  made  of  acts  incon- 
sistent with  a  coutinuame  of  the  offer  is  suffi- 
cient.— Dickinson  v.  Dodds,  77. 

Sale  ul"  property  to  a  third  person  amounts 
to  withdrawal  of  the  offer,  even  though  the 
party  to  whom  the  offer  was  first  made  had  no 
knowledge  of  it. — Dickinson   v.   Dodds,  77. 

Sale  of  property  to  a  third  person,  which 
came  to  the  knowledge  of  the  person  to  whom 
an  offer  was  made,  is  an  effectual  withdrawal 
of  the  offer.— Dickinson  v.  Dodds,  77. 

Though  the  extension  of  an  option  for  the 
sale  of  land  is  not  binding  when  unsupported 
b\  a  licw  consideration,  the  acceptance  thereof, 
and  tender  of  the  price  within  the  time  named, 
constitutes  a  valid  contract  of  sale. — Ide  v. 
Leiser,    S2. 

§  11.    Lapse  of  offer. 

Acceptance  of  an  offer  after  the  expiration 
of  the  time  to  which  it  is  limited  will  not  be 
binding. — Longworth  v.  Mitchell,  85. 

Where  the  market  in  certain  goods  is  subject 
to  sudden  and  great  fluctuations,  an  accept- 
ance of  a  proposition  by  telegraph,  after  a 
delay  of  24  hours,  is  not  within  a  reasonable 
time. — Minnesota  Linseed  Oil  Co.  v.  Collier 
White  Lead  Co.,  87. 

Where  one  has  refused  to  accept  an  offer, 
but  has  made  an  offer  himself,  which  has  been 
refused,  he  cannot  revive  the  first  offer  by 
afterwards  accepting  it. — Hyde  v.   Wrench,  89. 

An  offer  in  writing  to  subscribe  to  the  capital 
stock  of  a  railroad  company,  conditioned  upon 
the  construction  of  its  line  of  road  along  a  , 
designated  route,  is  revocable,  at  the  option  of 
the  party  making  such  offer,  at  any  time  be- 
fore its  delivery  to  and  acceptance  by  such 
company ;  and  his  death  before  such  delivery 
antl  acceptance  works  such  revocation. — Wal- 
lace v.  Townsend,  90. 

§  12.    Contractual  intention. 

In  an  action  by  a  cousin  for  services  as 
housekeeper  it  must  appear  that  when  the  ser- 
vices were  rendered  both  parties  expected  that 
they  should  be  paid  for. — Heffron  v.  Brown,  95. 

Letters  which  the  parties  intend  only  as  pre- 
liminary negotiations,  or  as  mere  advercise- 
meuts  or  business  circulars,  should  not  be  con- 
strued as  a  contract. — Moulton  v.  Kershaw,  99. 

Where  the  written  draft  of  a  contract  is 
viewed  as  the  consummation  of  the  negotia- 
tions, there  is  no  contract  until  it  is  finally 
signed. — Mississippi  &:  Dominion  S.  S.  Co.  v. 
Swift.  101. 

OFFICERS. 

Assignment    of    future    salary,    see    "Injury    to 
Public   Service." 


OPINION. 

As  fraudulent  representation,  see  "Fraud,"  $  5. 

PARENT   AND   CHILD. 

See   "Implied   Contracts." 

PAROL  AGREEMENT. 


See  "Statute  of  Frauds." 


G36 


INDEX. 


PARTIAL  INVALIDITY. 

Of   contract  of  employment,    see    "Master  and 

Servant." 
Of  mortgage,  see  "Mortgages." 


PARTIES. 

Construction     as    to     parties,     see    "Construc- 
tion," §  2. 

An  action  cannot  be  maintained  against  one 
of  three  joint  obligors,  on  allegation  that  the 
other  two  have  paid  their  share.— Eller  v. 
Lacy,  549. 

An  agreement  by  which  "plaintiffs  are  to 
pay"  is  a  joint  obligation. — Eller  v.  Lacy,  549. 

Where  a  sale  is  made  by  two  joint  owners, 
and  the  purchaser  afterwards  pays  one  of  them 
his  full  share  of  the  purchase  money,  the  other 
cannot  maintain  an  action  in  his  own  name 
for  the  balance,  unless  all  parties  have  agreed 
to  a  severance  of  the  joint  contract,  and  the 
purchaser  has  made  him  a  new  promise. — An- 
gus V.  Robinson,  551. 

PAST  CONSIDERATION. 

See  "Consideration,"  §  9. 

PAYMENT. 

Part  payment  as  consideration  for  release,  see 
"Consideration,"  §  8. 

A  forged  note  or  bill,  which  proves  to  be  of 
no  value,  given  in  payment  of  goods,  does  not 
extinguish  the  debt.— Markle  v.  Hatfield,  571. 

The  acceptance  by  a  creditor  of  the  note  of 
a  third  person,  which  he  credits  on  an  open 
account  existing  between  him  and  the  debtor, 
is  not  such  evidence  of  payment  as  to  prevent 
the  creditor  from  suing  on  the  account. — Chel- 
tenham Stone  &  Gravel  Co.  v.  Gates  Iron 
Co.,   573. 

PENALTIES. 

Penalty  or  liquidated  damages,  see  "Damages." 


PERFORMANCE  OR  BREACH. 

See  "Payment." 

Part  performance  under  statute  of  frauds,  see 
"Statute  of  Frauds,"  §  10. 

§    1.     Tender. 

An  agreement  that  directions  shall  be  left  by 
will  or  otherwise,  whereby  the  survivor  should 
have  a  prior  right  to  purchase  certain  shares 
of  stock,  is  fully  complied  with  by  the  adminis- 
tratrix by  an  offer  at  the  price  for  which  they 
were  finally  sold,  which  was  rejected. — Harris  v. 
Scott,  63. 

Where  a  note  is  payable  in  specific  articles, 
tender  of  such  articles  at  the  time  and  place 
specitiecl  satisfies  the  contract. — Lamb  v.  La- 
throp,  575. 

Where  a  note  is  payable  in  specific  articles, 
the  promisor  must  tender  such  articles  at 
the  amount  agreed  to  be  paid. — Lamb  v.  La- 
throp,  575. 

%    2.     Conditions  precedent. 

A  party  who  has  refused  to  fulfill  his  part 
of    an    agreement    cannot    maintain    an    action 


for   damages   against   the   other   party. — Dey    v. 
Dox,  59S. 

Under  a  contract  providing  that  one  install- 
ment of  the  purchase  money  of  land  should 
be  paid  before  and  one  after  delivery  of  the 
deed,  such  delivery  was  a  condition  precedent 
to  recovery  of  the  second  installment. — Grant 
T.   Johnson,   601. 

In  a  mercantile  contract,  a  statement  descrip- 
tive of  the  subject-matter,  or  of  some  material 
incident,  such  as  the  time  or  place  of  shipment, 
is  ordinarily  to  be  regarded  as  a  warranty  or 
condition  precedent,  upon  the  failure  or  non- 
perlormauce  of  which  the  party  aggrieved  may 
repudiate  the  whole  contract. — Norrington  v. 
Wright,  604. 

Plaintiff  contracted  to  sell  his  stock  of  goods 
and  his  two  stores  and  lots  to  defendants.  Both 
goods  and  land  were  sold  at  the  same  time, 
and  embraced  in  the  same  contract ;  but  they 
were  treated  as  distinct  subjects  of  sale,  the 
price  of  each  being  definitely  fixed.  Held,  that 
the  contract  was  divisible,  and  that  an  avoid- 
ance of  the  contract  by  plaintiff  as  to  the  laud 
did  not  avoid  the  conti'act  as  to  the  stock  of 
goods.— Wooten  v.  Walters,  610. 

Plaintiff  agreed  to  work  for  defendant  one 
year,  and  defendant  to  pay  him  therefor  a 
certain  sum.  During  the  year  plaintiff  lost 
time  to  the  amount  of  nine  days,  but  defendant 
allowed  him  to  resume  work  without  objec- 
tion, and  he  continued  at  work  until  the  ex- 
piration of  a  year  from  the  original  hiring. 
Held,  that  allowing  plaintiff  to  continue  work, 
after  the  loss  of  time,  without  objection,  was 
a  waiver  of  any  right  of  forfeiture  defendant 
might  have  therefor,  and  plaintiff  was  not 
bound,  after  the  expiration  of  the  year,  and  in 
the  absence  of  special  agreement,  to  make  up 
the  lost  time.— Bast  v.  Byrne,  613. 

§    3.     Conditions    subsequent. 

A  sale  of  personal  property  on  condition  that 
the  vendee  may  return  it  in  a  specified  time 
becomes  absolute  if  the  vendee  impairs  its  value 
by  misuse  during  that  time. — Kay  v.  Thomp- 
son, 577. 

§    4.     Concurrent  conditions. 

Under  a  contract  for  the  sale  of  corn,  de- 
livery of  the  corn  and  payment  of  the  price  are 
concurrent  acts,  to  be  done  by  the  parties  at 
the  same  time. — Morton  v.  Lamb,  594. 

§    5.     Renunciation. 

Where  one  party  to  a  contract  violates  some 
of  its  substantial  provisions,  so  as  to  deprive 
the  other  party  of  the  benefits  of  the  contract, 
and  manifests  an  intention  to  continue  such 
breaches,  the  other  party  may  abandon  further 
performance  of  the  contract,  and  sue  for  future 
]>rotits.  although  sueli  breaches  did  not  amount 
to  a  physical  obstruction  or  prevention  of  per- 
formance by  such  other  party. — Lake  Shore  & 
M.  S.  Ry.  Co.  v.  Richards,  578. 

The  right  to  do  so  is  not  lost  by  a  previous 
suit  for  damages  for  breach  of  the  conti'act, 
where  the  breaches  of  the  contract  continue 
after  the  bringing  of  such  suit.— Lake  Shore  & 
M.  S.  Ry.  Co.  V.  Richards,  578. 

§    6.     Impossibility  caused  by  party. 

Where  defendant  conveyed  land  to  another, 
which  he  had  promised  to  convey  to  plaintiff', 
plaintiff  need  not  tender  him  the  purchase 
price.— Newcomb  v.  Brackett,  592. 

§   7.     Deatb  of  party. 

Death  of  the  employer  before  expiration  of 
the  stipulated  term  of  service  of  a  clerk  and 
salesman  excuses  further  performance  of  the 
contract.— Yerrington  v.  Greene,  618. 


INDEX. 


637 


§   8.     Destruction  of  subject-matter. 

Under  a  contract  to  erect  a  building  for  a  cer- 
tain entire  price,  payable  in  installments, 
where  the  building  is  destroyed  before  comple- 
tion, the  owner  may  recover  the  installments 
paid. — Superintendent  and  Trustees  of  Public 
Schools  of  Trenton  v.  Bennett,  015. 

Under  a  contract  to  erect  a  complete  build- 
ing the  loss  falls  on  the  contractor  if  the 
building  falls  before  completion  by  reason  of 
a  latent  defect  in  the  soil. — 8ui)erintendent  and 
Trustees  of  Public  Schools  of  Trenton  v.  Ben- 
nett, 615. 

PLEADING. 

A  complaint  alleging  that  defendants  are  in- 
debted to  plaintiff  in  the  sum  of  i$:i.()i)0  for 
damages  by  reason  of  their  failure  to  sliip  cer- 
tain goods  bought  of  Ihem,  is  iiisuilic  ient,  as 
there  is  no  consideration  stated  for  the  alleged 
agreement,  and  as  it  docs  not  allege  promi.se 
to  pay  any  amount  for  which  defendants  were 
indebted  to  plaintiff,  nor  any  promise  by  de- 
fendants to  ship,  nor  tender  of  payment  or  per- 
formance by  plaintiff',  and  fails  to  allege  a 
valid  contract  of  any  kind. — Thomas  v.  Green- 
wood, 05. 

A  complaint  praying  specific  performance  of 
a  contract  for  the  sale  of  land  need  not  allege 
that  plaintiff  has  no  adequate  remedy  in  dam- 
ages, nor  that  defendant  is  the  owner  of  the 
land  when  the  action  is  brought,  wliere  it  does 
allogo  that  ho  was  such  owner  when  he  made 
the  offer,  and  the  complaint  was  tiled  on  the 
day  when  plaintiff  accepted  it. — Ide  v.  Leiser, 
82. 

In  an  action  on  a  joint  and  several  bastardy 
bond,  a  joint  plea  of  duress  of  unlawful  im- 
I)ris()nniont  of  one  dofeiidant  is  had  where  the 
relationshin.  such  as  father,  son,  etc.,  is  not 
averred  in  the  plea. — Township  of  Bordertown 
v.  Wallace,  281. 

A  complaint  in  an  action  for  damages,  al-  I 
leging  that  defendant,  in  order  to  induce  plain- 
tiff to  lease  from  him  certain  premises,  fraud- 
ulently concealed  the  fact  that  a  certain  build- 
ing thereon  did  not  belong  to  him,  but  which 
fails  to  allege  that  defendant  knew  or  had 
reason  to  know  that  plaintiff  was  ignorant  of 
the  fact  that  defendant  did  not  own  such  build- 
ing, and  that  the  leasing  of  the  premises  by 
plaintiff  was  actually  induced  by  such  conceal- 
ment, is  demurrable  for  failure  to  state  a 
cause  of  action. — Sheldon  v.  Davidson,  382. 

In  an  action  on  the  case  by  the  seller  of 
property  for  fraudulent  representations  and 
contealmont  by  the  purchaser  in  regard  to  its 
value,  the  price  paid  was  set  forth  in  the 
declaration  less  than  it  was  proved  on  trial 
to  have  actually  been.  Ildd  to  be  no  variance. 
— Mallory  v.  Leach,  390. 

A  complaint  seeking  to  set  aside  a  ffaud- 
ulent  conveyance  to  satisfy  a  judgment,  which 
mei-ely  alleges  the  recovery  of  judirment  against 
defendant,  without  stating  any  facts  to  show 
the  character  and  validity  thereof,  is  insuffi- 
cient.— Eller  V.  Lacy,  549. 

An  action  setting  up  a  judgment  must  state 
the  amount  and  character  and  validity  of  the 
judgment  sued  on. — Eller  v.  Lacy,  549. 


I  PUBLIC  POLICY. 

See  "Breach  of  Trust";  "Monopolies";  "Re- 
straint of  Marriage";  "Restraint  of  Trade." 

Limitation  of  carrier's  liability  for  negligence, 
see  "Carriers." 

Right  of  sheriff  to  reward,  see  "Rewards." 

Where  owners  of  corporate  stock  agree  to 
vote  only  for  certain  officers  as  directors,  and 
that  in  case  the  salary  of  one  is  increased  tliat 
of  the  other  should  also  be  increased,  the  con- 
tract is  void  as  against  public  policy.— Harris  v. 
Scott,  03. 

QUANTUM  MERUIT. 

Recovery  by  servant  under  contract  invalid  in 
part,  see  "Master  and  Servant." 

QUASI  CONTRACTS. 

See  "Constructive  Contracts";  "Implied  Con- 
tracts." 


PRINCIPAL  AND  AGENT. 

Husband  for  wife,  see  "Married   Women. 

PROPERTY. 

Duress  of  property,   see   "Duress,"   {   2. 


RATIFICATION. 

By  infant,  see  "Infants,"  §  3. 
Of   contract   made   for   corporation,   see   "Cor- 
I)orations." 

RESCISSION  AND  ABANDONMENT. 

Rescission  for  fraud,  see  "Fraud,"  §  0. 

A  decree  rescinding  a  deed  from  a  ward  to 
her  guardian  need  not  require  the  refunding 
of  the  consideration  when  the  guardian  is  in- 
debted to  the  ward  to  a  greater  amount.— 
McParland  v.  Larkin,  406. 

On  rescinding  a  deed  made  by  a  ward  to  her 
guardian,  the  ward's  estate  should  not  be  char- 
ged with  improvements  made  by  the  guardian 
M-ithout  the  ward's  authority.— McParland  v 
Larkin,  400. 

A  party  to  a  contract  prohibited  by  law,  but 
not  malum  in  se,  may,  while  it  rem'ains  exec- 
utory, rescind  it,  and  recover  money  advanced 
by  him  to  the  other  party,  who  had  performed 
no  part  of  it.— Congress  »fc  Empire  Spring  Co. 
V.  Kuowlton,  513. 

In  an  action  on  a  contract  for  the  sale  and 
future  delivery  of  brick  by  defendant  to  plain- 
tiffs, it  appeared  that  after  the  contract  was 
made  plaintiff's  became  insolvent,  and  made  a 
voluntary  assignment,  of  which  they  gave  no- 
tice to  defendant,  and  afterwards  compounded 
with  their  creditors.  No  reference  was  made  to 
the  contract  in  the  schedule  tiled,  nor  in  the 
statement  of  assets  made  by  plaintiff's  to  their 
creditors.  Plaintiffs  knew  that  the  brick  were 
to  be  made  in  Maine,  but  gave  no  notice  to 
defendant  that  they  would  claim  performance 
of  the  contract,  and  made  no  offer  to  pay  or 
secure  defendant  till  more  than  four  months 
after  the  assignment,  and  after  defendant  had 
sold  the  brick.  IJdd,  that  the  question  of 
abandonment  of  the  contract  by  iilaintiffs  and 
acceptance  by  defendant  should  have  been  sub- 
mitted to  the  jury. — Uobbs  v.  Columbia  Falls 
Brick  Co.,   500. 

Abandonment  of  an  executory  contract  by 
plaintiffs,  and  acceptance  thereof  by  defendant. 
Constitute  a  defense  to  an  action  on  such  con- 
tract.—Hobbs  V.  Columbia  Falls  Brick  Co., 
500. 

REFORMATION. 

A  contract  will  not  be  reformed  which  must 
be    construed    and    carried    into    effect    before 


638 


INDEX. 


reformation  exactly  as  it  would  be  after  it  has 
been  reformed.— Kue  v.  Mens,  249. 

RENUNCIATION. 

Operating  as  discharge,  see  "Performance  or 
Breach,"    §   5. 

RESTRAINT  OF  MARRIAGE. 

An  agreement  by  defendant  to  pay  plaintiff 
a  certain  sum  if  he  should  marry  any  other 
person  than  plaintiff  is  void.— Lowe  v.  Peers, 
454. 

RESTRAINT  OF  TRADE. 

See  "Monopolies." 

Agreement    within    statute,    see    "Statute    of 

Frauds,"   §   7. 

A  conti-act  by  defendant  not  to  teach  the 
French  or  German  language,  nor  aid  or  ad- 
vertise to  teach  them,  nor  to  be  connected  with 
any  person  or  institution  teaching  them,  in  the 
state  of  FJiode  Island,  for  a  year  after  leavmg 
complainant's  employ,  is  not  void  on  the  ground 
of  public  policy,  simply  because  it  applies  to 
the  entire  state.— Herreshoff  v.  Boutineau,  4o8. 

But  where  complainant  offers  to  allow  de- 
fendant to  teach  at  a  place  in  the  state  other 
than  that  at  which  complainant's  school  is 
established,  and  does  not  aver  that  such  teach- 
ing would  injure  him,  the  fact  that  the  con- 
tract applies  to  the  entire  state  renders  it  un- 
reasonable.—Herreshoff    V.    Boutineau,    458. 

A  contract  made  by  a  seller  with  the  pur- 
chaser, that  he  will  not,  at  any  time  withm 
99  years,  directly  or  indirectly  engage  in  the 
manufacture  or  sale  of  friction  matches,  ex- 
cepting in  the  capacity  of  agent  or  employe  of 
said  purchaser,  within  any  of  the  several  states 
of  the  United  States  of  America,  or  the  terri- 
tories thereof,  or  within  the  Disti'ict  of  Co- 
lumbia, excepting  and  reserving,  however,  the 
right  to  manufacture  and  sell  friction  matches 
in  the  state  of  Nevada  and  in  the  territory  of 
Montana,  is  not  void  as  a  covenant  in  restraint 
of  trade.— Diamond  Match  Co.  v.  Roeber,  4G1. 

An  agreement  not  to  engage  in  a  certain  busi- 
ness in  a  certain  place  is  not  invalid  because 
not  specifying  any  limit  of  time.— Carll  v.  Sny- 
der, 40."). 

Defendant,  who  owned  a  factory  for  the  man- 
ufacture of  a  certain  kind  of  cheese,  desig- 
nated by  a  certain  name,  sold  it,  together  with 
the  secret  of  the  manufacture,  to  plaintiffs, 
and  covenanted  that  neither  she,  nor  her  hus- 
band, her  father,  nor  her  brother-in-law,  who 
had  all  assisted  her  in  running  the  factory, 
would  impart  the  secret  to  any  other  person 
than  plaintiffs,  nor  engage  in  the  business  of 
manufacturing  or  selling  such  cheeses.  Udd, 
that  the  covenant  is  not  void  as  in  restraint  of 
trade.— Tode  v.  Gross,  467. 


REVOCATION. 


In- 


DisalBrmance    of    infant's    contract,    see 
fants,"  §  4.  ,,^^  ,    ^ 

Of  offer  or  acceptance,  see  "Offer  and  Accept 
ance,"   §   10.  o     ,  , 

under   seal,   see   "Contracts   under    Seal, 

§    2. 

Of  subscription,   see   "Subscriptions." 


REWARDS. 


Since  it  is  the  duty  of  a  sheriff  to  make  ar- 
rests, he  cannot  claim  a  reward  offered  there- 
for.— Stamper  v.  Temple,  93. 


To  entitle  a  party  to  a  reward  for  an  arrest, 
there  must  be  an  oi'fcr  clearly  intended  as  such, 
and  knowledge  of  the  offer  by  the  other  party 
at  the  time  of  the  arrest.— Stamper  v.  Temple, 
93. 

SALES. 

See  "Intoxicating  Liquors." 

On  Sunday,  see  '"Sunday." 

Rescission  for  mistake,  see  "Mistake,"  §  2. 

Sale  to  third  person  as  withdrawal  of  offer,  see 

"Offer  and  Acceptance,"  §  10. 
Within    statute    of    frauds,    see    "Statute    of 

Frauds,"  §  8. 

A  vendor  may  recover  for  goods  sold,  al- 
though he  knew  they  were  bought  for  an  illegal 
purpose,  where  it  was  not  part  of  the  contract, 
that  they  should  be  so  used,  and  he  has  done 
nothing  else  in  aid  of  it.— Tracy  v.  Talmag«, 
497;   State  of  Indiana  v.  Leavitt,  Id. 


SEDUCTION. 

Consideration    for    marriage,    see   "Breach    of 
Marriage  Promise." 

SEPARATE  ESTATE. 

See  "Married  Women." 

SHERIFFS. 

Right  to  reward,  see  "Rewards." 

SIGNATURE. 

Of  memorandum,  see  "Statute  of  Frauds,"  §  9. 

SLANDER. 

Agreement  to  publish  libelous  matter,  see  "Li- 
bel  and   Slander." 

SPECIFIC  PERFORIVIANCE. 

See  "Pleading." 

STATUTE  OF  FRAUDS. 

§    1.     InstTuments   under   statutes. 

An  undertaking  required  by  statute  to  give 
a  right  of  appeal  containing  the  requisite  stipu- 
lation is  valid,  though  it  do*s  not  express  a 
consideration,  and  is^not  under  seal.— Thomp- 
son v    Blanchard,  115. 

Instruments  created  under  and  deriving  their 
obligation  from  special  statutes  need  not  ex- 
press consideration.— Thompson  v.  Blanchard, 
115. 

§    2.     Executed  contracts. 

A  contract  for  services  not  to  be  performed 
within  a  year,  but  which  has  been  fully  per- 
formed on  both  sides,  cannot  be  avoided  be- 
cause not  in  writing.— Stone  v.  Dennison,  110. 

§    3.     Promise  by  executor  or  administra- 
tor. 

The  oral  agreement  of  an  executor  to  pay 
one  of  the  testator's  heirs  at  law  a  certain  sum 
in  consideration  that  he  would  forbear  further 
opposition  to  the  probate  of  the  will  is  an  origi- 
nal agreement,  not  within  the  statute;  and  the 
consideration  is  sufficient.— Bellows  v.  Sowles, 

lis. 


INDEX. 


63f) 


§    4.     Promise  to  ansiver  for  debt  of  an- 
other. 

An  agiec'iiiL'iit  by  one  person  to  pay  for  goods 
fiirnisht'd  to  another  is  not  a  collateral  promise 
to  pay  the  debt  or  answer  the  default  of  an- 
other, within  the  nieaniug  of  the  statute  of 
frauds. — Larson  v.  Jenson,  120. 

Whore  an  agent,  having,  contrary  to  instruc- 
tions of  his  principal,  loaned  money  without 
security,  and  taken  a  note  therefor,  and,  on 
being  told  by  the  principal  that  he  will  hold 
him  responsible,  guaranties  the  payment  of  the 
note,  the  guaranty  is  nut  a  promise  to  answer 
for  the  debt  of  another,  within  the  statute  of 
frauds,  so  as  to  be  void  for  failure  to  express 
the   consideration. — Crane   v.    Wheeler,    122. 

A  parol  promise  to  pay  the  debt  of  another 
in  consideration  of  property  placed  by  the  debt- 
or in  the  i)rc)misor's  hands  is  an  original  prom- 
ise, and  binding  upon  the  promisor,  whether  the 
liability  of  the  original  debtor  continues  or  is 
discharged. — Wait  v.  Wait's  Ex'r,  123. 

Testator,  in  consideration  of  the  conveyance 
of  a  farm  to  him,  upon  which  plaintiff,  at  the 
request  of  testator's  grantor,  had  erected  a 
barn,  promised  to  pay  plaintiff  the  cost  of  said 
barn.  UiIJ,  that  this  promise,  being  made 
upon  a  new  consideration,  was  binding,  though 
it  was  not  in  writing,  and  though  the  original 
liability  of  the  grantor  remained  undischarged. 
—Wait  V.  Wait's  Ex'r,  123. 

One  having  a  lien  on  property  for  repairs, 
who  delivers  it  to  the  owner  on  the  orarl  prom- 
ise of  a  third  party  to  pay  for  the  repairs, 
cannot  enforce  the  promise. — Mallory  v.  Gil- 
lett,  124. 

§    5.     Agreements     in     consideration     of 
marriage. 

An  antenuptial  contract,  by  which  each  party 
is  to  retain  the  title  of  his  or  her  property, 
and  dispose  of  it  as  if  unmarried,  is  a  contract 
in  consideration  of  marriage,  within  the  stat- 
ute of  frauds  (Gen.  St.  c.  22,  §  1),  and  must  be 
in  writing. — Mallorv's  Adm'r  v.  Mallory's 
Adm'r,  138. 

S    6.     Agreements  relating  to  land. 

A  person  sold  land,  representing  it  to  have  a 
certain  frontage.  The  buyer  paid  for  the  land, 
but,  finding  it  to  have  a  less  frontage,  refused 
to  accept  a  deed.  The  seller  then  agreed,  if  he 
would  accept  the  deed,  to  repay  the  difference 
in  value  between  the  actual  land  and  the  land 
as  represented.  II dd  not  an  agreement  for  the 
sale  of  land,  or  of  an  interest  in  or  concerning 
it,  necessary  to  be  in  writing. — Haviland  v. 
Sammis,  139. 

A  license  to  enter  on  lands  of  another  to 
do  a  particular  act  or  series  of  acts,  without 
possessing  an  interest  in  the  lands,  need  not 
be  in  writing. — Mum  ford  v.  Whitney,   140. 

A  parol  agreement  that  a  party  may  abut 
and  erect  a  dam  for  a  i)ernianent  purpose  on 
lands  of  another  is  void. — Mumford  v.  Whit- 
ney,  140. 

An  agreement  for  the  sale  of  growing  trees, 
with  a  right  to  enter  and  remove  them,  must  be 
in  writing. — Green  v.  Armstrong,  145. 

A  sale  of  standing  timber,  whether  or  not  the 
parties  contemidate  its  immediate  severance 
and  removal  by  the  vendee,  is  a  contract  con- 
cerning an  interest  in  lands,  within  the  mean- 
ing of  the  statute  of  frauds.— llirth  v.  Graham, 
147. 

A  parol  agreement  by  a  mortgagee  to  fore- 
close his  mortgage,  bid  in  the  land,  and  hold  it 
until  it  could  be  sold  for  its  value,  and,  when 
sold,  to  pay  the  mortgagor  the  balance  over 
the  mortgage,  cannot  be  enforced. — Wheeler  v. 
IleynolJs,  208. 


A  parol  agreement  in  reference  to  lands,  not 
authorized  by  the  statute  of  frauds,  is  void  as 
well  in  equity  as  in  law. — Wheeler  v.  Reynolds, 
208. 

A  parol  agreement  subsequent  to  a  deed  of 
land  that  the  land  should  be  surveyed,  and 
any  excess  over  what  the  deed  called  for  should 
be  paid  for  at  a  certain  price,  is  valid. — Seward 
V.   Mitchell,   233. 

§    7.     Agreements    not    to    be    performed 
within  a  year. 

A  promise  to  save  a  co-surety  harmless  may 
be  performed  within  a  year,  and  need  not  be  in 
writing. — Blake  v.  Cole,  140. 

An  agreement  not  to  engage  in  a  certain  busi- 
ness at  a  particular  place  for  a  specified  num- 
ber of  years  is  not  within  the  statute  of  frauds. 
— Doyle  V.  Dixon,  150. 

A  contract  to  serve  for  one  year,  service  to 
commence  the  second  day  after  the  contract 
was  made,  is  within  the  statute  of  frauds. — 
Britain  v.   Rossiter,  213. 

§    8.     Sale  of  goods. 

A  contract  for  the  sale  of  promissory  notes 
is  within  the  statute  of  frauds. — Baldwin  v. 
Williams,   151, 

An  executory  agreement  for  the  manufacture 
and  sale  of  a  specific  chattel  to  be  manufac- 
tured according  to  the  terms  of  the  agreement 
is  not  a  contract  of  sale. — Goddard  v.  Binney, 
153. 

Defendants  purchased  lumber,  pointed  out 
the  piles  from  which  it  was  to  be  taken,  and 
directed  that  when  it  was  dressed  and  cut  it 
should  be  placed  on  plaintiff's  dock  and  notice 
given,  which  was  done.  Ilcld,  that  there  was 
no  acceptance  and  receipt  of  the  lumber. — 
Cooke  v.  Millard,  155. 

Where  a  chattel  verbally  contracted  for  is  in 
existence,  but  the  vendor  is  to  do  some  work 
on  it  to  adapt  it  to  the  uses  of  the  vendee, 
it  is  a  contract  of  sale  under  the  statute. — 
Cooke  V.   Millard,  155. 

Defendants  ordered  from  plaintiffs'  salesman 
a  bill  of  boots  and  shoes,  to  be  manufactured 
by  plaintiffs.  The  salesman  made  a  copy  of 
the  order,  signed  it  himself,  and  gave  it  to 
defendants.  Before  the  order  was  shiitped,  it 
was  countermanded  by  defendants.  IJiUI,  that 
the  contract  was  for  the  sale  of  "goods,"  with- 
in the  meaning  of  Rev.  St.  1S79,  §  2514,  pro- 
viding that  "no  contract  for  the  sale  of  goods," 
etc..  "for  the  price  of  $30  or  upwards,  shall  be 
good,  unless  some  note  or  memorandum  thereof 
be  made  in  writing,  and  sisned  bv  the  party  to 
be  charged."— Pratt  v.  Miller,  163. 

There  must  be  a  receipt  and  acceptance  of 
the  goods  by  the  vendee  in  a  parol  contract  to 
bind  him,  where  no  part  of  the  imrchase  price 
is  paid. — Caulkins  v.  Hellman.  100. 

A  purchaser's  receipt  and  acceptance  of 
goods  sufficient  to  satisfy  the  statute  of  frauds 
may   be   constructive. — Garfield   t.   Paris,   168. 

Receipt  and  acceptance  of  labels,  furnished 
as  part  of  n  parol  contract  for  the  sale  of  liq- 
uor, satisfies  the  statute  of  frauds.  —  Garfield 
V.    Paris,    lOS. 

A  contract  for  the  sale  of  goods,  which  is 
void  for  failure  to  pay  some  part  of  the  con- 
sideration as  required  by  the  statute  of  frauds, 
cannot  be  validated  by  an  unaccepted  ofifer  of 
payment. — Edgerton  v.  Hodge,  172. 

Subsequent  payment  by  check,  on  a  contract 
void  under  the  statute  of  frauds,  and  a  re- 
statement of  its  essential  terms,  validates  the 
contract. — Hunter  v.   Wetsell,   174. 


G40 


INDEX. 


§    9.     Tlie  memorandum  in  'writing. 

An  option  to  sell  laud  at  au  agreed  price, 
a  consideration  for  the  option  bciuj;  stated,  is 
a  surSeient  compliance  ^vith  the  Montana  stat- 
ute of  frauds  (.Comp.  St.  div.  5,  p.  G52,  §  2111), 
which  only  requires  that  the  memorandum  of 
sale  shall  be  signed  by  the  seller. — Ide  v.  Leiser, 
S2. 

On  the  30th  of  June,  A.  bargained  with  B. 
for  his  cheese,  amounting  to  over  $40,  but 
nothing  was  done  to  bind  the  bargain.  The 
nest  day  B.  wrote  to  A.,  "I  shall  stand  to 
it"'  (alluding  to  the  contract),  "but  shall  want 
you  to  pay  me  fifty  dollars  to  bind  it."  The 
day  following  (July  2d)  A.  inclosed  ifoO  in  a 
letter,  and  sent  it  by  mail  to  B.,  which  he  re- 
ceived on  the  Sth,  and  immediately  returned  it 
to  A.  Held,  that  B.  had  a  right  to  decline  to 
receive  the  money,  and  by  so  doing  left  the 
contract  void  under  the  statute  of  frauds. — 
Edgerton  v.   Hodge,   172. 

Where  parties  in  making  a  contract  omit  to 
do  what  the  statute  of  frauds  requires  to  be 
done  to  make  a  valid  contract,  it  requires  the 
cons(|nt  of  both  parties  to  supply  the  thing 
orsiitted. — Edgerton  v.  Hodge,  172. 

A  paper  stating  the  terms  of  the  contract, 
signed  by  the  party  to  be  charged,  and  di- 
rected to  a  third  person,  may  be  deemed  part 
of  a  sufficient  memorandum,  though  not  at  the 
time  known  to  the  other  party. — Peabody  v. 
Speyers,  176. 

A  writing  signed  by  defendant,  directed  to  a 
bank  cashier,  to  the  effect  that  he  would  pay 
plaintiff  a  certain  amount  in  currency  for  a 
certain  sum  in  gold,  and  one  by  plaintiff  that 
he  would  accept  such  currency  for  gold,  is  a 
sufficient  memorandum. — Peabody  v.  Speyers, 
176. 

A  verbal  order  for  goods  given  to  plaintiff's 
traveling  salesman,  entered  in  his  memorandum 
book,  and  signed  by  him,  a  copy  of  which  was 
forwarded  to  plaintiff,  together  with  a  letter 
written  by  defendant  to  plaintiff,  countermand- 
ing the  order,  is  a  sufficient  memorandum. — 
Louisville  Asphalt  Varnish  Co.  v.  Lorick,  178. 

A  memorandum  of  a  sale,  which  neither 
names  nor  describes  the  sellers,  is  not  sufficient 
to  satisfy  the  statute  of  frauds. — McGovern  v. 
Hern,   183. 

A  memorandum  of  a  contract  for  services, 
not  containing  the  condition  on  which  defend- 
ants were  to  pay  and  the  subject-matter  of  the 
agreement,  is  insufficient. — Drake  v.  Seaman, 
184. 

An  agreement  signed  by  the  vendor  to  de- 
liver certain  articles  to  the  vendee  at  a  speci- 
fied price,  cash  on  delivery,  is  a  sufficient 
memorandum,  and  binds  the  vendor,  although 
not  signed  by  the  vendee. — Justice  v.  Lang,  187. 

A  contract  in  writing  for  services  for  a  term 
exceeding  one  year,  at  a  stipulated  salary, 
signed  by  the  employer  only,  and  containing  no 
promise  on  the  part  of  the  employe  to  pei'l'orm 
such  services,  is  void,  and  the  employe  cannot 
recover  if  discharged  before  the  expiration  of 
the  term. — Wilkinson  v.  Heavenrich,  199. 

A  memorandum  written  by  a  broker  em- 
ployed to  make  the  purchase  in  his  book  in 
presence  of  the  vendor,  containing  the  names 
of  the  parties  and  terms  of  purcha.se,  but  not 
subscribed  by  the  parties,  is  sufficient.— Clason 
V.  Bailey,  201. 

A  letter  from  the  vendor,  confirming  to  the 
purchaser  a  sale  of  personal  proiierty  at  a  cer- 
tain price  per  pound,  and  inclosing  an  order  on 
its  keeper  for  delivery  and  weighing,  is  a  suf- 
ficient memorandum. — Sherwood  v.  Walker. 
370. 


§  10.    Effect  of  noncompliance  \iritli  stat- 
ute. 

The  statute  of  frauds  affects  the  remedy  only» 
and  not  the  validity  of  a  contract. — Townsend  v. 
Hargraves,  205. 

Where  there  is  a  completed  oral  contract  of 
sale  of  goods,  acceptance  and  receipt  of  part 
of  them  takes  the  case  out  of  the  statute,  al- 
though after  the  destruction  of  the  rest  of  the 
goods  while  in  the  hands  of  the  seller. — Towns- 
end  V.  Hargraves,  205. 

Where,  in  reliance  on  parol  agreement  with- 
in the  statute  of  frauds,  one  party  has  so  far 
partly  performed  that  it  would  be  a  fraud 
on  him  unless  performed,  the  agreement  will 
be  enforced. — Wheeler   v.   Reynolds,   208. 

Plaintiff,  one  of  several  lessees  of  land  for 
ten  years,  made  an  oral  contract  to  transfer  to 
defendant,  an  outsider,  his  interest  in  the  lease 
for  the  remaining  four  years  of  the  term,  de- 
fendant agreeing  to  stand  in  plaintiff's  stead 
and  pay  his  share  of  the  rent.  Defendant  oc- 
cupied and  paid  the  rent  for  the  year,  and 
abandoned  his  portion  of  the  land.  Uchl,  in  an 
action  to  recover  the  rent  for  the  remainder  of 
the  term  which  plaintiff  was  compelled  to  pay, 
that  the  contract  was  invalid  under  the  stat- 
ute of  frauds,  and  the  equitable  doctrine  of 
part  performance  was  inapplicable,  the  action 
being  at  law. — Nally  v.  Reading,  212. 

A  contract  not  enforceable  by  reason  of  the 
statute  of  frauds  is  an  existing  contract,  and 
not  void,  and  a  new  contract  cannot  be  im- 
plied from  acts  done  under  it. — Britain  v.  Ros- 
siter,   213. 

The  doctrine  of  part  performance  making  a 
contract  not  in  accordance  with  the  statute  of 
frauds  enforceable  in  equity  applies  only  to 
contracts  relating  to  land. — Britain  v.  Rossiter, 
213. 

The  mother  of  deceased  attempted  by  writing 
to  bind  him,  then  20  years  of  age,  as  appren- 
tice to  defendants,  for  5  years,  for  a  stipulated 
sum;  $200  to  be  retained  by  defendants  from 
the  wages  as  a  penalty  if  deceased  left  for  any 
cause.  The  contract  was  not  signed  by  de- 
fendants. Deceased  remained  with  them  after 
coming  of  age,  until  killed  by  accident.  Ileld, 
that  the  contract  was  void,  under  the  statute 
of  frauds;  but  as  deceased  continued  to  work 
after  coming  of  age,  with  knowledge  of  the 
terms,  he  would  be  bound  to  that  rate  of  com- 
pensation, but  the  forfeiture  could  not  be  en- 
forced.— Baker  v.  Lauterback,  218. 


STATUTES. 

Contracts  in  violation  of  statutes,  see  "Intoxi- 
cating Liquors";  "Sunday";  "Usury." 

SUBSCRIPTIONS. 

As   consideration   for   other  subscriptions,   see 
"Consideration,"    §   3. 

Until  some  action  is  taken  on  the  basis  of  a 
subscription  to  a  benevolent  or  other  enterprise, 
it  may  be  revoked. — Wallace  v.  Townsend,  90. 

Where  decedent  signed  a  church  subscrip- 
tion, the  fact  that  the  trustees  made  efforts  to 
secure  other  subscriptions  in  order  to  fulfill 
the  conditions  on  which  the  liability  of  the  sub- 
scribers deiiended,  but  merely  as  individuals, 
and  not  because  of  any  request  by  the  dece- 
dent, constituted  no  consideration  for  his 
promise. — I'resbyterian  Church  v.  Cooper,  234. 

Where  defendant's  intestate  signed  a  sub- 
scription paper  by  which  the  signers  agreed  to 
pay    to    the    trustees    of    plaintiff"    church    the 


INDEX. 


G41 


amounts  set  opposite  thoir  names  on  condition 
that  a  certain  flxed  sum  was  subscribed,  the 
fact  that  otli'-r  pcr.son.s  signed  sucli  subsorii)- 
tion  on  the  laith  of  the  siKnalure  of  the  de- 
cedent constituted  no  consideration  for  tlie 
promise  of  the  latter,  as  between  him  and  the 
payee. — Presbyterian    Church    v.   Cooper,   234. 

SUFFICIENCY. 

Of   consideration,    see    "Consideration,"    §    2. 
Of  memorandum  within  statute  of  frauds,   see 
"Statute  of  Frauds,"  §  9. 

SUNDAY. 

A  sale  or  exchange  of  horses,  attended  with 
the  circumstances  Avhich  usually  attoud  those 
i'xchiuif,'es,  is  a  secular  labor  or  euiploymout, 
within  the  meaiiinj:  of  the  statute  for  the  ob- 
servance of  the  Sabbath. — Lyon  v.  Strong,  417. 

No  action  can  be  maintained  on  a  warranty 
made  on  the  sale  or  exohango  of  horses  on 
Sunday.— Lyon  v.  Strong,  417. 

The  court  will  not  enforce  a  contract  made 
on  the  Sabbath. — Lyon  v.  Strong,  417. 

TELEGRAMS. 

Acceptance  by  telegram,   see   "Offer   and   Ac- 
ceptance,"  §  7. 


TENDER. 

see  "Perform 

THEATERS. 


Of  performance,  see  "Performance  or  Breach," 
§   1. 


An  actor  may  recover  for  his  services  in  an 
unlicensed  theatrical  exhibition,  unless  he  knew 
that  his  employer  had  no  license. — Koys  v. 
Johnson,  41)6. 

TIME. 

Disaffirmance  of  contract  by  infant,  see  "In- 
fants,"  §  4. 

Of  acceptance,  see  "Offer  and  Acceptance," 
§  11. 

TREES. 

Parol  sale  of  growing  trees,  see  "Statute  of 
Frauds,"  §  6. 

TRUSTS 

Where  an  uncle,  who  is  indebted  to  his 
nephew  for  money  due  on  the  lattcr's  tweiity- 
first  birthday,  writes  the' nephew  that  he  had 
the  money  in  bank  that  he  intended  for  him, 
and  that  the  latter  should  certainly  have  it, 
adding  that  he  would  not  interfere  with  the 
money  until  he  thouirht  the  nephew  capable 
of  taking  care  of  it,  the  relation  of  the  parties 
Hopk.Sel.Qis.Cont.— 41 


is  thereby  changed  from  debtor  and  creditor 
to  trustee  and  beneficiary.— iiamer  v.  Sidway, 
220. 

UNDUE  INFLUENCE. 

The  fact  that  one  of  the  parties  to  a  contract 
is  old,  and  relies  u[)on  and  is  the  grandfather 
and  employer  of  the  other,  does  not  raise  a 
prcsuuiiition  of  undue  influence. — Cowee  v. 
Cornell,  402. 

Where  a  female  ward,  a  few  days  after  at- 
taining her  majority,  and  before  her  guardian 
has  made  his  final  report,  conveys  her  land  to 
the  guardian's  wife,  who  is  her  elder  sister, 
and  with  whom  she  is  living,  the  burden  is  on 
the  guardian  to  show  good  faith  and  the  ab- 
sence of  undue  influence. — McParland  v.  Lar- 
kin,  40(j. 

Where  a  conveyance  of  land  was  obtained  in 
exchange  for  property  of  about  half  its  value 
by  taking  advantage  of  the  grantor's  ignorance 
and  unfounded  apprehensions  that  if  he  did 
not  convey  it  would  be  taken  on  a  ju(l||pent, 
the  transaction  was  held  to  be  unconscionable, 
and  the  conveyance  was  set  aside. — Wooley  v. 
Drew,  410. 

UNITED   STATES. 

The  United  States  may,  within  the^  sphere 
of  its  constitutional  powers,  enter  into'-  a  con- 
tract not  prohibited  by  law,  and  appropriate 
to  the  exercise  of  such  powers. — United  States 
v.  Tingey,  27G. 

USURY. 

A  deed  granting  a  rent_  charge  of  $500  per 
year  in  consideration  of  $5,000,  with  an  option 
in  the  grantor  to  obtain  a  release  of  the  rent 
charge  after  five  years  by  paying  $.">.000  and 
arrears  of  rent,  held  usurious  and  void. — Lloyd 
V.  Scott,  421. 

VENDOR  AND  PURCHASER. 

Agreements  relating  to  land,  see  "Statute  of 

Frauds,"  §  6. 
Offer  under  seal,  see  "Contracts  under  Seal," 

§  2. 


WAGER. 


See   "Gaming." 


WARRANTY. 

Implied   warranty,   see   "Implied   Contracts." 

WITHDRAWAL. 

Of  offer  or  acceptance,  see  "Offer  and  Accept 
ance,"   §   10. 

YEAR. 

Agreements  not  to  be  performed  within  a  yem 
see  "Statute  of  Frauds,"  §  7. 


WEST    PUBLISniNU  CO..  PJUNTEBii  ASD  STEKEOTYPERB,  8T.  PAUL,  U1.V'N. 


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